UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 10-K



|x | Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
|- | -------------------------------------------------------------------------------------

For the year ended December 31, 2008



| ̈ | Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.
|- | -----------------------------------------------------------------------------------------

For the transition period from  to

Commission
File number 000-50210

ATEL Capital Equipment Fund IX, LLC

(Exact name of registrant as specified in its charter)



|                                                              |  |                                      
|------------------------------------------------------------- |  | -------------------------------------
|California                                                    |  | 94-3375584                           
|(State or other jurisdiction ofincorporation or organization) |  | (I. R. S. EmployerIdentification No.)

600 California Street, 6th Floor, San Francisco, California 94108-2733

(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: Limited Liability Company Units

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes   ̈    No  x

If this report is an annual or transition report,
indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Act of 1934.    Yes   ̈    No  x

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 (§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 a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of accelerated filer
and large accelerated filer in Rule 12b-2 of the Exchange Act. (Check one):



|                           |  |                      |  |                                              |  |                             
|-------------------------- |  | -------------------- |  | -------------------------------------------- |  | ----------------------------
|Large accelerated filer   ̈ |  | Accelerated filer   ̈ |  | Non-accelerated filer   ̈                     |  | Smaller reporting company  x
|                           |  |                      |  | (Do not check if a smallerreporting company) |  |                             

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange
Act).    Yes   ̈    No  x

State the aggregate market value of voting stock held by non-affiliates of the registrant: Not applicable

State the aggregate market value of the
voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was sold, or the average bid and asked price of such common equity, as of a specified date within the past 60 days. (See
definition of affiliate in Rule 12b-2 of the Exchange Act.) Not applicable

The number of Limited Liability Company Units outstanding as of
February 28, 2009 was 12,055,016.

DOCUMENTS INCORPORATED BY REFERENCE

Prospectus dated January 16, 2001, filed pursuant to Rule 424(b) (Commission File No. 333-47196) is hereby incorporated by reference into Part IV hereof.









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PART I



|Item 1. | BUSINESS
|------- | --------

General Development of Business

ATEL Capital Equipment Fund IX, LLC (the Company) was formed under the laws of the State of California on September 27, 2000 for the purpose of
engaging in the sale of limited liability company investment units and acquiring equipment to engage in equipment leasing, lending and sales activities, primarily in the United States. The Managing Member of the Company is ATEL Financial Services,
LLC (AFS), a California limited liability company. The Company may continue until December 31, 2020. Contributions in the amount of $600 were received as of December 31, 2000, $100 of which represented AFSs continuing
interest, and $500 of which represented the Initial Members capital investment.

The Company conducted a public offering of 15,000,000 Limited
Liability Company Units (Units), at a price of $10 per Unit. On February 21, 2001, subscriptions for the minimum number of Units (120,000, representing $1.2 million) had been received (excluding subscriptions from Pennsylvania
investors) and AFS requested that the subscriptions be released to the Company. On that date, the Company commenced operations in its primary business (acquiring equipment to engage in equipment leasing, lending and sales activities). As of
April 3, 2001, the Company had received subscriptions for 753,050 Units ($7.5 million), thus exceeding the $7.5 million minimum requirement for Pennsylvania, and AFS requested that the remaining funds in escrow (from Pennsylvania investors) be
released to the Company.

As of January 15, 2003, the offering was terminated. As of that date, the Company had received subscriptions for 12,065,266
Units ($120.7 million). Subsequent to January 15, 2003, Units totaling 10,250 were rescinded or repurchased and funds returned to investors. As of December 31, 2008, 12,055,016 Units remain issued and outstanding.

The Companys principal objectives are to invest in a diversified portfolio of equipment that (i) preserves, protects and returns the Companys invested
capital; (ii) generates 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) (defined as six full years following the year the offering was terminated), which ends on December 31, 2009 and (iii) provides additional distributions following the Reinvestment Period
and until all equipment has been sold. The Company is governed by the Limited Liability Company Operating Agreement (Operating Agreement), as amended.

Pursuant to the terms of the Operating Agreement, AFS receives compensation and reimbursements for services rendered on behalf of the Company (See Note 7 to the financial statements included in Item 8 of this report). The Company is
required to maintain reasonable cash reserves for working capital, the repurchase of Units and contingencies. The repurchase of Units is solely at the discretion of AFS.

The Company has incurred debt to finance the purchase of a portion of its equipment portfolio. The amount of borrowings in connection with any equipment acquisition transaction will be determined by, among other
things, the credit of the lease, the terms of the lease, the nature of the equipment and the condition of the money market. There is no limit on the amount of debt that may be incurred in connection with any single acquisition of equipment. However
the Company may not incur aggregate outstanding indebtedness in excess of 50% of the total cost of all equipment as of the date of the final commitment of the offering proceeds and, thereafter, as of the date of any subsequent indebtedness is
incurred. The Company will continue to borrow amounts equal to such maximum debt level in order to fund a portion of its equipment acquisitions, although there can be no assurance that such financing will continue to be available to the Company in
the future.

The Company may also incur long-term recourse debt in the form of asset securitization transactions in order to obtain lower interest rates or
other more desirable terms than may be available for individual non-recourse debt transactions. In an asset securitization, the lender would receive a security interest in a specified pool of securitized Company assets or a
general lien against all of the otherwise unencumbered assets of the Company. It is the intention of AFS to use asset securitization primarily to finance assets leased to those credits which, in the opinion of AFS, have a relatively lower potential
risk of lease default than those lessees with equipment financed with non-recourse debt. AFS expects that an asset securitization financing would involve borrowing at a variable interest rate based on an established reference rate. AFS would seek to
limit the Companys exposure to increases in the interest rate by engaging in hedging transactions that would effectively fix the interest rate obligation. As of December 31, 2008, the amount of such securitized borrowings was $8.0
million.



2



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Narrative Description of Business

The Company has acquired various types of equipment to lease 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 operating 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 only purchases equipment under pre-existing leases or for which a lease will be entered into concurrently at the time of the
purchase. Through December 31, 2008, the Company had purchased equipment with a total acquisition price of $159.6 million. The Company also had investments in notes receivable of which $3.7 million remained outstanding at December 31,
2008.

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 Investors Service 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) was originally leased to lessees with an aggregate credit rating of Baa or better or to such
hospitals or municipalities, as described in (ii) above.

During 2008 and 2007, certain lessees generated significant portions of the Companys
total lease revenues as follows (in thousands):



|                          |  |                    |  |                                  |   |  |      |  
|------------------------- |  | ------------------ |  | -------------------------------- | - |  | ---- | -
|                          |  |                    |  | Percentageof TotalLease Revenues |  
|Lessee                    |  | Type of Equipment  |  | 2008                             |   |  | 2007 |  
|Ford Motor Company        |  | Materials handling |  | 11                               | % |  | 11   | %
|Whirlpool Corporation     |  | Materials handling |  | 11                               | % |  | 10   | %
|The Sabine Mining Company |  | Mining             |  | 10                               | % |  | *    |  



|* | Less than 10%
|- | -------------

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

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, type of equipment and creditworthiness of the lessee. 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 raw material costs to manufacture equipment as well 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. AFS employees provide the services the Company requires to effectively operate. The cost of these services is reimbursed by the Company to AFS per the Operating Agreement.



3



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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, 2008 and the industries to which the assets have been leased (in thousands):



|                        |  |                                         |         |                                 |        |   |  | 
|----------------------- |  | --------------------------------------- | ------- | ------------------------------- | ------ | - |  | 
|Asset Types             |  | Purchase PriceExcludingAcquisition Fees |         | Percentage of TotalAcquisitions |        |   | 
|Materials handling      |  | $                                       | 34,774  |                                 | 21.79  | % | 
|Mining equipment        |  |                                         | 34,172  |                                 | 21.42  | % | 
|Manufacturing           |  |                                         | 22,196  |                                 | 13.90  | % | 
|Furniture & fixtures    |  |                                         | 13,459  |                                 | 8.44   | % | 
|Transportation          |  |                                         | 13,386  |                                 | 8.39   | % | 
|Aircraft                |  |                                         | 12,729  |                                 | 7.98   | % | 
|Rail transportation     |  |                                         | 11,200  |                                 | 7.02   | % | 
|Marine vessels          |  |                                         | 10,429  |                                 | 6.54   | % | 
|Office automation       |  |                                         | 2,680   |                                 | 1.68   | % | 
|Test equipment          |  |                                         | 2,363   |                                 | 1.48   | % | 
|Communications          |  |                                         | 1,001   |                                 | 0.63   | % | 
|Natural gas compressors |  |                                         | 697     |                                 | 0.44   | % | 
|Construction            |  |                                         | 468     |                                 | 0.29   | % | 
|                        |  |                                         |         |                                 |        |   | 
|                        |  | $                                       | 159,554 |                                 | 100.00 | % | 
|                        |  |                                         |         |                                 |        |   | 
|                        |  |                                         |        
|Industry of Lessee      |  | Purchase PriceExcludingAcquisition Fees |         | Percentage of TotalAcquisitions |        |   | 
|Manufacturing           |  | $                                       | 61,831  |                                 | 38.74  | % | 
|Mining                  |  |                                         | 29,138  |                                 | 18.26  | % | 
|Health care             |  |                                         | 24,755  |                                 | 15.52  | % | 
|Land transportation     |  |                                         | 12,112  |                                 | 7.59   | % | 
|Electric utilities      |  |                                         | 11,445  |                                 | 7.17   | % | 
|Marine transportation   |  |                                         | 8,438   |                                 | 5.29   | % | 
|Communications          |  |                                         | 6,646   |                                 | 4.17   | % | 
|Air transportation      |  |                                         | 3,315   |                                 | 2.08   | % | 
|Retail                  |  |                                         | 1,178   |                                 | 0.74   | % | 
|Oil and gas             |  |                                         | 696     |                                 | 0.44   | % | 
|                        |  |                                         |         |                                 |        |   | 
|                        |  | $                                       | 159,554 |                                 | 100.00 | % | 
|                        |  |                                         |         |                                 |        |   | 

From inception to December 31, 2008, the Company has disposed of certain leased assets as set forth below (in
thousands):



|                     |  |                                                 |        |            |   |                             |  |   |        |  | 
|-------------------- |  | ----------------------------------------------- | ------ | ---------- | - | --------------------------- |  | - | ------ |  | 
|Asset Types          |  | OriginalEquipment CostExcludingAcquisition Fees |        | Sale Price |   | Excess ofRents OverExpense* |  |  
|Manufacturing        |  | $                                               | 12,349 |            | $ | 8,859                       |  | $ | 8,068  | 
|Mining               |  |                                                 | 9,787  |            |   | 4,754                       |  |   | 8,806  | 
|Office automation    |  |                                                 | 6,691  |            |   | 1,854                       |  |   | 5,459  | 
|Materials handling   |  |                                                 | 4,641  |            |   | 500                         |  |   | 5,185  | 
|Construction         |  |                                                 | 3,166  |            |   | 1,698                       |  |   | 2,555  | 
|Furniture & fixtures |  |                                                 | 2,297  |            |   | 669                         |  |   | 2,556  | 
|Test equipment       |  |                                                 | 1,677  |            |   | 97                          |  |   | 2,075  | 
|Transportation       |  |                                                 | 157    |            |   | 118                         |  |   | 114    | 
|Other                |  |                                                 | 1,801  |            |   | 592                         |  |   | 1,975  | 
|                     |  |                                                 |        |            |   |                             |  |   |        | 
|                     |  | $                                               | 42,566 |            | $ | 19,141                      |  | $ | 36,793 | 
|                     |  |                                                 |        |            |   |                             |  |   |        | 



|* | Includes only those expenses directly related to the production of the related rents.
|- | -------------------------------------------------------------------------------------



4



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Proceeds from sales of lease assets are not expected to be consistent from one period to another. The Company is a finite
life equipment leasing fund, which will acquire leasing transactions during the period ending six years after completion of its public offering. On the termination of leases, assets may be re-leased or sold. Sales of assets are not scheduled and are
created by opportunities within the marketplace. The Company will seek to acquire and lease a wide variety of assets and to enter into leases on a variety of terms. Some assets will be expected to have little or no value for re-lease or sale upon
termination of the initial leases, and the anticipated residual values are a key factor in pricing and terms structured for each lease. The Companys goal is to seek maximum return on its leased assets and will determine when and under what
terms to dispose of such assets during the course of its term.

For further information regarding the Companys equipment lease portfolio as of
December 31, 2008 and 2007, see Note 6 to the financial statements, Investments in equipment and leases, net, as set forth in Part II, Item 8, Financial Statements and Supplementary Data.

Notes Receivable Activities

The Company finances a
diversified portfolio of assets in diverse industries. The following tables set forth the types of assets financed by the Company through December 31, 2008 and the industries to which the assets have been financed (in thousands):



|                     |  |                                          |        |                                 |        |   |  | 
|-------------------- |  | ---------------------------------------- | ------ | ------------------------------- | ------ | - |  | 
|Asset Types          |  | Amount FinancedExcludingAcquisition Fees |        | Percentage of TotalAcquisitions |        |   | 
|Computers            |  | $                                        | 4,462  |                                 | 34.34  | % | 
|Aviation             |  |                                          | 2,680  |                                 | 20.63  | % | 
|Storage facility     |  |                                          | 2,503  |                                 | 19.27  | % | 
|Research             |  |                                          | 1,422  |                                 | 10.95  | % | 
|Manufacturing        |  |                                          | 1,083  |                                 | 8.34   | % | 
|Telecommunications   |  |                                          | 501    |                                 | 3.85   | % | 
|Furniture & fixtures |  |                                          | 320    |                                 | 2.46   | % | 
|Office automation    |  |                                          | 21     |                                 | 0.16   | % | 
|                     |  |                                          |        |                                 |        |   | 
|                     |  | $                                        | 12,992 |                                 | 100.00 | % | 
|                     |  |                                          |        |                                 |        |   | 
|                     |  |                                          |       
|Industry of Borrower |  | Amount FinancedExcludingAcquisition Fees |        | Percentage of TotalAcquisitions |        |   | 
|Communications       |  | $                                        | 3,660  |                                 | 28.17  | % | 
|Manufacturing        |  |                                          | 3,586  |                                 | 27.60  | % | 
|Transportation       |  |                                          | 2,680  |                                 | 20.63  | % | 
|Business services    |  |                                          | 1,750  |                                 | 13.47  | % | 
|Health services      |  |                                          | 940    |                                 | 7.24   | % | 
|Electronics          |  |                                          | 350    |                                 | 2.69   | % | 
|Industrial machinery |  |                                          | 26     |                                 | 0.20   | % | 
|                     |  |                                          |        |                                 |        |   | 
|                     |  | $                                        | 12,992 |                                 | 100.00 | % | 
|                     |  |                                          |        |                                 |        |   | 

From inception to December 31, 2008, assets financed by the Company that are associated with terminated loans
are as follows (in thousands):



|                     |  |                                          |       |                     |   |                        |  |   |      
|-------------------- |  | ---------------------------------------- | ----- | ------------------- | - | ---------------------- |  | - | -----
|Asset Types          |  | Amount FinancedExcludingAcquisition Fees |       | DispositionProceeds |   | Total PaymentsReceived
|Computers            |  | $                                        | 5,484 |                     | $ | 323                    |  | $ | 4,333
|Manufacturing        |  |                                          | 1,083 |                     |   |                       |  |   | 697  
|Telecommunications   |  |                                          | 495   |                     |   | 288                    |  |   | 365  
|Research             |  |                                          | 480   |                     |   | 15                     |  |   | 573  
|Furniture & fixtures |  |                                          | 88    |                     |   |                       |  |   | 98   
|                     |  |                                          |       |                     |   |                        |  |   |      
|                     |  | $                                        | 7,630 |                     | $ | 626                    |  | $ | 6,066
|                     |  |                                          |       |                     |   |                        |  |   |      



5



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For further information regarding the Companys notes receivable portfolio as of December 31, 2008, see Note 4
to the financial statements, Notes receivable, net, as set forth in Part II, Item 8, Financial Statements and Supplementary Data.

The Company reports
segment information in accordance with Statement of Financial Accounting Standards (SFAS) No. 131 Disclosures about Segments of an Enterprise and Related Information. SFAS No. 131 establishes annual and interim
standards for operating segments of a company. It also requires entity-wide disclosures about the products and services an entity provides, the material countries in which it holds assets and reports revenue, and its major customers. The Company
operates in one reportable operating segment in the United States. For further information regarding the Companys geographic revenues and assets, and major customers, see Notes 2 and 3 to the financial statements 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 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
|------- | ---------------------------------------------------

None.



6



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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 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.

Holders

As of
December 31, 2008, a total of 3,076 investors were Unitholders of record holders in the Company.

Distributions

The Unitholders of record 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 between $0.90 and $1.10 per Unit which will be determined by AFS.

The rate for monthly distributions from 2008 operations was $0.075 per Unit for the period from January through December 2008. Likewise, the rate for
monthly distributions from 2007 operations was $0.075 per Unit for the period from January through December 2007. The rate for each of the quarterly distributions paid in 2008 and 2007 was $0.225 per Unit.

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



|                                                                                          |  |      |      |      |   |     
|----------------------------------------------------------------------------------------- |  | ---- | ---- | ---- | - | ----
|                                                                                          |  | 2008 |      | 2007
|Net income per Unit, based on weighted average Units outstanding                          |  | $    | 0.10 |      | $ | 0.19
|Return of investment                                                                      |  |      | 0.80 |      |   | 0.71
|                                                                                          |  |      |      |      |   |     
|Distributions declared per Unit, based on weighted average Other Member Units outstanding |  |      | 0.90 |      |   | 0.90
|Differences due to timing of distributions                                                |  |      |     |      |   |    
|                                                                                          |  |      |      |      |   |     
|Actual distributions paid per Unit                                                        |  | $    | 0.90 |      | $ | 0.90
|                                                                                          |  |      |      |      |   |     



|Item 6. | SELECTED FINANCIAL DATA
|------- | -----------------------

A smaller reporting company is not
required to present selected financial data in accordance with item 301(c) of Regulation S-K.



7



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|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 (MD&A) 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 from 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.

Overview

ATEL Capital Equipment Fund IX, LLC (the Company) is a California limited liability company that was formed in September 2000 for the purpose of engaging in the sale of limited liability company investment units and acquiring
equipment to generate revenues from equipment leasing and sales activities, primarily in the United States. The Managing Member of the Company is ATEL Financial Services, LLC (AFS), a California limited liability company.

The Company conducted a public offering of 15,000,000 Limited Liability Company Units (Units), at a price of $10 per Unit. The offering was terminated in
January 2003. During early 2003, the Company completed its initial acquisition stage with the investment of the net proceeds from the public offering of Units. Subsequently, during the reinvestment period (Reinvestment Period) (defined
as six full years following the year the offering was terminated), the Company has utilized its credit facilities and reinvested cash flow in excess of certain amounts required to be distributed to the Other Members to acquire additional equipment.
Throughout the Reinvestment Period, which ends December 31, 2009, the Company anticipates continued reinvestment of cash flow in excess of minimum distributions and other obligations.

The Company may continue until December 31, 2020. Periodic distributions are paid at the discretion of the Managing Member.

Capital Resources and Liquidity

The liquidity of the Company
varies, increasing to the extent cash flows from leases and proceeds of asset sales exceed expenses and decreasing as lease assets are acquired, as distributions are made to the Members and to the extent expenses exceed cash flows from leases and
proceeds from asset sales.

The primary source of liquidity for the Company is its cash flow from leasing activities. 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 remarketing or selling the equipment as it comes off rental.

Throughout the reinvestment period, the Company anticipates reinvesting a portion of lease payments from assets owned, and/or payments received on notes receivable, in
new leasing or financing transactions. Such reinvestment will occur only after the payment of all current obligations including debt (both principal and interest), the payment of management and acquisition fees to AFS and providing for cash
distributions to the members.

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 an 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.



8



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In a normal economy, if inflation in the general economy becomes significant, it may affect the Company in as much 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 and notes would not increase as such rates are
generally fixed for the terms of the leases and notes without adjustment for inflation. In addition, if interest rates increase significantly under such circumstances, the rates that the Company can obtain on future lease or financing transactions
will be expected to increase as the cost of capital is a significant factor in the pricing of lease financing and investments in notes receivable. Leases and notes already in place, for the most part, would not be affected by changes in interest
rates.

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. AFS envisions no such requirements for operating purposes.

The Company participates with AFS and certain of its affiliates in a financing arrangement (comprised of a working capital facility to AFS, an acquisition facility and a
warehouse facility to AFS, the Company and affiliates, and a venture facility available to an affiliate) with a group of financial institutions that includes certain financial covenants. The financial arrangement is for $75 million. Originally
scheduled to expire in June 2009, the facility was amended effective December 22, 2008 to extend the term of the agreement through June 2010. Under such amendment, the tangible net worth threshold for ATEL 12, LLC participation in the
acquisition facility was reduced from $15 million to $7.5 million. As of December 31, 2008, ATEL 12, LLC was eligible to participate.

Borrowings
under the facility as of December 31, 2008 were as follows (in thousands):



|                                                                                                                           |  |   |        |  
|-------------------------------------------------------------------------------------------------------------------------- |  | - | ------ | -
|Total available under the financing arrangement                                                                            |  | $ | 75,000 |  
|Amount borrowed by the Company under the acquisition facility                                                              |  |   | (2,000 | )
|Amounts borrowed by affiliated partnerships and limited liability companies under the acquisition and warehouse facilities |  |   | (6,823 | )
|                                                                                                                           |  |   |        |  
|Total remaining available under the acquisition and warehouse facilities                                                   |  | $ | 66,177 |  
|                                                                                                                           |  |   |        |  

The Company is contingently liable for principal payments under the warehouse facility as borrowings are recourse
jointly and severally to the extent of the pro-rata share of the Companys net worth as compared to the aggregate net worth of certain of the affiliated partnerships and limited liability companies of the Company and including AFS and ALC
(which latter two entities are 100% liable). The Company and its affiliates pay an annual commitment fee to have access to this line of credit. As of December 31, 2008, borrowings of $1.3 million were outstanding under the warehouse facility.
The Companys maximum obligation on the outstanding warehouse balance at December 31, 2008 was approximately $313 thousand.

The interest rate on
the Master Terms Agreement is based on either the LIBOR/Eurocurrency rate of 1-, 2-, 3- or 6-month maturity plus a lender designated spread, or the banks Prime rate, which re-prices daily. Principal amounts of loans made under the Master Terms
Agreement that are prepaid may be re-borrowed on the terms and subject to the conditions set forth under the Master Terms Agreement. The effective interest rate on borrowings at December 31, 2008 ranged from 2.69% to 3.25%.

Draws on the acquisition facility by any affiliated partnership and/or limited liability company borrower are secured by a blanket lien on that borrowers assets,
including but not limited to equipment and related leases.

To manage the warehousing facility for the holding of assets prior to allocation to specific
investor programs, a Warehousing Trust Agreement has been entered into by the Company, AFS, ALC, and certain of the affiliated partnerships and limited liability companies. The warehousing facility is used to acquire and hold, on a short-term basis,
certain lease transactions that meet the investment objectives of each of such entities. Each of the leasing programs sponsored by AFS and ALC currently in its acquisition stage is a pro rata participant in the Warehousing Trust Agreement, as
described below. When a program no longer has a need for short term financing provided by the warehousing facility, it is removed from participation, and as new leasing investment entities are formed by AFS and ALC and commence their acquisition
stages, these new entities are added. As of December 31, 2008, the investment program participants were the Company, ATEL Capital Equipment Fund X, LLC, ATEL Capital Equipment Fund XI, LLC and ATEL 12, LLC. Pursuant to the Warehousing Trust
Agreement, the benefit of the lease transaction assets, and the corresponding liabilities under the



9



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warehouse borrowing facility, inure to each of such entities based upon each entitys pro-rata share in the warehousing trust estate. The pro-rata
share is calculated as a ratio of the net worth of each entity over the aggregate net worth of all entities benefiting from the warehouse trust estate, excepting that the trustees, AFS and ALC, are both liable for their pro-rata shares of the
obligations based on their respective net worth, and jointly liable for the pro rata portion of the obligations of each of the affiliated partnerships and limited liability companies participating under the borrowing facility. Transactions are
financed through this warehousing facility only until the transactions are allocated to a specific program for purchase or are otherwise disposed by AFS and ALC. When a determination is made to allocate the transaction to a specific program for
purchase by the program, the purchaser repays the debt associated with the asset, either with cash or by means of the acquisition facility financing, the asset is removed from the warehouse facility collateral, and ownership of the asset and any
debt obligation associated with the asset are assumed solely by the purchasing entity.

As of December 31, 2008, the full amount remaining available
under the joint acquisition and warehouse facility is potentially available to the Company, subject to certain terms or agreement limitations. However, as amounts are drawn on the facility by each of the Company and the affiliates who are borrowers
under the facility, the amount available to all is reduced. As the warehousing facility is a short term bridge facility, any amounts borrowed under the warehousing facility, and then repaid by the affiliated borrowers (including the Company) upon
allocation of an acquisition to a specific purchaser, become available under the warehouse facility for further short term borrowing.

The financing
arrangement discussed above includes certain financial and non-financial covenants applicable to each borrower. The Company and affiliates were in compliance with all covenants as of December 31, 2008.

At December 31, 2008, the Company had a $60 million receivables funding program (Program) with a receivables financing company that issues commercial
paper rated A1 from Standard and Poors and P1 from Moodys Investors Service. Under this Program, the lenders would receive liens against the Companys assets. The Program terminated with respect to new borrowings in January 2006.
Under the terms of the Program, the lender will be in first position against certain specified assets and will be in either a subordinated or shared position against the remaining assets. The Program provides for borrowing at a variable interest
rate and requires AFS, on behalf of the Company, to enter into interest rate swap agreements with certain hedge counterparties (also rated A1/P1) to mitigate the interest rate risk associated with a variable interest rate note. As more fully
described in Note 10 to the financial statements, Receivables funding program, as set forth in Part II, Item 8, Financial Statements and Supplementary Data, the Company had $8.0 million outstanding under this receivables funding program as of
December 31, 2008. The Program expires in August 2011.

The Company also has access to certain sources of non-recourse debt financing, which the
Company will use on a transaction basis as a means of mitigating credit risk, as the credit risk is effectively transferred to the lender who retains recourse against collateralized assets. During 2008, the Company utilized such sources of
non-recourse debt financing and at December 31, 2008, had $4.8 million of outstanding non-recourse debt consisting of notes payable to financial institutions.

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. For detailed
information on the Companys debt obligations, see Notes 8 through 10 in the notes to the financial statements in Item 8, Financial Statements and Supplementary Data.

The Company commenced periodic distributions, based on cash flows from operations, beginning with the month of February 2001. Additional monthly and/or quarterly distributions have been consistently made through
December 2008.

At December 31, 2008, the Company had commitments to purchase lease assets totaling approximately $4.3 million. This amount represents
contract awards which may be canceled by the prospective lessee or not be accepted by the Company. There were no cancellations subsequent to year-end.

Cash Flows

2008 vs. 2007

Operating Activities

The Companys primary source of cash from operations has been rents from operating leases. Additionally, its cash
flows are impacted by changes in certain operating assets and liabilities.



10



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Cash provided by operating activities decreased by $2.3 million for 2008 as compared to the prior year. The net decrease
in cash flow was primarily attributable to a decline in operating results as adjusted for non-cash revenue and expense items such as gains on sales of assets and depreciation expense, and an increase in payments made against accounts payable and
accrued liabilities, offset, in part, by a reduction in outstanding accounts receivable.

The decrease in operating results, as adjusted for non-cash
items, reduced cash flow by $2.6 million and was mainly a result of a 22% decline in operating lease revenue offset, in part, by decreases in interest expense on the Companys outstanding debt and costs reimbursed to AFS. The increase in
payments made against accounts payable and accrued liabilities reduced cash flow by $600 thousand and was primarily due to the 2008 payment of certain 2007 management fees and the 2008 refund of a 2007 lessee overpayment.

The net reduction in outstanding accounts receivable was primarily due to a first quarter 2008 collection of approximately $534 thousand related to 2007 billings. In
prior years, such invoices had been settled during the same fiscal quarter as their origination. Accounts receivable further declined due to a year over year reduction in year-end revenue accruals resulting from increased lease terminations.

Investing Activities

Cash provided by investing
activities during 2008 decreased by $6.4 million, or 56%, as compared to the prior year. The net decline in cash flow was primarily due to decreases in proceeds from sales of lease assets and payments received on notes receivable offset, in part, by
a reduction in cash used to purchase lease assets and an increase in payments received on direct financing leases.

Net proceeds from sales of lease assets
decreased by $6.6 million as a result of a weak market demand for certain used equipment available for sale during 2008 as compared to 2007; and payments received on notes receivable decreased by $349 thousand mainly due to run-off of the
Companys investment in notes receivable since December 31, 2007.

Partially offsetting the above mentioned decreases in cash flow were increases
of $271 thousand and $217 thousand attributable to a decline in cash used to acquire lease assets and an increase in payments received on direct financing leases. The decrease in cash used to acquire assets was a result of a decline in acquisition
phase activity; and the increase in payments received on direct financing leases was a result of payments derived from terminated operating leases that were renewed as direct financing leases during 2008.

Financing Activities

Net cash used in financing activities during
2008 decreased by $5.4 million, or 20%, as compared to 2007. The net decrease in cash used (increase in cash flows) was due to a year over year reduction in net repayments made on a variety of outstanding borrowings. These net borrowings have
declined by approximately $9.3 million since December 31, 2007.

Results of Operations

As of December 31, 2008 and 2007, 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:



|                      |  |      |   |  |      |   |  | 
|--------------------- |  | ---- | - |  | ---- | - |  | 
|                      |  | 2008 |   |  | 2007 |   |  | 
|Manufacturing         |  | 33   | % |  | 40   | % | 
|Mining                |  | 17   | % |  | 13   | % | 
|Rail transportation   |  | 15   | % |  | 13   | % | 
|Marine transportation |  | 12   | % |  | 11   | % | 



11



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During 2008 and 2007, three customers comprised 32% and 29% of the Companys revenues from leases, respectively, as
follows:



|                          |  |                    |  |                                  |   |  |      |  
|------------------------- |  | ------------------ |  | -------------------------------- | - |  | ---- | -
|                          |  |                    |  | Percentageof TotalLease Revenues |  
|Lessee                    |  | Type of Equipment  |  | 2008                             |   |  | 2007 |  
|Ford Motor Company        |  | Materials handling |  | 11                               | % |  | 11   | %
|Whirlpool Corporation     |  | Materials handling |  | 11                               | % |  | 10   | %
|The Sabine Mining Company |  | Mining             |  | 10                               | % |  | 8    | %

These percentages are not expected to be comparable in future periods due to anticipated changes in the mix of
investments and/or lessees as a result of normal business activities.

Cost reimbursements to the Managing Member are based on its costs incurred in
performing administrative services for the Company. These costs are allocated to each managed entity based on certain criteria such as total assets, number of investors or contributed capital based upon the type of cost incurred. The Operating
Agreement places an annual limit and a cumulative limit for cost reimbursements to AFS and/or affiliates. Any reimbursable costs incurred by AFS and/or affiliates during the year exceeding the annual and/or cumulative limits cannot be reimbursed in
the current year, though such costs may be recovered in future years to the extent of the cumulative limit. As of December 31, 2008, the Company has not exceeded the annual and/or cumulative limitations discussed above.

2008 vs. 2007

The Company had net income of $2.1 million and $3.1
million for the years ended December 31, 2008 and 2007, respectively. Results for 2008 reflect a decrease in total revenues offset, in part, by a reduction in total operating expenses.

Revenues

Total revenues for 2008 decreased by $7.5 million, or 27%,
as compared to the prior year. The net decrease was largely due to a $5.0 million decline in operating lease revenues and a $2.8 million decrease in gains on sales of lease assets offset, in part, by a $366 thousand increase in revenues from direct
financing leases.

The decrease in operating lease revenue was attributable to run-off of the lease portfolio and subsequent sales of lease assets. The
year over year decline in net gains on sale of assets was primarily attributable to weak market demand for certain used equipment available for sale during 2008. Consequently, the weak market demand resulted in an $832 thousand year over year
increase in the Companys equipment held-for-sale inventory.

The increase in direct financing lease revenues was primarily due to revenues derived
from certain operating leases that terminated and were renewed as direct finance leases during 2008.

Expenses

Total expenses for 2008 decreased by $6.3 million, or 26%, as compared to the prior year. The net decline in expenses was primarily due to decreases in depreciation
expense, interest expense, outside services expense and professional fees, cost reimbursements to AFS, asset management fees paid to AFS and amortization of initial direct costs. These decreases were partially offset by increases in the provision
for losses and other expense.

Depreciation expense decreased by $3.9 million primarily as a result of continued run-off of the Companys lease
portfolio as well as lease asset sales since December 31, 2007. Similarly, interest expense decreased by $818 thousand mainly due to the continued decline in the Companys outstanding debt. Outside services expense and professional fees
declined by a combined $772 thousand primarily as a result of the elimination of costs associated with the audit and restatement of the Companys prior years financial statements, which were completed by the third quarter of 2007.

Further, costs reimbursed to AFS decreased by $486 thousand due to the refinement of cost allocation methodologies employed by the Managing Member which
resulted in lower costs allocated to the Fund. The modification of cost allocation methodologies is intended to ensure that Fund management costs are allocated appropriately. Asset management fees paid to AFS decreased by $446 thousand due to the
year over year decline in revenue-producing assets; and amortization of initial direct costs declined by $138 thousand primarily due to the reduction in initial direct costs associated with the continued decline in the Companys acquisition
phase activity.



12



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Partially offsetting the aforementioned decreases in expense were increases in the provision for losses and other expense
totaling $201 thousand and $102 thousand, respectively. The provision for losses increased as the Company reserved approximately $396 thousand for impaired construction and computer equipment during 2008. The provision was partially offset by
reductions in the Companys allowance for doubtful accounts resulting from various recoveries on previously reserved delinquencies. Other expense increased mostly due to a year over year increase in estimated state and franchise taxes.

Other

Other expense, net during 2008 decreased by
$140 thousand, as compared to 2007. The decrease was comprised of a $206 thousand decline in unfavorable fair value adjustments on the Companys interest rate swap contracts offset, in part, by a $66 thousand increase in losses on foreign
currency transactions.

The reduction in unfavorable fair value adjustments on interest rate swap contracts was attributable to the year over year decline
in notional principal balance; and the increase in foreign currency losses was largely due to the weakness of the U.S. currency during the earlier part of 2008.

Recent Accounting Pronouncements

In October 2008, the Financial Accounting Standards Board (FASB) issued FASB Staff
Position (FSP) No. FAS 157-3, Determining the Fair Value of a Financial Asset in a Market That Is Not Active (FSP No. 157-3), which clarifies the application of SFAS No. 157, Fair Value
Measurements (SFAS 157), when the market for a financial asset is inactive. Specifically, FSP No. 157-3 clarifies how (1) managements internal assumptions should be considered in measuring fair value when observable
data are not present, (2) observable market information from an inactive market should be taken into account, and (3) the use of broker quotes or pricing services should be considered in assessing the relevance of observable and
unobservable data to measure fair value. The guidance in FSP No. 157-3 is effective immediately and was adopted by the Company on October 1, 2008. The adoption of FSP No. 157-3 did not have a significant effect on the Companys
financial position, results of operations or cash flows.

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments
and Hedging Activities (SFAS 161), as an amendment to SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities. SFAS 161 requires that objectives for using derivative instruments be disclosed in
terms of underlying risk and accounting designation. The fair value of derivative instruments and their gains and losses will need to be presented in tabular format in order to present a more complete picture of the effects of using derivative
instruments. SFAS 161 is effective for financial statements issued for fiscal years beginning after November 15, 2008. The Company is currently evaluating the impact of adopting this pronouncement.

In December 2007, the FASB issued SFAS No. 141R, Business Combinations (SFAS 141R). SFAS 141R replaces SFAS 141 and establishes principles
and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any non controlling interest in the acquiree and the goodwill acquired. SFAS 141R also
establishes disclosure requirements which will enable users to evaluate the nature and financial effects of the business combination. This standard is effective for fiscal years beginning after December 15, 2008. The Company does not presently
anticipate the adoption of SFAS 141R to significantly impact its financial position, results of operations or cash flows.

In February 2007, the FASB
issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilitiesincluding an amendment of FASB Statement No. 115 (SFAS 159). This Statement permits entities to choose to measure many
financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported earnings caused by measuring related assets and liabilities
differently without having to apply complex hedge accounting provisions. This Statement is expected to expand the use of fair value measurement, which is consistent with the Boards long-term measurement objectives for accounting for financial
instruments. The Company adopted the provisions of SFAS 159 on January 1, 2008. The adoption of SFAS 159 did not have a significant effect on the Companys financial position, results of operations or cash flows.



13



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In September 2006, the FASB issued SFAS 157. This standard clarifies the definition of fair value for financial
reporting, establishes a framework for measuring fair value and requires additional disclosures about the use of fair value measurements. The provisions of SFAS 157 were to be effective for fiscal years beginning after November 15, 2007.
However, in February 2008, the FASB issued FSP No. FAS 157-2, Effective Date of FASB Statement No. 157 (FSP No. 157-2), which defers the effective date of SFAS 157 as it pertains to fair value measurements of
nonfinancial assets and nonfinancial liabilities until fiscal years beginning after November 15, 2008. On January 1, 2008, the Company adopted the provisions of SFAS 157 except as it applied to its investment in leases, and other
nonfinancial assets and nonfinancial liabilities as noted in FSP No. 157-2. The partial adoption of SFAS 157 did not have a significant effect on the Companys financial position, results of operations or cash flows. The Company is in the
process of evaluating the impact of the deferred provisions of SFAS 157.

Critical Accounting Policies and Estimates

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 significantly 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.

Use of estimates:

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (GAAP) 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 and expected future cash flows used for impairment analysis purposes
and for determination of the allowance for doubtful accounts and reserve for credit losses on notes receivable.

Equipment on operating leases and
related revenue recognition:

Equipment subject to operating leases is stated at cost. Depreciation is being recognized on a straight-line method over
the terms of the related leases to the equipments estimated residual values at the end of the leases. Maintenance costs associated with the Funds portfolio of leased assets are expensed as incurred.

Operating lease revenue is recognized on a straight-line basis over the term of the underlying leases. The initial lease terms will vary as to the type of equipment
subject to the leases, the needs of the lessees and the terms to be negotiated, but initial leases are generally from 36 to 120 months. The difference between rent received and rental revenue recognized is recorded as unearned operating lease income
on the balance sheet.

The Company earns revenues from its fleet of marine vessels based on utilization of the vessels. Such contingent rentals and the
associated expenses are recorded when earned and/or incurred.

Direct financing leases and related revenue recognition:

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 interest 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 off and collection experience and the collectability of
specifically identified lessees and billed and unbilled receivables. Direct financing leases are written-off as they are deemed uncollectible.



14



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Direct financing leases are generally placed in a non-accrual status (i.e., no revenue is recognized) when payments are
more than 90 days past due. Additionally, management periodically reviews the creditworthiness of all direct finance lessees with payments outstanding less than 90 days. Based upon managements judgment, direct finance lessees may be placed in
a non-accrual status. Leases placed on non-accrual status are only returned to an accrual status when the account has been brought current and management believes recovery of the remaining unpaid lease payments is probable.

Notes receivable, unearned interest income and related revenue recognition:

The Company records all future payments of principal and interest on notes as notes receivable and then offsets the related unearned interest income. For financial statement purposes, the Company reports only the principal due on the
balance sheet. The unearned interest is recognized over the term of the note and the income portion of each note payment is calculated so as to generate a constant rate of return on the net balance outstanding. Any fees or costs related to notes
receivable are recorded as part of the net investment in notes receivable and amortized over the term of the loan.

Allowances for losses on notes
receivable are typically established based on historical charge off and collection experience and the collectability of specifically identified borrowers and billed and unbilled receivables. Notes are considered impaired when, based on current
information and events, it is probable that the Company will be unable to collect the scheduled payments of principal or interest when due according to the contractual terms of the note agreement. Factors considered by management in determining
impairment include payment status, collateral value, and the probability of collecting scheduled principal and interest payments when due. Notes are written off to the allowance as they are deemed uncollectible.

Notes receivable are generally placed in a non-accrual status (i.e., no revenue is recognized) when payments are more than 90 days past due. Additionally, management
periodically reviews the creditworthiness of companies with note payments outstanding less than 90 days. Based upon managements judgment, notes may be placed in a non-accrual status. Notes placed on non-accrual status are only returned to an
accrual status when the account has been brought current and management believes recovery of the remaining unpaid receivable is probable.

Initial
direct costs:

The Company capitalizes initial direct costs (IDC) associated with the origination and funding of lease assets and
investments in notes receivable as defined in SFAS No. 91, Accounting for Nonrefundable Fees and Costs Associated with Originating or Acquiring Loans and Initial Direct Costs of Leases. IDC includes both internal costs (e.g., the
costs of employees activities in connection with successful lease and loan originations) and external broker fees incurred with such originations. The costs are amortized on a lease by lease (or note by note) basis based on actual contract
term using a straight-line method for operating leases and the effective interest rate method for direct finance leases and notes receivable. Upon disposal of the underlying lease or loan assets, both the initial direct costs and the associated
accumulated amortization are relieved. Costs related to leases or notes receivable that are not consummated are not eligible for capitalization as initial direct costs and are expensed as acquisition expense.

Asset valuation:

Recorded values of the Companys asset
portfolio are periodically reviewed for impairment in accordance with 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 a valuation method using
discounted estimated future cash flows) of the assets and its carrying value on the measurement 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 16 through 38.



15



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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

The Members

ATEL Capital Equipment Fund IX, LLC

We have audited the accompanying balance sheets of ATEL Capital Equipment Fund IX, LLC (the Company) as of December 31, 2008 and 2007, and the related
statements of income, changes in members capital, and cash flows for the years then ended. These financial statements are the responsibility of the Management of the Companys Managing Member. 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 audits 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. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as 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 IX, LLC as of December 31, 2008 and 2007, and the results of its operations and its cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles.



/s/ Moss Adams LLP


San Francisco, California

March 26, 2009



16



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ATEL CAPITAL EQUIPMENT FUND IX, LLC

BALANCE SHEETS

DECEMBER 31, 2008 AND 2007

(In Thousands)



|                                                                                                                                      |  |      |        |      |   |       
|------------------------------------------------------------------------------------------------------------------------------------- |  | ---- | ------ | ---- | - | ------
|                                                                                                                                      |  | 2008 |        | 2007
|ASSETS                                                                                                                                |  |      |        |      |   |       
|Cash and cash equivalents                                                                                                             |  | $    | 2,142  |      | $ | 4,326 
|Accounts receivable, net of allowance for doubtful accounts of $100 at December 31, 2008 and $144 at December 31,
2007                |  |      | 1,030  |      |   | 1,409 
|Notes receivable, net of unearned interest income of $612 at December 31, 2008 and $991 at December 31, 2007                          |  |      | 3,653  |      |   | 4,133 
|Prepaid expenses and other assets                                                                                                     |  |      | 51     |      |   | 48    
|Investment in securities                                                                                                              |  |      | 70     |      |   | 70    
|Investments in equipment and leases, net of accumulated depreciation of $55,818 at December 31, 2008 and $49,383 at December 31,
2007 |  |      | 41,655 |      |   | 57,593
|                                                                                                                                      |  |      |        |      |   |       
|Total assets                                                                                                                          |  | $    | 48,601 |      | $ | 67,579
|                                                                                                                                      |  |      |        |      |   |       
|LIABILITIES AND MEMBERS CAPITAL                                                                                                      |  |      |        |      |   |       
|Accounts payable and accrued liabilities:                                                                                             |  |      |        |      |   |       
|Managing Member                                                                                                                       |  | $    | 172    |      | $ | 455   
|Accrued distributions to Other Members                                                                                                |  |      | 1,209  |      |   | 1,208 
|Other                                                                                                                                 |  |      | 1,021  |      |   | 1,024 
|Deposits due lessees                                                                                                                  |  |      | 129    |      |   | 92    
|Non-recourse debt                                                                                                                     |  |      | 4,826  |      |   | 7,198 
|Interest rate swap contracts                                                                                                          |  |      | 225    |      |   | 79    
|Acquisition facility obligation                                                                                                       |  |      | 2,000  |      |   | 1,500 
|Receivables funding program obligation                                                                                                |  |      | 8,009  |      |   | 15,479
|Unearned operating lease income                                                                                                       |  |      | 950    |      |   | 879   
|                                                                                                                                      |  |      |        |      |   |       
|Total liabilities                                                                                                                     |  |      | 18,541 |      |   | 27,914
|                                                                                                                                      |  |      |        |      |   |       
|Commitments and contingencies                                                                                                         |  |      |        |      |   |       
|Members capital:                                                                                                                     |  |      |        |      |   |       
|Managing Member                                                                                                                       |  |      |       |      |   |      
|Other Members                                                                                                                         |  |      | 30,060 |      |   | 39,665
|                                                                                                                                      |  |      |        |      |   |       
|Total Members capital                                                                                                                |  |      | 30,060 |      |   | 39,665
|                                                                                                                                      |  |      |        |      |   |       
|Total liabilities and Members capital                                                                                                |  | $    | 48,601 |      | $ | 67,579
|                                                                                                                                      |  |      |        |      |   |       

See accompanying notes.



17



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

STATEMENTS OF INCOME

FOR THE YEARS ENDED

DECEMBER 31, 2008 AND 2007

(In
Thousands Except for Units and Per Unit Data)



|                                                              |  |      |            |   |      |   |            |  
|------------------------------------------------------------- |  | ---- | ---------- | - | ---- | - | ---------- | -
|                                                              |  | 2008 |            |   | 2007 |  
|Revenues:                                                     |  |      |            |   |      |   |            |  
|Leasing activities:                                           |  |      |            |   |      |   |            |  
|Operating leases                                              |  | $    | 17,478     |   |      | $ | 22,463     |  
|Direct financing leases                                       |  |      | 1,932      |   |      |   | 1,566      |  
|Interest on notes receivable                                  |  |      | 380        |   |      |   | 447        |  
|Gain on sales of assets                                       |  |      | 98         |   |      |   | 2,873      |  
|Other revenue                                                 |  |      | 183        |   |      |   | 183        |  
|                                                              |  |      |            |   |      |   |            |  
|Total revenues                                                |  |      | 20,071     |   |      |   | 27,532     |  
|Expenses:                                                     |  |      |            |   |      |   |            |  
|Depreciation of operating lease assets                        |  |      | 12,996     |   |      |   | 16,890     |  
|Asset management fees to Managing Member                      |  |      | 902        |   |      |   | 1,348      |  
|Acquisition expense                                           |  |      |           |   |      |   | 19         |  
|Cost reimbursements to Managing Member                        |  |      | 626        |   |      |   | 1,112      |  
|Provision for losses and doubtful accounts                    |  |      | 352        |   |      |   | 151        |  
|Amortization of initial direct costs                          |  |      | 305        |   |      |   | 443        |  
|Amortization of loan fee                                      |  |      |           |   |      |   | 3          |  
|Interest expense                                              |  |      | 1,089      |   |      |   | 1,907      |  
|Professional fees                                             |  |      | 315        |   |      |   | 678        |  
|Outside services                                              |  |      | 101        |   |      |   | 510        |  
|Insurance                                                     |  |      | 99         |   |      |   | 120        |  
|Marine vessel maintenance and other operating costs           |  |      | 631        |   |      |   | 662        |  
|Other                                                         |  |      | 337        |   |      |   | 235        |  
|                                                              |  |      |            |   |      |   |            |  
|Total operating expenses                                      |  |      | 17,753     |   |      |   | 24,078     |  
|Other expense, net                                            |  |      | (193       | ) |      |   | (333       | )
|                                                              |  |      |            |   |      |   |            |  
|Net income                                                    |  | $    | 2,125      |   |      | $ | 3,121      |  
|                                                              |  |      |            |   |      |   |            |  
|Net income:                                                   |  |      |            |   |      |   |            |  
|Managing Member                                               |  | $    | 880        |   |      | $ | 880        |  
|Other Members                                                 |  |      | 1,245      |   |      |   | 2,241      |  
|                                                              |  |      |            |   |      |   |            |  
|                                                              |  | $    | 2,125      |   |      | $ | 3,121      |  
|                                                              |  |      |            |   |      |   |            |  
|Net income per Limited Liability Company Unit (Other Members) |  | $    | 0.10       |   |      | $ | 0.19       |  
|Weighted average number of Units outstanding                  |  |      | 12,055,016 |   |      |   | 12,055,016 |  

See accompanying notes.



18



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

STATEMENTS OF CHANGES IN MEMBERS CAPITAL

FOR THE YEARS ENDED

DECEMBER 31, 2008 AND 2007

(In Thousands Except for Units and Per Unit Data)



|                                                |  |               |  |        |                |   |  |       |      |   |  |   |         |  
|----------------------------------------------- |  | ------------- |  | ------ | -------------- | - |  | ----- | ---- | - |  | - | ------- | -
|                                                |  | Other Members |  |        | ManagingMember |   |  | Total |     
|                                                |  | Units         |  | Amount |                |   | 
|Balance December 31, 2006                       |  | 12,055,016    |  | $      | 48,273         |   |  | $     |     |   |  | $ | 48,273  |  
|Distributions to Other Members ($0.90 per Unit) |  |              |  |        | (10,849        | ) |  |       |     |   |  |   | (10,849 | )
|Distributions to Managing Member                |  |              |  |        |               |   |  |       | (880 | ) |  |   | (880    | )
|Net income                                      |  |              |  |        | 2,241          |   |  |       | 880  |   |  |   | 3,121   |  
|                                                |  |               |  |        |                |   |  |       |      |   |  |   |         |  
|Balance December 31, 2007                       |  | 12,055,016    |  |        | 39,665         |   |  |       |     |   |  |   | 39,665  |  
|Distributions to Other Members ($0.90 per Unit) |  |              |  |        | (10,850        | ) |  |       |     |   |  |   | (10,850 | )
|Distributions to Managing Member                |  |              |  |        |               |   |  |       | (880 | ) |  |   | (880    | )
|Net income                                      |  |              |  |        | 1,245          |   |  |       | 880  |   |  |   | 2,125   |  
|                                                |  |               |  |        |                |   |  |       |      |   |  |   |         |  
|Balance December 31, 2008                       |  | 12,055,016    |  | $      | 30,060         |   |  | $     |     |   |  | $ | 30,060  |  
|                                                |  |               |  |        |                |   |  |       |      |   |  |   |         |  

See accompanying notes.



19



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED

DECEMBER 31, 2008 AND 2007

(In
Thousands)



|                                                                             |  |      |         |   |      |   |         |  
|---------------------------------------------------------------------------- |  | ---- | ------- | - | ---- | - | ------- | -
|                                                                             |  | 2008 |         |   | 2007 |  
|Operating activities:                                                        |  |      |         |   |      |   |         |  
|Net income                                                                   |  | $    | 2,125   |   |      | $ | 3,121   |  
|Adjustment to reconcile net income to cash provided by operating activities: |  |      |         |   |      |   |         |  
|Gain on sales of lease assets                                                |  |      | (98     | ) |      |   | (2,873  | )
|Depreciation of operating lease assets                                       |  |      | 12,996  |   |      |   | 16,890  |  
|Amortization of initial direct costs                                         |  |      | 305     |   |      |   | 443     |  
|Amortization of unearned income on direct financing leases                   |  |      | (1,932  | ) |      |   | (1,566  | )
|Amortization of unearned income on notes receivable                          |  |      | (380    | ) |      |   | (447    | )
|Provision for losses and impairments                                         |  |      | 352     |   |      |   | 151     |  
|Loss on interest rate swap contracts                                         |  |      | 146     |   |      |   | 352     |  
|Changes in operating assets and liabilities:                                 |  |      |         |   |      |   |         |  
|Accounts receivable                                                          |  |      | 423     |   |      |   | (578    | )
|Prepaid and other assets                                                     |  |      | (3      | ) |      |   | 85      |  
|Accounts payable, Managing Member                                            |  |      | (283    | ) |      |   | (106    | )
|Accounts payable, other                                                      |  |      | (2      | ) |      |   | 421     |  
|Deposits due lessees                                                         |  |      | 37      |   |      |   | (8      | )
|Unearned operating lease income                                              |  |      | 71      |   |      |   | 150     |  
|                                                                             |  |      |         |   |      |   |         |  
|Net cash provided by operating activities                                    |  |      | 13,757  |   |      |   | 16,035  |  
|                                                                             |  |      |         |   |      |   |         |  
|Investing activities:                                                        |  |      |         |   |      |   |         |  
|Purchases of equipment on operating leases                                   |  |      |        |   |      |   | (82     | )
|Purchases of equipment on direct financing leases                            |  |      |        |   |      |   | (189    | )
|Proceeds from sales of lease assets                                          |  |      | 690     |   |      |   | 7,264   |  
|Payments of initial direct costs                                             |  |      |        |   |      |   | (12     | )
|Payments received on direct financing leases                                 |  |      | 3,584   |   |      |   | 3,367   |  
|Payments received on notes receivable                                        |  |      | 857     |   |      |   | 1,206   |  
|                                                                             |  |      |         |   |      |   |         |  
|Net cash provided by investing activities                                    |  |      | 5,131   |   |      |   | 11,554  |  
|                                                                             |  |      |         |   |      |   |         |  
|Financing activities:                                                        |  |      |         |   |      |   |         |  
|Borrowings under acquisition facility                                        |  |      | 4,000   |   |      |   |        |  
|Repayments under acquisition facility                                        |  |      | (3,500  | ) |      |   | (2,500  | )
|Repayments under receivables funding program                                 |  |      | (7,470  | ) |      |   | (10,011 | )
|Repayments of non-recourse debt                                              |  |      | (2,372  | ) |      |   | (2,217  | )
|Distributions to Other Members                                               |  |      | (10,850 | ) |      |   | (10,849 | )
|Distributions to Managing Member                                             |  |      | (880    | ) |      |   | (880    | )
|                                                                             |  |      |         |   |      |   |         |  
|Net cash used in financing activities                                        |  |      | (21,072 | ) |      |   | (26,457 | )
|                                                                             |  |      |         |   |      |   |         |  
|Net (decrease) increase in cash and cash equivalents                         |  |      | (2,184  | ) |      |   | 1,132   |  
|Cash and cash equivalents at beginning of year                               |  |      | 4,326   |   |      |   | 3,194   |  
|                                                                             |  |      |         |   |      |   |         |  
|Cash and cash equivalents at end of year                                     |  | $    | 2,142   |   |      | $ | 4,326   |  
|                                                                             |  |      |         |   |      |   |         |  
|Supplemental disclosures of cash flow information:                           |  |      |         |   |      |   |         |  
|Cash paid during the year for interest                                       |  | $    | 1,116   |   |      | $ | 1,936   |  
|                                                                             |  |      |         |   |      |   |         |  
|Cash paid during the year for taxes                                          |  | $    | 150     |   |      | $ | 68      |  
|                                                                             |  |      |         |   |      |   |         |  
|Schedule of non-cash transactions:                                           |  |      |         |   |      |   |         |  
|Distributions payable to Other Members at year end                           |  | $    | 1,209   |   |      | $ | 1,208   |  
|                                                                             |  |      |         |   |      |   |         |  

See accompanying notes.



20



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



1. Organization and Limited Liability Company matters:

ATEL Capital Equipment Fund IX, LLC (the Company) was formed under the laws of the State of California on September 27, 2000 for the purpose of engaging
in the sale of limited liability company investment units and acquiring equipment to engage in equipment leasing, lending and sales activities, primarily in the United States. The Managing Member of the Company is ATEL Financial Services, LLC
(AFS), a California limited liability company. The Company may continue until December 31, 2020. Contributions in the amount of $600 were received as of December 31, 2000, $100 of which represented AFSs continuing
interest, and $500 of which represented the Initial Members capital investment.

The Company conducted a public offering of 15,000,000 Limited
Liability Company Units (Units), at a price of $10 per Unit. On February 21, 2001, subscriptions for the minimum number of Units (120,000, representing $1.2 million) had been received (excluding subscriptions from Pennsylvania
investors) and AFS requested that the subscriptions be released to the Company. On that date, the Company commenced operations in its primary business (acquiring equipment to engage in equipment leasing, lending and sales activities). As of
April 3, 2001, the Company had received subscriptions for 753,050 Units ($7.5 million), thus exceeding the $7.5 million minimum requirement for Pennsylvania, and AFS requested that the remaining funds in escrow (from Pennsylvania investors) be
released to the Company.

As of January 15, 2003, the offering was terminated. As of that date, the Company had received subscriptions for 12,065,266
Units ($120.7 million). Subsequent to January 15, 2003, Units totaling 10,250 were rescinded or repurchased and funds returned to investors. As of December 31, 2008, 12,055,016 Units remain issued and outstanding.

The Companys principal objectives are to invest in a diversified portfolio of equipment that (i) preserves, protects and returns the Companys invested
capital; (ii) generates 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) (defined as six full years following the year the offering was terminated), which ends on December 31, 2009 and (iii) provides additional distributions following the Reinvestment Period
and until all equipment has been sold. The Company is governed by the Limited Liability Company Operating Agreement (Operating Agreement), as amended.

Pursuant to the terms of the Operating Agreement, AFS receives compensation and reimbursements for services rendered on behalf of the Company (See Note 7). The Company is required to maintain reasonable cash reserves for working capital,
the repurchase of Units and contingencies. The repurchase of Units is solely at the discretion of AFS.

2. Summary of significant accounting policies:

Basis of presentation:

The accompanying balance
sheets as of December 31, 2008 and 2007, and the related statements of income and changes in members capital and cash flows for the years then ended, have been prepared in accordance with accounting principles generally accepted in the
United States of America (GAAP). Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications had no effect on equity or net income.

Footnote and tabular amounts are presented in thousands, except as to Units and per Unit data.

Use of estimates:

The preparation of financial statements in conformity with GAAP 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 and expected future cash flows used for impairment analysis purposes and for determination
of the allowance for doubtful accounts and reserve for credit losses on notes receivable.



21



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



2. Summary of significant accounting policies (continued):

Cash and cash equivalents:

Cash and cash equivalents include cash in
banks and cash equivalent investments such as U.S. Treasury instruments with original and/or purchased maturities of ninety days or less.

Credit risk:

Financial instruments that potentially subject the Company to concentrations of credit risk include cash and cash equivalents, direct finance lease
receivables, notes receivable and accounts receivable. The Company places the majority of its cash deposits and temporary cash investments in U.S. Treasury denominated instruments with the remainder placed in financial institutions where the
principal is 100% guaranteed under the Troubled Asset Relief Program Act of 2008 (TARP), so as to meet ongoing working capital requirements. The concentration of such deposits and temporary cash investments is not deemed to create a
significant risk to the Company. Accounts and notes receivable represent amounts due from lessees or borrowers in various industries related to equipment on operating and direct financing leases or notes receivable. See Note 3 for a description of
lessees and financial borrowers by industry as of December 31, 2008 and 2007.

Accounts receivable:

Accounts receivable represent the amounts billed under operating and direct financing lease contracts which are due to the Company. Allowances for doubtful accounts are
typically established based on historical charge off and collection experience and the collectability of specifically identified lessees and invoiced amounts. Accounts receivable deemed uncollectible are charged off to the allowance on specific
identification basis. Amounts recovered that were previously written-off are recorded as other income in the period received.

Equipment on operating
leases and related revenue recognition:

Equipment subject to operating leases is stated at cost. Depreciation is being recognized on a straight-line
method over the terms of the related leases to the equipments estimated residual values at the end of the leases. Maintenance costs associated with the Funds portfolio of leased assets are expensed upon receipt of invoice.

Operating lease revenue is recognized on a straight-line basis over the term of the underlying leases. The initial lease terms will vary as to the type of equipment
subject to the leases, the needs of the lessees and the terms to be negotiated, but initial leases are generally on terms from 36 to 120 months. The difference between rent received and rental revenue recognized is recorded as unearned operating
lease income on the balance sheet.

The Company earns revenues from its fleet of marine vessels based on utilization of the vessels. Such contingent
rentals and the associated expenses are recorded when earned and/or incurred.

Direct financing leases and related revenue recognition:

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 interest 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 off and collection experience and the collectability of
specifically identified lessees and billed and unbilled receivables. Direct financing leases are charged off to the allowance as they are deemed uncollectible.



22



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



2. Summary of significant accounting policies (continued):

Direct financing leases are generally placed in a non-accrual status (i.e., no revenue is recognized) when payments are more than 90 days past due. Additionally,
management periodically reviews the creditworthiness of all direct finance lessees with payments outstanding less than 90 days. Based upon managements judgment, direct finance lessees with balances less than 90 days delinquent may be placed in
a non-accrual status. Leases placed on non-accrual status are only returned to an accrual status when the account has been brought current and management believes recovery of the remaining unpaid lease payments is probable.

Notes receivable, unearned interest income and related revenue recognition:

The Company records all future payments of principal and interest on notes as notes receivable which is then offset by the amount of any related unearned interest income. For financial statement purposes, the Company reports only the net
amount of principal due on the balance sheet. The unearned interest is recognized over the term of the note and the income portion of each note payment is calculated so as to generate a constant rate of return on the net balance outstanding. Any
fees or costs related to notes receivable are recorded as part of the net investment in notes receivable and amortized over the term of the loan.

Allowances for losses on notes receivable are typically established based on historical charge off and collection experience and the collectability of specifically identified borrowers and billed and unbilled receivables. Notes are charged
off to the allowance as they are deemed uncollectible.

Notes receivable are generally placed in a non-accrual status (i.e., no revenue is recognized) when
payments are more than 90 days past due. Additionally, management periodically reviews the creditworthiness of companies with note payments outstanding less than 90 days. Based upon managements judgment, notes may be placed in a non-accrual
status. Notes placed on non-accrual status are only returned to an accrual status when the account has been brought current and management believes recovery of the remaining unpaid receivable is probable.

The fair value of the Companys notes receivable is commensurate with the amount at which the asset could be collected in a current transaction, exclusive of
transaction costs such as prepayment penalties. The estimated fair value of the Companys notes receivable were $3.7 million and $4.1 million at December 31, 2008 and 2007, respectively.

Initial direct costs:

The Company capitalizes initial direct costs
(IDC) associated with the origination and funding of lease assets and investments in notes receivable as defined in Statement of Financial Accounting Standards (SFAS) No. 91, Accounting for Nonrefundable Fees and
Costs Associated with Originating or Acquiring Loans and Initial Direct Costs of Leases. IDC includes both internal costs (e.g., the costs of employees activities in connection with successful lease and loan originations) and external
broker fees incurred with such originations. The costs are amortized on a lease by lease (or note by note) basis based on actual contract term using a straight-line method for operating leases and the effective interest rate method for direct
finance leases and notes receivable. Upon disposal of the underlying lease or loan assets, both the initial direct costs and the associated accumulated amortization are relieved. Costs related to leases or notes receivable that are not consummated
are not eligible for capitalization as initial direct costs and are expensed as acquisition expense.

Acquisition expense:

Acquisition expense represents costs which include, but are not limited to, legal fees and expenses, travel and communication expenses, cost of appraisals, accounting
fees and expenses and miscellaneous expenses related to the selection and acquisition of equipment which are reimbursable to the Managing Member under the terms of the Operating Agreement. As the costs are not eligible for capitalization as initial
direct costs, such amounts are expensed as incurred.

Asset valuation:

Recorded values of the Companys asset portfolio are periodically reviewed for impairment in accordance with SFAS No. 144, Accounting for the Impairment or Disposal of Long-Lived Assets. An
impairment loss is measured and recognized



23



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



2. Summary of significant accounting policies (continued):

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 a valuation method using discounted estimated future cash flows) of the asset and its carrying value on the measurement date.

Segment reporting:

The Company reports segment information in
accordance with SFAS No. 131 Disclosures about Segments of an Enterprise and Related Information. SFAS No. 131 establishes annual and interim standards for operating segments of a company. It also requires entity-wide
disclosures about the products and services an entity provides, the material countries in which it holds assets and reports revenue, and its major customers. The Company is not organized by multiple operating segments for the purpose of making
operating decisions or assessing performance. Accordingly, the Company operates in one reportable operating segment in the United States.

The
Companys principal decision makers are the Managing Members Chief Executive Officer and its Chief Financial Officer and Chief Operating Officer. The Company believes that its equipment leasing business operates as one reportable segment
because: a) the Company measures profit and loss at the equipment portfolio level as a whole; b) the principal decision makers do not review information based on any operating segment other than the equipment leasing transaction portfolio; c) the
Company does not maintain discrete financial information on any specific segment other than its equipment financing operations; d) the Company has not chosen to organize its business around different products and services other than equipment lease
financing; and e) the Company has not chosen to organize its business around geographic areas.

The primary geographic regions in which the Company seeks
leasing opportunities are North America and Europe. The table below summarizes geographic information relating to the sources, by nation, of the Companys total revenues for the years ended December 31, 2008 and 2007 and long-lived assets
as of December 31, 2008 and 2007 (in thousands):



|                    |  |                                 |        |            |     |   |      |   |            |  |     |  
|------------------- |  | ------------------------------- | ------ | ---------- | --- | - | ---- | - | ---------- |  | --- | -
|                    |  | For the year ended December 31, |       
|                    |  | 2008                            |        | % of Total |     |   | 2007 |   | % of Total | 
|Revenue             |  |                                 |        |            |     |   |      |   |            |  |     |  
|United States       |  | $                               | 18,506 |            | 92  | % |      | $ | 25,954     |  | 94  | %
|                    |  |                                 |        |            |     |   |      |   |            |  |     |  
|United Kingdom      |  |                                 | 1,353  |            | 7   | % |      |   | 1,341      |  | 5   | %
|Canada              |  |                                 | 212    |            | 1   | % |      |   | 237        |  | 1   | %
|                    |  |                                 |        |            |     |   |      |   |            |  |     |  
|Total International |  |                                 | 1,565  |            | 8   | % |      |   | 1,578      |  | 6   | %
|                    |  |                                 |        |            |     |   |      |   |            |  |     |  
|Total               |  | $                               | 20,071 |            | 100 | % |      | $ | 27,532     |  | 100 | %
|                    |  |                                 |        |            |     |   |      |   |            |  |     |  
|                    | 
|                    |  | As of December 31,              |       
|                    |  | 2008                            |        | % of Total |     |   | 2007 |   | % of Total | 
|Long-lived assets   |  |                                 |        |            |     |   |      |   |            |  |     |  
|United States       |  | $                               | 39,004 |            | 94  | % |      | $ | 53,809     |  | 93  | %
|                    |  |                                 |        |            |     |   |      |   |            |  |     |  
|United Kingdom      |  |                                 | 2,651  |            | 6   | % |      |   | 3,784      |  | 7   | %
|                    |  |                                 |        |            |     |   |      |   |            |  |     |  
|Total International |  |                                 | 2,651  |            | 6   | % |      |   | 3,784      |  | 7   | %
|                    |  |                                 |        |            |     |   |      |   |            |  |     |  
|Total               |  | $                               | 41,655 |            | 100 | % |      | $ | 57,593     |  | 100 | %
|                    |  |                                 |        |            |     |   |      |   |            |  |     |  



24



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



2. Summary of significant accounting policies (continued):

Derivative financial instruments:

In June 1998, the Financial
Accounting Standards Board (FASB) issued 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.

The
Company records all derivatives as either assets or liabilities in the balance sheet and measures those instruments at fair value. It further provides criteria as to when derivative instruments can 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 records derivative instruments at fair value in the balance sheet and recognizes the offsetting gains or losses
as adjustments to net income.

Credit exposure from derivative financial instruments, which are assets, arises from the risk of a counterparty default on
the derivative contract. The amount of the loss created by the default is the replacement cost or current positive fair value of the defaulted contract.

Foreign currency transactions:

Foreign currency transaction gains and losses are reported in the results of operations as other
income or other expense in the period in which they occur. Currently, the Company does not use derivative instruments to hedge its economic exposure with respect to assets, liabilities and firm commitments as the foreign currency
transactions risks to date have not been significant. During the year ended December 31, 2008 and 2007, the Company recognized a foreign currency loss of $47 thousand and a foreign currency gain of $19 thousand, respectively, which are included
in other expense, net for each of the reporting years.

Investment in securities:

Purchased securities

Purchased
securities are generally not registered for public sale and are carried at cost. Such securities are adjusted to fair value if the fair value is less than the carrying value and such impairment is deemed by the Managing Member to be other than
temporary. Factors considered by the Managing Member in determining fair value include, but are not limited to, available financial information, the issuers ability to meet its current obligations and indications of the issuers
subsequent ability to raise capital. Management has concluded that there are no identified events or changes in circumstances that may have a significant adverse effect on the fair value of the instruments and that it is not practicable to estimate
the fair value of the investment because of its illiquidity. Accordingly, such investment is stated at cost. See note 14 for further discussion.

Warrants

Warrants owned by the Company are not registered for public sale, but are considered derivatives and are carried
at an estimated fair value on the balance sheet at the end of the period, as determined by the Managing Member. At December 31, 2008 and 2007, the Managing Member estimated the fair value of the warrants to be nominal in amount.

Unearned operating lease income:

The Company records prepayments on
operating leases as a liability, unearned operating lease income. The liability is recorded when the prepayments are received and recognized as operating lease revenue ratably over the period to which the prepayments relate.



25



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



2. Summary of significant accounting policies (continued):

Income taxes:

The Company is treated as a partnership for federal
income tax purposes. Pursuant to the provisions of Section 701 of the Internal Revenue Code, a partnership is not subject to federal income taxes. Accordingly, the Company has provided current income taxes for only those states which levy
income taxes on partnerships. For the years ended December 31, 2008 and 2007, the related provision for state income taxes was approximately $138 thousand and $8 thousand, respectively.

The tax bases of the Companys net assets and liabilities vary from the amounts presented in these financial statements at December 31, 2008 and 2007 (in
thousands):



|                                        |  |      |        |  |      |   |        |  |  | 
|--------------------------------------- |  | ---- | ------ |  | ---- | - | ------ |  |  | 
|                                        |  | 2008 |        |  | 2007 |   |        | 
|Financial statement basis of net assets |  | $    | 30,060 |  |      | $ | 39,665 |  | 
|Tax basis of net assets (unaudited)     |  |      | 27,814 |  |      |   | 35,020 |  | 
|                                        |  |      |        |  |      |   |        |  | 
|Difference                              |  | $    | 2,246  |  |      | $ | 4,645  |  | 
|                                        |  |      |        |  |      |   |        |  | 

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.

The following reconciles the net income reported in these financial statements to the net income (loss) reported on the Companys federal tax return (unaudited) for each of the years ended December 31, 2008
and 2007 (in thousands):



|                                              |  |      |       |   |      |   |        |   |  | 
|--------------------------------------------- |  | ---- | ----- | - | ---- | - | ------ | - |  | 
|                                              |  | 2008 |       |   | 2007 |   |        |  
|Net income per financial statements           |  | $    | 2,125 |   |      | $ | 3,121  |   | 
|Tax adjustments (unaudited):                  |  |      |       |   |      |   |        |   | 
|Adjustment to depreciation expense            |  |      | 161   |   |      |   | (1,195 | ) | 
|Provision for losses and doubtful accounts    |  |      | (44   | ) |      |   | 116    |   | 
|Adjustments to revenues / other expenses      |  |      | 2,269 |   |      |   | 2,337  |   | 
|Adjustments to gain on sales of assets        |  |      | 12    |   |      |   | 1,320  |   | 
|                                              |  |      |       |   |      |   |        |   | 
|Net income per federal tax return (unaudited) |  | $    | 4,523 |   |      | $ | 5,699  |   | 
|                                              |  |      |       |   |      |   |        |   | 

Other expense, net:

Other expense, net consists of gains and losses on interest rate swap contracts and gains and losses on foreign exchange transactions. The table below details the Companys other expense, net for the years ended December 31, 2008
and 2007 (in thousands):



|                                                     |  |      |      |   |      |   |      |   |  | 
|---------------------------------------------------- |  | ---- | ---- | - | ---- | - | ---- | - |  | 
|                                                     |  | 2008 |      |   | 2007 |   |      |  
|Foreign currency gain (loss)                         |  | $    | (47  | ) |      | $ | 19   |   | 
|Change in fair value of interest rate swap contracts |  |      | (146 | ) |      |   | (352 | ) | 
|                                                     |  |      |      |   |      |   |      |   | 
|                                                     |  | $    | (193 | ) |      | $ | (333 | ) | 
|                                                     |  |      |      |   |      |   |      |   | 

Per Unit data:

Net income and distributions per Unit are based upon the weighted average number of Other Members Units outstanding during the period.



26



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



2. Summary of significant accounting policies (continued):

Recent accounting pronouncements:

In October 2008, the FASB issued
FASB Staff Position (FSP) No. FAS 157-3, Determining the Fair Value of a Financial Asset in a Market That Is Not Active (FSP No. 157-3), which clarifies the application of SFAS No. 157, Fair Value
Measurements (SFAS 157), when the market for a financial asset is inactive. Specifically, FSP No. 157-3 clarifies how (1) managements internal assumptions should be considered in measuring fair value when observable
data are not present, (2) observable market information from an inactive market should be taken into account, and (3) the use of broker quotes or pricing services should be considered in assessing the relevance of observable and
unobservable data to measure fair value. The guidance in FSP No. 157-3 is effective immediately and was adopted by the Company on October 1, 2008. The adoption of FSP No. 157-3 did not have a significant effect on the Companys
financial position, results of operations or cash flows.

In March 2008, the FASB issued SFAS No. 161, Disclosures about Derivative Instruments
and Hedging Activities (SFAS 161), as an amendment to SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities. SFAS 161 requires that objectives for using derivative instruments be disclosed in
terms of underlying risk and accounting designation. The fair value of derivative instruments and their gains and losses will need to be presented in tabular format in order to present a more complete picture of the effects of using derivative
instruments. SFAS 161 is effective for financial statements issued for fiscal years beginning after November 15, 2008. The Company is currently evaluating the impact of adopting this pronouncement.

In December 2007, the FASB issued Statement of Financial Accounting Standards No. 141R, Business Combinations (SFAS 141R). SFAS 141R
replaces SFAS 141 and establishes principles and requirements for how an acquirer recognizes and measures in its financial statements the identifiable assets acquired, the liabilities assumed, any non controlling interest in the acquiree and the
goodwill acquired. SFAS 141R also establishes disclosure requirements which will enable users to evaluate the nature and financial effects of the business combination. This standard is effective for fiscal years beginning after
December 15, 2008. The Company does not presently anticipate the adoption of SFAS 141R to significantly impact its financial position, results of operations or cash flows.

In February 2007, the FASB issued SFAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilitiesincluding an amendment of FASB Statement No. 115 (SFAS 159).
This Statement permits entities to choose to measure many financial instruments and certain other items at fair value. The objective is to improve financial reporting by providing entities with the opportunity to mitigate volatility in reported
earnings caused by measuring related assets and liabilities differently without having to apply complex hedge accounting provisions. This Statement is expected to expand the use of fair value measurement, which is consistent with the Boards
long-term measurement objectives for accounting for financial instruments. The Company adopted the provisions of SFAS 159 on January 1, 2008. The adoption of SFAS 159 did not have a significant effect on the Companys financial position,
results of operations or cash flows.

In September 2006, the FASB issued SFAS 157. This standard clarifies the definition of fair value for financial
reporting, establishes a framework for measuring fair value and requires additional disclosures about the use of fair value measurements. The provisions of SFAS 157 were to be effective for fiscal years beginning after November 15, 2007.
However, in February 2008, the FASB issued FSP No. FAS 157-2, Effective Date of FASB Statement No. 157 (FSP No. 157-2), which defers the effective date of SFAS 157 as it pertains to fair value measurements of nonfinancial
assets and nonfinancial liabilities until fiscal years beginning after November 15, 2008. On January 1, 2008, the Company adopted the provisions of SFAS 157 except as it applied to its investment in leases, and other nonfinancial
assets and nonfinancial liabilities as noted in FSP No. 157-2. The partial adoption of SFAS 157 did not have a significant effect on the Companys financial position, results of operations or cash flows. The Company is in the process of
evaluating the impact of the deferred provisions of SFAS 157.

3. 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 to the Company upon default.



27



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



3. Concentration of credit risk and major customers (continued):

As of December 31, 2008 and 2007, there were concentrations (greater than 10% as a percentage of total equipment cost) of equipment leased to lessees and/or
financial borrowers in certain industries as follows:



|                      |  |      |   |  |      |   |  | 
|--------------------- |  | ---- | - |  | ---- | - |  | 
|                      |  | 2008 |   |  | 2007 |   |  | 
|Manufacturing         |  | 33   | % |  | 40   | % | 
|Mining                |  | 17   | % |  | 13   | % | 
|Rail transportation   |  | 15   | % |  | 13   | % | 
|Marine transportation |  | 12   | % |  | 11   | % | 

During 2008 and 2007, three customers comprised 32% and 29% of the Companys revenues from leases,
respectively, as follows:



|                          |  |                    |  |                                  |   |  |      |  
|------------------------- |  | ------------------ |  | -------------------------------- | - |  | ---- | -
|                          |  |                    |  | Percentageof TotalLease Revenues |  
|Lessee                    |  | Type of Equipment  |  | 2008                             |   |  | 2007 |  
|Ford Motor Company        |  | Materials handling |  | 11                               | % |  | 11   | %
|Whirlpool Corporation     |  | Materials handling |  | 11                               | % |  | 10   | %
|The Sabine Mining Company |  | Mining             |  | 10                               | % |  | 8    | %

4. Notes receivable, net:

The Company has various notes receivable from borrowers who have financed the purchase of equipment through the Company. At December 31, 2008, the original terms of the notes receivable are 60 to 120 months and
bear interest at rates ranging from 8.5% to 11.4%. The notes are secured by the equipment financed. The notes mature from 2009 through 2016. There were no impaired notes as of December 31, 2008 and 2007. As of December 31, 2008, the
minimum future payments receivable are as follows (in thousands):



|                                                    |  |   |       |  | 
|--------------------------------------------------- |  | - | ----- |  | 
|                                                    |  |   |       | 
|Year ending December 31, 2009                       |  | $ | 2,211 | 
|2010                                                |  |   | 393   | 
|2011                                                |  |   | 393   | 
|2012                                                |  |   | 393   | 
|2013                                                |  |   | 295   | 
|Thereafter                                          |  |   | 575   | 
|                                                    |  |   |       | 
|                                                    |  |   | 4,260 | 
|Less: portion representing unearned interest income |  |   | (612) | 
|                                                    |  |   |       | 
|                                                    |  |   | 3,648 | 
|Unamortized indirect costs                          |  |   | 5     | 
|                                                    |  |   |       | 
|Notes receivable, net                               |  | $ | 3,653 | 
|                                                    |  |   |       | 

IDC amortization expense related to notes receivable and the Companys operating and direct finance leases
for the years ended December 31, 2008 and 2007 are as follows (in thousands):



|                                    |  |      |     |      |   |     |  | 
|----------------------------------- |  | ---- | --- | ---- | - | --- |  | 
|                                    |  | 2008 |     | 2007 |   |    
|IDC amortization - notes receivable |  | $    | 3   |      | $ | 9   | 
|IDC amortization - lease assets     |  |      | 302 |      |   | 434 | 
|                                    |  |      |     |      |   |     | 
|Total                               |  | $    | 305 |      | $ | 443 | 
|                                    |  |      |     |      |   |     | 



28



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



5. Provision for losses:

The Companys provision for losses and doubtful accounts is as follows (in thousands):



|                              |  |                                 |     |                               |   |     |       |  |   |     |   |  | 
|----------------------------- |  | ------------------------------- | --- | ----------------------------- | - | --- | ----- |  | - | --- | - |  | 
|                              |  | Reserve forLosses andImpairment |     | Allowance forDoubtfulAccounts |   |     | Total |  |   |    
|Balance December 31, 2006     |  | $                               |    |                               | $ | 28  |       |  | $ | 28  |   | 
|Provision                     |  |                                 |    |                               |   | 116 |       |  |   | 116 |   | 
|                              |  |                                 |     |                               |   |     |       |  |   |     |   | 
|Balance December 31, 2007     |  | $                               |    |                               | $ | 144 |       |  | $ | 144 |   | 
|Provision                     |  |                                 | 396 |                               |   |    |       |  |   | 396 |   | 
|Charge-offs and/or recoveries |  |                                 |    |                               |   | (44 | )     |  |   | (44 | ) | 
|                              |  |                                 |     |                               |   |     |       |  |   |     |   | 
|Balance December 31, 2008     |  | $                               | 396 |                               | $ | 100 |       |  | $ | 496 |   | 
|                              |  |                                 |     |                               |   |     |       |  |   |     |   | 

6. Investment in equipment and leases, net:

The Companys investment in leases consists of the following (in thousands):



|                                                                                                                     |  |                         |        |                                           |   |        |                                                          |  |   |                         |   |  |   |       
|-------------------------------------------------------------------------------------------------------------------- |  | ----------------------- | ------ | ----------------------------------------- | - | ------ | -------------------------------------------------------- |  | - | ----------------------- | - |  | - | ------
|                                                                                                                     |  | BalanceDecember 31,2007 |        | Reclassifications&Additions /Dispositions |   |        | Depreciation/AmortizationExpense orAmortizationof Leases |  |   | BalanceDecember 31,2008
|Net investment in operating leases                                                                                   |  | $                       | 51,431 |                                           | $ | (2,523 | )                                                        |  | $ | (12,963                 | ) |  | $ | 35,945
|Net investment in direct financing leases                                                                            |  |                         | 5,579  |                                           |   | 665    |                                                          |  |   | (1,647                  | ) |  |   | 4,597 
|Assets held for sale or lease, net                                                                                   |  |                         | 74     |                                           |   | 865    |                                                          |  |   | (33                     | ) |  |   | 906   
|Initial direct costs, net of accumulated amortization of $718 and $1,075 at December 31, 2008 and 2007, respectively |  |                         | 509    |                                           |   |       |                                                          |  |   | (302                    | ) |  |   | 207   
|                                                                                                                     |  |                         |        |                                           |   |        |                                                          |  |   |                         |   |  |   |       
|Total                                                                                                                |  | $                       | 57,593 |                                           | $ | (993   | )                                                        |  | $ | (14,945                 | ) |  | $ | 41,655
|                                                                                                                     |  |                         |        |                                           |   |        |                                                          |  |   |                         |   |  |   |       

For the respective years ended December 31, 2008 and 2007, IDC amortization expense related to operating
leases and direct finance leases was $302 thousand and $434 thousand, respectively (See Note 4).

Impairment of investments in leases and assets held
for sale or lease:

Management periodically reviews the carrying values of its assets on leases and assets held for lease or sale. As a result of those
reviews, management determined that certain assets were impaired. The Company measured the impairment based on the difference between the carrying value and fair value of the related asset groups. Fair value was determined based on the sum of the
discounted estimated future cash flows of the related asset groups. During 2008, the Company recognized a $396 thousand impairment loss reserve related to impaired construction and computer equipment. No impairment losses were recorded in 2007.

Impairment losses are recorded as an adjustment to the net investment in operating leases. Depreciation expense and impairment losses on property subject
to operating leases and property held for lease or sale consist of the following for the years ended December 31, 2008 and 2007 (in thousands).



|                                       |  |      |        |      |   |        |  | 
|-------------------------------------- |  | ---- | ------ | ---- | - | ------ |  | 
|                                       |  | 2008 |        | 2007 |   |       
|Depreciation of operating lease assets |  | $    | 12,996 |      | $ | 16,890 | 
|Impairment losses                      |  |      | 396    |      |   |       | 
|                                       |  |      |        |      |   |        | 
|Total                                  |  | $    | 13,392 |      | $ | 16,890 | 
|                                       |  |      |        |      |   |        | 

All of the leased property was acquired during the years 2001 through 2007.



29



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



6. Investment in equipment and leases, net (continued):

Operating leases:

Property on operating leases consists of the
following (in thousands):



|                              |  |                         |         |   |           |   |         |                                  |  |   |                         |   |  |   |         |  
|----------------------------- |  | ----------------------- | ------- | - | --------- | - | ------- | -------------------------------- |  | - | ----------------------- | - |  | - | ------- | -
|                              |  | BalanceDecember 31,2007 |         |   | Additions |   |         | Reclassificationsor Dispositions |  |   | BalanceDecember 31,2008 |  
|Materials handling            |  | $                       | 26,715  |   |           | $ |        |                                  |  | $ | (5,100                  | ) |  | $ | 21,615  |  
|Transportation, other         |  |                         | 14,672  |   |           |   |        |                                  |  |   |                        |   |  |   | 14,672  |  
|Manufacturing                 |  |                         | 13,934  |   |           |   |        |                                  |  |   | (2,475                  | ) |  |   | 11,459  |  
|Transportation, rail          |  |                         | 13,359  |   |           |   |        |                                  |  |   | (59                     | ) |  |   | 13,300  |  
|Mining                        |  |                         | 12,651  |   |           |   |        |                                  |  |   |                        |   |  |   | 12,651  |  
|Marine vessels                |  |                         | 10,776  |   |           |   |        |                                  |  |   |                        |   |  |   | 10,776  |  
|Office automation             |  |                         | 4,000   |   |           |   |        |                                  |  |   | (4,000                  | ) |  |   |        |  
|Construction                  |  |                         | 3,319   |   |           |   |        |                                  |  |   | (1,561                  | ) |  |   | 1,758   |  
|Office furniture              |  |                         | 1,174   |   |           |   |        |                                  |  |   | (594                    | ) |  |   | 580     |  
|                              |  |                         |         |   |           |   |         |                                  |  |   |                         |   |  |   |         |  
|                              |  |                         | 100,600 |   |           |   |        |                                  |  |   | (13,789                 | ) |  |   | 86,811  |  
|Less accumulated depreciation |  |                         | (49,169 | ) |           |   | (12,963 | )                                |  |   | 11,266                  |   |  |   | (50,866 | )
|                              |  |                         |         |   |           |   |         |                                  |  |   |                         |   |  |   |         |  
|Total                         |  | $                       | 51,431  |   |           | $ | (12,963 | )                                |  | $ | (2,523                  | ) |  | $ | 35,945  |  
|                              |  |                         |         |   |           |   |         |                                  |  |   |                         |   |  |   |         |  

The average estimated residual value for assets on operating leases was 24% and 26% of the assets original
cost at December 31, 2008 and 2007, respectively.

Direct financing leases:

As of December 31, 2008, investment in direct financing leases consists of materials handling equipment and office furniture. The following lists the components of the Companys investment in direct
financing leases as of December 31, 2008 and 2007 (in thousands):



|                                                             |  |      |        |   |      |   |        |   |  | 
|------------------------------------------------------------ |  | ---- | ------ | - | ---- | - | ------ | - |  | 
|                                                             |  | 2008 |        |   | 2007 |   |        |  
|Total minimum lease payments receivable                      |  | $    | 6,974  |   |      | $ | 8,946  |   | 
|Estimated residual values of leased equipment (unguaranteed) |  |      | 681    |   |      |   | 821    |   | 
|                                                             |  |      |        |   |      |   |        |   | 
|Investment in direct financing leases                        |  |      | 7,655  |   |      |   | 9,767  |   | 
|Less unearned income                                         |  |      | (3,058 | ) |      |   | (4,188 | ) | 
|                                                             |  |      |        |   |      |   |        |   | 
|Net investment in direct financing leases                    |  | $    | 4,597  |   |      | $ | 5,579  |   | 
|                                                             |  |      |        |   |      |   |        |   | 

At December 31, 2008, the aggregate amounts of future minimum lease payments receivable are as follows (in
thousands):



| |                               |  |   |                 |  |                       |       |       |   |        |  |  | 
| | ----------------------------- |  | - | --------------- |  | --------------------- | ----- | ----- | - | ------ |  |  | 
| |                               |  |   | OperatingLeases |  | DirectFinancingLeases |       | Total |   |       
| | Year ending December 31, 2009 |  | $ | 10,534          |  | $                     | 2,403 |       | $ | 12,937 | 
| | 2010                          |  |   | 4,163           |  |                       | 1,444 |       |   | 5,607  | 
| | 2011                          |  |   | 1,602           |  |                       | 1,353 |       |   | 2,955  | 
| | 2012                          |  |   | 1,227           |  |                       | 1,774 |       |   | 3,001  | 
| | 2013                          |  |   | 843             |  |                       | -     |       |   | 843    | 
| | Thereafter                    |  |   | 1,499           |  |                       | -     |       |   | 1,499  | 
| |                               |  |   |                 |  |                       |       |       |   |        | 
| |                               |  | $ | 19,868          |  | $                     | 6,974 |       | $ | 26,842 | 
| |                               |  |   |                 |  |                       |       |       |   |        | 



30



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



6. Investment in equipment and leases, net (continued):

The Company utilizes a straight line depreciation method for equipment in all of the categories currently in its portfolio of operating lease transactions. The useful
lives for investment in leases by category are as follows (in years):



|                      |  |             |  | 
|--------------------- |  | ----------- |  | 
|Equipment category    |  | Useful Life |  | 
|Mining                |  | 30 - 40     | 
|Transportation, rail  |  | 30 - 35     | 
|Marine vessels        |  | 20 - 30     | 
|Manufacturing         |  | 10 - 20     | 
|Construction          |  | 7 - 10      | 
|Materials handling    |  | 7 - 10      | 
|Office furniture      |  | 7 - 10      | 
|Transportation, other |  | 7 - 10      | 
|Office automation     |  | 5 - 7       | 

7. Related party transactions:

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

The Operating Agreement allows for the reimbursement of costs incurred by AFS for providing administrative services to the Company. Administrative services provided
include Company accounting, finance/treasury, investor relations, legal counsel and lease and equipment documentation. AFS is not reimbursed for services whereby it is entitled to receive a separate fee as compensation for such services, such as
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. The Company
would be liable for certain future costs to be incurred by AFS to manage the administrative services provided to the Company.

Each of ATEL Leasing
Corporation (ALC) and AFS is a wholly-owned subsidiary of ATEL Capital Group and performs services for the Company. Acquisition services, equipment management, lease administration and asset disposition services are performed by ALC;
investor relations, communications services and general administrative services for the Company are performed by AFS.

Cost reimbursements to the Managing
Member are based on its costs incurred in performing administrative services for the Company. These costs are allocated to each managed entity based on certain criteria such as total assets, number of investors or contributed capital based upon the
type of cost incurred. The Operating Agreement places an annual limit and a cumulative limit for cost reimbursements to AFS and/or affiliates. Any reimbursable costs incurred by AFS and/or affiliates during the year exceeding the annual and/or
cumulative limits cannot be reimbursed in the current year, though such costs may be recovered in future years to the extent of the cumulative limit. As of December 31, 2008, the Company has not exceeded the annual and/or cumulative limitations
discussed above.

AFS and/or affiliates earned fees, commissions and reimbursements, pursuant to the Operating Agreement as follows during each of the
years ended December 31, 2008 and 2007 (in thousands):



|                                                             |  |      |       |      |   |      
|------------------------------------------------------------ |  | ---- | ----- | ---- | - | -----
|                                                             |  | 2008 |       | 2007
|Costs reimbursed to Managing Member and/or affiliates        |  | $    | 626   |      | $ | 1,112
|Asset management fees to Managing Member and/or affiliates   |  |      | 902   |      |   | 1,348
|Acquisition and initial direct costs paid to Managing Member |  |      |      |      |   | 19   
|                                                             |  |      |       |      |   |      
|                                                             |  | $    | 1,528 |      | $ | 2,479
|                                                             |  |      |       |      |   |      



31



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



8. Non-recourse debt

At December 31, 2008, non-recourse debt consists of notes payable to financial institutions. The notes are due in varying quarterly and semi-annual installments. Interest on the notes is at fixed rates ranging from 6.07% to 6.16%. The
notes are secured by assignments of lease payments and pledges of assets. At December 31, 2008, gross lease rentals totaled approximately $5.9 million over the remaining lease terms; and the carrying value of the pledged assets is $5.8 million.

The notes mature from 2008 through 2015.

Future minimum
payments of non-recourse debt are as follows (in thousands):



|                              |  |           |       |          |   |       |  |   |       |  | 
|----------------------------- |  | --------- | ----- | -------- | - | ----- |  | - | ----- |  | 
|                              |  | Principal |       | Interest |   | Total |  |  
|Year ending December 31, 2009 |  | $         | 676   |          | $ | 278   |  | $ | 954   | 
|2010                          |  |           | 719   |          |   | 235   |  |   | 954   | 
|2011                          |  |           | 650   |          |   | 193   |  |   | 843   | 
|2012                          |  |           | 691   |          |   | 152   |  |   | 843   | 
|2013                          |  |           | 735   |          |   | 108   |  |   | 843   | 
|Thereafter                    |  |           | 1,355 |          |   | 75    |  |   | 1,430 | 
|                              |  |           |       |          |   |       |  |   |       | 
|                              |  | $         | 4,826 |          | $ | 1,041 |  | $ | 5,867 | 
|                              |  |           |       |          |   |       |  |   |       | 

9. Borrowing facilities:

The Company participates with AFS and certain of its affiliates in a financing arrangement (comprised of a working capital facility to AFS, an acquisition facility and a warehouse facility to AFS, the Company and
affiliates, and a venture facility available to an affiliate) with a group of financial institutions that includes certain financial covenants. The financial arrangement is for $75 million. Originally scheduled to expire in June 2009, the facility
was amended effective December 22, 2008 to extend the term of the agreement through June 2010. Under such amendment, the tangible net worth threshold for ATEL 12, LLC participation in the acquisition facility was reduced from $15 million to
$7.5 million. As of December 31, 2008, ATEL 12, LLC was eligible to participate.

As of December 31, 2008 and 2007, borrowings under the facility
were as follows (in thousands):



|                                                                                                                           |  |      |        |   |      |   |        |  
|-------------------------------------------------------------------------------------------------------------------------- |  | ---- | ------ | - | ---- | - | ------ | -
|                                                                                                                           |  | 2008 |        |   | 2007 |  
|Total available under the financing arrangement                                                                            |  | $    | 75,000 |   |      | $ | 75,000 |  
|Amount borrowed by the Company under the acquisition facility                                                              |  |      | (2,000 | ) |      |   | (1,500 | )
|Amounts borrowed by affiliated partnerships and limited liability companies under the acquisition and warehouse facilities |  |      | (6,823 | ) |      |   | (7,125 | )
|                                                                                                                           |  |      |        |   |      |   |        |  
|Total remaining available under the acquisition and warehouse facilities                                                   |  | $    | 66,177 |   |      | $ | 66,375 |  
|                                                                                                                           |  |      |        |   |      |   |        |  

The Company is contingently liable for principal payments under the warehouse facility as borrowings are recourse
jointly and severally to the extent of the pro-rata share of the Companys net worth as compared to the aggregate net worth of certain of the affiliated partnerships and limited liability companies of the Company and including AFS and ALC
(which latter two entities are 100% liable). The Company and its affiliates pay an annual commitment fee to have access to this line of credit. As of December 31, 2008, borrowings of $1.3 million were outstanding under the warehouse facility.
The Companys maximum obligation on the outstanding warehouse balance at December 31, 2008 was approximately $313 thousand. There were no borrowings under the warehouse facility as of December 31, 2007.

The interest rate on the Master Terms Agreement is based on either the LIBOR/Eurocurrency rate of 1-, 2-, 3- or 6-month maturity plus a lender designated spread, or the
banks Prime rate, which re-prices daily. Principal amounts of loans made under the Master Terms Agreement that are prepaid may be re-borrowed on the terms and subject to the conditions set forth under the Master Terms Agreement. The effective
interest rate on borrowings ranged from 2.69% to 3.25% at December 31, 2008 and was 6.12% at December 31, 2007. The weighted average interest rate on borrowings was 3.49% and 6.60% during the years ended December 31, 2008 and 2007,
respectively.



32



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ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



9. Borrowing facilities (continued):

Draws on the acquisition facility by any affiliated partnership and/or limited liability company borrower are secured by a blanket lien on that borrowers assets, including but not limited to equipment and
related leases.

To manage the warehousing facility for the holding of assets prior to allocation to specific investor programs, a Warehousing Trust
Agreement has been entered into by the Company, AFS, ALC, and certain of the affiliated partnerships and limited liability companies. The warehousing facility is used to acquire and hold, on a short-term basis, certain lease transactions that meet
the investment objectives of each of such entities. Each of the leasing programs sponsored by AFS and ALC currently in its acquisition stage is a pro rata participant in the Warehousing Trust Agreement, as described below. When a program no longer
has a need for short term financing provided by the warehousing facility, it is removed from participation, and as new leasing investment entities are formed by AFS and ALC and commence their acquisition stages, these new entities are added. As of
December 31, 2008, the investment program participants were the Company, ATEL Capital Equipment Fund X, LLC, ATEL Capital Equipment Fund XI, LLC and ATEL 12, LLC. Pursuant to the Warehousing Trust Agreement, the benefit of the lease transaction
assets, and the corresponding liabilities under the warehouse borrowing facility, inure to each of such entities based upon each entitys pro-rata share in the warehousing trust estate. The pro-rata share is calculated as a ratio of
the net worth of each entity over the aggregate net worth of all entities benefiting from the warehouse trust estate, excepting that the trustees, AFS and ALC, are both liable for their pro-rata shares of the obligations based on their respective
net worth, and jointly liable for the pro rata portion of the obligations of each of the affiliated partnerships and limited liability companies participating under the borrowing facility. Transactions are financed through this warehousing facility
only until the transactions are allocated to a specific program for purchase or are otherwise disposed by AFS and ALC. When a determination is made to allocate the transaction to a specific program for purchase by the program, the purchaser repays
the debt associated with the asset, either with cash or by means of the acquisition facility financing, the asset is removed from the warehouse facility collateral, and ownership of the asset and any debt obligation associated with the asset are
assumed solely by the purchasing entity.

As of December 31, 2008, the full amount remaining available under the joint acquisition and warehouse
facility is potentially available to the Company, subject to certain terms or agreement limitations. However, as amounts are drawn on the facility by each of the Company and the affiliates who are borrowers under the facility, the amount available
to all is reduced. As the warehousing facility is a short term bridge facility, any amounts borrowed under the warehousing facility, and then repaid by the affiliated borrowers (including the Company) upon allocation of an acquisition to a specific
purchaser, become available under the warehouse facility for further short term borrowing.

The financing arrangement discussed above includes certain
financial and non-financial covenants applicable to each borrower. The Company and affiliates were in compliance with all covenants as of December 31, 2008. The financial institutions providing the above discussed financing arrangement have a
blanket lien on the Companys assets as collateral on any and all borrowings.

10. Receivables funding program:

As of December 31, 2008, the Company had a $60 million receivables funding program (the Program) with a receivables financing company that issues
commercial paper rated A1 from Standard and Poors and P1 from Moodys Investors Service. In this receivables funding program, the lenders would receive liens against the Companys assets. The lender will be in a first position
against certain specified assets and will be in either a subordinated or shared position against the remaining assets. The Program expires August 2011.

The Program provides for borrowing at a variable interest rate and requires AFS, on behalf of the Company, to enter into interest rate swap agreements with certain hedge counterparties (also rated A1/P1) to mitigate the interest rate risk
associated with a variable interest rate note. AFS anticipates that this program will allow the Company to have a more cost effective means of obtaining debt financing than available for individual non-recourse debt transactions.

As of December 31, 2008 and 2007, the Company had $8.0 million and $15.5 million outstanding under the Program, respectively. During the years ended
December 31, 2008 and 2007, the Company paid program fees, as defined in the receivables funding agreement, totaling $44 thousand and $76 thousand, respectively. Such fees are included in interest expense in the Companys statements of
income. The program terminated with respect to new borrowings in January 2006.



33



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ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



10. Receivables funding program (Continued):

As of December 31, 2008, the Company has entered into interest rate swap agreements to receive or pay interest on a notional principal of $8.0 million based on the difference between nominal rates ranging from
3.75% to 4.81% and the variable rates that ranged from 1.45% to 4.95% under the Program. As of December 31, 2007, the Company had interest rate swap agreements to receive or pay interest on a notional principal of $15.5 million based on the
difference between nominal rates ranging from 3.75% to 4.81% and the variable rates that ranged from 5.57% to 6.19% under the Program. No actual borrowing or lending is involved. The termination of the swaps coincides with the maturity of the debt.
Through the swap agreements, the interest rates have been effectively fixed. The differential to be paid or received is accrued as interest rates change and is recognized currently as an adjustment to interest expense related to the debt. The
interest rate swaps are carried at fair value on the balance sheet with unrealized gain/loss included in the statements of income in other income/(loss).

At December 31, 2008 and 2007, borrowings under the Program are as follows (in thousands):



|                  |  |                        |        |                         |   |                                 |  |                           |        |  |                                     |      |   |  |      |  
|----------------- |  | ---------------------- | ------ | ----------------------- | - | ------------------------------- |  | ------------------------- | ------ |  | ----------------------------------- | ---- | - |  | ---- | -
|Date Borrowed     |  | OriginalAmountBorrowed |        | BalanceDecember 31,2008 |   | NotionalBalanceDecember 31,2008 |  | SwapValueDecember 31,2008 |        |  | PaymentRate OnInterestSwapAgreement |     
|February 14, 2005 |  | $                      | 20,000 |                         | $ | 2,291                           |  | $                         | 2,291  |  | $                                   | (43  | ) |  | 3.75 | %
|March 22, 2005    |  |                        | 9,892  |                         |   | 2,365                           |  |                           | 2,365  |  |                                     | (74  | ) |  | 4.31 | %
|December 15, 2005 |  |                        | 13,047 |                         |   | 2,505                           |  |                           | 2,505  |  |                                     | (79  | ) |  | 4.80 | %
|January 9, 2006   |  |                        | 2,500  |                         |   | 848                             |  |                           | 848    |  |                                     | (29  | ) |  | 4.81 | %
|                  |  |                        |        |                         |   |                                 |  |                           |        |  |                                     |      |   |  |      |  
|                  |  | $                      | 45,439 |                         | $ | 8,009                           |  | $                         | 8,009  |  | $                                   | (225 | ) |  |      |  
|                  |  |                        |        |                         |   |                                 |  |                           |        |  |                                     |      |   |  |      |  
|                  |  |                        |        |                         |  
|Date Borrowed     |  | OriginalAmountBorrowed |        | BalanceDecember 31,2007 |   | NotionalBalanceDecember 31,2007 |  | SwapValueDecember 31,2007 |        |  | PaymentRate OnInterestSwapAgreement |     
|February 14, 2005 |  | $                      | 20,000 |                         | $ | 4,837                           |  | $                         | 4,837  |  | $                                   | 10   |   |  | 3.75 | %
|March 22, 2005    |  |                        | 9,892  |                         |   | 4,180                           |  |                           | 4,180  |  |                                     | (21  | ) |  | 4.31 | %
|December 15, 2005 |  |                        | 13,047 |                         |   | 5,016                           |  |                           | 5,016  |  |                                     | (50  | ) |  | 4.80 | %
|January 9, 2006   |  |                        | 2,500  |                         |   | 1,446                           |  |                           | 1,446  |  |                                     | (18  | ) |  | 4.81 | %
|                  |  |                        |        |                         |   |                                 |  |                           |        |  |                                     |      |   |  |      |  
|                  |  | $                      | 45,439 |                         | $ | 15,479                          |  | $                         | 15,479 |  | $                                   | (79  | ) |  |      |  
|                  |  |                        |        |                         |   |                                 |  |                           |        |  |                                     |      |   |  |      |  

At December 31, 2008, the minimum repayment schedule under the Program is as follows (in thousands):



|                              |  |   |       |  | 
|----------------------------- |  | - | ----- |  | 
|                              |  |   |       | 
|Year ending December 31, 2009 |  | $ | 5,604 | 
|2010                          |  |   | 1,990 | 
|2011                          |  |   | 415   | 
|                              |  |   |       | 
|                              |  | $ | 8,009 | 
|                              |  |   |       | 

At December 31, 2008, there are specific leases that are identified as collateral under the Program with
expected future lease receivables of approximately $8.3 million at their discounted present value.

During the years ended December 31, 2008 and 2007,
the weighted average interest rate on the Program was 4.22% and 5.70%, respectively.

The Program discussed above includes certain financial and
non-financial covenants applicable to each borrower. The Company and affiliates were in compliance with all covenants as of December 31, 2008.

11.
Commitments:

At December 31, 2008, the Company had commitments to purchase lease assets totaling approximately $4.3 million. This amount
represents contract awards which may be canceled by the prospective lessee or not be accepted by the Company. There were no cancellations subsequent to year-end.



34



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



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.

In the normal course of business, the Company enters into contracts of various types, including lease contracts,
contracts for the sale or purchase of lease assets, management contracts, loan agreements, credit lines and other debt facilities. It is prevalent industry practice for most contracts of any significant value to include provisions that each of the
contracting partiesin addition to assuming liability for breaches of the representations, warranties, and covenants that are part of the underlying contractual obligationsalso assume an obligation to indemnify and hold the other
contracting party harmless for such breaches, for harm caused by such partys gross negligence and willful misconduct, including, in certain instances, certain costs and expenses arising from the contract. The Managing Member has substantial
experience in managing similar leasing programs subject to similar contractual commitments in similar transactions, and the losses and claims arising from these commitments have been insignificant, if any. Generally, to the extent these contracts
are performed in the ordinary course of business under the reasonable business judgment of the Managing Member, no liability will arise as a result of these provisions. The Managing Member has no reason to believe that the facts and circumstances
relating to the Companys contractual commitments differ from those it has entered into on behalf of the prior programs it has managed. The Managing Member knows of no facts or circumstances that would make the Companys contractual
commitments outside standard mutual covenants applicable to commercial transactions between businesses. Accordingly, the Company believes that these indemnification obligations are made in the ordinary course of business as part of standard
commercial and industry practice, and that any potential liability under the Companys similar commitments is remote. Should any such indemnification obligation become payable, the Company would separately record and/or disclose such liability
in accordance with GAAP.

13. Members capital:

As of December 31, 2008 and 2007, 12,055,016 Units were issued and outstanding. The Company was authorized to issue up to 15,000,000 Units in addition to the Units issued to the initial members (50 Units).

As defined in the Operating Agreement, the Companys Net Income, Net Losses, and Distributions are to be allocated 92.5% to the Members and 7.5% to AFS. In
accordance with the terms of the Operating Agreement, additional allocations of income were made to AFS in 2008 and 2007. The amounts allocated were determined to bring AFSs ending capital account balance to zero at the end of each year.

Distributions to the Other Members were as follows (in thousands except Units and per Unit data):



|                                             |  |      |            |      |   |            |  | 
|-------------------------------------------- |  | ---- | ---------- | ---- | - | ---------- |  | 
|                                             |  | 2008 |            | 2007 |   |           
|Distributions declared                       |  | $    | 10,850     |      | $ | 10,849     | 
|Weighted average number of Units outstanding |  |      | 12,055,016 |      |   | 12,055,016 | 
|                                             |  |      |            |      |   |            | 
|Weighted average distributions per Unit      |  | $    | 0.90       |      | $ | 0.90       | 
|                                             |  |      |            |      |   |            | 

14. Fair value of financial instruments:

On January 1, 2008, the Company adopted SFAS 157, except as it applies to the nonfinancial assets and nonfinancial liabilities subject to FSP No. 157-2 and FSP No. FAS 157-1, Application of FASB
Statement No. 157 to FASB Statement No. 13 and Other Accounting Pronouncements That Address Fair Value Measurements for Purposes of Lease Classification or Measurement under Statement 13. SFAS 157 clarifies the definition of fair value,
prescribes methods for measuring fair value, establishes a fair value hierarchy based on the inputs used to measure fair value, and expands disclosures about fair value measurements. The three levels of inputs within the fair value hierarchy are
defined as follows:

Level 1  Quoted prices in active markets for identical assets or liabilities. An active market for the asset or liability
is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2  Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuations in which all significant inputs are observable in the
market.



35



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ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



14. Fair value of financial instruments (continued):

Level 3  Valuation is modeled using significant inputs that are unobservable in the market. These unobservable inputs reflect the Companys own estimates
of assumptions that market participants would use in pricing the asset or liability.

At December 31, 2008, the Companys only financial
instrument that requires measurement on a recurring or non-recurring basis under SFAS 157 was its interest rate swap contracts. Such estimate of measurement methodology is as follows:

Interest rate swaps

The fair value of interest rate swaps is estimated by the counterparty using inputs that are
defined or that can be corroborated by observable market data. Accordingly, such swap contracts are classified within Level 2 of the valuation hierarchy.

The following table presents the fair value measurement of instruments measured at fair value on a recurring basis and the level within the SFAS 157 hierarchy in which the fair value measurements fall at December 31, 2008 (in
thousands):



|                    |  |                  |     |                            |   |                            |  |                            |     |  |   |  
|------------------- |  | ---------------- | --- | -------------------------- | - | -------------------------- |  | -------------------------- | --- |  | - | -
|                    |  | December 31,2008 |     | Level 1EstimatedFair Value |   | Level 2EstimatedFair Value |  | Level 3EstimatedFair Value
|Liabilities:        |  |                  |     |                            |   |                            |  |                            |     |  |   |  
|Interest rate swaps |  | $                | 225 |                            | $ |                           |  | $                          | 225 |  | $ | 

Alternatively, the following disclosure of the estimated fair value of financial instruments not measured under
SFAS 157 is made in accordance with the requirements of SFAS No. 107, Disclosures about Fair Value of Financial Instruments (SFAS 107). Fair value estimates, methods and assumptions, set forth below for the
Companys financial instruments, are made solely to comply with the requirements of SFAS 107 and should be read in conjunction with the Companys financial statements and related notes.

The Company has determined the estimated fair value amounts by using market information and valuation methodologies that it considers appropriate consistent with SFAS
157. However, considerable judgment is required to interpret market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize or has realized in a
current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts. For all of these reasons, the aggregation of the fair values presented herein does not
represent, and should not be construed to represent, their underlying value.

Cash and cash equivalents

The recorded amounts of the Companys cash and cash equivalents at December 31, 2008 approximate fair value because of the liquidity and short-term maturity of
these instruments.

Notes receivable

The
Companys notes receivable are stated at the amount at which the asset could be collected in a current transaction, exclusive of transaction costs such as prepayment penalties.

Investment in securities

The Companys investment securities are not registered for public sale and are carried
at cost. The investment securities are adjusted for impairment, if any, based upon factors which include, but are not limited to, available financial information, the issuers ability to meet its current obligations and indications of the
issuers subsequent ability to raise capital. Management has concluded that there are no identified events or changes in circumstances that may have a significant adverse effect on the fair value of the instruments and that it is not
practicable to estimate the fair value of the investment because of its illiquidity. Accordingly, such investment is stated at cost.



36



---

ATEL CAPITAL EQUIPMENT FUND IX, LLC

NOTES TO FINANCIAL STATEMENTS



14. Fair value of financial instruments (continued):

Borrowings

Borrowings include the outstanding amounts on the
Companys acquisition facility. The carrying amount of these variable rate obligations approximate fair value based on current borrowing rates for similar types of borrowings.

Non-recourse debt

The fair value of the Companys non-recourse debt is estimated using discounted cash flow
analyses, based upon the Companys estimated current incremental borrowing rates for similar types of borrowing arrangements.

Limitations

The fair value estimates presented herein were based on pertinent information available to the Company as of December 31, 2008 and 2007. Although the
Company is not aware of any factors that would significantly affect the estimated fair value amounts, such amounts have not been comprehensively revalued for purposes of these financial statements since those dates and, therefore, current estimates
of fair value may differ significantly from the amounts presented herein.

The following table presents estimated fair values of the Companys
financial instruments in accordance with SFAS 107 at December 31, 2008 and 2007 (in thousands):



|                             |  |                |        |                     |   |                |  |                     |        |  |   |       
|---------------------------- |  | -------------- | ------ | ------------------- | - | -------------- |  | ------------------- | ------ |  | - | ------
|                             |  | 2008           |        | 2007               
|                             |  | CarryingAmount |        | EstimatedFair Value |   | CarryingAmount |  | EstimatedFair Value
|Financial assets:            |  |                |        |                     |   |                |  |                     |        |  |   |       
|Cash and cash equivalents    |  | $              | 2,142  |                     | $ | 2,142          |  | $                   | 4,326  |  | $ | 4,326 
|Notes receivable             |  |                | 3,653  |                     |   | 3,653          |  |                     | 4,133  |  |   | 4,133 
|Financial liabilities:       |  |                |        |                     |   |                |  |                     |        |  |   |       
|Non-recourse debt            |  |                | 4,826  |                     |   | 5,274          |  |                     | 7,198  |  |   | 7,386 
|Borrowings                   |  |                | 10,009 |                     |   | 10,009         |  |                     | 16,979 |  |   | 16,979
|Interest rate swap contracts |  |                | 225    |                     |   | 225            |  |                     | 79     |  |   | 79    



37



---

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

None.



|Item 9A(T). | CONTROLS AND PROCEDURES
|----------- | -----------------------

Evaluation of disclosure controls
and procedures

The Companys Managing Members Chief Executive Officer, and Executive Vice President and Chief Financial and Operating
Officer (Management), evaluated the effectiveness of the Companys disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) as of the end of the period covered by this report. Based on the evaluation of the
Companys disclosure controls and procedures, the Chief Executive Officer and Executive Vice President and Chief Financial and Operating Officer concluded that as of the end of the period covered by this report, the design and operation of
these disclosure controls and procedures were effective.

The Company does not control the financial reporting process, and is solely dependent on the
Management of the Managing Member, who is responsible for providing the Company with financial statements in accordance with generally accepted accounting principles in the United States. The Managing Members disclosure controls and
procedures, as it is applicable to the Company, were effective to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting
principles generally accepted in the United States.

Managements Annual Report on Internal Control over Financial Reporting

The Management of the Managing Member is responsible for establishing and maintaining adequate internal control over financial reporting as that term is defined in
Exchange Act Rule 13a-15(f) for the Company, and for performing an assessment of the effectiveness of internal control over financial reporting as of December 31, 2008. The internal control process of the Managing Member, as it is applicable to
the Company, was designed to provide reasonable assurance to Management regarding the preparation and fair presentation of published financial statements, and includes those policies and procedures that:



| | (1) | Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles in
the United States, and that the Companys receipts and expenditures are being made only in accordance with authorization of the Management of the Managing Member; and
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | (2) | Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Companys assets that could have a material effect
on the financial statements.
| | --- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

All internal control processes, no matter how well designed, have inherent limitations. Therefore, even those
processes determined to be effective can provide only reasonable assurance with respect to the reliability of financial statement preparation and presentation. Further, projections of any evaluation of effectiveness to future periods are subject to
the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Management of the Managing Member assessed the effectiveness of its internal control over financial reporting, as it is applicable to the Company, as of December 31, 2008. In making this assessment, it used the criteria set forth in
Internal Control  Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on its assessment, Management of the Managing Member concluded that the Managing Members internal control
over financial reporting, as it is applicable to the Company, was effective as of December 31, 2008.

This annual report does not include an
attestation report of the Companys independent registered public accounting firm regarding internal control over financial reporting. Managements report was not subject to attestation by the Companys independent registered public
accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only managements report in this annual report.

Changes in internal control

There were no changes in the Managing Members internal control over
financial reporting, as it is applicable to the Company, during the quarter ended December 31, 2008 that has materially affected, or is reasonably likely to materially affect, the Managing Members internal control over financial
reporting, as it is applicable to the Company.



38



---

PART III



|Item 10. | DIRECTORS AND EXECUTIVE OFFICERS
|-------- | --------------------------------

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

ATEL Financial Services, LLC (AFS) is the Companys Managing Member or
Manager. AFS is controlled by ATEL Capital Group (ACG or ATEL), a holding company formed to control ATEL and affiliated companies, through its subsidiaries, ATEL Leasing Corporation (ALC), AFSs managing
member, and ATEL Business Credit, Inc. (ABC), the other member of AFS. ALC and ABC are AFSs only members. The outstanding voting capital stock of ATEL Capital Group is owned 100% by Dean Cash.

Each of ALC and AFS is a subsidiary under the control of ACG and performs services for the Company. Acquisition services, equipment management, lease administration and
asset disposition services are performed by ALC; investor relations, communications services and general administrative services are performed by AFS. ATEL Securities Corporation (ASC), a wholly-owned subsidiary of AFS, performed
distribution services in connection with the Companys public offering of its Units.

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



|                   |  |                                                                                                                                   
|------------------ |  | ----------------------------------------------------------------------------------------------------------------------------------
|Dean L. Cash       |  | President and Chief Executive Officer of ATEL Financial Services, LLC (Managing Member)                                           
|                   | 
|Paritosh K. Choksi |  | Executive Vice President and Chief Financial Officer and Chief Operating Officer of ATEL Financial Services, LLC (Managing Member)
|                   | 
|Vasco H. Morais    |  | Executive Vice President, Secretary and General Counsel of ATEL Financial Services, LLC (Managing Member)                         

Dean L. Cash, age 58, 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.

Paritosh
K. Choksi, age 55, joined ATEL in 1999 as a director, senior vice president and its chief financial officer. He became its executive vice president and CFO/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 is a member of the board
of directors of Syntel, Inc. 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.

Vasco H. Morais, age 50, 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.



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Audit Committee

ALC is the managing member of AFS, the Managing Member of the registrant. The board of directors of ALC 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.

Section 16(a) Beneficial Ownership Reporting Compliance

Based solely on a review of Forms 3, 4 and 5, the Company is not aware of any failures to file reports of beneficial ownership required to be filed
during or for the year ended December 31, 2008.

Code of Ethics

A Code of Ethics that is applicable to the Company, including the Chief Executive Officer and Chief Financial Officer and Chief Operating Officer of its Managing Member, AFS, or persons acting in such capacity on
behalf of the Company, 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 AFS and
its affiliates. The amount of such remuneration paid in 2008 and 2007 is set forth in Item 8 of this report under the caption Financial Statements and Supplementary Data - Notes to Financial Statements - Related party transactions,
at Note 7 thereof, which information is hereby incorporated by reference.

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 is 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



40



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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 7 to the financial statements included in Item 8, Financial Statements and Supplementary Data, for amounts paid.

Managing Members Interest in Operating Proceeds

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 AFS. In accordance with the terms of the Operating Agreement, additional
allocations of income were made to AFS in 2008 and 2007. The amounts allocated were determined to bring AFSs ending capital account balance to zero at the end of each year. See financial statements as set forth in Part II, Item 8,
Financial Statements and Supplementary Data, of this report for amounts allocated to AFS in 2008 and 2007.



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|Item 12. | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
|-------- | --------------------------------------------------------------

Security Ownership of Certain Beneficial Owners

At December 31, 2008, 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)             |  
|Title of Class                  |  | Name and Address ofBeneficial
Owner                                       |  | Amount and Nature ofBeneficial
Ownership              |  | Percent ofClass |  
|Limited Liability Company Units |  | ATEL Capital Group600 California Street, 6th FloorSan Francisco, CA 94108 |  | Initial Limited LiabilityCompany Units50 Units ($500) |  | 0.0004          | %

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 Supplementary Data - Notes to Financial Statements - Related party transactions
at footnote 7 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 most recent two
years, the Company incurred audit and audit related fees with its principal auditors as follows (in thousands):



|           |  |      |     |      |   |    
|---------- |  | ---- | --- | ---- | - | ---
|           |  | 2008 |     | 2007
|Audit fees |  | $    | 159 |      | $ | 143
|Other      |  |      | 41  |      |   | 1  
|           |  |      |     |      |   |    
|           |  | $    | 200 |      | $ | 144
|           |  |      |     |      |   |    

Audit fees consist of the aggregate fees and expenses billed in connection with the audit of the Companys
annual financial statements and the review of the financial statements included in the Companys quarterly reports on Form 10-Q.

Other fees represent
costs incurred in connection with various Agreed-Upon Procedures engagements.

ALC is the managing member of AFS, the Managing Member of the registrant.
The board of directors of ALC 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 ALC acting on behalf of the board of
directors in its role as the audit committee of the Company.



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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, 2008 and 2007

Statements of Income for the years ended
December 31, 2008 and 2007

Statements of Changes in Members Capital for the years ended December 31, 2008 and 2007

Statements of Cash Flows for the years ended December 31, 2008 and 2007

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) | Exhibits
|--- | --------

(3) and (4) Amended and Restated Limited
Liability Company Agreement, included as Exhibit B to the Prospectus included in the registrants registration statement on form S-1 effective January 16, 2001, (File Number 333-47196) is hereby incorporated herein by reference.



|       |  |                                                                       
|------ |  | ----------------------------------------------------------------------
|(14.1) |  | Code of Ethics                                                        
|       | 
|(31.1) |  | Rule 13a-14(a)/ 15d-14(a) Certification of Dean L. Cash               
|       | 
|(31.2) |  | Rule 13a-14(a)/ 15d-14(a) Certification of Paritosh K. Choksi         
|       | 
|(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



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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: March 26, 2009

ATEL Capital Equipment Fund IX, LLC
(Registrant)



|    |  |                              
|--- |  | -----------------------------
|    | 
|By: |  | ATEL Financial Services, LLC 
|    |  | Managing Member of Registrant



By:

/s/ Dean L. CashDean L. Cash,President and Chief Executive Officer ofATEL Financial Services, LLC(Managing Member)By:

/s/ Paritosh K. ChoksiParitosh K. Choksi,Executive Vice President and Chief Financial Officer and Chief Operating Officer of ATEL Financial Services, LLC (Managing Member)By:

/s/ Samuel SchusslerSamuel Schussler,Vice President and Chief Accounting Officer of ATEL Financial Services, LLC(Managing Member)




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 Dean L. Cash             |  | President and Chief Executive Officer of ATEL Financial
Services, LLC (Managing Member)                                            |  | March 26, 2009
|                                          |  |                                                                                                                                   
|/s/ Paritosh K. Choksi Paritosh K. Choksi |  | Executive Vice President and Chief Financial Officer and Chief Operating Officer of ATEL Financial Services, LLC (Managing Member) |  | March 26, 2009
|                                          |  |                                                                                                                                   
|/s/ Samuel Schussler Samuel Schussler     |  | Vice President and Chief Accounting Officer of ATEL Financial Services, LLC (Managing Member)                                      |  | March 26, 2009

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.



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