**UNITED
                STATES****SECURITIES
                AND EXCHANGE COMMISSION****Washington,
                D.C. 20549****___________________****FORM
                10-KSB****[X]
                Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
                Act of 1934****For
                the fiscal year ended December 31, 2005.****[********]
                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 0-21806****_______________________****PLM
                EQUIPMENT GROWTH FUND VI**(Name
                of small business issuer in its charter)**California                                                              
                                     
                94-3135515**(State
                or other jurisdiction of incorporation or
                organization)         
                 (I.R.S. Employer Identification No.)**405
                Lexington Avenue, 67th floor, New York,
                NY                                              
                 10174**(Address
                of principal executive
                offices)                                                                  
                (Zip code)Issuer's
                telephone number, including area code: (212) 682-3344**_______________________**Securities
                registered under Section 12(b) of the Exchange Act:Limited
                Partnership Units(Title
                of class)Check
                whether the Registrant is not required to file reports pursuant to
                Section
                13 or 15(d) of the Exchange Act. [ ]Check
                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 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 [ ]Check
                if there is no disclosure of delinquent filers in response to Item
                405 of
                Regulation S-B contained in this form, and no disclosure will be
                contained, to the best of the Registrant's knowledge, in definitive
                proxy
                or information statements incorporated by reference in Part III of
                this
                Form 10-KSB or any amendment to this Form 10-KSB. [ ]Indicate
                by check mark whether the Registrant is a shell company (as defined
                in
                Rule 12b-2 of the Exchange Act). [ ]Registrant's
                aggregate market value of voting stock:N/ARegistrant's
                Limited Partnership units outstanding as of December 31, 2005 were
                7,730,965.Registrant's
                revenues for the fiscal year ended December 31, 2005 was
                $7,883,000.Transitional
                Small Business Disclosure Format: Yes [ ] No
                [X]










**PART
      I**


ITEM
      1.  DESCRIPTION
      OF BUSINESS





(A)  Background





In
      April
      1991, PLM Financial Services, Inc. (FSI or the General Partner) filed a
      Registration Statement on Form S-1 with the Securities and Exchange Commission
      with respect to a proposed offering of 8,750,000 limited partnership units
      (the
      units) in PLM Equipment Growth Fund VI, a California limited partnership (the
      Partnership, the Registrant, or EGF VI). The Partnership's offering became
      effective on December 23, 1991.  FSI, as General Partner, owns a 5%
      interest in the Partnership. The offering of units of the Partnership closed
      on
      May 24, 1993. As of December 31, 2005, there were 7,730,965 units outstanding.
      The Partnership engages in the business of investing in a diversified equipment
      portfolio consisting primarily of long-lived, low-obsolescence capital equipment
      that is easily transportable by and among prospective users.





The
      Partnership's primary objectives are:





(1)  to
      maintain a diversified portfolio of low-obsolescence equipment with long lives
      and high residual values which were purchased with the net proceeds of the
      initial Partnership offering, supplemented by debt financing, and cash generated
      from operations during the investment phase of the Partnership;





(2)  to
      generate sufficient net operating cash flow from lease operations to meet
      liquidity requirements and to generate cash distributions to the limited
      partners until such time as the General Partner commences the orderly
      liquidation of the Partnership's assets or unless the Partnership is terminated
      earlier upon sale of all Partnership property or by certain other
      events;





(3)  to
      selectively sell equipment when the General Partner believes that, due to market
      conditions, market prices for equipment exceed inherent equipment values or
      expected future benefits from continued ownership of a particular asset.
      Proceeds from these sales, together with excess net operating cash flows from
      operations are used for distributions to the limited partners; and





(4)  to
      preserve and protect the value of the portfolio through quality management,
      maintaining diversity, and constantly monitoring equipment markets.





The
      Partnership will terminate on December 31, 2011, unless terminated earlier
      upon
      the sale of all of the equipment or by certain other events. The Partnership
      may
      not reinvest cash flow generated from operations after January 1, 2005 into
      additional equipment. Excess cash, if any, less reasonable reserves, will be
      distributed to the limited partners.







Table
      1,
      below, lists the equipment and the original cost of equipment and capitalized
      improvements in the Partnership's portfolio and the Partnership's proportional
      share of equipment in entities in which the Partnership has an equity investment
      as of December 31, 2005 (in thousands of dollars):





**TABLE
      1**








Units
            
            Type
            Manufacturer
            
            
            Cost





Owned
                equipment:





8,786
            
            Marine
                containers
            Various
            
            $
            21,3781
            
            MD-80
                Stage III commercial aircraft
            McDonnell
                Douglas
            
            
            13,9511
            
            Portfolio
                of aircraft rotables
            Various
            
            
            976Total
                owned equipment
            
            
            $
            36,305
            1





Equipment
                owned by entities in which the Partnership has an equity
                investment:





0.62
            
            737-300
                Stage III commercial aircraft
            Boeing
            
            $
            14,840
            20.34
            
            Four
                737-500 Stage III commercial aircraft
            Boeing
            
            
            21,314
            30.53
            
            Double-hull
                product tanker
            Boelwerf-Temse
            
            
            10,476
            20.20
            
            Machinery
                and other equipment
            Various
            
            
            4,021
            3Total
                equity investments
            
            
            $
            50,651
            1





Equipment
      is generally leased under operating leases for a term of one to ten years except
      for the marine vessel which is usually leased for periods of less than one
      year.
      Some of the Partnership's marine containers are leased to operators of
      utilization-type leasing pools, which include equipment owned by affiliated
      programs and unaffiliated third parties. In such instances, revenues received
      by
      the Partnership consist of a specified percentage of revenues generated by
      leasing the pooled equipment to sublessees, after deducting certain direct
      operating expenses of the pooled equipment. The remaining Partnership marine
      container leases are based on a fixed rate. Rents for all other equipment are
      based on fixed rates.





(B)  Management
      of Partnership Equipment and Other Assets





The
      Partnership has entered into an equipment management agreement with PLM
      Investment Management, Inc. (IMI), a wholly owned subsidiary of FSI, for
      the management of the Partnership’s equipment. The Partnership’s management
      agreement with IMI is to co-terminate with the dissolution of the Partnership,
      unless the limited partners vote to terminate the agreement prior to that date,
      or at the discretion of the General Partner.  IMI has agreed to perform all
      services necessary to manage the equipment on behalf of the Partnership and
      to
      perform or contract for the performance of all obligations of the lessor under
      the Partnership's leases.  In consideration for its services and pursuant
      to the partnership agreement, IMI is entitled to a monthly management fee.
      (see
      Notes 1, 2, and 3 to the financial statements)






1
            Includes
                equipment and investments purchased with the proceeds from capital
                contributions, undistributed cash flow from operations, and Partnership
                borrowings invested in equipment. Includes costs capitalized, subsequent
                to the date of purchase, and equipment acquisition fees paid to FSI
                or its
                affiliates. 2
            Jointly
              owned: EGF VI and an affiliated program. 3
            Jointly
              owned: EGF VI, two affiliated programs and a non-affiliated third party.







(C)  Competition





(1)  Operating
      Leases versus Full Payout Leases





Generally,
      the equipment owned or invested in by the Partnership is leased out on an
      operating lease basis wherein the rents received during the initial
      noncancelable term of the lease are insufficient to recover the Partnership’s
      purchase price of the equipment. The short- to mid-term nature of operating
      leases generally commands a higher rental rate than longer-term full payout
      leases and offer lessees relative flexibility in their equipment commitment.
      In
      addition, the rental obligation under an operating lease need not be capitalized
      on the lessee's balance sheet.





The
      Partnership encounters considerable competition from lessors that utilize full
      payout leases on new equipment, i.e., leases that have terms equal to the
      expected economic life of the equipment.  While some lessees prefer the
      flexibility offered by a shorter-term operating lease, other lessees prefer
      the
      rate advantages possible with a full payout lease.  Competitors may write
      full payout leases at considerably lower rates and for longer terms than the
      Partnership offers, or larger competitors with a lower cost of capital may
      offer
      operating leases at lower rates, which may put the Partnership at a competitive
      disadvantage.





(2)  Manufacturers
      and Equipment Lessors





The
      Partnership competes with equipment manufacturers who offer operating leases
      and
      full payout leases.  Manufacturers may provide ancillary services that the
      Partnership cannot offer, such as specialized maintenance service (including
      possible substitution of equipment), training, warranty services, and trade-in
      privileges.





The
      Partnership also competes with many equipment lessors, including GATX Corp.,
      General Electric Capital Aviation Services Corporation, Textainer and other
      programs that lease the same types of equipment.





(D)  Demand





The
      Partnership currently operates in the four operating segments: marine container
      leasing, aircraft leasing, double-hull product tanker leasing, and machinery
      and
      other equipment leasing. Each equipment leasing segment engages in short-term
      to
      mid-term operating leases to a variety of customers. The Partnership’s equipment
      and investments are primarily used to transport materials and commodities,
      except for aircraft leased to passenger air carriers and machinery and other
      equipment which is used in the operation of hospitals.





The
      following section describes the international and national markets in which
      the
      Partnership’s capital equipment operates:





(1)  Marine
      Containers





Marine
      containers are used to transport a variety of types of cargo. They typically
      travel on marine vessels but may also travel on railroads loaded on certain
      types of railcars and highways loaded on a trailer.





Demand
      for marine containers is primarily influenced by global economic
      conditions.





The
      Partnership owns a total of 8,786 standard dry cargo marine
      containers **** acquired
      from 1998 to 2000. The Partnership had utilization in the low 90%'s for its
      containers in 2005. Utilization on these containers is expected to remain strong
      with utilization in the low 90% range through at least the first half of 2006.





Prices
      for new marine containers have decreased up to 25% from the peak that they
      reached in early 2005 due to lower steel prices and reduced demand for new
      marine containers. There have been reports that marine container manufacturers
      have seen an increase in their inventory of unsold marine containers in recent
      months. Shipping lines have embarked on a shipbuilding program over the last
      few
      years with many new container ships being delivered in 2006 and 2007. This
      may
      result in over-capacity which could result in lower freight rates and have
      adverse implications for marine container lessors. While lease rates on the
      Partnership’s marine containers have been stable for the last three years, these
      factors may lead to a decrease in lease rates in 2006.





The
      decrease in new container prices and potential decrease in lease rates could
      lead to a decrease in the sales proceeds received from the marine containers
      upon disposition.





In
      addition, the lessee for approximately 1,183 of the Partnership's marine
      containers has the option to purchase these marine containers in the first
      and
      second quarters of 2006. The Partnership received notification from the lessee
      in 2006 that the lessee will exercise this option. The sale of these marine
      containers will result in a significant decline in Partnership lease revenues.





(2)  Aircraft





(a)
            Commercial
                Aircraft





During
      2005, global air traffic continued to recover, driven by the long haul markets,
      especially into Asia. There was initial concern at the beginning of the year
      that continued high oil prices would lead to a slowing of economic growth,
      with
      consequential negative effects on air traffic. The pace of 'permanent
      retirement' of aircraft increased and new aircraft orders reached new
      highs.





The
      United States (US) market continued to cause most concern. Several US carriers
      are currently in bankruptcy and results of most carriers have been
      mixed.





In
      Europe, the expansion by low cost carriers continued during 2005, but at a
      slower pace. National carriers finally saw financial improvements following
      their attempts at reducing overhead and correctly structuring their product.





The
      Asian
      market continued its growth during 2005. The first quarter experienced slower
      growth in the regions affected by the tsunami catastrophe but domestic Chinese
      and intra-Asian markets experienced strong growth as well as India where
      liberalization saw the birth of several new start-ups.





For
      2006,
      the General Partner believes that stabilization of fuel prices will be critical
      for the continued recovery in the airline and aircraft industry.





The
      Partnership owns 100% of one MD-80 Stage III commercial aircraft, which is
      on
      lease to a major US carrier at above market rates through July 2008. In addition
      the Partnership owns 62% of an entity owning a Boeing 737-300 Stage III
      commercial aircraft which is on lease to a South American carrier through April
      2008. During 2005, the operator had financial difficulties but is continuously
      supported by its local government. Should a default occur, we expect the
      Partnership would be able to re-lease the aircraft relatively quickly and at
      least the same rate. The Partnership also owns 34% of two entities that each
      own
      two Boeing 737-500 Stage III commercial aircraft on lease to a major US carrier
      through 2015. While the General Partner is not aware of any specific liquidity
      problems in regards to the US lessee, the poor financial condition of the US
      airline industry require this lessee to be monitored closely.





(b)
            Rotables





The
      Partnership owns 100% of a package of aircraft rotables that are used for MD-83
      aircraft. Aircraft rotables are replacement spare parts that are held in
      inventory by an airline. The types of rotables owned by the Partnership include
      avionics, replacement doors, control surfaces, pumps, valves, and other
      comparable equipment. The market for MD-83 spare parts further deteriorated
      during 2005 due to continued decline in demand for the aircraft type and an
      increased availability of aircraft rotables due to the high level of scrapping
      and part-out of the aircraft type over the last few years. The rotables package
      is off-lease and being marketed for sale. The General Partner expected that
      the
      rotables would have been sold off during 2005 but due to the continued weak
      market approximately 50% of the inventory continues to remain. Demand for
      aircraft rotables of the type owned by the Partnership is not expected to
      increase in 2006 and it may take a considerable amount of time to fully dispose
      of this equipment.




(3)  Double-Hull
      Product Tanker





The
      Partnership has an investment in an entity that owns a double-hull product
      tanker constructed in 1985, which operates in international markets carrying
      a
      variety of clean commodity-type liquid cargoes. Demand for commodity-based
      shipping is closely tied to worldwide economic growth patterns, which can affect
      demand by causing changes in specific grade volume on trade routes. The General
      Partner operates the Partnership’s product tanker in the spot charter markets,
      carrying mostly gasoline, jet fuel, gas oils and similar petroleum distillates
      or simple chemicals or vegetable oils, an approach that provides the flexibility
      to adapt to changes in market conditions.





The
      Partnership’s product tanker has recently received "vetting approval" from a
      leading oil major and as such is likely to find continued employment in not
      only
      the products markets carrying such products as gasoline and jet fuel, but also
      in the vegetable and palm oil markets. The phase out of a number of uncertified
      vessels in the vegetable oil trade commencing in 2007 should make marines
      vessels such as this product tanker more in demand from charterers and operators
      in those trades.





The
      marine vessel owned by an entity in which the Partnership has an interest is
      20
      years old which may limit its future marketability although her recent vetting
      approvals will mitigate this to some extent.





(4)  Machinery
      and Other Equipment





In
      2004
      the Partnership, along with two affiliated programs and a non-affiliated third
      party, entered into a tenancy-in-common agreement (CFHS). The Partnership owns
      20% of CFHS. CFHS purchased machinery and other equipment for $19.0 million
      and
      leased it back to the seller, an entity that operates three hospitals. The
      equipment is critical to the day to day operations of the hospitals. The
      equipment was leased for a two year term that expires in November 2006 with
      up
      to three one year renewals following the initial term, at the lessee’s option.
      As the equipment is critical to the operation of the hospitals operated by
      the
      lessee and the lessee does not have the right to return less than all the
      equipment, the General Partner considers it highly likely that the lessee will
      exercise each of its renewal options.





(E)  Government
      Regulations





The
      use,
      maintenance, and ownership of equipment are regulated by federal, state, local,
      or foreign governmental authorities. Such regulations may impose restrictions
      and financial burdens on the Partnership's ownership and operation of equipment.
      Changes in government regulations, industry standards, or deregulation may
      also
      affect the ownership, operation, and resale of the equipment. Substantial
      portions of the Partnership's equipment portfolio are either registered or
      operated internationally. Such equipment may be subject to adverse political,
      governmental, or legal actions, including the risk of expropriation or loss
      arising from hostilities. Certain of the Partnership's equipment is subject
      to
      extensive safety and operating regulations, which may require its removal from
      service or extensive modification of such equipment to meet these regulations,
      at considerable cost to the Partnership. Such regulations include but are not
      limited to:





The
      new
      maritime and port security laws as passed by the United States Congress and
      other International Maritime Organizations came into full effect in July 2004.
      US Coastguard and members of Homeland Security are patrolling ports and boarding
      vessels to insure regulations are being followed. The Partnership partially
      owned marine vessel meets the new code and are in compliance with the necessary
      reporting procedures and precautions for pre-entry into US waters and ports.
      Similarly, the Partnership's partially owned marine vessel meets port entry
      security regulations of foreign countries as mandated by international
      law.





No
      new US
      or International Regulations are scheduled to come into effect during 2006
      which
      would have a significant impact on the Partnership's partially owned marine
      vessel.





As
      of
      December 31, 2005, the Partnership is in compliance with the above governmental
      regulations. Typically, costs related to extensive equipment modifications
      to
      meet government regulations are passed on to the lessee of that
      equipment.




ITEM
        2.  DESCRIPTION
        OF PROPERTIES





The
      Partnership neither owns nor leases any properties other than the equipment
      it
      has purchased and its interests in entities that own equipment for leasing
      purposes. As of December 31, 2005, the Partnership owned a portfolio of
      transportation and related equipment and investments in entities that owned
      transportation equipment and machinery and other equipment as described in
      Item
      1, Table 1. The Partnership acquired equipment with the proceeds of the
      Partnership offering of $166.1 million, with proceeds from the debt financing
      of
      $30.0 million, and by reinvesting a portion of its operating cash flow in
      additional equipment. The Partnership does not own any real
      property.





The
      Partnership maintains its principal office at 405 Lexington Avenue, 67th floor,
      New York, NY 10174.





ITEM
      3.  LEGAL
      PROCEEDINGS





On
      December 31, 2003 and during 2004, in the state court for Darlington County,
      South Carolina, actions were filed by Harold H. Collins, his wife Dianne
      Collins, and Rickey Thomas, Sr. against South Carolina Central Railroad Company,
      Inc., CSX Transportation, Inc., TradeMark Nitrogen, Inc. and PLM Investment
      Management, Inc. (IMI) as the lessor of a railcar.  The actions involve the
      chemical spill of an ammonia solution from a railcar owned by the Partnership
      on
      September 28, 2003. All three law suits allege permanent injuries and negligence
      on the part of all defendants in their respective duties to exercise reasonable
      care in the selection of railcar type, inspection, maintenance, repair and
      transport of the railcar. The complaints did not allege a specific amount of
      damages.





In
      November 2005, Harold Collins entered into a settlement of his litigation during
      the course of his trial.  The litigation settlement is included in loss
      from operation of discontinued operations in the accompanying statements of
      income.  At the time of Mr. Collins’ settlement, his wife Diane Collins
      also dismissed, with prejudice, her case against IMI and the other
      defendants.





No
      trial
      date has been set for the Rickey Thomas Sr. case, but counsel advises it will
      be
      reached in the ordinary course no sooner than June of 2006. The Partnership
      has
      recently been added as a defendant in the case. Counsel for the Partnership
      and
      IMI (collectively, PLM entities) defendants intend to move for summary judgment
      in the case as soon as discovery permits.





In
      January 2006, a new action against the same group of defendants, including
      PLM
      entities, was filed in the same county in South Carolina by the same plaintiffs’
attorneys on behalf of the Estate of Glen Collins. Glen Collins was the brother
      of Harold Collins and was deposed before his demise as a witness in the Harold
      Collins case. He lived in the neighborhood of the spill and observed it from
      an
      apparently safe distance on the day of the occurrence. The evidence is that
      his
      exposure was minimal or non-existent on the day of the spill. Glenn Collins
      claims additional exposure as a result of his employment as a welder with a
      railcar service company a few days after the spill. He was in his mid-forties
      at
      the time of his death and was known to have had pre-existing diseases such
      as
      emphysema and Chrohn's disease before the date of the spill. He had also
      received a cash settlement from a separate workers’ compensation claim for some
      of his ailments.





The
      attorneys for these plaintiffs also represent additional potential plaintiffs.
      Twenty-two additional actions were once filed and subsequently dismissed without
      prejudice.  These actions were never served. A review of those withdrawn
      complaints reveals that they too are substantially similar to the complaints
      filed on behalf of the Collins’ and Rickey Thomas.  The potential
      exists for additional claims to be filed prior to the expiration of the statute
      of limitations on September 28, 2006. Potential plaintiffs are all represented
      by the same counsel, who has indicated an interest in a global mediation of
      all
      cases and potential cases. Defendants are awaiting voluntary discovery of
      medical records in the as yet, un-filed cases as a precondition of further
      discussion of a global mediation.





Additionally,
      the Partnership is subject to legal proceedings involving ordinary and routine
      claims related to its business. The ultimate legal and financial liability
      with
      respect to such matters cannot be estimated with certainty and requires the
      use
      of estimates in recording liabilities for potential litigation settlements.
      Estimates for losses from litigation are disclosed if considered reasonably
      possible and accrued if considered probable after consultation with outside
      counsel. If estimates of potential losses increase or the related facts and
      circumstances change in the future, the Partnership may be required to record
      additional litigation expense.





The
      General Partner believes that all of the actions discussed above will
      not have a material effect on the financial condition of the Partnership, are
      completely without merit and will vigorously defend against the
      actions.


In
        the
        first quarter of 2005, the Partnership settled all litigation matters with
        a
        former India lessee who had defaulted on its lease for several aircraft.
        The
        Partnership received $3.3 million in cash. The Partnership incurred legal
        costs
        of approximately $0.3 million related to this settlement in
        2005.


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





No
      matters were submitted to a vote of the Partnership's limited partners during
      the fourth quarter of its fiscal year ended December 31, 2005.




**PART
      II**





ITEM
      5.  MARKET
      FOR THE PARTNERSHIP'S EQUITY AND RELATED UNITHOLDER MATTERS





Pursuant
      to the terms of the partnership agreement, the General Partner is entitled
      to 5%
      of the cash distributions of the Partnership. The General Partner is the sole
      holder of such interests. Net income is allocated to the General Partner to
      the
      extent necessary to cause the General Partner’s capital account to equal zero.
      The remaining interests in the profits, losses, and cash distributions of the
      Partnership are allocated to the limited partners. As of December 31, 2005,
      there were 6.854 limited partners holding units in the Partnership.





There
      are
      several secondary markets in which limited partnership units trade. Secondary
      markets are characterized as having few buyers for limited partnership interests
      and therefore are viewed as being inefficient vehicles for the sale of limited
      partnership units and, as such, prices for limited partnership units in these
      markets may not be indicative of the actual value of the Partnership units.
      Presently, there is no public market for the limited partnership units and
      none
      is likely to develop.





To
      prevent the limited partnership units from being considered publicly traded
      and
      thereby to avoid taxation of the Partnership as an association treated as a
      corporation under the Internal Revenue Code, the limited partnership units
      will
      not be transferable without the consent of the General Partner, which may be
      withheld in its absolute discretion. The General Partner monitors transfers
      of
      limited partnership units in an effort to ensure that they do not exceed the
      percentage or number permitted by certain safe harbors promulgated by the
      Internal Revenue Service. Effective January 1, 2006, the percentage of
      Partnership units that may be traded in any calendar year has been reduced
      from
      five percent to two percent to comply with Internal Revenue Service regulations.
      A transfer may be prohibited if the intended transferee is not a United States
      citizen or if the transfer would cause any portion of the units of a “Qualified
      Plan” as defined by the Employee Retirement Income Security Act of 1974 and
      Individual Retirement Accounts to exceed the allowable limit.




ITEM
        6.
MANAGEMENT'S
        DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
        OPERATIONS




The
      Partnership's consolidated financial statements contained in the 2005 annual
      report have been prepared in accordance with the requirements for a Small
      Business Issuer as prescribed by Regulation S-B under the Securities Exchange
      Act of 1934. Generally, a Small Business Issuer cannot file under Regulation
      S-B
      if its annual revenues or public float exceed $25.0 million for two consecutive
      years. The Partnership qualifies as a Regulation S-B filer since both its 2005
      and 2004 annual revenues were less than $25.0 million and its public float
      is
      less than $25.0 million. The
      Partnership will continue to qualify as an S-B filer through at least 2006,
      as
      its revenues for the year ended December 31, 2005 are less than $25.0
      million.





(A)  Introduction





Management's
      discussion and analysis of financial condition and results of operations relates
      to the financial statements of PLM Equipment Growth Fund VI (the Partnership).
      The following discussion and analysis of operations focuses on the performance
      of the Partnership's equipment in the various segments in which it operates
      and
      its effect on the Partnership's overall financial condition.





(B)  Results
      of Operations - Factors Affecting Performance





(1)  Re-leasing
      Activity and Re-pricing Exposure to Current Economic Conditions





The
      exposure of the Partnership's equipment portfolio to re-pricing risk occurs
      whenever the leases for the equipment expire or are otherwise terminated and
      the
      equipment must be remarketed. Major factors influencing the current market
      rate
      for Partnership equipment include supply and demand for similar or comparable
      types of transport capacity, desirability of the equipment in the leasing
      market, market conditions for the particular industry segment in which the
      equipment is to be leased, overall economic conditions, and various regulations
      concerning the use of the equipment. Equipment that is idle or out of service
      between the expiration of one lease and the assumption of a subsequent lease
      can
      result in a reduction of operating cash flow to the Partnership. The Partnership
      experienced re-leasing or re-pricing activity in 2005 for its aircraft, marine
      vessel and marine container portfolios.





(a)  Aircraft:  As
      of
      December 31, 2005, the Partnership’s owned aircraft rotables were off-lease and
      are being marketed for sale.





(b)  Marine
      vessel: The Partnership’s investment in an entity owning a marine vessel
      operated in the short-term leasing market. As a result of this, the
      Partnership’s partially owned marine vessel was remarketed during 2005 exposing
      it to re-leasing and re-pricing risk. The marine vessel is expected to be
      operated in the short-term leasing market through 2006.





(c)  Marine
      containers: 87% of the Partnership’s marine containers are leased to operators
      of utilization-type leasing pools and, as such, are highly exposed to re-pricing
      activity.





(2)  Equipment
      Liquidations





Liquidation
      of Partnership owned equipment and equipment owned by entities in which the
      Partnership has an equity investment, represents a reduction in the size of
      the
      equipment portfolio and may result in a reduction of future operating cash
      flow
      to the Partnership.





During
      2005, the Partnership disposed of owned equipment that included certain aircraft
      rotables and marine containers for proceeds of 0.7 million. See discussion
      of
      discontinued operations below regarding additional equipment
      liquidations.





(3)  Nonperforming
      Lessees





Lessees
      not performing under the terms of their leases, either by not paying rent,
      not
      maintaining or operating the equipment in accordance with the conditions of
      the
      leases, or other possible departures from the lease terms, can result not only
      in reductions in contribution, but also may require the Partnership to assume
      additional costs to protect its interests under the leases, such as repossession
      or legal fees.





During
      2005, the operator of the Boeing 737-300 Stage III commercial aircraft owned
      by
      the entity in which the Partnership has an equity investment, struggled
      financially to make its monthly lease payments but is continuously supported
      by
      its local government. Should a default occur, the General Partner expects the
      Partnership would be able to re-lease this aircraft relatively quickly and
      for
      at least the same lease rate.





(4)  Equipment
      Valuation





The
      Partnership evaluates long-lived assets for impairment whenever events or
      circumstances indicate that the carrying values of such assets may not be
      recoverable. Losses for impairment are recognized when the undiscounted cash
      flows estimated to be realized from a long-lived asset are determined to be
      less
      than the carrying value of the asset and the carrying amount of long-lived
      assets exceed its fair value. The determination of fair value for a given
      investment requires several considerations, including but not limited to, income
      expected to be earned from the asset, estimated sales proceeds, and holding
      costs excluding interest.





(C)  Financial
      Condition - Capital Resources and Liquidity





The
      General Partner purchased the Partnership's initial equipment portfolio with
      capital raised from its initial equity offering of $166.1 million and permanent
      debt financing of $30.0 million. No further capital contributions from the
      limited partners are permitted under the terms of the Partnership's limited
      partnership agreement.





The
      Partnership relies on operating cash flow to meet its operating obligations
      and
      make cash distributions to the limited partners.





DISCONTINUED
      OPERATIONS





During
      2005, the Partnership and several affiliated entities (collectively, the 
Sellers), including PLM Rail Partners (Rail Partners), an entity in which the
      Partnership had a 43% ownership interest, entered into an Asset Purchase
      Agreement to sell the railcar business of the Sellers, which includes railcars
      owned and leased by the Sellers as well as management contracts pursuant to
      which the Sellers managed the railcars of third parties. The sale of the railcar
      business was completed on August 18, 2005.





The
      Partnership received net proceeds of $9.7 million from the disposition of its
      railcar assets including its interest in Rail Partners resulting in a gain
      on
      disposition of discontinued operations of $4.6 million. The amount received
      by
      the Partnership and Rail Partners was based on the appraised value of the
      railcars sold by the Partnership and Rail Partners to the purchaser, as
      determined by an independent third party appraiser or, for railcars manufactured
      in 2005, the greater of the appraised value or the actual cost. The proceeds
      received from Rail Partners by the Partnership was net of Rail Partner's
      repayment of its debt.





Accordingly,
      the Partnership's railcar leasing operations including its equity investment
      in
      Rail Partners are accounted for as a discontinued operation and prior periods
      have been restated. Assets and liabilities relating to the railcar leasing
      operations have been presented as assets held for sale and liabilities held
      for
      sale for all periods presented. Rail Partners was dissolved during the fourth
      quarter of 2005.





CONTINUING
      OPERATIONS





At
      December 31, 2005, the Partnership had unrestricted cash of $9.7
      million.





For
      the
      year ended December 31, 2005, the Partnership generated cash from operations
      of
      $7.2 million which included cash used in discontinued operations of $1.3
      million, to meet its operating obligations, pay debt and interest, maintain
      working capital reserves and make cash distributions of $3.9 million ($0.50
      per
      limited partnership unit) to the limited partners and $0.2 million to PLM
      Financial Services, Inc. (FSI or the General Partner).





During
      2005, the Partnership disposed of owned equipment and received aggregate
      proceeds of $0.7 million.





Restricted
      cash decreased $1.1 million in 2005 resulting from the General Partner's
      determination that the transaction for which the Partnership had funded $1.1
      million into an escrow account in 2004 to purchase manufacturing equipment
      would
      not close.  Accordingly, the funds for this purchase were returned to the
      Partnership from the escrow agent.





Accounts
      receivable decreased $0.2 million during 2005 due to the timing of cash
      receipts.





Equity
      investments in affiliated entities decreased $3.6 million during 2005 due to
      cash distributions of $2.3 million from the equity investments to the
      Partnership and from the loss of $1.3 million that was recorded by the
      Partnership for its interests in the equity investments.





Other
      assets decreased $0.4 million during 2005 due to collections totaling $0.4
      million on the finance lease receivable and a reduction in debt placement fees
      of $0.1 million. These decreases were partially offset by an increase of $0.1
      million in prepaid insurance.





Due
      to
      affiliates decreased $0.1 million during 2005. A decrease of $0.3 million was
      due to the payment of engine reserves due to an equity investment. The equity
      investment used these funds to repair the aircraft. This decrease was partially
      offset by an increase of $0.3 million caused by additional engine reserve
      deposits being received from the equity investment.





Notes
      payable decreased $10.0 million during 2005. The Partnership made the regularly
      scheduled principal payments of $1.0 million each in the first and second
      quarters of 2005. In August 2005, the Partnership prepaid the remaining
      outstanding note payable of $8.0 million plus accrued interest. There was no
      prepayment penalty associated with the payment of the note payable. The cash
      for
      these payments came from operations and equipment dispositions.





The
      Partnership is a participant in a $10.0 million warehouse credit facility.
      The
      warehouse credit facility is shared by the Partnership, PLM Equipment Growth
      & Income Fund VII, MILPI Holdings LLC (MILPI) and it's subsidiaries, and
      Railcar Investors II. MILPI and Railcar Investors II are controlled by the
      previous owners of FSI. The facility provides for financing up to 100% of the
      cost of the equipment and expires on May 1, 2006. Borrowings by the Partnership
      are collateralized by equipment purchased with the proceeds of the loan.
      Outstanding borrowings by one borrower reduce the amount available to each
      of
      the other borrowers under the facility. Individual borrowings may be outstanding
      for no more than 360 days, with all advances due no later than May 1, 2006.
      Interest accrues either at the prime rate or LIBOR plus 2.0% at the borrower’s
      option and is set at the time of an advance of funds. Borrowings by the
      Partnership are guaranteed by FSI. The Partnership cannot borrow on this
      facility until the lender releases the requirement that PLM International and
      MILPI provide guarantees. The Partnership is not liable for the advances made
      to
      the other borrowers.





As
      of
      March 29, 2006, there were no other outstanding borrowings on this facility
      by
      the Partnership or other eligible borrowers.





In
      the
      first quarter of 2005, the Partnership settled all litigation with a former
      lessee who had defaulted on its lease of two commercial aircraft. The
      Partnership received $3.3 million in cash and incurred legal costs of
      approximately $0.3 million related to this settlement. Of the $3.3 million,
      $0.4
      million represented lease revenues previously reserved as a bad debt from this
      lessee and $3.0 million was recorded as lease revenues from litigation
      settlement.





The
      General Partner has not planned any expenditures, nor is it aware of any
      contingencies that would cause it to require any additional capital over that
      mentioned above.





(D)  Critical
      Accounting Policies and Estimates





The
      preparation of financial statements in conformity with accounting principles
      generally accepted in the United States of America requires the General Partner
      to make estimates and assumptions that affect the reported amounts of assets
      and
      liabilities and the 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. On a regular basis, the General Partner reviews
      these estimates including those related to asset lives and depreciation methods,
      impairment of long-lived assets, allowance for doubtful accounts, reserves
      related to legally mandated equipment repairs ** and
      contingencies and litigation. These estimates are based on the General Partner's
      historical experience and on various other assumptions believed to be reasonable
      under the circumstances. Actual results may differ from these estimates under
      different assumptions or conditions. The General Partner believes, however,
      that
      the estimates, including those for the above-listed items, are reasonable and
      that actual results will not vary significantly from the estimated
      amounts.





The
      General Partner believes the following critical accounting policies affect
      the
      more significant judgments and estimates used in the preparation of the
      Partnership's financial statements:





Revenue
      recognition: Revenues are generally earned by placing equipment under operating
      leases. Rental payments are recorded as revenue on a straight-line basis over
      the lease term as earned. A portion of the Partnership's marine containers
      are
      leased to operators of utilization-type leasing pools, which include equipment
      owned by affiliated and unaffiliated parties. In such instances, revenues
      received by the Partnership consist of a specified percentage of revenues
      generated by leasing the pooled equipment to sublessees, after deducting certain
      direct operating expenses of the pooled equipment. The remaining Partnership
      leases for marine containers are based on a fixed rate. Rents for all other
      equipment are based on fixed rates.





Asset
      lives and depreciation methods: The Partnership’s primary business involves the
      purchase and subsequent lease of long-lived transportation and related
      equipment. The General Partner has chosen asset lives that it believes
      correspond to the economic life of the related asset. Depreciation is computed
      using the double-declining balance method, taking a full month's depreciation
      in
      the month of acquisition based upon estimated useful lives 12 years for all
      transportation equipment and 7 years for machinery and other equipment. The
      depreciation method changes to straight line when annual depreciation expense
      using the straight-line method exceeds that calculated by the double-declining
      balance method. The General Partner has chosen a depreciation method that it
      believes matches the benefit to the Partnership from the asset with the
      associated costs. These judgments have been made based on the General Partner’s
      expertise in each equipment segment that the Partnership operates. If the asset
      life and depreciation method chosen does not reduce the book value of the asset
      to at least the potential future cash flows from the asset to the Partnership,
      the Partnership would be required to record an impairment loss. Likewise, if
      the
      net book value of the asset was less than the economic value, the Partnership
      may record a gain on sale upon final disposition of the asset.





Impairment
      of long-lived assets: Whenever circumstances indicate that an impairment may
      exist such as when cash-flows decrease, there are unexpected maintenance issues
      or when economic conditions deteriorate in the market the equipment operates,
      the General Partner reviews the carrying value of its equipment and equity
      investments in affiliated entities to determine if the carrying value of the
      assets may not be recoverable, in consideration of the current economic
      conditions. This requires the General Partner to make estimates related to
      future cash flows from each asset as well as the determination if the
      deterioration is temporary or permanent. If these estimates or the related
      assumptions change in the future, the Partnership may be required to record
      additional impairment charges.





Allowance
      for doubtful accounts: The Partnership maintains allowances for doubtful
      accounts for estimated losses resulting from the inability of the lessees to
      make the lease payments. These estimates are primarily based on the amount
      of
      time that has lapsed since the related payments were due as well as specific
      knowledge related to the ability of the lessees to make the required payments.
      If the financial condition of the Partnership’s lessees were to deteriorate,
      additional allowances could be required that would reduce income. Conversely,
      if
      the financial condition of the lessees were to improve or if legal remedies
      to
      collect past due amounts were successful, the allowance for doubtful accounts
      may need to be reduced and income would be increased.





Reserves
      for repairs: The Partnership accrues for legally required repairs to equipment
      such as dry docking for marine vessels and engine overhauls to aircraft engines
      over the period prior to the required repairs. The amount that is reserved
      for
      is based on the General Partner’s expertise in each equipment segment, the past
      history of such costs for that specific piece of equipment and discussions
      with
      independent, third party equipment brokers. If the amount reserved for is not
      adequate to cover the cost of such repairs or if the repairs must be performed
      earlier than the General Partner estimated, the Partnership would incur
      additional repair and maintenance or equipment operating expenses.





Contingencies
      and litigation: The Partnership is subject to legal proceedings involving
      ordinary and routine claims related to its business. The ultimate legal and
      financial liability with respect to such matters cannot be estimated with
      certainty and requires the use of estimates in recording liabilities for
      potential litigation settlements. Estimates for losses from litigation are
      disclosed if considered possible and accrued if considered probable after
      consultation with outside counsel. If estimates of potential losses increase
      or
      the related facts and circumstances change in the future, the Partnership may
      be
      required to record additional litigation expense.





(E)  Recent
      Accounting Pronouncements





In
      December 2004, Financial Accounting Standards Board issued Statement 153,
      "Exchanges of Non-monetary Assets" (Statement 153), an amendment of Accounting
      Principles Board Opinion No. 29. Statement 153 is effective for non-monetary
      asset exchanges occurring in fiscal periods beginning after June 15, 2005.
      Statement 153 eliminates the exception to fair value for exchanges of similar
      productive assets and replaces it with a general exception for exchange
      transactions that do not have commercial substance - that is, transactions
      that
      are not expected to result in significant changes in the cash flows of the
      reporting entity.  Adoption of Statement 153 did not have a significant
      effect on the Partnership's financial statements.





At
      the
      June 15 -16, 2005 Emerging Issues Task Force (EITF) meeting, the EITF reached
      a
      consensus on Issue No. 04-05 entitled "Determining Whether a General Partner,
      or
      the General Partners as a Group, Controls a Limited Partnership or Similar
      Entity When the Limited Partners Have Certain Rights" (Issue 04-05). The
      consensus provides a framework for addressing when a general partner, or general
      partners as a group, controls a limited partnership or similar entity.
      Additionally, on July 14, 2005, the Financial Accounting Standards Board issued
      a Staff Position FSP-78-1, “Interaction of AICPA Statement of Position 78-9 and
      EITF Issue No. 04-05” which amends the guidance in AICPA Statement of Position
      78-9, “Accounting for Investments in Real Estate Ventures”, to be consistent
      with EITF Issue No. 04-05. The effective dates of this issue and technical
      position depend on whether the partnership agreement is new or modified, and
      is
      therefore effective for the Partnership no later than the beginning of the
      first
      quarter of 2006. The General Partner is currently evaluating the effect that
      this Issue and Staff Position will have on the Partnership’s financial position
      and results of operations.





(F)  Results
      of Operations - Year-to-Year Detailed Comparison





Comparison
      of the Partnership's Operating Results for the Years Ended December 31, 2005
      and
      2004





(a)  Owned
      Equipment Operations





Operating
      lease revenues less operations support on owned equipment increased during
      the
      year ended December 31, 2005, compared to the year ended December 31, 2004.
      Gains from the disposition of equipment, interest and other income, and certain
      expenses such as management fees to affiliate, depreciation and amortization,
      interest expense, and general and administrative expenses relating to the
      operating segments (see Note 7 to the financial statements), are not included
      in
      the owned equipment operation discussion because these expenses are indirect
      in
      nature and not a result of operations, but the result of owning a portfolio
      of
      equipment. The following table presents lease revenues less direct expenses
      by
      segment (in thousands of dollars):





For
                the Years
              Ended
                December 31,2005
            
            2004Aircraft
                and rotables
            
            $
            4,120
            
            $
            1,247Marine
                containers
            
            
            3,049
            
            
            2,983Trailers
            
            
            --
            
            
            26





Aircraft
      and rotables: Aircraft and rotables lease revenues of $1.2 million and lease
      revenues from litigation settlement of $3.0 million for the year ended December
      31, 2005, compared to lease revenues of $1.2 million during 2004. During the
      year ended December 31, 2005, the Partnership received lease revenues of $3.0
      million in settlement of all litigation matters with a former lessee in India
      who had defaulted on its lease for several aircraft. A similar event did not
      occur during 2004.





Marine
      containers: Marine container lease revenues and operations support were $3.1
      million and $27,000, respectively, for the year ended December 31, 2005,
      compared to $3.0 million and $54,000, respectively, during 2004. The increase
      in
      lease revenues of $0.1 million during the year ended December 31, 2005 was
      due
      to higher lease rates earned on the Partnership's marine containers due to
      improved market conditions for this equipment during 2005 compared to
      2004.





Trailers:  Trailer
      lease revenues and operations support were $-0- and $-0-, respectively, for
      the
      year ended December 31, 2005, compared to $0.1 million and $27,000,
      respectively, during the same period of 2004. Trailer lease revenues and
      operations support decreased due to all of the Partnership's trailers being
      placed on a direct finance lease in 2004. The lessee of these trailers prepaid
      the lease in full in 2005.





(b)  Interest
      and Other Income





Interest
      and other income increased $0.2 million in 2005 due to increased interest earned
      due to higher cash balances.




(c)  Indirect
      Expenses Related to Owned Equipment Operations





Total
      indirect expenses of $2.7 million for the year ended December 31, 2005 decreased
      from $3.6 million for the same period in 2004. Significant variances are
      explained as follows:





(i)  A
      $0.3
      million decrease in depreciation and amortization expenses from 2004 levels
      reflecting the decrease of $0.3 million caused by equipment dispositions during
      2005 and 2004;





(ii)  A
      $0.1
      million decrease in interest expense resulted from a decrease of $0.2 million
      in
      interest expense caused by lower average borrowings outstanding during 2005
      compared to the same period of 2004 partially offset by an increase of $0.1
      million caused by the expensing of the remaining unamortized portion of debt
      placement fees in the year ended December 31, 2005;





(iii)  Recovery
      of bad debts decreased $0.4 million compared to 2004 due to the collection
      of
      receivables from an aircraft lessee in 2005 that had been previously reserved
      as
      a bad debt. A similar event did not occur in 2004; and





(iv)  An
      increase of $0.1 million in management fees to affiliates was primarily the
      result of higher lease revenues and lease revenues for litigation settlement
      on
      owned equipment during 2005.





(d)  Net
      Gain
      on Disposition of Owned Equipment





The
      net
      gain on the disposition of owned equipment for the year ended December 31,
      2005
      totaled $0.4 million, and resulted from the disposition of aircraft rotables
      and
      marine containers with an aggregate net book value of $0.4 million for proceeds
      of $0.7 million. The gain on the disposition of owned equipment for the year
      ended December 31, 2004 totaled $0.3 million, and resulted from the disposition
      of aircraft rotables, marine containers, and trailers, with an aggregate net
      book value of $0.4 million for proceeds of $0.7 million.





(e)  Equity
      in
      Net (Loss) Income of Equity Investments





Equity
      in
      net (loss) income of equity investments represents the Partnership's share
      of
      the net loss or income generated from the operation of jointly owned assets
      accounted for under the equity method of accounting. The following table
      presents equity in net income (loss) by equipment type (in thousands of
      dollars):





For
                the Years
              Ended
                December 31,2005
            
            2004Marine
                vessel
            
            $
            1,344
            
            $
            672Machinery
                and other equipment
            
            
            (685
            )
            
            (149
            )Aircraft
            
            
            (1,918
            )
            
            (933
            )Equity
                in net loss of equity investments
            
            $
            (1,259
            )
            $
            (410
            )





The
      following equity investment discussion by equipment type is based on the
      Partnership's proportional share of revenues, depreciation and amortization
      expenses, operations support, interest expense, general and administrative
      expenses, and provision for bad debts:





Marine
      vessel:  As
      of
      December 31, 2005 and 2004, the Partnership owned an interest in an entity
      that
      owned a marine vessel. During the year ended December 31, 2005, lease revenues
      of $5.1 million were partially offset by depreciation expense, operations
      support, and administrative expenses of $3.8 million. During the same period
      of
      2004, lease revenues of $3.8 million were offset by depreciation expense,
      operations support, and administrative expenses of $3.1 million.





Marine
      vessel lease revenues increased $1.3 million during the year ended December
      31,
      2005 compared to 2004. An increase of $1.0 million was due to the marine vessel
      earning a higher lease rate during 2005 compared to 2004. In addition, the
      marine vessel earned an additional $0.3 million due to being available for
      hire
      the full year of 2005 compared to the same period of 2004 when the marine vessel
      was off-hire approximately 30 days while undergoing dry docking.





Marine
      vessel operations support and administrative expenses increased $0.6 million
      during the year ended December 31, 2005 compared to 2004. The $0.6 million
      increase was due to an increase of $0.1 million due to higher repairs and
      maintenance expenses during the year ended December 31, 2005, increased fuel
      costs of $0.1 million, higher operating expenses of $0.3 million resulting
      from
      the marine vessel being available for lease during all of 2005 compared to
      2004
      when the marine vessel was undergoing a scheduled dry docking and off-lease
      for
      30 days and an increase of $0.1 million due to increased bad debt expense.





Machinery
      and other equipment: As of December 31, 2005 and 2004, the Partnership owned
      an
      interest in an entity formed in the fourth quarter of 2004 that owned machinery
      and other equipment. During the year ended December 31, 2005, lease revenues
      of
      $0.5 million were offset by depreciation and amortization expense and
      administrative expenses of $1.1 million. During 2004, lease revenues of $0.1
      million were offset by depreciation and amortization expense and administrative
      expenses of $0.2 million.





Machinery
      and other equipment lease revenues increased $0.4 million due to the Partnership
      owning this entity for the entire year of 2005 compared to being owned for
      approximately one month of 2004.





Machinery
      and other equipment depreciation and amortization expense and administrative
      expenses increased $0.9 million due to the Partnership owning this entity for
      the entire year of 2005 compared to being owned for approximately one month
      of
      2004.





Aircraft:
      As of December 31, 2005, the Partnership owned an interest in an entity owning
      a
      Boeing 737-300 commercial aircraft and an interest in two entities that were
      formed in the third quarter of 2004 each owning two Boeing 737-500 commercial
      aircraft. As of December 31, 2004, the Partnership owned an interest in an
      entity owning two commercial aircraft on a direct finance lease, an interest
      in
      an entity owning a Boeing 737-300 commercial aircraft, an interest in two
      entities each owning two Boeing 737-500 commercial aircraft, and an interest
      in
      an entity owning other aircraft related assets. In the first quarter of 2005,
      the lessee of the two commercial aircraft on a direct finance lease in which
      the
      Partnership had an interest, exercised its purchase option for these aircraft.
      The aircraft were sold for their net book value and the trust that owned these
      aircraft were dissolved. The entity owning aircraft related assets was dissolved
      in the fourth quarter of 2005.





During
      the year ended December 31, 2005, revenues of $3.8 million were offset by
      depreciation and amortization expense, operations support, interest expense
      and
      administrative expenses of $5.7 million. During the same period of 2004,
      revenues of $2.1 million were offset by depreciation and amortization expense,
      operations support, interest expense and administrative expenses of $3.1
      million.





Aircraft
      revenues increased $1.7 million due to the Partnership's investment into two
      entities during the third quarter of 2004 that each own two Boeing 737-500
      commercial aircraft. These aircraft were owned and on-lease for twelve months
      of
      2005 compared to being owned and on lease for four months of 2004.





Depreciation
      and amortization expense, operations support, interest expense and
      administrative expenses increased $2.6 million during the year ended December
      31, 2005 compared to 2004 resulting from an increase in depreciation and
      amortization expense of $1.8 million caused by the Partnership's investment
      during the third quarter of 2004 into two entities each owning two Boeing
      737-500 commercial aircraft and an increase of $0.8 million caused by interest
      expense from the non-recourse debt financing the two Boeing 737-500 commercial
      aircraft in each of the entities the Partnership invested in during the third
      quarter of 2004. The Partnership had an interest in these two entities owning
      commercial aircraft for twelve months of 2005 compared to four months of
      2004.





(f)  Loss
      from
      Operation of Discontinued Operations





During
      the year ended December 31, 2005, the Partnership's railcar operations, which
      are being accounted for as a discontinued operation, generated a loss from
      operations of $2.9 million compared to a loss of $0.1 million during 2004.





(g)  Gain
      on
      Disposition of Discontinued Operations





The
      Partnership had a gain on disposition of discontinued operations from the sale
      of its railcar assets of $4.6 million in the year ended December 31, 2005
      compared to $-0- during the same period of 2004.




(h)  Net
      Income





As
      a
      result of the foregoing, the Partnership's net income for the year ended
      December 31, 2005 was $5.6 million, compared to net income of $0.6 million
      during the same period of 2004. The Partnership's ability to operate and
      liquidate assets, secure leases and re-lease those assets whose leases expire
      is
      subject to many factors. Therefore, the Partnership's performance in the year
      ended December 31, 2005 is not necessarily indicative of future
      periods.





(G)  Geographic
      Information





Certain
      of the Partnership’s equipment operates in international markets. Although these
      operations expose the Partnership to certain currency, political, credit and
      economic risks, the General Partner believes these risks are minimal or has
      implemented strategies to control the risks. Currency risks are at a minimum
      because all invoicing is conducted in United States (US) dollars. Political
      risks are minimized by avoiding operations in countries that do not have a
      stable judicial system and established commercial business laws. Credit support
      strategies for lessees may range from letters of credit supported by US banks
      to
      cash deposits. Although these credit support mechanisms generally allow the
      Partnership to maintain its lease yield, there are risks associated with
      slow-to-respond judicial systems when legal remedies are required to secure
      payment or repossess equipment. Economic risks are inherent in all international
      markets and the General Partner strives to minimize this risk with market
      analysis prior to committing equipment to a particular geographic area. Refer
      to
      Note 8 to the financial statements for information on the lease revenues, net
      income (loss), and net book value of equipment in the various geographic
      regions.





Revenues
      and net operating income (loss) from continuing operations by geographic region
      are impacted by the time period the asset is owned and the useful life ascribed
      to the asset for depreciation purposes. Net income (loss) from equipment is
      significantly impacted by depreciation charges, which are greatest in the early
      years of ownership due to the use of the double-declining balance method of
      depreciation. The relationships of geographic revenues, net income (loss),
      and
      net book value of equipment are expected to change significantly in the future,
      as assets come off lease and decisions are made either to redeploy the assets
      in
      the most advantageous geographic location or sell the assets.





The
      Partnership's owned equipment and investments in equipment owned by equity
      investments on lease to US - domiciled lessees consists of aircraft, trailers
      and machinery and other equipment. During 2005, US lease revenues from
      continuing operations accounted for 27% of the total lease revenues of wholly
      and jointly owned equipment while this region reported net loss of $1.6 million.
      The primary reason for this loss was due to the double-declining balance method
      of depreciation that results in greater depreciation in the first years an
      asset
      is owned.





The
      Partnership settled litigation in 2005 with a former lessee domiciled in India
      and recorded lease revenues of $3.0 million. India revenues accounted for 18%
      of
      the total lease revenues of wholly and jointly owned equipment while this region
      reported net income of $3.0 million.





The
      Partnership's investment in equipment owned by an equity investment on lease
      to
      a lessee domiciled in South America consists of an aircraft. South American
      lease revenues accounted for 6% of the total lease revenues of wholly and
      jointly owned equipment while this region reported net income of $0.1 million.





The
      Partnership's owned equipment and investments in equipment owned by equity
      investments on lease to lessees in the rest of the world consists of a marine
      vessel and marine containers. The marine vessel and marine containers were
      moved
      on a regular basis to locations throughout the world. During 2005, lease
      revenues from these continuing operations accounted for 50% of the total lease
      revenues of wholly and jointly owned equipment, while reporting net income
      from
      these operations of $3.3 million.





(H)  Inflation





Inflation
      had no significant impact on the Partnership's operations during 2005 or
      2004.


(I)  Forward-Looking
        Information
  Except
        for historical information contained herein, the discussion in this Form
        10-KSB
        contains forward-looking statements that involve risks and uncertainties,
        such
        as statements of the Partnership’s plans, objectives, expectations, and
        intentions. The cautionary statements made in this Form 10-KSB should be
        read as
        being applicable to all related forward-looking statements wherever they
        appear
        in this Form 10-KSB. The Partnership’s actual results could differ materially
        from those discussed here.
  (J)  Outlook
        for the Future





The
      Partnership's operation of a diversified equipment portfolio in a broad base
      of
      markets is intended to reduce its exposure to volatility in individual equipment
      sectors.





The
      ability of the Partnership to realize acceptable lease rates on its equipment
      in
      the different equipment markets is contingent upon many factors, such as
      specific market conditions and economic activity, technological obsolescence,
      and government or other regulations. The unpredictability of these factors
      makes
      it difficult for the General Partner to clearly define trends or influences
      that
      may impact the performance of the Partnership's equipment. The General Partner
      continuously monitors both the equipment markets and the performance of the
      Partnership's equipment in these markets. The General Partner may make an
      evaluation to reduce the Partnership's exposure to those equipment markets
      in
      which it determines that it cannot operate equipment and achieve acceptable
      rates of return.





The
      Partnership intends to use future cash flow from operations to satisfy its
      operating requirements and make cash distributions to the partners.





The
      Partnership may not reinvest cash flows generated from operations after January
      1, 2005 into additional equipment. The Partnership will terminate on December
      31, 2011, unless terminated earlier upon sale of all equipment and by certain
      other events. The General Partner is currently reviewing the strategic
      alternatives for the Partnership’s remaining assets. These alternatives include
      selling the Partnership’s remaining assets.





Disposition
      of the Partnership's equipment and investments in entities owning equipment
      may
      result in a reduction of cash flows from operations to the
      Partnership.





Factors
      affecting the Partnership’s contribution during the year 2006 and beyond
      include:





(1)  Demand
      for marine containers is closely tied to worldwide economic conditions.
      Utilization of the Partnership's marine containers is expected to be in the
      low
      90% range for at least the first six months of 2006. Marine container
      manufacturers have recently seen an increase in their inventory of marine
      containers. This increase may result in a decrease in utilization and lease
      rates earned on the Partnership's marine containers.





The
      lessee of 1,183, or 13% **** of
      the
      Partnership's marine containers, has the option to purchase these marine
      containers in the first and second quarters of 2006. The Partnership received
      notification from the lessee in 2006 that it will exercise this option. The
      sale
      of these marine containers will result in a significant decline in Partnership
      lease revenues;





(2)  The
      Partnership has an investment in an entity owning a double-hull product tanker
      constructed in 1985, which operates in international markets carrying a variety
      of clean product/chemical liquid cargoes.  Demand for product /
      chemical shipping is closely tied to worldwide economic growth patterns,
      which can affect demand by causing changes in specific grade volume on trade
      routes.  The General Partner operates the Partnership’s product tanker in
      the voyage charter markets, carrying mostly gasoline, jet fuel, gas oils ,
      similar petroleum distillates or simple chemicals, and vegetable and palm oils
      an approach that provides the flexibility to adapt to changes in market
      conditions.





The
      Partnership’s product tanker has continued to operate with minimum idle time
      between charters. Two major hurricanes in the United States (US) Gulf created
      major problems with the oil supply chain and especially the limited refinery
      capacity of the US.  Several major refineries in the US Gulf area were shut
      down or product refining capacity severely reduced resulting in shortage of
      refined products such as gasoline, jet fuel, heating oil, etc. which created
      a
      high demand for imported product from Europe and elsewhere.  These events
      drove the shipping markets for product carriers to all time highs.  While
      some, but not all refining capacity has come back on stream, the demand, while
      off the highs, remains strong and should continue into early 2006.  The
      advent of the heating oils season in North America with supply levels reported
      low could further prolong the strong product tanker market.





Recently,
      the Partnership's product tanker received "vetting approval" from an oil
      major.  Receiving this approval will enhance this marine vessel's
      marketability in the future.  The phase-out of a number of uncertified
      marine vessels in the vegetable oil trade commencing in 2007 should further
      enhance this product tanker's demand from charterers and operators in those
      trades.





The
      marine vessel owned by an entity in which the Partnership has an interest is
      over 20 years old  which may hinder  its future marketability. 
Marine vessels of this age typically earn a lower charter rate than newer more
      efficient marine vessels and may have increased off-hire time.  The recent
      "vetting approval" should help mitigate this to some extent;





(3)  Market
      demand for used aircraft continues to be severely impacted by the poor financial
      condition of the US airline industry.





The
      General Partner believes that the commercial aviation industry is recovering
      from several years of reduced travel; however, the General Partner views the
      recovery with caution as major increases in the cost of fuel have added another
      factor to the poor financial condition of the airlines. The General Partner
      believes that stabilization of fuel prices will be critical for the recovery
      in
      the airline industry to continue.





The
      Partnership owns an equity interest in a trust that owns a Boeing 737-300 Stage
      III commercial aircraft that is on lease to a South American carrier through
      April 2008. During 2005, the operator of this aircraft struggled financially
      but
      has been continuously supported by its local government. Should a default occur,
      we expect the Partnership would be able to re-lease the aircraft relatively
      quickly and for at least the same lease rate.





The
      Partnership’s owned aircraft rotables are off-lease. The General Partner is
      marketing this equipment for sale. Due to the poor market for these rotables,
      it
      is taking a considerable period of time to dispose of them.





The
      Partnership has an equity interest in entities owning a total of four aircraft
      on lease to a major US airline. While the General Partner is not aware of any
      specific liquidity problems in regards to this lessee, the poor financial
      condition of the US airline industry, which has included several bankruptcies
      in
      the last twelve months, indicate there could be collection issues related to
      this lessee in the future;





(4)  The
      Partnership's debt was prepaid in the third quarter of 2005 and, accordingly,
      interest expense will decrease in the future;





(5)  While
      the
      Partnership is scheduled to terminate on December 31, 2011, the General Partner
      is currently reviewing the strategic alternatives for the Partnership’s
      remaining assets. These alternatives include selling the Partnership’s remaining
      assets and assets owned by entities in which the Partnership has an equity
      interest;





(6)  The
      timing and amount of future cash distributions to the limited partners and
      the
      General Partner will be based on the cash position of the Partnership and
      operational requirements; and





(7)  Beginning
      in 2006, in order to prevent the Partnership from being considered publicly
      traded and to avoid taxation of the Partnership as an association treated as
      a
      corporation under the Internal Revenue Code, the General Partner began limiting
      the number of limited partnership units to be traded to 2% per year of the
      total
      outstanding units.





Several
      other factors may affect the Partnership's operating performance in 2006 and
      beyond, including changes in the markets for the Partnership's equipment and
      changes in the regulatory environment in which that equipment
      operates.





(1)  Re-pricing
      Risk





Certain
      portions of the Partnership's aircraft rotables, marine container, and marine
      vessel portfolios will be remarketed in 2006 as existing leases expire, exposing
      the Partnership to considerable re-pricing risk/opportunity.





(2)  Equipment
      Liquidations





The
      General Partner may elect to sell certain underperforming equipment, equipment
      whose continued operation may become prohibitively expensive, or has a greater
      strategic value to others. The General Partner intends to re-lease or sell
      equipment at prevailing market rates; however, the General Partner cannot
      predict these future rates with any certainty at this time and cannot accurately
      assess the effect of such activity on future Partnership performance. The
      proceeds from the sold or liquidated equipment will be used to fund operations
      and make cash distributions to the partners.





(3)  Impact
      of
      Government Regulations on Future Operations





Ongoing
      changes in the regulatory environment, both in the United States and
      internationally, cannot be predicted with accuracy, and preclude the General
      Partner from determining the impact of such changes on Partnership operations
      or
      sale of equipment.





The
      General Partner operates the Partnership's equipment in accordance with current
      applicable regulations (see Item 1, Section E, Government Regulations). However,
      the continuing implementation of new or modified regulations by some of the
      authorities mentioned previously, or others, may adversely affect the
      Partnership's ability to continue to own or operate equipment in its portfolio.
      Additionally, regulatory systems vary from country to country, which may
      increase the burden to the Partnership of meeting regulatory compliance for
      the
      same equipment operated between countries.





(K)  Distribution
      Levels and Additional Capital Resources





The
      Partnership's initial contributed capital was composed of the proceeds from
      its
      initial offering of $166.1 million, supplemented by permanent debt in the amount
      of $30.0 million. The Partnership may no longer purchase equipment with cash
      flow from operations. The General Partner has not planned any expenditures,
      nor
      is it aware of any contingencies that would cause it to require any additional
      capital to that mentioned above. The Partnership intends to rely on operating
      cash flow to meet its operating obligations and make cash distributions to
      its
      limited partners.





Cash
      distributions when paid to the limited partners generally consist of both a
      return of and a return on capital. Cash distributions do not represent and
      are
      not indicative of yield on investment. Actual yield on investment cannot be
      determined with any certainty until conclusion of the Partnership and will
      be
      dependent upon the collection of all future contracted rents, the generation
      of
      renewal and/or re-lease rents and the residual value realized for each asset
      at
      its disposal.





The
      General Partner believes that sufficient cash flow will be available in the
      future to meet Partnership operating cash flow requirements.





ITEM
      7.  FINANCIAL
      STATEMENTS AND SUPPLEMENTARY DATA





The
      financial statements for the Partnership are listed in the Index to Financial
      Statements included in Item 13(a) of this Annual Report on Form
      10-KSB.







ITEM
        8.
CHANGES
        IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
        DISCLOSURE


(A)
            Disagreements
                with Accountants on Accounting and Financial
                Disclosures





None.





(B)
            Changes
                in Accountants





None.





ITEM
      8A.  CONTROLS
      AND PROCEDURES





(A)  Limitations
      on the Effectiveness of Controls





The
      General Partner’s management, including it’s President and Chief Financial
      Officer (CFO), does not expect that our internal controls or disclosure control
      will prevent all errors and all fraud. A control system, no matter how well
      conceived and operated, can provide only reasonable, not absolute, assurance
      that the objectives of the control system are met. Further, the design of a
      control system must reflect the fact that there are resource constraints, and
      the benefits of controls must be considered relative to their
      costs.





Because
      of the inherent limitations in all control systems, no evaluation of control
      can
      provide absolute assurance that all control issues and instances of fraud,
      if
      any, within the Partnership have been detected. These inherent limitations
      include the realities that judgments in decision-making can be faulty and that
      breakdowns can occur because of a simple error or mistake. Additionally,
      controls can be circumvented by the individual acts of some persons, collusion
      of two or more people, or by management override of the control. The design
      of
      any system of controls also is based partly on certain assumptions about the
      likelihood of future events, and there can be no assurance that any design
      will
      succeed in achieving its stated goals under all potential future conditions.





Notwithstanding
      the forgoing limitations, we believe that our internal controls and disclosure
      controls provide reasonable assurances that the objectives of our control system
      are met.





(B)  Quarterly
      Evaluation of the Partnership’s Disclosure Controls and Internal
      Controls





(1)  As
      of the
      end of the period prior to the filing of this report, the General Partner
      carried out an evaluation, under the supervision and with the participation
      of
      the General Partner’s management, including it’s President and CFO, of the
      effectiveness of the design and operation of the Partnership’s disclosure
      controls and procedures pursuant to Rule 13a-14 under the Securities Exchange
      Act of 1934 (the “Exchange Act”). Based upon that evaluation, the President and
      CFO concluded that the Partnership’s disclosure controls and procedures are
      effective in timely alerting them to material information relating to the
      Partnership’s required to be included in the Partnership’s exchange act filings.





(2)  There
      have been no significant changes in the Partnership’s internal controls or in
      other factors which could significantly affect internal controls subsequent
      to
      the date the General Partner carried out its evaluations.





ITEM
      8B.  OTHER
      INFORMATION





(A)  Reports
      on Form 8-K





(1)  Form
      8-K
      dated November 15, 2005 announcing the sale of PLM Financial Services, Inc.
      and
      the announcement
      of elections of officers and appointments of directors of PLM Financial
      Services, Inc..




**PART
      III**





ITEM
      9.
DIRECTORS AND EXECUTIVE OFFICERS OF PLM FINANCIAL SERVICES,
      INC.


As
      of the
      date of this annual report, the directors and executive officers of PLM
      Financial Services, Inc. are as follows:





Name
            Age
            PositionPaul
                M. Leand, Jr,
            39
            Chairman
                of the Board of Directors, President and Secretary ofPLM
                Financial Services, Inc.Michael
                Dockman
            42
            Director,
                PLM Financial Services, Inc.James
                G. Dolphin
            38
            Director,
                PLM Financial Services, Inc.Richard
                K Brock
            43
            Chief
                Financial Officer, PLM Financial Services,
                Inc.





Paul
      M.
      Leand, Jr, 39, was elected in November 2005 as the Chairman of the Board of
      Directors and appointed the President and Secretary of PLM
      Financial Services, Inc.(FSI) .
      Mr.
      Leand joined the predecessor of AMA Capital Partners LLC (AMA) in 1998 and
      has
      been AMA’s **** CEO
      since
      2004. Mr. Leand developed AMA’s restructuring practice in the maritime industry
      and has led many mergers and acquisitions. Mr. Leand has extensive experience
      in
      structuring leasing and debt facilities. Prior to joining AMA, Mr. Leand was
      employed at The First National Bank of Maryland where he managed the bank’s
      railroad and maritime divisions.





Michael
      Dockman, 42, was elected in November 2005 to FSI’s board of directors. Mr.
      Dockman joined AMA Capital Partners in 2005 as a Managing Director. Mr. Dockman
      is involved in merger and acquisitions and structured financings in the domestic
      transportation marketplace. Prior to joining AMA, Mr. Dockman was with Railroad
      Financial Corporation, a leading investment bank focused on the rail industry.





James
      G.
      Dolphin, 38, was elected in November 2005 to FSI’s board of directors. Mr.
      Dolphin joined AMA in 2001 and is AMA’s President. Mr. Dolphin is involved in
      AMA’s strategic advisory work in the shipping industry. Prior to joining AMA,
      Mr. Dolphin led the global freight transportation management consulting practice
      at Booz Allen Hamilton.





Richard
      K
      Brock, 43, was appointed Chief Financial Officer of PLM Financial Services,
      Inc.
      in August 2002. From June 2001 through August 2002, Mr. Brock was a consultant
      to various leasing companies including PLM Financial Services, Inc. From October
      2000 through June 2001, Mr. Brock was a Director of PLM Financial Services,
      Inc.
      Mr. Brock was appointed Vice President and Chief Financial Officer of PLM
      International, Inc. and PLM Financial Services, Inc. in January 2000, having
      served as Acting Chief Financial Officer since June 1999 and as Vice President
      and Corporate Controller of PLM International, Inc. and PLM Financial Services,
      Inc. since June 1997. Prior to June 1997, Mr. Brock served as an accounting
      manager at PLM Financial Services, Inc. beginning in September 1991 and as
      Director of Planning and General Accounting beginning in February
      1994.





The
      directors of PLM Financial Services, Inc. are elected for a one-year term or
      until their successors are elected and qualified. No family relationships exist
      between any director or executive officer of PLM Financial Services,
      Inc..





CODE
      OF ETHICS





The
      Board
      of Directors of PLM Financial Services Inc, (“FSI”) the General Partner, has
      adopted a written Code of Ethics that is applicable to the Board, executive
      officers and employees of PLM Financial Services Inc. FSI’s Code of Ethics is
      designed to deter wrongdoing and to promote:





-
            the
                integrity and values of FSI, including the ethical handling of actual
                or
                apparent conflicts of interest between personal and professional
                relationships;-
            compliance
                with applicable governmental laws, rules and
                regulations;-
            internal
                reporting of violations of the Code of Ethics to any member of FSI’s Board
                of Directors; and-
            accountability
                for adherence to the Code of
                Ethics.





ITEM
      10.  EXECUTIVE
      COMPENSATION





The
      Partnership has no directors, officers, or employees. The Partnership had no
      pension, profit sharing, retirement, or similar benefit plan in effect as of
      December 31, 2005.





ITEM
      11.  SECURITY
      OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT





(A)
            Security
                Ownership of Certain Beneficial
                Owners





The
      General Partner is generally entitled to a 5% interest in the profits and losses
      (subject to certain allocations of income), and cash distributions. As of
      December 31, 2004, no investor was known by the General Partner to beneficially
      own more than 5% of the limited partnership units of the
      Partnership.





(B)  Security
      Ownership of Management





Neither
      the General Partner and its affiliates nor any executive officer or director
      of
      the General Partner and its affiliates owned any limited partnership units
      of
      the Partnership as of December 31, 2005.





ITEM
      12.  CERTAIN
      RELATIONSHIPS AND RELATED TRANSACTIONS





(A)  Transactions
      with Management and Others





During
      2005, the Partnership paid or accrued the following fees to FSI or its
      affiliates: management fees, $0.3 million; and administrative and data
      processing services performed on behalf of the Partnership, $0.1 million.





During
      2005, the Partnership's discontinued operations paid or accrued the following
      fees to FSI or its affiliates: acquisition fees, $0.1 million; lease negotiation
      fees, $27,000; management fees, $11,000; and administrative and data processing
      services performed on behalf of the Partnership, $0.2 million.





During
      2005, the Partnership’s proportional share of ownership in equity investments
      paid or accrued the following fees to FSI or its affiliates (based on the
      Partnership’s proportional share of ownership): management fees, $0.3 million;
      and administrative and data processing services performed on behalf of these
      entities, $0.1 million.





During
      2005, the Partnership’s proportional share of ownership in the discontinued
      operation of an equity investment paid or accrued the following fees to FSI
      or
      its affiliates: management fees, $0.1 million; and administrative and data
      processing services performed on behalf of this entity, $0.1
      million.





The
      balance due to affiliates as of December 31, 2005 includes $0.1 million due
      to
      FSI for management fees and $1.2 million due to an equity investment.





ITEM
      13.  EXHIBITS,
      FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K





(A)  1.  Financial
      Statements





The
      financial statements listed in the accompanying Index to Financial Statements
      are filed as part of this Annual Report on Form 10-KSB.





(B)
            Financial
                Statement Schedule




None.




(C)  Exhibits





4
            Amended
                and Restated Limited Partnership Agreement of Partnership, incorporated
                by
                reference to the Partnership's Registration Statement on Form S-1
                (Reg. No. 33-40093) which became effective with the Securities
                and Exchange Commission on December 23, 1991.4.1
            First
                Amendment to the Amended and Restated Limited Partnership Agreement
                dated
                November 26, 1996.4.2
            Second
                Amendment to the Amended and Restated Limited Partnership Agreement
                dated
                August 24, 2001, incorporated by reference to the Partnership’s Form
                10-KSB dated December 31, 2001 filed with the Securities and Exchange
                Commission on March 26, 2002.10.1
            Management
                Agreement between Partnership and PLM Investment Management, Inc. 
                incorporated by reference to the Partnership's Registration Statement
                on
                Form S-1 (Reg. No. 33-40093) which became effective with the
                Securities and Exchange Commission on December 23,
                1991.10.2
            Note
                Agreement, dated as of December 21, 2001, regarding $30.0 million
                term
                loan notes due December 21, 2006, incorporated by reference to the
                Partnership’s Form 10-KSB dated December 31, 2001 filed with the
                Securities and Exchange Commission on March 26, 2002.10.3
            First
                Amendment to Credit Agreement, dated March 2, 2003, incorporated
                by
                reference to the Partnership’s Form 10-QSB dated June 30, 2003 filed with
                the Securities and Exchange Commission on August 14,
                2003.10.4
            Second
                Amendment to Credit Agreement, dated June 30, 2003, incorporated
                by
                reference to the Partnership’s Form 10-QSB dated June 30, 2003 filed with
                the Securities and Exchange Commission on August 14,
                2003.10.5
            Third
                Amendment to Credit Agreement, dated September 30, 2003, incorporated
                by
                reference to the Partnership’s Form 10-QSB dated September 30, 2003 filed
                with the Securities and Exchange Commission on November 13,
                2003.10.6
            Amended
                and restated Warehouse Credit Agreement, dated March 17, 2004,
                incorporated by reference to the Partnership’s Form 10-KSB dated December
                31, 2003 filed with the Securities and Exchange Commission on March
                29,
                2004.10.7
            First
                Amendment to Amended and Restated Warehouse Credit Agreement dated
                September 3, 2004, incorporated by reference to the Partnership’s Form
                10-QSB dated September 30, 2004 filed with the Securities and Exchange
                Commission on November 12, 2004.10.8
            Second
                Amendment to Amended and Restated Warehouse Credit Agreement dated
                October
                20, 2004, incorporated by reference to the Partnership’s Form 10-QSB dated
                September 30, 2004 filed with the Securities and Exchange Commission
                on
                November 12, 2004.10.9
            PLM
                CAL I LLC operating agreement dated June 4, 2004, incorporated by
                reference to the Partnership’s Form 10-QSB dated September 30, 2004 filed
                with the Securities and Exchange Commission on November 12,
                2004.10.10
            PLM
                CAL II LLC operating agreement dated June 4, 2004, incorporated by
                reference to the Partnership’s Form 10-QSB dated September 30, 2004 filed
                with the Securities and Exchange Commission on November 12,
                2004.10.11
            PLM
                CAL I LLC equipment purchase agreement dated August 26, 2004, incorporated
                by reference to the Partnership’s Form 10-QSB dated September 30, 2004
                filed with the Securities and Exchange Commission on November 12,
                2004.10.12
            PLM
                CAL II LLC equipment purchase agreement dated August 26, 2004,
                incorporated by reference to the Partnership’s Form 10-QSB dated September
                30, 2004 filed with the Securities and Exchange Commission on November
                12,
                2004.10.13
            Trust
                Indenture and Mortgage 645 between First Security Bank, National
                Association and Wilmington Trust Company assumed by PLM CAL I,
                incorporated by reference to the Partnership’s Form 10-KSB dated December
                31, 2004 filed with the Securities and Exchange Commission on March
                29,
                2005.10.14
            Trust
                Indenture and Mortgage 646 between First Security Bank, National
                Association and Wilmington Trust Company assumed by PLM CAL I,
                incorporated by reference to the Partnership’s Form 10-KSB dated December
                31, 2004 filed with the Securities and Exchange Commission on March
                29,
                2005.10.15
            Trust
                Indenture and Mortgage 647 between First Security Bank, National
                Association and Wilmington Trust Company assumed by PLM CAL II,
                incorporated by reference to the Partnership’s Form 10-KSB dated December
                31, 2004 filed with the Securities and Exchange Commission on March
                29,
                2005.10.16
            Trust
                Indenture and Mortgage 648 between First Security Bank, National
                Association and Wilmington Trust Company assumed by PLM CAL II,
                incorporated by reference to the Partnership’s Form 10-KSB dated December
                31, 2004 filed with the Securities and Exchange Commission on March
                29,
                2005.10.17
            Trust
                Indenture and Mortgage 645 Supplement between First Security Bank,
                National Association and Wilmington Trust Company assumed by PLM
                CAL I,
                incorporated by reference to the Partnership’s Form 10-KSB dated December
                31, 2004 filed with the Securities and Exchange Commission on March
                29,
                2005.10.18
            Trust
                Indenture and Mortgage 646 Supplement between First Security Bank,
                National Association and Wilmington Trust Company assumed by PLM
                CAL I,
                incorporated by reference to the Partnership’s Form 10-KSB dated December
                31, 2004 filed with the Securities and Exchange Commission on March
                29,
                2005.10.19
            Trust
                Indenture and Mortgage 647 Supplement between First Security Bank,
                National Association and Wilmington Trust Company assumed by PLM
                CAL II,
                incorporated by reference to the Partnership’s Form 10-KSB dated December
                31, 2004 filed with the Securities and Exchange Commission on March
                29,
                2005.10.20
            Trust
                Indenture and Mortgage 648 Supplement between First Security Bank,
                National Association and Wilmington Trust Company assumed by PLM
                CAL II,
                incorporated by reference to the Partnership’s Form 10-KSB dated December
                31, 2004 filed with the Securities and Exchange Commission on March
                29,
                2005.10.21
            Letter
                of intent to purchase manufacturing equipment with PLM International,
                Inc.
                dated December 23, 2004, incorporated by reference to the Partnership’s
                Form 10-KSB dated December 31, 2004 filed with the Securities and
                Exchange
                Commission on March 29, 2005.10.22
            Third
                Amendment to Amended and Restated Warehouse Credit Agreement dated
                December 28, 2004, incorporated by reference to the Partnership’s Form
                10-KSB dated December 31, 2004 filed with the Securities and Exchange
                Commission on March 29, 2005.10.23
            Fourth
                Amendment to Amended and Restated Warehouse Credit Agreement dated
                March
                24, 2005, incorporated by reference to the Partnership’s Form 10-KSB dated
                December 31, 2004 filed with the Securities and Exchange Commission
                on
                March 29, 2005.10.24
            Fifth
                Amendment to Amended and Restated Warehouse Credit Agreement dated
                July
                26, 2005, incorporated by reference to the Partnership’s Form 10-QSB dated
                June 30, 2005 filed with the Securities and Exchange Commission on
                August
                10, 2005.10.25
            Asset
                Purchase Agreement dated as of August 4, 2005 by and among the
                Partnership, CIT Group, Inc., et al. incorporated by reference to
                the
                Partnership’s Form 8-K dated August 18, 2005, filed with the Securities
                and Exchange Commission on August 24, 2005.14
            PLM
                Financial Services Inc. Code of Ethics, incorporated by reference
                to the
                Partnership’s Form 10-KSB dated December 31, 2003 filed with the
                Securities and Exchange Commission on March 29, 2004.31.1
            Certificate
                of President of the General Partner pursuant to Section 302 of Sarbanes
                -
                Oxley Act of 2002.31.2
            Certificate
                of Chief Financial Officer of the General Partner pursuant to Section
                302
                of Sarbanes - Oxley Act of 2002.32.1
            Certificate
                of President of the General Partner pursuant to Section 906 of Sarbanes
                -
                Oxley Act of 2002.32.2
            Certificate
                of Chief Financial Officer of the General Partner pursuant to Section
                906
                of Sarbanes - Oxley Act of 2002.








ITEM
                14.
            PRINCIPAL
                ACCOUNTANT FEES AND SERVICES





The
      table
      below list principal accountant fees and services (in thousands of
      dollars):





Audit
            
            Audit
            
            Tax
            
            All
                OtherFees
            
            Related
                Fees
            
            Fees
            
            Fees





Year
                Ended December 31, 2005
            $
            113
            
            $
            --
            
            $
            --
            
            $
            --Year
                Ended December 31, 2004
            $
            70
            
            $
            --
            
            $
            --
            
            $
            --





It
      is the
      policy of the Board of Directors that it pre-approves all of the services
      described above in this Item 14.











SIGNATURES





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





The
      Partnership has no directors or officers.  The General Partner has signed
      on behalf of the Partnership by duly authorized officers.




Dated:
                March 29, 2006
            
            
            PLM
                EQUIPMENT GROWTH FUND VIPARTNERSHIPBy:
            PLM
                Financial Services, Inc.General
                PartnerBy:
            /s/Paul
                M. LeandPaul
                M. LeandPresidentBy:
            /s/
                Richard K BrockRichard
                K BrockChief
                Financial Officer






CERTIFICATION





The
      undersigned hereby certifies, in their capacity as a director of the General
      Partner of PLM Equipment Growth Fund VI (the Partnership), that the Annual
      Report of the Partnership on Form 10-KSB for the year ended December 31, 2005,
      fully complies with the requirements of Section 13(a) of the Securities Exchange
      Act of 1934 and that the information contained in such report fairly presents,
      in all material respects, the financial condition of the Partnership at the
      end
      of such period and the results of operations of the Partnership for such
      period.





Pursuant
      to the requirements of the Securities Exchange Act of 1934, this report has
      been
      signed below by the following directors of the Partnership's General Partner
      on
      the dates indicated.




Name
              
              
              Capacity
              
              Date/s/Paul
                  M. LeandPaul
                  M. Leand
              
              
              Director,
                  FSI
              
              March
                  29, 2006/s/Michael
                  DockmanMichael
                  Dockman
              
              
              Director,
                  FSI
              
              March
                  29, 2006/s/James
                  G. DolphinJames
                  G. Dolphin
              
              
              Director,
                  FSI
              
              March
                  29, 2006





**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**INDEX
      TO FINANCIAL STATEMENTS**





(Item
      13(a))





PageReport
                of independent registered public accounting firm
            27Balance
                sheets as of December 31, 2005 and 2004
            28Statements
                of income for the years endedDecember
                31, 2005 and 2004
            29Statements
                of changes in partners’ capital for theyears
                ended December 31, 2005 and 2004
            30Statements
                of cash flows for the years endedDecember
                31, 2005 and 2004
            31Notes
                to financial statements
            32-49



































**REPORT
      OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM**

















The
      Partners


PLM
      Equipment Growth Fund VI:








We
      have
      audited the accompanying balance sheets of PLM Equipment Growth Fund VI, a
      limited partnership (the Partnership), as of December 31, 2005 and 2004, and
      the
      related statements of income, changes in partners' capital, and cash flows
      for
      the years then ended. These financial statements are the responsibility of
      the
      Partnership's management. Our responsibility is to express an opinion on these
      financial statements based on our audits.





We
      conducted our audits in accordance with the standards of the Public Company
      Accounting Oversight Board (United States). Those standards require that we
      plan
      and perform the audits to obtain reasonable assurance about whether the
      financial statements are free of material misstatement. The Partnership is
      not
      required to have, nor were we engaged to perform an audit of its internal
      control over financial reporting. Our audits 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 Partnership's internal control over
      financial reporting. Accordingly, we express no such opinion. The audits also
      include examining, on a test basis, evidence supporting the amounts and
      disclosures in the financial statements, assessing the accounting principles
      used and significant estimates made by management, 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 PLM Equipment Growth Fund VI at
      December 31, 2005 and 2004, and the results of its operations and its cash
      flows
      for the years then ended in conformity with accounting principles generally
      accepted in the United States of America.




















/s/
      Grant
      Thornton LLP





New
      York,
      New York


March
      24,
      2006












**PLM
                  EQUIPMENT GROWTH FUND VI****(A
                  Limited Partnership)****BALANCE
                  SHEETS****December
                  31,**(in
                  thousands of dollars, except unit amounts)


2005
              
              2004**Assets**Equipment
                  held for operating leases, at cost
              
              $
              36,305
              
              $
              37,539Less
                  accumulated depreciation
              
              
              (29,786
              )
              
              (29,364
              )Net equipment
              
              
              6,519
              
              
              8,175Cash
                  and cash equivalents
              
              
              9,744
              
              
              4,656Restricted
                  cash
              
              
              --
              
              
              1,056Accounts
                  receivable, less allowance for doubtful accounts of$-0-
                  in 2005 and $375 in 2004
              
              
              778
              
              
              1,011Equity
                  investments in affiliated entities
              
              
              12,306
              
              
              15,886Other
                  assets, net of accumulated amortization of$58
                  in 2005 and $328 in 2004
              
              
              178
              
              
              576Assets
                  held for sale
              
              
              33
              
              
              6,836Total
                  assets
              
              $
              29,558
              
              $
              38,196**Liabilities
                  and partners’ capital**LiabilitiesAccounts
                  payable and accrued expenses
              
              $
              127
              
              $
              203Due
                  to affiliates
              
              
              1,253
              
              
              1,307Notes
                  payable
              
              
              --
              
              
              10,000Liabilities
                  held for sale
              
              
              123
              
              
              151Total
                  liabilities
              
              
              1,503
              
              
              11,661Commitments
                  and contingenciesPartners'
                  capitalLimited
                  partners (7,730,965 limited partnership units outstanding)
              
              
              28,055
              
              
              26,535General
                  Partner
              
              
              --
              
              
              --Total partners' capital
              
              
              28,055
              
              
              26,535Total
                  liabilities and partners' capital
              
              $
              29,558
              
              $
              38,196







See
      accompanying notes to financial statements.










**PLM
                EQUIPMENT GROWTH FUND VI****(A
                Limited Partnership)****STATEMENTS
                OF INCOME****For
                the Years Ended December 31,**(In
                thousands of dollars, except weighted-average partnership unit
                amounts)








2005
            
            2004**Revenues**Lease
                revenue
            
            $
            4,229
            
            $
            4,337Lease
                revenue from litigation settlement
            
            
            2,967
            
            
            --Interest
                and other income
            
            
            324
            
            
            146Gain
                on disposition of equipment
            
            
            363
            
            
            296Total revenues
            
            
            7,883
            
            
            4,779**Expenses**Depreciation
                and amortization
            
            
            1,309
            
            
            1,619Operations
                support
            
            
            28
            
            
            81Management
                fees to affiliate
            
            
            309
            
            
            173Interest
                expense
            
            
            471
            
            
            616General
                and administrative expenses to affiliates
            
            
            117
            
            
            334Other
                general and administrative expenses
            
            
            857
            
            
            846Recovery
                of bad debts
            
            
            (375
            )
            
            --Total expenses
            
            
            2,716
            
            
            3,669Equity
                in net loss of equity investments
            
            
            (1,259
            )
            
            (410
            )Income
                from continuing operations
            
            
            3,908
            
            
            700Discontinued
                operations:Loss from operation of discontinued operations
            
            
            (2,927
            )
            
            (121
            )Gain on disposition of discontinued operations
            
            
            4,608
            
            
            --Income
                (loss) from discontinued operations
            
            
            1,681
            
            
            (121
            )Net income
            
            $
            5,589
            
            $
            579**Partners’
                share of net income**Limited
                partners
            
            $
            5,385
            
            $
            579General
                Partner
            
            
            204
            
            
            --Total
            
            $
            5,589
            
            $
            579Limited
                partners' basic earnings (loss) perweighted-average
                limited partnership unit:Income
                from continuing operations
            
            $
            0.48
            
            $
            0.09Loss
                from operation of discontinued operations
            
            
            (0.38
            )
            
            (0.02
            )Gain
                on disposition of discontinued operations
            
            
            0.60
            
            
            --$
            0.70
            
            $
            0.07











See
      accompanying notes to financial statements.










**PLM
                EQUIPMENT GROWTH FUND VI****(A
                Limited Partnership)****STATEMENTS
                OF CHANGES IN PARTNERS' CAPITAL****For
                the Years Ended December 31, 2005 and 2004**(in
                thousands of dollars)








Limited
              Partners
            
            General
              Partner
            
            TotalPartners'
                capital as of December 31, 2003
            
            $
            25,956
            
            $
            --
            
            $
            25,956Net
                income
            
            
            579
            
            
            --
            
            
            579Partners'
                capital as of December 31, 2004
            
            
            26,535
            
            
            --
            
            
            26,535Net
                income
            
            
            5,385
            
            
            204
            
            
            5,589Cash
                distribution
            
            
            (3,865
            )
            
            (204
            )
            
            (4,069
            )Partners'
                capital as of December 31, 2005
            
            $
            28,055
            
            $
            --
            
            $
            28,055







































See
      accompanying notes to financial statements.














**PLM
                EQUIPMENT GROWTH FUND VI****(A
                Limited Partnership)****STATEMENTS
                OF CASH FLOWS****For
                the Years Ended December 31,**(in
                thousands of dollars)





2005
            
            2004**Operating
                activities**Net
                income (Revised)
            
            $
            5,589
            
            $
            579Adjustments
                to reconcile net incometo net cash provided by (used in) operating activities:Depreciation
            
            
            1,300
            
            
            1,610Amortization
            
            
            9
            
            
            9Amortization of debt placement costs
            
            
            125
            
            
            110Recovery of bad debts
            
            
            (375
            )
            
            --Gain on disposition of equipment
            
            
            (363
            )
            
            (296
            )Equity in net loss from equity investments
            
            
            1,259
            
            
            410Distributions from equity investments
            
            
            2,321
            
            
            1,747Changes in operating assets and liabilities:Accounts receivable
            
            
            608
            
            
            (84
            )Other assets
            
            
            (118
            )
            
            172Accounts payable and accrued expenses
            
            
            (76
            )
            
            126Due to affiliates
            
            
            (54
            )
            
            (180
            )Cash
                provided by operating activities of continuing operations
            
            
            10,225
            
            
            4,203Cash
                (used in) provided by operating activities ofdiscontinued operations
            
            
            (3,027
            )
            
            473Net cash provided by operating activities
            
            
            7,198
            
            
            4,676**Investing
                activities**Investments
                in equity investments
            
            
            --
            
            
            (23,444
            )Non-operating
                distributions from equity investments
            
            
            --
            
            
            14,642Decrease
                (increase) in restricted cash
            
            
            1,056
            
            
            (646
            )Collections
                on finance lease receivable
            
            
            382
            
            
            172Proceeds
                from disposition of equipment
            
            
            719
            
            
            701Cash
                provided by (used in) investing activities of continuingoperations
            
            
            2,157
            
            
            (8,575
            )Cash
                provided by (used in) investing activities of discontinuedoperations
            
            
            9,802
            
            
            (714
            )Net
                cash provided by (used in) investing activities
            
            
            11,959
            
            
            (9,289
            )**Financing
                activities**Payments
                of notes payable
            
            
            (10,000
            )
            
            (4,000
            )Payment
                of debt placement fees
            
            
            --
            
            
            (25
            )Cash
                distribution paid to limited partners
            
            
            (3,865
            )
            
            --Cash
                distribution paid to General Partner
            
            
            (204
            )
            
            --Net cash used in financing activities
            
            
            (14,069
            )
            
            (4,025
            )Net
                increase (decrease) in cash and cash equivalents
            
            
            5,088
            
            
            (8,638
            )Cash
                and cash equivalents at beginning of period
            
            
            4,656
            
            
            13,294Cash
                and cash equivalents at end of period
            
            $
            9,744
            
            $
            4,656**Supplemental
                information**Interest
                paid
            
            $
            346
            
            $
            514





See
      accompanying notes to financial statements.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





1.  Basis
      of Presentation





Organization





PLM
      Equipment Growth Fund VI, a California limited partnership (the Partnership),
      was formed on April 17, 1991 to engage in the business of owning, leasing or
      otherwise investing in primarily used transportation and related equipment.





PLM
      Financial Services, Inc. (FSI) is the General Partner of the Partnership and
      manages the affairs of the Partnership. On November 15, 2005, PLM International,
      Inc., the former parent company of FSI, sold all the issued and outstanding
      shares of common stock of FSI to AMA CP Fund I Inc.





The
      Partnership may not reinvest cash flow generated from operations after January
      1, 2005 into additional equipment. The Partnership will terminate on December
      31, 2011, unless terminated earlier upon the sale of all of the equipment or
      by
      certain other events. The General Partner is currently reviewing the strategic
      alternatives for the Partnership’s remaining assets. These alternatives include
      selling the Partnership’s remaining assets and assets in entities in which the
      Partnership has an equity interest.





The
      Partnership's consolidated financial statements contained in the 2005 annual
      report have been prepared in accordance with the requirements for a Small
      Business Issuer as prescribed by Regulation S-B under the Securities Exchange
      Act of 1934. Generally, a Small Business Issuer cannot file under Regulation
      S-B
      if its annual revenues or public float exceed $25.0 million for two consecutive
      years.





Estimates





These
      financial statements have been prepared on the accrual basis of accounting
      in
      accordance with accounting principles generally accepted in the United States
      of
      America. This requires management to make estimates and assumptions that affect
      the reported amounts of assets and liabilities, disclosures 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 materially from these estimates.





Accounting
      for Leases





The
      Partnership's leasing operations generally consist of operating leases. Under
      the operating lease method of accounting, the lessor records the leased asset
      at
      cost and depreciates the leased asset over its estimated useful life. Rental
      payments are recorded as revenue on a straight-line basis over the lease term
      as
      earned. Lease origination costs are capitalized and amortized over the term
      of
      the lease. The Partnership and an equity investment in which it had an
      investment in, occasionally leases equipment with lease terms that qualify
      for
      direct finance lease classification, as required by Statement of Financial
      Accounting Standards No. 13, “Accounting for Leases”.





Revenue
      Recognition





Revenues
      are generally earned by placing equipment under operating leases. A portion
      of
      the Partnership's marine containers are leased to operators of utilization-type
      leasing pools, which include equipment owned by unaffiliated and affiliated
      parties. In such instances, revenues received by the Partnership consist of
      a
      specified percentage of revenues generated by leasing the pooled equipment
      to
      sublessees, after deducting certain direct operating expenses of the pooled
      equipment. The remaining Partnership leases for marine containers are based
      on a
      fixed rate. Rents for all other equipment are based on fixed rates.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





1.  Basis
      of Presentation (continued)





Depreciation
      and Amortization





Depreciation
      of equipment held for operating leases is computed on the double-declining
      balance method, taking a full month's depreciation in the month of acquisition,
      based upon estimated useful lives of 12 years for transportation equipment
      and 7
      years for non-transportation equipment. The depreciation method changes to
      straight line when the annual depreciation expense using the straight-line
      method exceeds that calculated by the double-declining balance method.
      Acquisition fees paid to the General Partner (see Notes 2 and 3 to the financial
      statements) and certain other acquisition costs have been capitalized as part
      of
      the cost of the equipment. Major expenditures that are expected to extend the
      useful lives or reduce future operating expenses of equipment are capitalized
      and amortized over the estimated remaining life of the equipment. Lease
      negotiation fees are included in other assets and are amortized over the initial
      equipment lease term.





Debt
      placement fees were included in other assets and were amortized over the term
      of
      the loan using either the effective interest or the straight-line method if
      that
      method approximates the effective interest method and are included in interest
      expense in the accompanying statements of operations. (see Note 12 to the
      financial statements)





Equipment





Equipment
      held for operating leases is recorded at cost and depreciated over its useful
      life.





The
      Partnership evaluates long-lived assets for impairment whenever events or
      circumstances indicate that the carrying values of such assets may not be
      recoverable such as when cash-flows decrease, there are unexpected maintenance
      issues or when economic conditions in which the equipment operate deteriorates.
      Losses for impairment are recognized when the undiscounted cash flows estimated
      to be realized from a long-lived asset are determined to be less than the
      carrying value of the asset and the carrying amount of long-lived assets exceed
      their fair value. The determination of fair value for a given investment
      requires several considerations, including but not limited to, income expected
      to be earned from the asset, estimated sales proceeds, and holding costs
      excluding interest.





The
      estimate of the fair value for the Partnership’s owned equipment and equipment
      owned by entities in which the Partnership has an equity interest is based
      on
      the opinion of the Partnership’s equipment managers using data, reasoning and
      analysis of prevailing market conditions of similar equipment, data from recent
      purchases, independent third party valuations and discounted cash flows.





Equity
      Investments in Affiliated Entities





The
      Partnership has equity interests in entities that own transportation equipment
      and other types of equipment. All major business decisions for these entities
      must be decided by a unanimous vote of the owners. Accordingly, the Partnership
      does not control these entities and these entities are accounted for using
      the
      equity method.





The
      Partnership’s interests in equity investments are managed by PLM Investment
      Management, Inc. (IMI), a wholly owned subsidiary of FSI or affiliates. The
      Partnership’s equity interest in the net income (loss) of equity investments is
      reflected net of management fees paid or payable to IMI or
      affiliates.





Discontinued
      Operations





During
      2005, the Partnership and an investment entity in which the Partnership has
      an
      interest, sold all of their remaining railcars. Consequently, the results from
      this operation have been classified as discontinued operations for all periods
      presented. Assets and liabilities from discontinued operations have been
      classified as assets and liabilities held for sale for all periods presented.
      (see Note 2 to the financial statements)







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





1.  Basis
      of Presentation (continued)





Repairs
      and Maintenance





Repairs
      and maintenance costs related to a partially owned marine vessel is usually
      the
      obligation of the entity in which the Partnership has an investment in and
      are
      charged against operations as incurred. Costs associated with marine vessel
      dry-docking are estimated and accrued ratably over the period prior to such
      dry-docking. If a marine vessel is sold and there is a balance in the
      dry-docking reserve account for that marine vessel, the balance in the reserve
      account is included as additional gain on disposition. Maintenance costs of
      aircraft, marine containers, and machinery and other equipment are the
      obligation of the lessee. To meet the maintenance requirements of aircraft
      airframes and engines, reserve accounts are prefunded by certain lessees over
      the period of the lease based on the number of hours this equipment is used,
      times the estimated rate to repair this equipment. If repairs exceed the amount
      prefunded by the lessee or the lessee defaults on the lease, the Partnership
      may
      have the obligation to fund and accrue the difference. If an aircraft is sold
      and there is a balance in the reserve account for repairs to that aircraft,
      the
      balance in the reserve account is included as additional gain on disposition.
      Marine vessel dry-docking reserve accounts and aircraft reserves are included
      in
      equity investments in affiliated entities.





Net
      Income and Distributions





Special
      allocations of income are made to the General Partner to the extent necessary
      to
      cause the capital account balance of the General Partner to be zero as of the
      close of such year in accordance with the Limited Partnership Agreement. The
      limited partners' net income is allocated among the limited partners based
      on
      the number of limited partnership units owned by each limited partner. (see
      Note
      9 to the financial statements)





Cash
      distributions of the Partnership are allocated 95% to the limited partners
      and
      5% to the General Partner and may include amounts in excess of net income.





Cash
      distributions are recorded when declared.





For
      the
      year ended December 31, 2005, cash distributions declared and paid totaled
      $3.9
      million ($0.50 per limited partnership unit) to the limited partners and $0.2
      million to the General Partner. No cash distributions were declared or paid
      to
      the limited partners or General Partner during the year ended December 31,
      2004.





Basic
      Earnings (Loss) Per Weighted-Average Limited Partnership Unit





Basic
      earnings (loss) per weighted-average limited partnership unit was computed
      by
      dividing income from continuing operations, loss from operation of discontinued
      operations and the gain on disposition of discontinued operations attributable
      to limited partners by the weighted-average number of limited partnership units
      deemed outstanding during the year. The weighted-average number of limited
      partnership units deemed outstanding during the years ended December 31, 2005
      and 2004 was 7,730,965. (see Note 9 to the financial statements) All special
      allocations of income to the General Partner are included in basic earnings
      from
      continuing operations.





Cash
      and Cash Equivalents





The
      Partnership considers highly liquid investments that are readily convertible
      to
      known amounts of cash with original maturities of three months or less as cash
      equivalents. The carrying amount of cash equivalents approximates fair value
      due
      to the short-term nature of the investments.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





1.  Basis
      of Presentation (continued)





Restricted
      Cash





As
      of
      December 31, 2004, restricted cash consisted of escrowed funds which were to
      be
      used to purchase equipment in 2005 for which the General Partner entered into
      legally binding commitments to purchase in 2004. The cash to fund this purchase
      was in an escrow account with an unaffiliated third party as escrow agent.
      The
      Partnership did not have any restricted cash at December 31, 2005.





Accounts
      Receivable





The
      Partnership generally invoices its lessees monthly for the lease of its
      equipment. The Partnership reserves as bad debts any unpaid account receivable
      that is past due over 90 days. The Partnership will also reserve any unpaid
      receivable as a bad debt when circumstances indicate that it will not be paid,
      such as when the lessee goes into bankruptcy. Unpaid receivables are written-off
      only when all collection efforts have been exhausted.





Fair
      Value of Financial Instruments





The
      Partnership's financial instruments consisted of cash and cash equivalents,
      restricted cash, accounts receivable, accounts payable and accrued expenses,
      due
      to affiliated and notes payable. The fair value of cash, restricted cash and
      cash equivalent, accounts receivable, accounts payable and accrued expenses
      and
      due to affiliates approximate book value due to their short-term nature. The
      fair value of the Partnership's note payable at December 31, 2004 approximated
      its book value due to the interest rate on the debt being re-priced on a regular
      basis.





Comprehensive
      Income





The
      Partnership’s comprehensive income is equal to net income for the years ended
      December 31, 2005 and 2004.





Statements
      of Cash Flows





In
      the
      Partnership's December 31, 2005 Form 10-KSB, the Partnership has reconciled
      to
      cash flow from operations beginning with the caption "Net income". In the
      Partnership's September 30, 2005 filing of the Form 10-QSB, the reconciliation
      began with "Income from continuing operations".





New
      Accounting Standards





In
      December 2004, Financial Accounting Standards Board issued Statement 153,
      "Exchanges of Non-monetary Assets" (Statement 153), an amendment of Accounting
      Principles Board Opinion No. 29. Statement 153 is effective for non-monetary
      asset exchanges occurring in fiscal periods beginning after June 15, 2005.
      Statement 153 eliminates the exception to fair value for exchanges of similar
      productive assets and replaces it with a general exception for exchange
      transactions that do not have commercial substance - that is, transactions
      that
      are not expected to result in significant changes in the cash flows of the
      reporting entity. The General Partner does not believe that adoption of
      Statement 153 will have a significant effect on the Partnership's financial
      statements.





At
      the
      June 15 -16, 2005 Emerging Issues Task Force (EITF) meeting, the EITF reached
      a
      consensus on Issue No. 04-05 entitled "Determining Whether a General Partner,
      or
      the General Partners as a Group, Controls a Limited Partnership or Similar
      Entity When the Limited Partners Have Certain Rights" (Issue 04-05). The
      consensus provides a framework for addressing when a general partner, or general
      partners as a group, controls a limited partnership or similar entity.
      Additionally, on July 14, 2005, the Financial Accounting Standards Board issued
      a Staff Position FSP-78-1, “Interaction of AICPA Statement of Position 78-9 and
      EITF Issue No. 04-05” which amends the guidance in AICPA Statement of Position
      78-9, “Accounting for Investments in Real Estate Ventures”, to be consistent
      with EITF Issue No. 04-05. The







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





1.  Basis
      of Presentation (continued)





New
      Accounting Standards (continued)





effective
      dates of this issue and technical position depend on whether the partnership
      agreement is new or modified, and is therefore effective for the Partnership
      no
      later than the beginning of the first quarter of 2006. The General Partner
      is
      currently evaluating the effect that this Issue and Staff Position will have
      on
      the Partnership’s financial position and results of operations.





Reclassifications





Certain
      amounts previously reported have been reclassified to conform to the 2005
      presentation. These reclassifications did not have any effect on total assets,
      total liabilities and net income.





2.  Discontinued
      Operations





During
      2005, the Partnership and several affiliated entities (collectively, the
      Sellers), including PLM Rail Partners (Rail Partners), an entity in which the
      Partnership had a 43% ownership interest, entered into an Asset Purchase
      Agreement to sell the railcar business of the Sellers, which included railcars
      owned and leased by the Sellers as well as management contracts pursuant to
      which the Sellers managed the railcars of third parties. The sale of the railcar
      business was completed on August 18, 2005.





The
      Partnership received net proceeds of $9.7 million from the disposition of its
      railcar assets including its interest in Rail Partners resulting in a gain
      on
      disposition of discontinued operations of $4.6 million. The amount received
      by
      the Partnership and Rail Partners was based on the appraised value of the
      railcars sold by the Partnership and Rail Partners to the purchaser, as
      determined by an independent third party appraiser or, for railcars manufactured
      in 2005, the greater of the appraised value or the actual cost. The proceeds
      received from Rail Partners by the Partnership was net of Rail Partner's
      repayment of its debt. During the third quarter of 2005, some immaterial costs
      for bonuses that were paid are included in general and administrative
      expenses.





Accordingly,
      the Partnership's railcar leasing operations including its equity investment
      in
      Rail Partners are accounted for as discontinued operations. Rail Partners was
      dissolved during the fourth quarter 2005.





Loss
      from
      the operation of discontinued operations for the years ended December 31 are
      as
      follows (in thousands of dollars):





2005
            
            2004RevenuesLease revenue
            
            $
            149
            
            $
            1,868Interest and other income
            
            
            34
            
            
            39Gain on disposition of equipment
            
            
            140
            
            
            561Total revenues
            
            
            323
            
            
            2,468ExpensesDepreciation and amortization
            
            
            280
            
            
            1,048Operations support
            
            
            87
            
            
            526Management fees to affiliate
            
            
            11
            
            
            108General and administrative expenses to affiliates
            
            
            227
            
            
            200General and administrative expenses
            
            
            2,431
            
            
            494Recovery of bad debts
            
            
            (40
            )
            
            (15
            )Total expenses
            
            
            2,996
            
            
            2,361Equity
                in net loss of equity investments
            
            
            (254
            )
            
            (228
            )Loss
                from operation of discontinued operations
            
            $
            (2,927
            )
            $
            (121
            )Gain
                on disposition of discontinued operations
            
            $
            4,608
            
            $
            --







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





2.  Discontinued
      Operations (continued)





Assets
      and liabilities held for sale as of December 31 are as follows (in thousands
      of
      dollars):





**Assets**
            
            2005
            
            2004Equipment
                held for operating leases, net
            
            $
            --
            
            $
            129Restricted
                cash
            
            
            --
            
            
            5,082Accounts
                receivable, net
            
            
            33
            
            
            43Equity
                investment in affiliated entity
            
            
            --
            
            
            1,490Other
                assets, net
            
            
            --
            
            
            92Total assets held for sale
            
            $
            33
            
            $
            6,836**Liabilities**Account
                payable and other liabilities
            
            $
            123
            
            $
            151Total liabilities held for sale
            
            $
            123
            
            $
            151





Transactions
      with General Partner and Affiliates - Discontinued Operations





During
      2005 and 2004, the Partnership's discontinued operations incurred these types
      of
      costs to FSI or its affiliates; acquisition, lease negotiation and management
      fees and data processing and administrative expenses. The components of these
      fees and expenses incurred to FSI or its affiliates were as follows (in
      thousands of dollars):





Owned
                Equipment
            
            Equity
                InvestmentsFor
                the years ended December 31,
            
            2005
            
            2004
            
            2005
            
            2004Acquisition
                fees
            
            $
            118
            
            $
            269
            
            $
            --
            
            $
            --Lease
                negotiation fees
            
            
            27
            
            
            60
            
            
            --
            
            
            --Management
                fees
            
            
            11
            
            
            108
            
            
            102
            
            
            90Data
                processing and administrativeexpenses
            
            
            227
            
            
            200
            
            
            141
            
            
            82





During
      2004, the Partnership purchased $6.0 million in railcars from FSI or its
      affiliates. The Partnership's cost for the railcars purchased from FSI was
      the
      lower of FSI's or its affiliates cost or the fair market value at the time
      of
      purchase. In addition, the Partnership transferred 774 owned railcars with
      a net
      book value of $11.4 million into Rail Partners. Rail Partners was owned with
      two
      affiliated partnerships that also transferred owned railcars into this entity.
      Rail Partners was dissolved in the fourth quarter of 2005.





3.  Transactions
      with General Partner and Affiliates





The
      Partnership's owned equipment and interests in equity investments are managed
      by
      IMI, under a continuing management agreement. IMI receives a monthly management
      fee from the Partnership for managing the equipment.





The
      equipment management agreement, subject to certain reductions, requires the
      payment of a monthly management fee attributable to either owned equipment
      or
      interests in equipment owned by the equity investments to be paid to IMI in
      an
      amount equal to the lesser of (i) the fees that would be charged by an
      independent third party for similar services for similar equipment or (ii)
      the
      sum of (a) 5% of the gross lease revenues attributable to equipment that is
      subject to operating leases, (b) 2% of the gross lease revenues, as defined
      in
      the agreement, that is subject to full payout net leases, and (c) 7% of the
      gross lease revenues attributable to equipment for which IMI provides both
      management and additional services relating to the continued and active
      operation of program equipment, such as on-going marketing and re-leasing of
      equipment, hiring or arranging for the hiring of crew or operating personnel
      for
      equipment, and similar services.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





3.  Transactions
      with General Partner and Affiliates (continued)





As
      part
      of the settlement of litigation filed against the General Partner and its
      affiliates in a prior year, Partnership management fees were reduced 25% for
      the
      period January 1, 2003 through June 30, 2005.





The
      General Partner is entitled to 5% of cash available for distribution.





The
      General Partner can earn a subordinated incentive fee as defined in the limited
      partnership agreement after the limited partners receive a minimum return on,
      and a return of, their invested capital. The General Partner does not anticipate
      that the conditions to earn this fee will be met.





PLM
      Transportation Equipment Corp. (TEC), a subsidiary of the General Partner,
      will
      also be entitled to receive an equipment liquidation fee equal to the lesser
      of
      (i) 3% of the sales price of equipment sold on behalf of the Partnership or
      (ii)
      50% of the "Competitive Equipment Sale Commission," as defined in the agreement,
      if certain conditions are met. The General Partner does not anticipate that
      the
      conditions required to earn this fee will be met.





The
      Partnership had equity investments in affiliated entities that own equipment
      and
      other assets during 2005 and 2004. (see Note 6 to the financial
      statements)





During
      2004, the Partnership, two affiliated programs and a non-affiliated third party
      formed two investment entities which each purchased two commercial aircraft.
      The
      Partnership's net investment in these entities was $4.7 million. In addition,
      the Partnership, two affiliated programs and a non-affiliated third party formed
      a tenancy-in-common which purchased certain machinery and other equipment used
      in hospitals. The Partnership's net investment in this entity was $4.1 million.
      (see Note 6 to the financial statements)





The
      balance due to affiliates as of December 31, 2005 and 2004 included $0.1 million
      due to FSI for management fees and $1.2 million due to affiliates in which
      the
      Partnership has an equity investment.





During
      the years ended December 31, 2005 and 2004, the Partnership incurred
      acquisition, lease negotiation, debt placement, and management fees and the
      Partnership reimbursed FSI or its affiliates for data processing and
      administrative expenses. The components of these fees and expenses incurred
      to
      FSI or its affiliates were as follows (in thousands of dollars):





Owned
                Equipment
            
            Equity
                InvestmentsFor
                the years ended December 31,
            
            2005
            
            2004
            
            2005
            
            2004Acquisition
                fees
            
            $
            --
            
            $
            --
            
            $
            --
            
            $
            1,091Lease
                negotiation fees
            
            
            --
            
            
            --
            
            
            --
            
            
            242Debt
                placement fees
            
            
            --
            
            
            --
            
            
            --
            
            
            178Management
                fees
            
            
            309
            
            
            173
            
            
            329
            
            
            202Data
                processing and administrativeexpenses
            
            
            117
            
            
            334
            
            
            59
            
            
            34





4.  Restricted
      Cash





In
      December 2004, the General Partner entered into an escrow agreement on behalf
      of
      the Partnership to fund equipment purchases in 2005 for which the General
      Partner has entered into legally binding commitments to purchase in 2004. The
      General Partner placed $1.1 million with the escrow agent, an unaffiliated
      third
      party, during 2004 which was to be used to fund a purchase in 2005. In the
      first
      quarter of 2005, the General Partner determined that the deal for which the
      escrowed funds were to be used would not close. The $1.1 million in escrowed
      funds for this deal were returned to the Partnership in the first quarter of
      2005.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





5.  Equipment





The
      components of owned equipment as of December 31 are as follows (in thousands
      of
      dollars):





Equipment
                Held for Operating Leases
            
            2005
            
            2004Marine
                containers
            
            $
            21,378
            
            $
            22,332Aircraft
                and rotables
            
            
            14,927
            
            
            15,20736,305
            
            
            37,539Less
                accumulated depreciation
            
            
            (29,786
            )
            
            (29,364
            )Net equipment
            
            $
            6,519
            
            $
            8,175





Equipment
      held for operating leases is stated at cost less depreciation and any reductions
      to the carrying value.





As
      of
      December 31, 2005 and 2004, all owned equipment in the Partnership's portfolio
      was on lease except for the aircraft rotables with an aggregate net book value
      of $0.3 million.





During
      2005, the Partnership disposed of aircraft rotables and marine containers,
      with
      an aggregate net book value of $0.4 million for proceeds of $0.7 million, which
      resulted in a net gain on disposition of $0.4 million.





During
      2004, the Partnership disposed of aircraft rotables, marine containers, and
      trailers, with an aggregate net book value of $0.4 million for proceeds of
      $0.7
      million which resulted in a gain on disposition of $0.3 million.





The
      lessee for 1,183 of the Partnership's marine containers has the option to
      purchase these marine containers in the first quarter of 2006. The purchase
      option for these marine containers is in excess of the net book value. Should
      the lessee exercise this option, lease revenues will be negatively
      impacted.





Future
      minimum rentals under non-cancelable operating leases, as of December 31, 2005,
      for owned equipment held for operating leases during each of the next five
      years
      and thereafter is approximately $1.5 million in 2006; $1.2 million in 2007;
      $0.6
      million in 2008; and none thereafter. Per diem and short-term rentals consisting
      of utilization rate lease payments included in owned equipment lease revenues
      amounted to $2.6 million in 2005 and 2004.





6.  Equity
      Investments in Affiliated Entities





The
      Partnership owns equipment jointly with affiliated programs and a non-affiliated
      third party. The accounting policies followed by the entities in which the
      Partnership has an equity investment are substantially the same as the
      Partnership's accounting policies.





Ownership
      interest is based on the Partnership’s contribution towards the cost of the
      assets in the equity investments. The Partnership’s proportional share of equity
      and income (loss) in each entity is not necessarily the same as its ownership
      interest. The primary reason for this is that certain fees such as management
      fees, acquisition fees, and lease and re-lease fees vary among the owners of
      the
      equity investments. The Partnership’s investment in equity investments includes
      acquisition fees, lease negotiation fees, and debt placement fees paid by the
      Partnership to the General Partner or its affiliates. The Partnership’s equity
      interest in the net income (loss) of equity investments is reflected net of
      management fees incurred and the amortization of acquisition fees, lease
      negotiation fees and debt placement fees.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





6.  Equity
      Investments in Affiliated Entities (continued)





The
      tables below set forth 100% of the assets, liabilities, and equity of the
      entities in which the Partnership has an interest and the Partnership’s
      proportional share of equity in each entity (in thousands of
      dollars):




BoeingLion
            
            737-300As
                of December 31, 2005
            
            
            Partnership1
            
            
            Trust2





AssetsEquipment less accumulated depreciation
            
            $
            3,901
            
            $
            6,366Accounts receivable
            
            
            2,739
            
            
            54Due from affiliate
            
            
            --
            
            
            1,907Other assets
            
            
            491
            
            
            --Total assets
            
            $
            7,131
            
            $
            8,327LiabilitiesAccounts payable
            
            $
            123
            
            $
            5Due to affiliates
            
            
            166
            
            
            12Lessee deposits and reserve for repairs
            
            
            628
            
            
            1,907Total liabilities
            
            
            917
            
            
            1,924Equity
            
            
            6,214
            
            
            6,403Total liabilities and equity
            
            $
            7,131
            
            $
            8,327Partnership’s
                share of equity
            
            $
            3,270
            
            $
            4,056





PLM
                CAL I
            
            PLM
                CAL IIAs
                of December 31, 2005 (continued)
            
            LLC3
            
            LLC4
            
            CFHS5
            
            Total





AssetsEquipment
                less accumulated depreciation
            
            $
            24,568
            
            $
            24,535
            
            $
            13,446Cash
                and cash equivalents
            
            
            1,877
            
            
            1,878
            
            
            112Accounts
                receivable
            
            
            47
            
            
            16
            
            
            2,540
            6Other
                assets
            
            
            477
            
            
            477
            
            
            79Total assets
            
            $
            26,969
            
            $
            26,906
            
            $
            16,177LiabilitiesAccounts
                payable
            
            $
            447
            
            $
            446
            
            $
            --Due
                to affiliates
            
            
            6
            
            
            6
            
            
            98Notes
                payable
            
            
            23,937
            
            
            23,919
            
            
            --Total liabilities
            
            
            24,390
            
            
            24,371
            
            
            98Equity
            
            
            2,579
            
            
            2,535
            
            
            16,079Total
                liabilities and equity
            
            $
            26,969
            
            $
            26,906
            
            $
            16,177Partnership’s
                share of equity
            
            $
            870
            
            $
            855
            
            $
            3,255
            
            $
            12,306




1
            The
                Partnership owns a 53% interest in the Lion Partnership that was
                formed in
                1997 that owns a product tanker.


2
            The
                Partnership owns a 62% interest in the Boeing 737-300 Trust that
                was
                formed in 1999 that owns a stage III commercial
                aircraft.


3
            The
                Partnership owns a 34% interest in PLM CAL I LLC that was formed
                in the
                third quarter of 2004 that owns two Boeing 737-500 stage III commercial
                aircraft.


4
            The
                Partnership owns a 34% interest in PLM CAL II LLC that was formed
                in the
                third quarter of 2004 that owns two Boeing 737-500 stage III commercial
                aircraft.


5
            The
                Partnership owns a 20% interest in CFHS that was formed in the fourth
                quarter of 2004 that owns various types of machinery and other
                equipment.


6.
            CFHS
                accounts receivable represents unpaid lease payments since inception.
                The
                accounts receivable is not due until the end of the existing lease
                in
                November 2006 unless the lessee extends the lease in accordance with
                the
                lease agreement, in which case, the lessee can remain up to two years
                in
                arrears of its lease payments.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





6.  Equity
      Investments in Affiliated Entities (continued)





Aero
            
            Boeing
            
            PLMLion
            
            California
            
            737-300
            
            WorldwideAs
                of December 31, 2004
            
            
            Partnership1
            
            
            Trust2
            
            
            Trust3
            
            
            Leasing
                Corp.4





AssetsEquipment
                less accumulated depreciation
            
            $
            5,015
            
            $
            --
            
            $
            7,643
            
            $
            --Cash
                and cash equivalents
            
            
            --
            
            
            34
            
            
            --
            
            
            140Accounts
                and note receivables
            
            
            1,318
            
            
            --
            
            
            --
            
            
            2,228Finance
                lease receivable
            
            
            --
            
            
            191
            
            
            --
            
            
            --Due
                from affiliate
            
            
            --
            
            
            --
            
            
            1,966
            
            
            4Other
                assets
            
            
            544
            
            
            2
            
            
            6
            
            
            --Total assets
            
            $
            6,877
            
            $
            227
            
            $
            9,615
            
            $
            2,372LiabilitiesAccounts
                payable
            
            $
            133
            
            $
            34
            
            $
            65
            
            $
            2,205Due
                to affiliates
            
            
            111
            
            
            2
            
            
            5
            
            
            --Lessee
                deposits and reserve for repairs
            
            
            260
            
            
            --
            
            
            1,966
            
            
            --Total liabilities
            
            
            504
            
            
            36
            
            
            2,036
            
            
            2,205Equity
            
            
            6,373
            
            
            191
            
            
            7,579
            
            
            167Total liabilities and equity
            
            $
            6,877
            
            $
            227
            
            $
            9,615
            
            $
            2,372Partnership’s
                share of equity
            
            $
            3,346
            
            $
            76
            
            $
            4,791
            
            $
            42




PLM
                CAL I
            
            PLM
                CAL IIAs
                of December 31, 2004 (continued)
            
            LLC5
            
            LLC6
            
            CFHS7
            
            Total





AssetsEquipment
                less accumulated depreciation
            
            $
            29,482
            
            $
            29,442
            
            $
            18,900Cash
                and cash equivalents
            
            
            1,897
            
            
            1,897
            
            
            125Accounts
                receivable
            
            
            --
            
            
            --
            
            
            260Other
                assets
            
            
            543
            
            
            542
            
            
            167Total assets
            
            $
            31,922
            
            $
            31,881
            
            $
            19,452LiabilitiesAccounts
                payable
            
            $
            480
            
            $
            480
            
            $
            2Due
                to affiliates
            
            
            6
            
            
            6
            
            
            9Notes
                payable
            
            
            25,744
            
            
            25,716
            
            
            --Lessee
                deposits and reserve for repairs
            
            
            199
            
            
            203
            
            
            --Total liabilities
            
            
            26,429
            
            
            26,405
            
            
            11Equity
            
            
            5,493
            
            
            5,476
            
            
            19,441Total liabilities and equity
            
            $
            31,922
            
            $
            31,881
            
            $
            19,452Partnership’s
                share of equity
            
            $
            1,850
            
            $
            1,844
            
            $
            3,937
            
            $
            15,886





The
      tables below set forth 100% of the lease revenues and interest and other income,
      depreciation and amortization expense, interest expense, operations support
      and
      general and administrative expenses, and net income (loss) of the entities
      in
      which the Partnership has an interest, and the Partnership‘s




1
            The
                Partnership owns a 53% interest in the Lion Partnership that was
                formed in
                1997 that owns a product tanker.


2  The
      Partnership owned a 40% interest in the Aero California Trust that was formed
      in
      1996 and dissolved in 2005 that owned two stage III commercial aircraft that
      were on a direct finance lease.


3
            The
                Partnership owns a 62% interest in the Boeing 737-300 Trust that
                was
                formed in 1999 that owns a stage III commercial
                aircraft.


4
            The
                Partnership owned a 25% interest in PLM Worldwide Leasing that was
                formed
                in 1995 and dissolved in 2005 that owned aircraft related
                assets.


5
            The
                Partnership owns a 34% interest in PLM CAL I LLC that was formed
                in the
                third quarter of 2004 that owns two Boeing 737-500 stage III commercial
                aircraft.


6
            The
                Partnership owns a 34% interest in PLM CAL II LLC that was formed
                in the
                third quarter of 2004 that owns two Boeing 737-500 stage III commercial
                aircraft.


7
            The
                Partnership owns a 20% interest in CFHS that was formed in the fourth
                quarter of 2004 that owns various types of machinery and other
                equipment.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





6.  Equity
      Investments in Affiliated Entities (continued)





proportional
      share of income (loss) in each entity for the years ended December 31, 2005
      and
      2004 (in thousands of dollars):





Boeing
            
            PLMFor
                the year ended
            
            Lion
            
            737-300
            
            WorldwideDecember 31, 2005
            
            
            Partnership1
            
            
            Trust3
            
            
            Leasing
                Corp.4





Lease
                revenues and interest and other income
            
            $
            9,712
            
            $
            1,566
            
            $
            601Less:
                Depreciation and amortization expense
            
            
            1,115
            
            
            1,277
            
            
            --Operations support
            
            
            5,242
            
            
            26
            
            
            --General and administrative expenses
            
            
            826
            
            
            146
            
            
            590Net income
            
            $
            2,529
            
            $
            117
            
            $
            11Partnership’s
                share of net income
            
            $
            1,344
            
            $
            78
            
            $
            2





For
                the year ended
            
            PLM
                CAL I
            
            PLM
                CAL IIDecember 31, 2005 (continued)
            
            
            LLC5
            
            
            LLC6
            
            
            CFHS7
            
            
            Total





Lease
                revenues and interest and other income
            
            $
            3,949
            
            $
            3,911
            
            $
            2,283Less:
                Depreciation and amortization expense
            
            
            4,941
            
            
            4,934
            
            
            5,541Interest expense
            
            
            1,858
            
            
            1,856
            
            
            --Operations support
            
            
            --
            
            
            --
            
            
            --General
                and administrative expenses
            
            
            105
            
            
            104
            
            
            120Net loss
            
            $
            (2,955
            )
            $
            (2,983
            )
            $
            (3,378
            )Partnership’s
                share of net loss
            
            $
            (994
            )
            $
            (1,004
            )
            $
            (685
            )
            $
            (1,259
            )




Aero
            
            Boeing
            
            PLMFor
                the year ended
            
            Lion
            
            California
            
            737-300
            
            WorldwideDecember 31, 2004
            
            
            Partnership1
            
            
            Trust2
            
            
            Trust3
            
            
            Leasing
                Corp.4





Lease
                revenues and interest and other income
            
            $
            7,218
            
            $
            495
            
            $
            1,560Less:
                Depreciation and amortization expense
            
            
            1,115
            
            
            49
            
            
            1,533Operations support
            
            
            4,434
            
            
            26
            
            
            23General and administrative expenses
            
            
            415
            
            
            25
            
            
            127Net income (loss)
            
            $
            1,254
            
            $
            395
            
            $
            (123
            )Partnership’s
                share of net income (loss)
            
            $
            672
            
            $
            158
            
            $
            (64
            )
            $
            42





For
                the year ended
            
            PLM
                CAL I
            
            PLM
                CAL IIDecember 31, 2004 (continued)
            
            
            LLC5
            
            
            LLC6
            
            
            CFHS7
            
            
            Total





Lease
                revenues and interest and other income
            
            $
            1,372
            
            $
            1,354
            
            $
            260Less:
                Depreciation and amortization expense
            
            
            2,210
            
            
            2,206
            
            
            979Interest expense
            
            
            683
            
            
            682
            
            
            --General and administrative expenses
            
            
            65
            
            
            65
            
            
            21Net loss
            
            $
            (1,586
            )
            $
            (1,599
            )
            $
            (740
            )Partnership’s
                share of net loss
            
            $
            (532
            )
            $
            (537
            )
            $
            (149
            )
            $
            (410
            )




1
            The
                Partnership owns a 53% interest in the Lion Partnership that was
                formed in
                1997 that owns a product tanker.


2  The
      Partnership owned a 40% interest in the Aero California Trust that was formed
      in
      1996 and dissolved in 2005 that owned two stage III commercial aircraft that
      were on a direct finance lease.


3
            The
                Partnership owns a 62% interest in the Boeing 737-300 Trust that
                was
                formed in 1999 that owns a stage III commercial
                aircraft.


4
            The
                Partnership owned a 25% interest in PLM Worldwide Leasing that was
                formed
                in 1995 and dissolved in 2005 that owned aircraft related
                assets.


5
            The
                Partnership owns a 34% interest in PLM CAL I LLC that was formed
                in the
                third quarter of 2004 that owns two Boeing 737-500 stage III commercial
                aircraft.


6
            The
                Partnership owns a 34% interest in PLM CAL II LLC that was formed
                in the
                third quarter of 2004 that owns two Boeing 737-500 stage III commercial
                aircraft.


7
            The
                Partnership owns a 20% interest in CFHS that was formed in the fourth
                quarter of 2004 that owns various types of machinery and other
                equipment.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





6.  Equity
      Investments in Affiliated Entities (continued)





As
      of
      December 31, 2005 and 2004, all equipment owned by the Partnership’s equity
      investments were on lease.





In
      the
      first quarter of 2005, the lessee of the two stage III commercial aircraft
      on a
      direct finance lease in which the Partnership had an interest, exercised its
      purchase option for these aircraft in accordance with the lease agreement.
      The
      aircraft were sold for their net book value and the trust that had owned these
      aircraft was dissolved.





During
      2004, the Partnership, two affiliated programs and a non-affiliated third party,
      formed two new entities, PLM CAL I LLC (CAL I) and PLM CAL II LLC (CAL II).
      The
      Partnership contributed a total of $19.4 million to these entities and owns
      a
      33.7% interest in CAL I and CAL II. CAL I and CAL II each own two Boeing 737-500
      stage III commercial aircraft. CAL I and CAL II each assumed two loans totaling
      $25.7 million that bear an interest rate of 7.46% and 7.42%. The loans are
      non-recourse to the Partnership. The loans are collateralized by the aircraft
      and future lease payments. CAL I and CAL II distributed a total of $14.6 million
      as a non-operating cash distribution to the Partnership during 2004. No similar
      distributions were paid during 2005.





The
      Partnership's proportional share of acquisition, lease negotiation and debt
      placement fees paid by CAL I and CAL II to an affiliate of the General Partner
      totaled $1.3 million.





Additionally
      during 2004, the Partnership, two affiliated programs and a non-affiliated
      third
      party formed a tenancy-in-common (CFHS) that purchased and subsequently leased
      machinery and other equipment used in three hospitals. The Partnership
      contributed $4.1 million to this entity and owns a 20% interest in this entity.





The
      Partnership's proportional share of acquisition and lease negotiation fees
      paid
      by CFHS to an affiliate of the General Partner totaled $0.2 million.





The
      Partnership did not make any equity investments in 2005.





All
      leased equipment owned by entities in which the Partnership has an equity
      interest is accounted for as operating leases, except for the two jointly owned
      commercial aircraft on a direct finance lease that were sold in 2005. The
      Partnership’s proportionate share of future minimum rentals under non-cancelable
      leases as of December 31, 2005, for jointly owned equipment during each of
      the
      next five years are $3.4 million in 2006, $3.1 million in 2007, $2.4 million
      in
      2008, $2.8 million in 2009, $3.1 million in 2010, and $20.7 million thereafter.
      The Partnership’s proportionate share of per diem and short-term rentals
      consisting of utilization rate lease payments included in jointly owned lease
      revenues amounted to $5.1 million in 2005 and $3.8 million in 2004.





PLM
      Worldwide Leasing Corp. was dissolved during the fourth quarter of 2005.





7.  Operating
      Segments





The
      Partnership operates or operated in five operating segments: aircraft leasing,
      marine container leasing, marine vessel leasing, trailer leasing, and machinery
      and other equipment. Each equipment leasing segment engages in short-term to
      mid-term operating leases to a variety of customers.





The
      General Partner evaluates the performance of each segment based on profit or
      loss from operations before allocation of interest expense, general and
      administrative expenses, and certain other expenses. The segments are managed
      separately due to different business strategies for each operation. The
      accounting policies of the Partnership’s operating segments are the same as
      described in Note 1, Basis of Presentation. There were no intersegment revenues
      for the years ended December 31, 2005 and 2004.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





7.  Operating
      Segments (continued)





The
      following tables present a summary of the operating segments (in thousands
      of
      dollars):





Marine
            
            
            
            
            
            Machinery
            
            MarineFor
                the year ended
            
            Vessel
            
            Aircraft
            
            Trailer
            
            And
                Other
            
            ContainerDecember 31, 2005
            
            Leasing
            
            Leasing
            
            Leasing
            
            Equipment
            
            Leasing
            
            Other1
            
            TotalRevenuesLease
                revenue
            
            $
            --
            
            $
            4,120
            
            $
            --
            
            $
            --
            
            $
            3,076
            
            $
            --
            
            $
            7,196Interest
                and other income
            
            
            13
            
            
            --
            
            
            22
            
            
            --
            
            
            --
            
            
            289
            
            
            324Gain
                on disposition of equipment
            
            
            --
            
            
            --
            
            
            --
            
            
            --
            
            
            363
            
            
            --
            
            
            363Total revenues
            
            
            13
            
            
            4,120
            
            
            22
            
            
            --
            
            
            3,439
            
            
            289
            
            
            7,883ExpensesDepreciation
                and amortization
            
            
            --
            
            
            --
            
            
            --
            
            
            --
            
            
            1,309
            
            
            --
            
            
            1,309Operations
                support
            
            
            --
            
            
            --
            
            
            1
            
            
            --
            
            
            27
            
            
            --
            
            
            28Management
                fees to affiliate
            
            
            --
            
            
            154
            
            
            21
            
            
            --
            
            
            134
            
            
            --
            
            
            309Interest
                expense
            
            
            --
            
            
            --
            
            
            --
            
            
            --
            
            
            --
            
            
            471
            
            
            471General
                and administrative expenses
            
            
            --
            
            
            283
            
            
            --
            
            
            --
            
            
            --
            
            
            691
            
            
            974Recovery
                of bad debts
            
            
            --
            
            
            (375
            )
            
            --
            
            
            --
            
            
            --
            
            
            --
            
            
            (375
            )Total expenses
            
            
            --
            
            
            62
            
            
            22
            
            
            --
            
            
            1,470
            
            
            1,162
            
            
            2,716Equity
                in net income (loss) of equityInvestments
            
            
            1,344
            
            
            (1,918
            )
            
            --
            
            
            (685
            )
            
            --
            
            
            --
            
            
            (1,259
            )Income
                (loss) from continuing operations
            
            $
            1,357
            
            $
            2,140
            
            $
            --
            
            $
            (685
            )
            $
            1,969
            
            $
            (873
            )
            $
            3,908Total
                assets as ofDecember 31, 2005
            
            $
            3,270
            
            $
            6,034
            
            $
            --
            
            $
            3,256
            
            $
            7,034
            
            $
            9,964
            
            $
            29,558




Marine
            
            
            
            
            
            Machinery
            
            MarineFor
                the year ended
            
            Vessel
            
            Aircraft
            
            Trailer
            
            And
                Other
            
            ContainerDecember 31, 2004
            
            Leasing
            
            Leasing
            
            Leasing
            
            Equipment
            
            Leasing
            
            Other1
            
            TotalRevenuesLease
                revenue
            
            $
            --
            
            $
            1,247
            
            $
            53
            
            $
            --
            
            $
            3,037
            
            $
            --
            
            $
            4,337Interest
                and other income
            
            
            --
            
            
            --
            
            
            42
            
            
            --
            
            
            --
            
            
            104
            
            
            146Gain
                on disposition of equipment
            
            
            --
            
            
            --
            
            
            5
            
            
            --
            
            
            291
            
            
            --
            
            
            296Total revenues
            
            
            --
            
            
            1,247
            
            
            100
            
            
            --
            
            
            3,328
            
            
            104
            
            
            4,779ExpensesDepreciation
                and amortization
            
            
            --
            
            
            --
            
            
            --
            
            
            --
            
            
            1,613
            
            
            6
            
            
            1,619Operations
                support
            
            
            --
            
            
            --
            
            
            27
            
            
            --
            
            
            54
            
            
            --
            
            
            81Management
                fees to affiliate
            
            
            --
            
            
            27
            
            
            32
            
            
            --
            
            
            114
            
            
            --
            
            
            173Interest
                expense
            
            
            --
            
            
            --
            
            
            --
            
            
            --
            
            
            --
            
            
            616
            
            
            616General
                and administrative expenses
            
            
            2
            
            
            87
            
            
            31
            
            
            --
            
            
            --
            
            
            1,060
            
            
            1,180Total expenses
            
            
            2
            
            
            114
            
            
            90
            
            
            --
            
            
            1,781
            
            
            1,682
            
            
            3,669Equity
                in net income (loss) of equityinvestments
            
            
            672
            
            
            (933
            )
            
            --
            
            
            (149
            )
            
            --
            
            
            --
            
            
            (410
            )Income
                (loss) from continuing operations
            
            $
            670
            
            $
            200
            
            $
            10
            
            $
            (149
            )
            $
            1,547
            
            $
            (1,578
            )
            $
            700Investment
                in equity investments
            
            $
            --
            
            $
            19,358
            
            $
            --
            
            $
            4,086
            
            $
            --
            
            $
            --
            
            $
            23,444Total
                assets as ofDecember 31, 2004
            
            $
            3,346
            
            $
            8,950
            
            $
            434
            
            $
            3,937
            
            $
            8,787
            
            $
            12,742
            
            $
            38,196





8.  Geographic
      Information





The
      Partnership owns equipment that is leased and operated internationally. All
      of
      the Partnership's leasing transactions are denominated in United States dollars.
      Gains or losses resulting from foreign currency transactions are included in
      the
      results of operations and are not material.




1
            Includes
                certain assets not identifiable to a specific segment such as cash
                and
                certain other assets and assets held for sale. Also includes certain
                interest income and costs not identifiable to a particular segment,
                such
                as interest expense and certain amortization general and administrative
                expenses.





**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





8.
Geographic
      Information(continued)


The
      Partnership leases or leased its aircraft, trailers and machinery and other
      equipment to lessees domiciled in four geographic regions: United States, South
      America, Central America, and India. The marine vessel and marine containers
      are
      leased to multiple lessees in different regions that move the equipment on
      a
      regular basis to locations throughout the world.





The
      table
      below sets forth operating lease revenues by geographic region for the
      Partnership's owned equipment grouped by domicile of the lessee for the years
      ended December 31 (in thousands of dollars):





Owned
                EquipmentRegion
            
            2005
            
            2004United
                States
            
            $
            1,153
            
            $
            1,300India
            
            
            2,967
            
            
            --Rest
                of the world
            
            
            3,076
            
            
            3,037Lease
              revenues
            
            
            $
                7,196
            
            
            $
                4,337




The
      following table sets forth net income (loss) information from continuing
      operations by region for the owned equipment and equity investments in
      affiliated entities for the years ended December 31 (in thousands of
      dollars):





Owned
                Equipment
            
            Equity
                InvestmentsRegion
            
            2005
            
            2004
            
            2005
            
            2004United
                States
            
            $
            1,092
            
            $
            1,143
            
            $
            (2,681
            )
            $
            (1,176
            )South
                America
            
            
            --
            
            
            --
            
            
            78
            
            
            (64
            )Central
                America
            
            
            --
            
            
            --
            
            
            --
            
            
            158India
            
            
            2,967
            
            
            --
            
            
            --
            
            
            --Rest
                of the world
            
            
            1,981
            
            
            1,546
            
            
            1,344
            
            
            672Regional income (loss)
            
            
            6,040
            
            
            2,689
            
            
            (1,259
            )
            
            (410
            )Administrative
                and other
            
            
            (873
            )
            
            (1,579
            )
            
            --
            
            
            --Income
                (loss) from continuing operations
            
            $
            5,167
            
            $
            1,110
            
            $
            (1,259
            )
            $
            (410
            )





The
      net
      book value of owned equipment under operating lease and equity investments
      in
      affiliated entities as of December 31 are as follows (in thousands of
      dollars):





Owned
                Equipment
            
            Equity
                InvestmentsRegion
            
            2005
            
            2004
            
            2005
            
            2004United
                States
            
            $
            253
            
            $
            300
            
            $
            4,980
            
            $
            7,673South
                America
            
            
            --
            
            
            --
            
            
            4,056
            
            
            4,791Central
                America
            
            
            --
            
            
            --
            
            
            --
            
            
            76Rest
                of the world
            
            
            6,266
            
            
            7,875
            
            
            3,270
            
            
            3,346Net
                book value
            
            $
            6,519
            
            $
            8,175
            
            $
            12,306
            
            $
            15,886





9.  Basic
      Earnings (Loss) Per Weighted-Average Limited Partnership Unit





Basic
      earnings or loss per weighted-average limited partnership unit was computed
      by
      dividing income from continuing operations, loss from operations of discontinued
      operations and the gain on disposition of discontinued operations attributable
      to limited partners by the weighted-average number of limited partnership units
      deemed outstanding during the year. The weighted-average number of limited
      partnership units deemed outstanding during the year ended December 31, 2005
      and
      2004 was 7,730,965.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





9.  Basic
      (Loss) Earnings Per Weighted-Average Limited Partnership Unit (continued)





All
      special allocations of income to the General Partner are included in the
      calculation of basic earnings (loss) from continuing operations.





Basic
      earnings or loss per weighted average limited partnership unit from continuing
      operations, operation of discontinued operations, gain on disposition of
      discontinued operations and any special allocations to the limited partners
      are
      based on the following for the years ended December 31 (in thousands of dollars,
      except weighted-average limited partnership unit amounts):





2005
            
            2004Attributable
                to limited partners:Basic
                income from continuing operations
            
            $
            3,908
            
            $
            700Special
                allocation of loss
            
            
            (204
            )
            
            --Income
                from continuing operationsattributable to limited partners
            
            
            3,704
            
            
            700Loss
                from operation of discontinued operations
            
            
            (2,927
            )
            
            (121
            )Gain
                on disposition of discontinued operations
            
            
            4,608
            
            
            --Net
                income
            
            $
            5,385
            
            $
            579Weighted
                average limited partnership unitsoutstanding
            
            
            7,730,965
            
            
            7,730,965Basic
                earnings per weighted average limited
              partnership unit:Income
                from continuing operations
            
            $
            0.48
            
            $
            0.09Loss
                from operation of discontinued operations
            
            
            (0.38
            )
            
            (0.02
            )Gain
                on disposition of discontinued operations
            
            
            0.60
            
            
            --Net
                income per weighted average limitedpartnership unit
            
            $
            0.70
            
            $
            0.07





10.  Accounts
      Receivable





Accounts
      receivable represents balances due from current or former lessees for unpaid
      balances incurred from leasing Partnership owned equipment. The components
      of
      accounts receivable as of December 31 were as follows (in thousands of
      dollars):





2005
            
            2004Trade
                accounts receivable
            
            $
            778
            
            $
            1,386Allowance
                for doubtful accounts
            
            
            --
            
            
            (375
            )$
            778
            
            $
            1,011





During
      2005, the allowance for doubtful accounts decreased $0.4 million due to the
      collection of receivables that had been previously reserved as a bad debt.
      No
      additional provisions for bad debts were required at December 31,
      2005.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





11.  Other
      Assets





The
      components of the other assets, net, as of December 31 are as follows (in
      thousands of dollars):





2005
            
            2004Prepaid
                expenses
            
            $
            173
            
            $
            64Other
                assets
            
            
            5
            
            
            5Finance
                lease receivable
            
            
            --
            
            
            382Debt
                placement fees, net
            
            
            --
            
            
            125$
            178
            
            $
            576





In
      the
      fourth quarter of 2005, the lessee prepaid the outstanding balance on the
      finance lease receivable.





12.  Debt





The
      Partnership's notes payable, which had a balance of $10.0 million at
      December 31, 2004, was collateralized by substantially all of the Partnership's
      cash, accounts receivable and equipment.  The Partnership made each of the
      regularly scheduled principal payments of $1.0 million on the notes payable
      in
      the first and second quarter of 2005. During August 2005, the Partnership
      prepaid its remaining outstanding notes payable of $8.0 million plus accrued
      interest of $0.1 million. There was no prepayment penalty associated with the
      prepayment of the notes payable. The cash for the payment came from operations
      and equipment dispositions. Concurrent with repayment of the notes payable,
      the
      Partnership expensed the remaining unamortized portion of debt placement fees
      related to this note payable of $0.1 million.





The
      Partnership is a participant in a $10.0 million warehouse credit facility.
      The
      warehouse credit facility is shared by the Partnership, PLM Equipment Growth
      & Income Fund VII, MILPI Holdings LLC (MILPI) and its subsidiaries, and
      Railcar Investors II. MILPI and Railcar Investors II are controlled by the
      previous owners of FSI. The facility provides for financing up to 100% of the
      cost of the equipment and is scheduled to expire on May 1, 2006 with all
      advances due no later than May 1, 2006. Borrowings by the Partnership are
      collateralized by equipment purchased with the proceeds of the loan. Outstanding
      borrowings by one borrower reduce the amount available to each of the other
      borrowers under the facility. Interest accrues either at the prime rate or
      LIBOR
      plus 2.0% at the borrower’s option and is set at the time of an advance of
      funds. Borrowings by the Partnership are guaranteed by FSI, PLM International,
      Inc. and MILPI. The Partnership cannot borrow on this facility until the lender
      releases the requirement that PLM International and MILPI provide guarantees.
      The Partnership is not liable for the advances made to the other
      borrowers.





As
      of
      December 31, 2005, there were no outstanding borrowings on this facility by
      the
      Partnership.





13.  Concentrations
      of Credit Risk





For
      the
      years ended December 31, 2005 and 2004, the Partnership’s customers that
      accounted for 10% or more of the total revenues for the owned equipment and
      jointly owned equipment were Sahara Airlines (17% in 2005) and American Airlines
      (12% in 2004) which are in the aircraft leasing segment, and Cronos Group (14%
      in 2005 and 21% in 2004) which is in the marine container leasing segment.
      In
      2005, the Partnership settled all litigation with Sahara Airlines, a former
      lessee, who had defaulted on its lease.





As
      of
      December 31, 2005 and 2004, the Partnership’s customers that accounted for 10%
      or more of the total accounts receivable for the owned equipment and jointly
      owned equipment were Cronos Group (19% in 2005 and 30% 2004) and Capital Leasing
      (20% in 2004) which are in the marine container leasing segment, CFHS Leasing
      (19% in 2005) which is in the machinery and other equipment leasing segment,
      and
      Stena Bulk LLC (52% in 2005 and 38% in 2004) which is in the marine vessel
      leasing segment. CFHS trade accounts receivable is fully payable at the end
      of
      the existing lease which is scheduled to expire in November 2006 unless the
      existing lessee extends the lease in accordance with the lease agreement, in
      which case, the lessee can remain up to two years in arrears of its lease
      payments.





As
      of
      December 31, 2005 and 2004, the General Partner believed the Partnership had
      no
      other significant concentrations of credit risk that could have a material
      adverse effect on the Partnership.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





14.  Income
      Taxes





The
      Partnership is not subject to income taxes, as any income or loss is included
      in
      the tax returns of the individual partners. Accordingly, no provision for income
      taxes has been made in the financial statements of the Partnership.





As
      of
      December 31, 2005 and 2004, the financial statement carrying amount of assets
      and liabilities was approximately $22.1 million and $20.9 million, respectively,
      lower than the federal income tax basis of such assets and liabilities and
      the
      Partnership's income in 2005 was approximately $0.7 million lower and the
      Partnership's income in 2004 was approximately $3.9 million higher than the
      federal income tax basis. These differences are primarily due to the tax
      treatment of depreciation, equipment reserves, provisions for bad debts,
      lessees’ prepaid deposits, and of underwriting commissions and syndication
      costs.





To
      prevent the limited partnership units from being considered publicly traded
      and
      thereby to avoid taxation of the Partnership as an association treated as a
      corporation under the Internal Revenue Code, the limited partnership units
      will
      not be transferable without the consent of the General Partner, which may be
      withheld in its absolute discretion. The General Partner monitors transfers
      of
      limited partnership units in an effort to ensure that they do not exceed the
      percentage or number permitted by certain safe harbors promulgated by the
      Internal Revenue Service. Effective January 1, 2006, the percentage of
      Partnership units that may be traded in any calendar year has been reduced
      from
      five percent to two percent to comply with Internal Revenue Service regulations.
      A transfer may be prohibited if the intended transferee is not a United States
      citizen or if the transfer would cause any portion of the units of a “Qualified
      Plan” as defined by the Employee Retirement Income Security Act of 1974 and
      Individual Retirement Accounts to exceed the allowable limit.





15.  Contingencies





Litigation





On
      December 31, 2003 and during 2004, in the state court for Darlington County,
      South Carolina, actions were filed by Harold H. Collins, his wife Dianne
      Collins, and Rickey Thomas, Sr. against South Carolina Central Railroad Company,
      Inc., CSX Transportation, Inc., TradeMark Nitrogen, Inc. and PLM Investment
      Management, Inc. (IMI) as the lessor of a railcar.  The actions involve the
      chemical spill of an ammonia solution from a railcar owned by the Partnership
      on
      September 28, 2003. All three law suits allege permanent injuries and negligence
      on the part of all defendants in their respective duties to exercise reasonable
      care in the selection of railcar type, inspection, maintenance, repair and
      transport of the railcar. The complaints did not allege a specific amount of
      damages.





In
      November 2005, Harold Collins entered into a settlement of his litigation during
      the course of his trial.  The litigation settlement is included in
      loss from operation of discontinued operations in the accompanying statements
      of
      income.  At the time of Mr. Collins’ settlement, his wife Diane Collins
      also dismissed, with prejudice, her case against IMI and the other
      defendants.





No
      trial
      date has been set for the Rickey Thomas Sr. case, but counsel advises it will
      be
      reached in the ordinary course no sooner than June of 2006. The Partnership
      has
      recently been added as a defendant in the case. Counsel for the Partnership
      and
      IMI (collectively, PLM entities) defendants intend to move for summary judgment
      in the case as soon as discovery permits.





In
      January 2006, a new action against the same group of defendants, including
      PLM
      entities, was filed in the same county in South Carolina by the same plaintiffs’
attorneys on behalf of the Estate of Glen Collins. Glen Collins was the brother
      of Harold Collins and was deposed before his demise as a witness in the Harold
      Collins case. He lived in the neighborhood of the spill and observed it from
      an
      apparently safe distance on the day of the occurrence. The evidence is that
      his
      exposure was minimal or non-existent on the day of the spill. Glenn Collins
      claims additional exposure as a result of his employment as a welder with a
      railcar service company a few days after the spill. He was in his mid-forties
      at
      the time of his death and was known to have had pre-existing diseases such
      as
      emphysema and Chrohn's disease before the date of the spill. He had also
      received a cash settlement from a separate workers’ compensation claim for some
      of his ailments.







**PLM
      EQUIPMENT GROWTH FUND VI**


**(A
      Limited Partnership)**


**NOTES
      TO FINANCIAL STATEMENTS**





15.  Commitments
      and Contingencies (continued)





Litigation (continued)





The
      attorneys for these plaintiffs also represent additional potential plaintiffs.
      Twenty-two additional actions were once filed and subsequently dismissed without
      prejudice.  These actions were never served.  A review of those
      withdrawn complaints reveals that they too are substantially similar to the
      complaints filed on behalf of the Collins’ and Rickey Thomas.  The
      potential exists for additional claims to be filed prior to the expiration
      of
      the statute of limitations on September 28, 2006. Potential plaintiffs are
      all
      represented by the same counsel, who has indicated an interest in a global
      mediation of all cases and potential cases. Defendants are awaiting voluntary
      discovery of medical records in the as yet, un-filed cases as a precondition
      of
      further discussion of a global mediation.





The
      Partnership's policy is to expense legal fees as incurred.






Additionally,
      the Partnership is subject to legal proceedings involving ordinary and routine
      claims related to its business. The ultimate legal and financial liability
      with
      respect to such matters cannot be estimated with certainty and requires the
      use
      of estimates in recording liabilities for potential litigation settlements.
      Estimates for losses from litigation are disclosed if considered reasonably
      possible and accrued if considered probable after consultation with outside
      counsel. If estimates of potential losses increase or the related facts and
      circumstances change in the future, the Partnership may be required to record
      additional litigation expense.





The
      General Partner believes that all of the actions discussed above will not
      have a material effect on the financial condition of the Partnership, are
      substantially without merit and will vigorously defend against the
      actions.


In
        the
        first quarter of 2005, the Partnership settled all litigation matters with
        a
        former India lessee who had defaulted on its lease for several aircraft.
        The
        Partnership received $3.3 million in cash. The Partnership incurred legal
        costs
        of approximately $0.3 million related to this settlement in
        2005.




16.  Subsequent
      Event





During
      February 2006, the lessee of approximately 1,183 of the Partnership's marine
      containers notified the General Partner that it intends to exercise its purchase
      option of these marine containers in the first and second quarter of 2006.
      The
      purchase option for these marine containers is in excess of the net book
      value.







**PLM
      EQUIPMENT GROWTH FUND VI**





**INDEX
      OF EXHIBITS**




Exhibit
              
              Page4.
              Amended
                  and Restated Limited Partnership Agreement of Partnership.
              *4.1
              First
                  Amendment to the Amended and Restated Limited Partnership
                  Agreement.
              56-574.2
              Second
                  Amendment to the Amended and Restated Limited Partnership
                  Agreement.
              *10.1
              Management
                  Agreement between Partnership and PLM Investment Management,
                  Inc.
              *10.2
              Note
                  Agreement, dated as of December 21, 2001, regarding $30.0 million
term
                  loan notes due December 21, 2006.
              *10.3
              First
                  Amendment to Credit Agreement, dated March 2, 2003.
              *10.4
              Second
                  Amendment to Credit Agreement, dated June 30, 2003.
              *10.5
              Third
                  Amendment to Credit Agreement, dated September 30, 2003.
              *10.6
              Amended
                  and restated Warehouse Credit Agreement, dated as of March 17,
                  2004.
              *10.7
              First
                  Amendment to Amended and Restated Warehouse Credit Agreement
                  datedSeptember
                  3, 2004.
              *10.8
              Second
                  Amendment to Amended and Restated Warehouse Credit Agreement dated
                  October
                  20, 2004.
              *10.9
              PLM
                  CAL I LLC operating agreement dated June 4, 2004.
              *10.10
              PLM
                  CAL II LLC operating agreement dated June 4, 2004.
              *10.11
              PLM
                  CAL I LLC equipment purchase agreement dated August 26,
                  2004.
              *10.12
              PLM
                  CAL II LLC equipment purchase agreement dated August 26,
                  2004.
              *10.13
              Trust
                  Indenture and Mortgage 645 between First Security Bank, National
                  Association and Wilmington Trust Company assumed by PLM CAL
                  I.
              *10.14
              Trust
                  Indenture and Mortgage 646 between First Security Bank, National
                  Association and Wilmington Trust Company assumed by PLM CAL
                  I.
              *10.15
              Trust
                  Indenture and Mortgage 647 between First Security Bank, National
                  Association and Wilmington Trust Company assumed by PLM CAL
                  II.
              *10.16
              Trust
                  Indenture and Mortgage 648 between First Security Bank, National
                  Association and Wilmington Trust Company assumed by PLM CAL
                  II.
              *10.17
              Trust
                  Indenture and Mortgage 645 Supplement between First Security Bank,
                  National Association and Wilmington Trust Company assumed by PLM
                  CAL
                  I.
              *10.18
              Trust
                  Indenture and Mortgage 646 Supplement between First Security Bank,
                  National Association and Wilmington Trust Company assumed by PLM
                  CAL
                  I.
              *10.19
              Trust
                  Indenture and Mortgage 647 Supplement between First Security Bank,
                  National Association and Wilmington Trust Company assumed by PLM
                  CAL
                  II.
              *10.20
              Trust
                  Indenture and Mortgage 648 Supplement between First Security Bank,
                  National Association and Wilmington Trust Company assumed by PLM
                  CAL
                  II.
              *10.21
              Letter
                  of intent to purchase manufacturing equipment with PLM International,
                  Inc.
                  dated December 23, 2004.
              *10.22
              Third
                  Amendment to Amended and Restated Warehouse Credit Agreement dated
                  December28,
                  2004.
              *10.23
              Fourth
                  Amendment to Amended and Restated Warehouse Credit Agreement dated
                  March
                  24, 2005.
              *10.24
              Fifth
                  Amendment to Amended and Restated Warehouse Credit Agreement dated
                  July
                  26, 2005.
              *10.25
              Asset
                  purchase agreement dated as of August 4, 2005.
              *14.
              PLM
                  Financial Services Inc. Code of Ethics.
              *31.1
              Certificate
                  of President of the General Partner pursuant to Section 302 of
                  Sarbanes -
                  Oxley Act of 2002.
              5231.2
              Certificate
                  of Chief Financial Officer of the General Partner pursuant to Section
                  302
                  of Sarbanes - Oxley Act of 2002.
              5332.1
              Certificate
                  of President of the General Partner pursuant to Section 906 of
                  Sarbanes -
                  Oxley Act of 2002.
              5432.2
              Certificate
                  of Chief Financial Officer of the General Partner pursuant to Section
                  906
                  of Sarbanes - Oxley Act of 2002.
              55


* Incorporated by reference. See page 22-24 of this
      report.