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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the quarterly period ended March 31, 2010
 OR
 o
    
    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 0-27496
 CRONOS GLOBAL INCOME FUND XVI, L.P.
  California
(State or other jurisdiction of 
incorporation or organization)
    
    94-3230380
(I.R.S. Employer
Identification No.)
 
 
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer o
    
    Smaller reporting company þ(Do not check if a smaller reporting company)
 o þ




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Report on Form 10-Q for the Quarterly Period
Ended March 31, 2010
 TABLE OF CONTENTS
 PAGEPART I  FINANCIAL INFORMATION
    
    
    1Item 1. Financial Statements
    
    
    1Unaudited Condensed Balance Sheets as of March 31, 2010 and December 31, 2009
    
    
    2Unaudited Condensed Statements of Operations for the three months ended March 31, 2010 and 2009
    
    
    3Unaudited Condensed Statements of Cash Flows for the three months ended March 31, 2010 and 2009
    
    
    4Unaudited Notes to the Condensed Financial Statements
    
    
    5Item 2. Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    11Item 3. Quantitative and Qualitative Disclosures About Market Risk
    
    
    15Item 4. Controls and Procedures
    
    
    15Item 4T. Controls and Procedures
    
    
    15PART II  OTHER INFORMATION
    
    
    16Item 1. Legal Proceedings
    
    
    16Item 1A. Risk Factors
    
    
    16Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
    
    
    16Item 3. Defaults Upon Senior Securities
    
    
    16Item 4. [Removed and Reserved]
    
    
    16Item 5. Other Information
    
    
    16Item 6. Exhibits
    
    
    16EX-31.1EX-31.2EX-32




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##### Table of Contents



PART I  FINANCIAL INFORMATION
 
 Financial Statements
   1




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Condensed Balance Sheets
 (Unaudited)
 March 31,
    
    
    December 31,2010
    
    
    2009AssetsCurrent assets:Cash
    
    $
    550,097
    
    
    $
    650,666Net lease receivables due from Leasing Agent
    
    
    239,652
    
    
    
    182,324Direct finance lease receivable, due from Leasing Agent within one year, net
    
    
    26,539
    
    
    
    26,485Total current assets
    
    
    816,288
    
    
    
    859,475Direct finance lease receivable, due from Leasing Agent after one year, net
    
    
    62,668
    
    
    
    67,711Container rental equipment, at cost
    
    
    12,884,684
    
    
    
    13,976,467Less accumulated depreciation
    
    
    (9,658,728
    )
    
    
    (10,330,153
    )Net container rental equipment
    
    
    3,225,956
    
    
    
    3,646,314Total assets
    
    $
    4,104,912
    
    
    $
    4,573,500Partners CapitalPartners capital:General partner
    
    
    958
    
    
    
    1,697Limited partners
    
    
    4,103,954
    
    
    
    4,571,803Total partners capital
    
    $
    4,104,912
    
    
    $
    4,573,500
  2




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Condensed Statements of Operations
 (Unaudited)
 Three Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2009Net lease revenue from Leasing Agent
    
    $
    173,281
    
    
    $
    294,764Other operating (expenses) income:Depreciation
    
    
    (197,202
    )
    
    
    (257,714
    )Other general and administrative expenses
    
    
    (39,495
    )
    
    
    (25,842
    )Net gain on disposal of equipment
    
    
    107,428
    
    
    
    49,500(129,269
    )
    
    
    (234,056
    )Net income
    
    $
    44,012
    
    
    $
    60,708Allocation of net income:General partner
    
    $
    11,965
    
    
    $
    21,626Limited partners
    
    
    32,047
    
    
    
    39,082$
    44,012
    
    
    $
    60,708Limited partners per unit share of net income
    
    $
    0.02
    
    
    $
    0.02
  3




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Condensed Statements of Cash Flows
 (Unaudited)
 Three Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2009Net cash provided by operating activities
    
    $
    113,180
    
    
    $
    310,673Cash flows from investing activities:Proceeds from sale of container rental equipment
    
    
    298,851
    
    
    
    303,406Cash flows from financing activities:Distributions to general partner
    
    
    (12,704
    )
    
    
    (21,838
    )Distributions to limited partners
    
    
    (499,896
    )
    
    
    (646,532
    )Net cash used in financing activities
    
    
    (512,600
    )
    
    
    (668,370
    )Net decrease in cash
    
    
    (100,569
    )
    
    
    (54,291
    )Cash at the beginning of the period
    
    
    650,666
    
    
    
    886,181Cash at the end of the period
    
    $
    550,097
    
    
    $
    831,890
  4




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Notes to Unaudited Condensed Financial Statements
 Summary of Significant Accounting Policies
 Nature of Operations
     Leasing Agent
   5




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Unaudited Condensed Financial Statements
    Basis of Presentation
  Use of Estimates in Interim Financial Statements
  6




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Unaudited Condensed Financial Statements
 Container Rental Equipment
   Allocation of Net Income or Loss, Partnership Distributions and Partners Capital
   7




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Unaudited Condensed Financial Statements
  Net Lease Receivables Due from Leasing Agent
  March 31,
    
    
    December 31,2010
    
    
    2009Gross lease receivables
    
    $
    474,121
    
    
    $
    391,120Less:Direct operating expenses payable
    
    
    179,217
    
    
    
    155,879Base management fees payable
    
    
    17,619
    
    
    
    18,860Reimbursed administrative expenses payable
    
    
    6,859
    
    
    
    6,873Allowance for doubtful accounts
    
    
    30,774
    
    
    
    27,184Net lease receivables due from Leasing Agent
    
    $
    239,652
    
    
    $
    182,324
   8




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Unaudited Condensed Financial Statements
 Net Lease Revenue
  Three Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2009Gross lease revenue
    
    $
    307,678
    
    
    $
    455,287Interest income from direct finance lease
    
    
    8,758
    
    
    
    2,477Less:Direct operating expenses
    
    
    102,260
    
    
    
    111,563Base management fees
    
    
    21,252
    
    
    
    31,144Reimbursed administrative expensesSalaries
    
    
    14,450
    
    
    
    14,886Other payroll related expenses
    
    
    1,913
    
    
    
    1,755General and administrative expenses
    
    
    3,280
    
    
    
    3,652143,155
    
    
    
    163,000Net lease revenue
    
    $
    173,281
    
    
    $
    294,764
 Operating Segment
   Three Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2009Dry cargo containers
    
    $
    238,690
    
    
    $
    354,604Refrigerated containers
    
    
    29,904
    
    
    
    61,965Tank containers
    
    
    39,084
    
    
    
    38,718Total
    
    $
    307,678
    
    
    $
    455,287
  9




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Unaudited Condensed Financial Statements
 Limited Partners Capital
  Three Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2009Cash Distributions from Operations
    
    $
    179,962
    
    
    $
    359,924Cash Distributions from Sales Proceeds
    
    
    319,934
    
    
    
    286,608Total Cash Distributions
    
    $
    499,896
    
    
    $
    646,532
   10




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Managements Discussion and Analysis of Financial Condition and Results of
Operations
  Results of Operations
 Partnership Overview
   
    
    Activity-related expenses, including agent costs and depot costs such as repairs,
maintenance and handling;
    
    Inventory-related expenses for off-hire containers, comprising storage and
repositioning costs. These costs are sensitive to the quantity of off-hire containers
as well as the frequency at which containers are re-delivered and the frequency and
size of repositioning moves undertaken; and
    
    Legal and other expenses, including legal costs related to the recovery of
containers and doubtful accounts, insurance and provisions for doubtful accounts.
  Dry Cargo
    
    
    RefrigeratedContainers
    
    
    Containers
    
    
    Tank Containers
    
    
    TotalContainer on lease:Master lease
    
    
    3,946
    
    
    
    40
    
    
    
    20
    
    
    
    4,006Term leaseShort term1
    
    
    390
    
    
    
    3
    
    
    
    14
    
    
    
    407Long term2
    
    
    990
    
    
    
    23
    
    
    
    7
    
    
    
    1,0201,380
    
    
    
    26
    
    
    
    21
    
    
    
    1,427Subtotal
    
    
    5,326
    
    
    
    66
    
    
    
    41
    
    
    
    5,433Containers off-hire
    
    
    887
    
    
    
    21
    
    
    
    9
    
    
    
    917Total container fleet
    
    
    6,213
    
    
    
    87
    
    
    
    50
    
    
    
    6,350
 
 1.
    
    Short term leases represent term leases that are either scheduled for renegotiation or that
may expire on or before March 2011.2.
    
    Long term leases represent term leases that will expire after March 2011. 11




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Dry Cargo Containers
    
    
    Refrigerated Containers
    
    
    Tank Containers
    
    
    TotalTEU
    
    
    %
    
    
    TEU
    
    
    %
    
    
    TEU
    
    
    %
    
    
    TEU
    
    
    %Total purchases
    
    
    11,053
    
    
    
    100
    %
    
    
    690
    
    
    
    100
    %
    
    
    52
    
    
    
    100
    %
    
    
    11,795
    
    
    
    100
    %Less disposals
    
    
    4,840
    
    
    
    44
    %
    
    
    603
    
    
    
    87
    %
    
    
    2
    
    
    
    4
    %
    
    
    5,445
    
    
    
    46
    %Remaining fleet at March 31, 2010
    
    
    6,213
    
    
    
    56
    %
    
    
    87
    
    
    
    13
    %
    
    
    50
    
    
    
    96
    %
    
    
    6,350
    
    
    
    54
    %
 Market & Industry Overview
    Three Months EndedMarch 31,
    
    
    March 31,2010
    
    
    2009Fleet size (measured in TEUs)Dry cargo containers
    
    
    6,333
    
    
    
    7,610Refrigerated containers
    
    
    93
    
    
    
    206Tank containers
    
    
    50
    
    
    
    51Utilization rates for combined fleetAverage for the period
    
    
    82
    %
    
    
    86
    %At end of period
    
    
    86
    %
    
    
    83
    %
 Three Months Ended March 31, 2010 Compared to the Three Months Ended March 31, 2009
 Overview
 Net income
 
    
    an 18% reduction in the size of the container fleet (measured in TEUs) as
equipment that was redelivered by customers was sold;
    
    a decline in the levels of net lease revenues, resulting from the combined effect of a reduction
in the size of the fleet, lower average utilization and lease per-diem levels;
    
    a decrease in depreciation expense as a result of the declining fleet size; and
    
    an increase in the levels of gains recorded on the disposal of equipment at the end of its
useful maritime life.
 12




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Analysis and discussion
 Net lease revenue
 Depreciation expense
 Other general and administrative expenses
 Net gain on disposal of equipment
 Liquidity and Capital Resources
    13




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Cash from Operating Activities:
 Cash from Investing Activities:
 Cash from Financing Activities
 Critical Accounting Policies
  
    
    Container equipment  depreciable lives and residual values.
    
    Container equipment  recoverability and valuation.
    
    Allowance for doubtful accounts.
  Inflation
 The Partnership believes inflation has not had a material adverse effect on the results of its
operations.
 14




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Quantitative and Qualitative Disclosures About Market Risk
 Exchange rate risk
 Credit risk:
 
 Controls and Procedures
 See Item 4T.
 
 Controls and Procedures
   15




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PART II  OTHER INFORMATION
 
 Item 1. Legal Proceedings
  
 Item 1A. Risk Factors
  
 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
  
 Item 3. Defaults Upon Senior Securities
  
 Item 4. [Removed and Reserved]
 
 Item 5. Other Information
  
 Item 6. Exhibits
  ExhibitNo.
    
    Description
    
    Method of Filing3(a)
    
    Limited Partnership Agreement, amended
and restated as of December 28, 1995
    
    *3(b)
    
    Certificate of Limited Partnership
    
    **10
    
    Form of Leasing Agent Agreement
with Cronos Containers Limited
    
    ***31.1
    
    Rule 13a-14 Certification
    
    Filed with this document31.2
    
    Rule 13a-14 Certification
    
    Filed with this document32
    
    Section 1350 Certification
    
    Filed with this document ****
 
 *
    
    Incorporated by reference to Exhibit A to the Prospectus of the Partnership dated December
28, 1995, included as part of Registration Statement on Form S-1 (No. 33-98290)**
    
    Incorporated by reference to Exhibit 3.2 to the Registration Statement on Form S-1
(No. 33-98290)***
    
    Incorporated by reference to Exhibit 10.2 to the Registration
Statement on Form S-1 (No. 33-98290)****
    
    This certification, required by Section 906 of the Sarbanes-Oxley Act of 2002, other than as
required by Section 906, is not to be deemed filed with the Commission or subject to the rules
and regulations promulgated by the Commission under the Securities Exchange Act of 1934, as
amended, or to the liabilities of Section 18 of said Act. 16




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SIGNATURES
  CRONOS GLOBAL INCOME FUND XVI, L.P.

By Cronos Capital Corp.
The General Partner By
    /s/ Peter J. YoungerPeter J. Younger  President and Chief Executive Officer of CronosCapital Corp. (CCC)
Principal Executive Officer of CCC By
    /s/ Frank P. VaughanFrank P. VaughanChief Financial Officer and Director of CronosCapital Corp. (CCC)
Principal Financial and Accounting Officer of CCC  17




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EXHIBIT INDEX
 ExhibitNo.
    
    Description
    
    Method of Filing3(a)
    
    Limited Partnership Agreement, amended
and restated as of December 28, 1995
    
    *3(b)
    
    Certificate of Limited Partnership
    
    **10
    
    Form of Leasing Agent Agreement
with Cronos Containers Limited
    
    ***31.1
    
    Rule 13a-14 Certification
    
    Filed with this document31.2
    
    Rule 13a-14 Certification
    
    Filed with this document32
    
    Section 1350 Certification
    
    Filed with this document ****
 
 *
    
    Incorporated by reference to Exhibit A to the Prospectus of the Partnership dated December
28, 1995, included as part of Registration Statement on Form S-1 (No. 33-98290)**
    
    Incorporated by reference to Exhibit 3.2 to the Registration Statement on Form S-1
(No. 33-98290)***
    
    Incorporated by reference to Exhibit 10.2 to the Registration
Statement on Form S-1 (No. 33-98290)****
    
    This certification, required by Section 906 of the Sarbanes-Oxley Act of 2002, other than as
required by Section 906, is not deemed to be filed with the Commission or subject to the rules
and regulations promulgated by the Commission under the Securities Exchange Act of 1934, as
amended, or to the liabilities of Section 18 of said Act.