Arboretum Silverleaf Income Fund, L.P.

Summary

• Arboretum Silverleaf Income Fund, L.P. operates a single business segment focused on ownership and investment in leased equipment and related financings. It acquires equipment, provides financing, acquires residual interests at lease expiration, and remarkets or sells reclassified inventory.

Business activities

• Purchases equipment and leases it to third-party end-users.
• Provides equipment and other asset financing.
• Acquires equipment subject to lease and ownership rights in leased equipment at lease expiration (residual value interests).
• Remarkets and sells asset inventory reclassified from finance leases.
• Occasionally purchases equipment and sells it directly to leasing customers.
• Structures investments through pooled capital from Limited Partners using various lease and financing arrangements (full payout finance, operating leases, participation agreements, residual sharing, project financings, vendor programs).

Structure and governance

• Organized as a Delaware limited partnership on January 14, 2016.
• Lifecycle stages:
  • Offering Period: August 11, 2016 – March 31, 2019.
  • Operating Period: October 3, 2016 – October 3, 2021.
  • Liquidation Period: began October 4, 2021 and has been extended by the General Partner to June 30, 2026.
• General Partner: ASIF GP, LLC (wholly owned by the Investment Manager).
• Investment Manager: Arboretum Investment Advisors, LLC.
• Allocation of income, losses, and distributions:
  • 99% to Limited Partners and 1% to the General Partner until Limited Partners receive capital contributions plus an 8% per year, compounded annual, cumulative return.
  • Thereafter allocations shift to 80% to Limited Partners and 20% to the General Partner.
• The partnership has no direct employees; the General Partner and Investment Manager supervise and control operations.
• Redemption: Limited Partners may not redeem Units without written consent of the General Partner; approval is at the General Partner’s sole discretion.

Current status and key financials (as of December 31, 2023)

• Total assets: $9,452,921.
• Investments: $3,542,710
  • Investments in finance leases: $3,442,636
  • Collateralized loan receivables: $100,074
• Other assets: $4,497,008
• Net loss for the year ended December 31, 2023: $1,249,351.
• Net loss for the year ended December 31, 2022: $1,580,761.
• Portfolio profile includes infrastructure equipment, industrial dryers, welding systems, LED lighting, capital improvements, fish processing equipment, furniture and kitchen equipment, telecommunication equipment, and collateralized loans receivable.
• The Fund reports ongoing asset dispositions, impairments, recoveries, reclassifications to “Other Assets” for underperforming leases, and subsequent liquidation or remarketing activities.
• The Liquidation Period has been extended to June 30, 2026 by the General Partner.

Distribution activity and history

• During the Operating Period, quarterly distributions were targeted at an annualized rate of 6.0% (1.5% quarterly), pro-rated for new Limited Partners.
• Distribution rate changes:
  • 6.5% annually starting June 30, 2017 (1.625% quarterly).
  • 7.0% annually starting March 31, 2018 (1.75% quarterly).
  • 7.5% annually starting June 30, 2018 (1.875% quarterly).
  • 8.0% annually starting September 30, 2018 (2.00% quarterly).
  • 4.0% annually starting June 30, 2020 (1.00% quarterly).
  • 2021: one quarterly distribution of 1.00%.
  • 2022: no distributions.
  • 2023: increased to 9.5% annualized (2.375% per quarter), then effective April 1, 2023 increased to 24% annualized (6% per quarter).
• Distributions are not guaranteed.

Geographic and market scope

• Investments are located primarily in the United States and the European Union, with potential investments elsewhere.
• Sector exposure includes agriculture, energy, environmental, medical, manufacturing, technology, and transportation.

Reporting and documents

• Annual Reports, Form 10-K, Form 10-Qs, Form 8-Ks, and amendments are available on the SEC website and the company’s website.

Key numerical takeaways

• Limited Partners admitted during Offering Period: 617
• Total capital contributions during Offering Period: $25,371,709
• Units sold during Offering Period: 2,537,170.91
• Cash contributions received during Offering Period: $24,718,035
• Amount applied to reduce sales commissions: $653,674
• Net assets (as of 12/31/2023): $9,452,921
• Investments in finance leases (as of 12/31/2023): $3,442,636
• Collateralized loan receivables (as of 12/31/2023): $100,074
• Other assets (as of 12/31/2023): $4,497,008
• Net loss for 2023: $1,249,351
• Net loss for 2022: $1,580,761