##### Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 Washington, D.C. 20549
 FORM 10-K
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934
 For the fiscal year ended December 31, 2008
 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
    
    94-3230380(State or other jurisdiction of
    
    (I.R.S. Employer Identification No.)incorporation or organization)
 
   Name of each exchange onTitle of each class
    
    which registeredNot Applicable
  UNITS OF LIMITED PARTNERSHIP INTERESTS
  o þ
 o þ
 þ o
 þ
  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-K for the Fiscal Year
Ended December 31, 2008
 TABLE OF CONTENTS
 PAGEPART I
    
    
    3Item 1  Business
    
    
    3Item 1A  Risk Factors
    
    
    10Item 1B  Unresolved Staff Comments
    
    
    14Item 2  Properties
    
    
    14Item 3  Legal Proceedings
    
    
    14Item 4  Submission of Matters to a Vote of Security Holders
    
    
    14PART II
    
    
    15Item 5  Market for the Partnerships Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
    
    
    15Item 6  Selected Financial Data
    
    
    16Item 7  Managements Discussion and Analysis of Financial Condition and Results of Operations
    
    
    17Item 7A Quantitative and Qualitative Disclosures About Market Risk
    
    
    23Item 8  Financial Statements and Supplementary Data
    
    
    23Item 9  Changes In and Disagreements with Accountants on Accounting and Financial Disclosure
    
    
    39Item 9A  Controls and Procedures
    
    
    39Item 9A(T)  Controls and Procedures
    
    
    39Item 9B  Other Information
    
    
    39PART III
    
    
    40Item 10  Directors, Executive Officers and Corporate Governance
    
    
    40Item 11  Executive Compensation
    
    
    43Item 12  Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
    
    
    44Item 13  Certain Relationships and Related Transactions, and Director Independence
    
    
    44Item 14  Principal Accountant Fees and Services
    
    
    45PART IV
    
    
    46Item 15  Exhibits and Financial Statement Schedules
    
    
    46EX-31.1EX-31.2EX-32
  2




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PART I
 
 Item 1. Business
    Percentage ofAmount
    
    
    Gross ProceedsGross Subscription Proceeds
    
    $
    31,993,340
    
    
    
    100.0
    %Public Offering Expenses:Underwriting Commissions
    
    $
    3,199,334
    
    
    
    10.0
    %Offering and Organization Expenses
    
    $
    1,482,466
    
    
    
    4.6
    %Total Public Offering Expenses
    
    $
    4,681,800
    
    
    
    14.6
    %Net Proceeds
    
    $
    27,311,540
    
    
    
    85.4
    %Acquisition Fees
    
    $
    1,276,220
    
    
    
    4.0
    %Working Capital Reserve
    
    $
    319,933
    
    
    
    1.0
    %Unexpended Proceeds
    
    $
    190,993
    
    
    
    0.6
    %Gross Proceeds Invested in Equipment
    
    $
    25,524,394
    
    
    
    79.8
    %
    3




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##### Table of Contents



Benefits of Leasing
  
    
    Leasing provides shipping lines with the flexibility to respond to rapidly changing market
opportunities as they arise without relying exclusively on their own containers;
    
    Leasing allows shipping lines to respond to changing seasonal and trade route demands, thereby
optimizing their capital investment and minimizing storage costs;
    
    Leasing enables shipping lines to expand their trade routes and market shares at a relatively
low cost without making a permanent commitment to support their new structure;
 4




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##### Table of Contents




    
    Leasing allows the shipping lines to utilize the equipment they need without having to
make large capital expenditures;
    
    Leasing offers a shipping line an alternative source of financing in a traditionally
capital-intensive industry; and
    
    Leasing allows shipping lines to benefit from the relationships between container
manufacturers and leasing companies.
 Fleet Profile
  ® ®
    Dry Cargo
    
    Refrigerated
    
    TankContainers
    
    Containers
    
    Containers40-Foot
    
    
    
    
    
    40-Foot20-Foot
    
    40-Foot
    
    High-Cube
    
    20-Foot
    
    High-CubeContainers on lease:Master lease
    
    
    1,804
    
    
    
    644
    
    
    
    1,075
    
    
    
    19
    
    
    
    46
    
    
    
    21Term leaseShort term1
    
    
    157
    
    
    
    51
    
    
    
    72
    
    
    
    5
    
    
    
    2
    
    
    
    7Long term 2
    
    
    530
    
    
    
    156
    
    
    
    225
    
    
    
    1
    
    
    
    22
    
    
    
    19687
    
    
    
    207
    
    
    
    297
    
    
    
    6
    
    
    
    24
    
    
    
    26Subtotal
    
    
    2,491
    
    
    
    851
    
    
    
    1,372
    
    
    
    25
    
    
    
    70
    
    
    
    47Containers off hire
    
    
    242
    
    
    
    82
    
    
    
    181
    
    
    
    4
    
    
    
    23
    
    
    
    4Total container fleet
    
    
    2,733
    
    
    
    933
    
    
    
    1,553
    
    
    
    29
    
    
    
    93
    
    
    
    51
 
 1.
    
    Short term leases represent term leases that are either scheduled for renegotiation or
that may expire in 2009.2.
    
    Long term leases represent term leases, the majority of which will expire between 2010
and 2019.  5




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##### Table of Contents



Types of Leases
  
    
    Master leases.Master leases provide customers with flexibility by allowing them to
pick up containers where and when required on pre-agreed terms, subject to restrictions
and availability. Master leases also define the number of containers that may be
returned within each calendar month, the permitted return locations and applicable
drop-off charges. Due to the increased flexibility they offer, master leases usually
command higher per-diem rates and generate more ancillary revenue (including pick-up,
drop-off, handling and off-hire revenue) than term leases. The commercial terms of
master leases are usually negotiated or renewed annually.
    
    Term leases.Term leases are for a fixed quantity of containers for a fixed period
of time, typically ranging from three to five years. In most cases, containers cannot
be returned prior to the expiration of the lease. Some term lease agreements contain
early termination penalties that apply in the event of early redelivery. Term leases
provide greater revenue stability to the lessor, but usually at lower lease rates than
master leases. Ocean carriers use term leases to lower their operating costs when they
have a need for an identified number of containers for a specified term.
    
    Direct finance leases.Direct finance leases are long-term in nature, usually
ranging from three to seven years, and require relatively low levels of customer
service. They ordinarily require fixed payments over a defined period and provide
customers with an option to purchase the subject containers at the end of the lease
term. Per-diem rates include an element of repayment of capital and therefore are
usually higher than rates charged under either term or master leases.
      Customers
  6




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Credit Controls
   Repair and Maintenance
   Disposition of Used Containers
  Operations
    7




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Insurance
  Competition
     8




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Environmental Matters
  Employees
     2008
    
    
    2007
    
    
    2006Dry cargo containers
    
    $
    1,665,521
    
    
    $
    1,926,769
    
    
    $
    2,271,778Refrigerated containers
    
    
    354,761
    
    
    
    567,939
    
    
    
    975,704Tank containers
    
    
    165,428
    
    
    
    157,917
    
    
    
    154,421Total
    
    $
    2,185,710
    
    
    $
    2,652,625
    
    
    $
    3,401,903
     9




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Item 1A. Risk Factors
  Risks Related to the Container Leasing Industry and to the Partnership
 Demand for leased containers depends on economic and political factors beyond the control of
the Leasing Agent, CCC and the Partnership.
  §
    
    prices of new and used containers;§

    
    economic conditions, competitive pressures and consolidation in the container shipping
industry;§

    
    shifting trends and patterns of cargo traffic;§

    
    the availability and terms of container financing;§

    
    fluctuations in inflation rates, interest rates and foreign currency values;§

    
    overcapacity, undercapacity and consolidation of container manufacturers;§

    
    the lead times required to purchase containers;§

    
    the number of containers purchased by competitors and container lessees;§

    
    container ship fleet overcapacity or undercapacity;§

    
    increased repositioning by container shipping lines of their own empty containers to
higher demand locations instead of leasing containers;§

    
    consolidation or withdrawal of individual container lessees in the container leasing
industry;§

    
    import / export tariffs and restrictions;§

    
    customs procedures, foreign exchange controls and other governmental regulations;§

    
    natural disasters that are severe enough to affect local and global economies or
interfere with trade; and§

    
    other political and economic factors.
 Lease rates may decrease, which could harm the results of operations and financial condition
of the Partnership.
  §

    
    the supply of containers available;§

    
    the price of new containers (which is positively correlated with the price of steel);§

    
    the type and length of the lease;§

    
    interest rates;§

    
    embedded residual assumptions;§

    
    the type and age of the container;§

    
    the location of the container being leased;§

    
    the number of containers available for lease by competitors; and§

    
    the lease rates offered by competitors.
 Customer defaults could have an adverse effect on the profitability and financial condition of
the Leasing Agent and the Partnership.
  10




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§

    
    a decline in revenues reflecting lower volumes of world trade and correspondingly lower
freight rates;§

    
    increased expenses due to a rise in cost of financing and the significant fluctuation in
fuel prices experienced during 2008; and§

    
    a decline in the supply of capital required to acquire new ships and container equipment
and to refinance existing debt facilities.
  Amendments to the terms of existing leases could have an adverse effect on the profitability
and financial condition of the Leasing Agent and the Partnership.
  Fluctuations in the residual value of containers may impact profitability and the long-term
returns generated by leased equipment.
  The Leasing Agent operates in a highly competitive industry.
  Increases in the cost of insurance or the lack of availability of insurance could increase the
risk exposure of the Partnership and reduce its profitability.
  11




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The Leasing Agent relies on its information technology systems to conduct its business. Any
failure or interruption in these systems could have an adverse effect on the profitability and
financial condition of the Leasing Agent and the Partnership.
   The Leasing Agent and Partnership are reliant on electronic banking systems to receive and
make payments. Any failure or interruption in banking systems could have an adverse effect on the
profitability and financial condition of the Leasing Agent and the Partnership.
  Specialized containers could have potential mechanical, obsolescence and other risks.
  Environmental liability may adversely affect the Partnerships business and financial
situation.
  Affiliates of the Leasing Company may not have adequate resources to pay container
manufacturers for equipment purchased for resale.
  There are political, economic and business risks inherent in the global business environment.
  §

    
    Political instability;§

    
    Increases in maintenance expenses, taxes, third party fees and other expenses
attributable to the operation and the maintenance of the containers that cannot be offset
by increased lease revenues from the containers;§

    
    Fluctuations in supply and demand for containers resulting from, among other things,
obsolescence, changes in the methods or economics of a particular mode of transportation or
changes in governmental regulations or safety standards;§

    
    Restrictions on the movement of capital;§

    
    The imposition of new direct and indirect taxes in jurisdictions in which the Group
trades;§

    
    The effects of strikes and labor disputes; and§

    
    Terrorist attacks and the risk of terrorist attack.
 12




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Risk Associated with the Operations of an Equipment Leasing Business in Partnership Form
 There is no assurance of successful operations.
  The Partnership has a high degree of reliance on CCC and the Leasing Agent.
  The Partnership is dependent on key personnel in CCC and the Leasing Agent.
  There is a lack of liquidity for Partnership units.
  The Limited Partners have limited voting rights.
  Limited liability is not clearly established.
  13




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Item 1B. Unresolved Staff Comments
  
 Item 2. Properties
  Containers
    
    QuantityDry Cargo - 20-Foot
    
    
    2,733Dry Cargo - 40-Foot
    
    
    933Dry Cargo - 40-Foot High-Cube
    
    
    1,553Refrigerated - 20-Foot
    
    
    29Refrigerated - 40-Foot High-Cube
    
    
    93Tanks
    
    
    51
   
 Item 3. Legal Proceedings
  
 Item 4. Submission of Matters to a Vote of Security Holders
  14




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PART II
 
 Item 5. Market for the Partnerships Common Equity, Related Stockholder Matters and Issuer
Purchases of Equity Securities
   (a)(1)(ii)
    
    Inapplicable.(a)(1)(iii)
    
    Inapplicable.(a)(1)(iv)
    
    Inapplicable.(a)(1)(v)
    
    Inapplicable.(a)(2)
    
    Inapplicable.(a)(3)
    
    The Partnership sold no equity securities during 2008 that were not registered under the
Securities Act of 1933, as amended.(b)
    
    Holders
 Number of Unit Holders(b)(1)
    
    Title of Class
    
    as of December 31, 2008Units of limited partnership interests
    
    
    1,645
 (c)
    
    Dividends
  (d)
    
    Securities authorized for issuance under equity compensation plans
  (e)
    
    Use of Proceeds
  (f)
    
    Purchases of equity securities by the issuer and affiliated purchasers
  15




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Item 6. Selected Financial Data
 Year Ended December 31,2008
    
    2007
    
    2006
    
    2005
    
    2004Net lease revenue
    
    $
    1,603,384
    
    
    $
    1,808,075
    
    
    $
    2,316,295
    
    
    $
    2,803,236
    
    
    $
    3,001,124Net income
    
    $
    303,588
    
    
    $
    308,275
    
    
    $
    196,435
    
    
    $
    916,814
    
    
    $
    947,281Limited partners share of net
income (per unit basis)
    
    $
    0.12
    
    
    $
    0.12
    
    
    $
    0.06
    
    
    $
    0.47
    
    
    $
    0.51Cash distributions per unit of
limited partnership interest
    
    $
    1.63
    
    
    $
    1.88
    
    
    $
    2.08
    
    
    $
    1.71
    
    
    $
    1.48At year-end:Total assets
    
    $
    6,824,266
    
    
    $
    9,218,045
    
    
    $
    12,013,715
    
    
    $
    15,272,387
    
    
    $
    17,213,457Partners capital
    
    $
    6,824,266
    
    
    $
    9,218,045
    
    
    $
    12,013,715
    
    
    $
    15,272,387
    
    
    $
    17,213,457
 16




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Item 7. Managements Discussion and Analysis of Financial Condition and Results of Operations
  Forward-Looking Statements
   Primary Revenue Items
  
    
    Activity-related expenses, include agents costs and depot costs such as repairs,
maintenance and handling;
    
    Inventory-related expenses for off-hire containers, comprise of 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, include legal costs related to the recovery of containers and
doubtful accounts, insurance and provisions for doubtful accounts.
 Partnership Overview
  17




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Dry Cargo
    
    Refrigerated
    
    TankContainers
    
    Containers
    
    Containers40-Foot
    
    
    
    40-Foot20-Foot
    
    40-Foot
    
    High-Cube
    
    20-Foot
    
    High-CubeUnits
    
    %
    
    Units
    
    %
    
    Units
    
    %
    
    Units
    
    %
    
    Units
    
    %
    
    Units
    
    %Total purchases
    
    
    4,553
    
    
    
    100
    %
    
    
    1,500
    
    
    
    100
    %
    
    
    1,750
    
    
    
    100
    %
    
    
    90
    
    
    
    100
    %
    
    
    300
    
    
    
    100
    %
    
    
    52
    
    
    
    100
    %Less disposals
    
    
    1,820
    
    
    
    40
    %
    
    
    567
    
    
    
    38
    %
    
    
    197
    
    
    
    11
    %
    
    
    61
    
    
    
    68
    %
    
    
    207
    
    
    
    69
    %
    
    
    1
    
    
    
    2
    %Remaining fleet at
December 31, 2008
    
    
    2,733
    
    
    
    60
    %
    
    
    933
    
    
    
    62
    %
    
    
    1,553
    
    
    
    89
    %
    
    
    29
    
    
    
    32
    %
    
    
    93
    
    
    
    31
    %
    
    
    51
    
    
    
    98
    %
  Market & Industry Overview
   2008
    
    
    2007
    
    
    2006Fleet size (measured in TEU)Dry cargo containers
    
    
    8,181
    
    
    
    8,934
    
    
    
    9,574Refrigerated containers
    
    
    310
    
    
    
    428
    
    
    
    598Tank containers
    
    
    51
    
    
    
    51
    
    
    
    52Average utilization ratesDry cargo containers
    
    
    97
    %
    
    
    91
    %
    
    
    89
    %Refrigerated containers
    
    
    82
    %
    
    
    81
    %
    
    
    85
    %Tank containers
    
    
    93
    %
    
    
    96
    %
    
    
    91
    %
 18




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§

    
    a decline in revenuesas falling consumer demand resulted in a reduction in the volume
of trade for containerized goods and a corresponding decrease in freight rates;§

    
    an increase in expensesas interest rates increased due to the disruption experienced
in the financial markets, including the significant and sudden contraction in the supply
of money. Additionally, fuel costs reached record high levels during 2008 placing an
additional cost burden on most customers for part of the year;§

    
    a reduction in the level of available fundingwhich may have an impact on the ability
of shipping lines to fund existing contractual commitments for new ship building and other
capital programs. In addition, existing financial facilities may become increasingly
difficult to refinance as they fall due and it is likely that, on renewal, the cost of
such facilities will increase;§

    
    an increase in containership overcapacity. This reflects the reduction in the volume
of containerized trade together with the increased capacity introduced in recent years by
significant ship building programs.
    §

    
    a number of shipping lines have already gone into bankruptcy and there is a risk of
further insolvencies in 2009;§

    
    container utilization levels are likely to decline as shipping lines off-hire
containers. Direct operating expenses will increase in line with any increase in
inventories.§

    
    the economic terms of existing leases, including term leases, may change as customers
seek to renegotiate existing terms; and§

    
    the sale proceeds realized on the sale of containers may decline in locations where
there is a large increase in inventories. Containers may prove difficult to sell in
certain locations. The US dollar value of sales proceeds may decline because of the
relative strengthening of the US dollar against most major currencies.
 Year Ended December 31, 2008 Compared to the Year Ended December 31, 2007
   §

    
    a 12% reduction in the size of the container fleet as equipment that was off-hired was
sold;§

    
    a decline in net lease revenue as a result of the reduction in the size of the fleet;
and§

    
    an increased gain recorded on the disposal of equipment.
 Net lease revenue
 19




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Depreciation expense
 Other general and administrative expenses
 Net gain on disposal of equipment
 Year Ended December 31, 2007 Compared to the Year Ended December 31, 2006
 Net lease revenue
 Depreciation expense
 Other general and administrative expenses
 Net gain on disposal of equipment
 Liquidity and Capital Resources
    20




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Cash from Operating Activities:
 Cash from Investing Activities:
 Cash from Financing Activities
 Off-Balance Sheet Arrangements
  Contractual Obligations
  Critical Accounting Policies
 Container equipment  depreciable lives
 Container equipment  valuation:
 Allowance for doubtful accounts:
 21




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Accounting Pronouncements Adopted During the Period
    Inflation
  The Cronos Group
    22




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Item 7A. Quantitative and Qualitative Disclosures About Market Risk
 Exchange rate risk:
   Credit risk:
 
 Item 8. Financial Statements and Supplementary Data
 23




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REPORT OF MANAGEMENT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
       /s/ Dennis J. TietzDennis J. Tietz,President and Director of Cronos Capital Corp.,
General Partner of the Partnership /s/ Frank P. VaughanFrank P. Vaughan,Chief Financial Officer of Cronos Capital Corp,.
General Partner of the Partnership 24




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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
 
    
  25




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Balance Sheets
 December 31, 2008 and 2007
 2008
    
    
    2007AssetsCurrent assets:Cash and cash equivalents
    
    $
    886,181
    
    
    $
    831,160Net lease receivables due from Leasing Agent
    
    
    396,009
    
    
    
    390,560Direct finance lease receivable, due from Leasing Agent within one year, net
    
    
    22,382
    
    
    
    Total current assets
    
    
    1,304,572
    
    
    
    1,221,720Direct finance lease receivable, due from Leasing Agent after one year, net
    
    
    21,091
    
    
    
    Container rental equipment, at cost
    
    
    18,016,216
    
    
    
    22,530,005Less accumulated depreciation
    
    
    (12,517,613
    )
    
    
    (14,533,680
    )Net container rental equipment
    
    
    5,498,603
    
    
    
    7,996,325Total assets
    
    $
    6,824,266
    
    
    $
    9,218,045Partners CapitalPartners capital (deficit):General partner
    
    
    607
    
    
    
    (24,596
    )Limited partners
    
    
    6,823,659
    
    
    
    9,242,641Total partners capital
    
    $
    6,824,266
    
    
    $
    9,218,045
  26




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Statements of Operations
 For the years ended December 31, 2008, 2007 and 2006
 2008
    
    
    2007
    
    
    2006Net lease revenue from Leasing Agent
    
    $
    1,603,384
    
    
    $
    1,808,075
    
    
    $
    2,316,295Other operating (expenses) income:Depreciation
    
    
    (1,273,694
    )
    
    
    (1,466,930
    )
    
    
    (1,689,468
    )Other general and administrative expenses
    
    
    (142,368
    )
    
    
    (116,299
    )
    
    
    (110,848
    )Net gain (loss) on disposal of equipment
    
    
    111,011
    
    
    
    43,743
    
    
    
    (363,720
    )(1,305,051
    )
    
    
    (1,539,486
    )
    
    
    (2,164,036
    )Income from operations
    
    
    298,333
    
    
    
    268,589
    
    
    
    152,259Other income:Interest income
    
    
    5,255
    
    
    
    39,686
    
    
    
    44,176Net income
    
    $
    303,588
    
    
    $
    308,275
    
    
    $
    196,435Allocation of net income:General partner
    
    $
    116,447
    
    
    $
    119,183
    
    
    $
    95,599Limited partners
    
    
    187,141
    
    
    
    189,092
    
    
    
    100,836$
    303,588
    
    
    $
    308,275
    
    
    $
    196,435Limited partners per unit share of net income
    
    $
    0.12
    
    
    $
    0.12
    
    
    $
    0.06
  27




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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Statements of Partners Capital
 For the years ended December 31, 2008, 2007 and 2006
 Limited
    
    
    GeneralPartners
    
    
    Partner
    
    
    TotalBalances at January 1, 2006
    
    $
    15,278,065
    
    
    $
    (5,678
    )
    
    $
    15,272,387Net income
    
    
    100,836
    
    
    
    95,599
    
    
    
    196,435Cash distributions
    
    
    (3,325,976
    )
    
    
    (129,131
    )
    
    
    (3,455,107
    )Balances at December 31, 2006
    
    $
    12,052,925
    
    
    $
    (39,210
    )
    
    $
    12,013,715Net income
    
    
    189,092
    
    
    
    119,183
    
    
    
    308,275Cash distributions
    
    
    (2,999,376
    )
    
    
    (104,569
    )
    
    
    (3,103,945
    )Balances at December 31, 2007
    
    $
    9,242,641
    
    
    $
    (24,596
    )
    
    $
    9,218,045Net income
    
    
    187,141
    
    
    
    116,447
    
    
    
    303,588Cash distributions
    
    
    (2,606,123
    )
    
    
    (91,244
    )
    
    
    (2,697,367
    )Balances at December 31, 2008
    
    $
    6,823,659
    
    
    $
    607
    
    
    $
    6,824,266
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Statements of Cash Flows
 For the years ended December 31, 2008, 2007 and 2006
 2008
    
    
    2007
    
    
    2006Cash flows from operating activities:Net income
    
    $
    303,588
    
    
    $
    308,275
    
    
    $
    196,435Adjustments to reconcile net income to net cash from
operating activities:Depreciation
    
    
    1,273,694
    
    
    
    1,466,930
    
    
    
    1,689,468Net (gain) loss on disposal of equipment
    
    
    (111,011
    )
    
    
    (43,743
    )
    
    
    363,720Decrease (increase) in net lease and other
receivables due from Leasing Agent
    
    
    104,269
    
    
    
    24,708
    
    
    
    (38,472
    )Total adjustments
    
    
    1,266,952
    
    
    
    1,447,895
    
    
    
    2,014,716Net cash provided by operating activities
    
    
    1,570,540
    
    
    
    1,756,170
    
    
    
    2,211,151Cash flows from investing activities:Proceeds from sale of container rental equipment
    
    
    1,181,848
    
    
    
    975,561
    
    
    
    1,399,068Cash flows from financing activities:Distributions to general partner
    
    
    (91,244
    )
    
    
    (104,569
    )
    
    
    (129,131
    )Distributions to limited partners
    
    
    (2,606,123
    )
    
    
    (2,999,376
    )
    
    
    (3,325,976
    )Net cash used in financing activities
    
    
    (2,697,367
    )
    
    
    (3,103,945
    )
    
    
    (3,455,107
    )Net increase (decrease) in cash and cash equivalents
    
    
    55,021
    
    
    
    (372,214
    )
    
    
    155,112Cash and cash equivalents at beginning of year
    
    
    831,160
    
    
    
    1,203,374
    
    
    
    1,048,262Cash and cash equivalents at end of year
    
    $
    886,181
    
    
    $
    831,160
    
    
    $
    1,203,374
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 
 Notes to Financial Statements
 December 31, 2008, 2007 and 2006
 Summary of Significant Accounting Policies
 (a)
    
    Nature of OperationsCronos Global Income Fund XVI, L.P. (the Partnership) is a limited partnership that was
organized under the laws of the State of California on September 1, 1995, for the purpose
of owning and leasing dry and specialized marine cargo containers to ocean carriers. The
Partnership commenced operations on March 29, 1996, when the minimum subscription proceeds
of $2,000,000 were received from over 100 subscribers (excluding from such count,
Pennsylvania residents, Cronos Capital Corp. (CCC), the general partner, and all
affiliates of CCC). On February 3, 1997, CCC suspended the offer and sale of units in the
Partnership. The offering terminated on December 27, 1997, at which time 1,599,667
limited partnership units had been sold. The Partnership shall continue until December
31, 2015, unless terminated sooner upon the occurrence of certain events.CCC and its affiliate, Cronos Containers Limited (the Leasing Agent), manage the
business of the Partnership. CCC and the Leasing Agent also manage the container leasing
business for other partnerships affiliated with CCC.The Partnership has entered into its 14th year of operations and has entered its
liquidation phase, wherein CCC focuses its attention on the retirement of the remaining
equipment in the Partnerships container fleet. At December 31, 2008, approximately 65% of
the original equipment remained in the Partnerships fleet. CCC will take several factors
into consideration when examining options for the timing of the disposal of the
containers. These factors include the level of gross lease revenue generated by the
diminishing fleet, the level of costs relative to this revenue, projected disposal
proceeds on the disposition of the Partnerships containers, overall market conditions and
any foreseeable changes in other general and administrative expenses. The Partnerships
operations depend on global economic and political conditions. The Partnership believes
that the profitability and risk profile of leases with foreign customers are generally the
same as those with domestic customers. The majority of the Partnerships leases generally
require all payments to be made in United States dollars.(b)
    
    Cronos Ltd.The Cronos Group (TCG), formerly the parent of CCC, announced on February 28, 2007 that
it had entered into an Asset Purchase Agreement (Asset Purchase Agreement) with CRX
Acquisition Ltd, a Bermuda exempted company (CRX) and FB Transportation Capital LLC, a
Delaware limited liability company (FB Transportation). Under the terms of the Asset
Purchase Agreement, and subject to the conditions stated therein, TCG agreed to sell all
of its assets to CRX and CRX agreed to assume all of TCGs liabilities. FB Transportation
is an affiliate of Fortis Bank S.A. / N.V (Fortis Belgium).At a special meeting held August 1, 2007, TCGs shareholders approved the Asset Purchase
Agreement and the transactions contemplated thereunder, including TCGs dissolution and
liquidation. Closing of the sale of TCGs assets and liabilities to CRX occurred later
that same day. Promptly following the closing, TCG changed its name to CRG Liquidation
Company, and CRX changed its name to Cronos Ltd.The container leasing business of TCG has been continued by Cronos Ltd. as a private
company. Management of TCG has continued as the management of Cronos Ltd and acquired an
equity interest in Cronos Ltd. at closing.
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Financial Statements
 (1)
    
    Summary of Significant Accounting Policies (continued)
 (c)
    
    Leasing AgentThe Partnership and the Leasing Agent have entered into an agreement (the Leasing Agent
Agreement) whereby the Leasing Agent manages the leasing operations for all equipment
owned by the Partnership. In addition to responsibility for leasing and re-leasing the
equipment to ocean carriers, the Leasing Agent disposes of the containers at the end of
their useful economic life and has full discretion over which ocean carriers and suppliers
of goods and services it may deal with. The Leasing Agent Agreement permits the Leasing
Agent to use the containers owned by the Partnership, together with other containers owned
or managed by the Leasing Agent and its affiliates, as part of a single fleet operated
without regard to ownership. The Leasing Agent Agreement generally provides that the
Leasing Agent will make payments to the Partnership based upon rentals collected from
ocean carriers after deducting direct operating expenses and management fees due both to
CCC and the Leasing Agent.The Leasing Agent leases containers to ocean carriers, generally under operating leases
which are either master leases or term leases (mostly one to five years). Master leases
do not specify the exact number of containers to be leased or the term that each container
will remain on hire but allow the ocean carrier to pick up and drop off containers at
various locations, and rentals are charged and recognized based upon the number of
containers used and the applicable per-diem rate. Accordingly, rentals under master
leases are all variable and contingent upon the number of containers used.Term leases are for a fixed quantity of containers for a fixed period of time, typically
varying from three to five years. In most cases, containers cannot be returned prior to
the expiration of the lease. Term lease agreements may contain early termination penalties
that apply in the event of early redelivery. Term leases provide greater revenue stability
to the lessor, usually at lower lease rates than master leases. Ocean carriers use term
leases to lower their operating costs when they have a need for an identified number of
containers for a specified term. Rentals under term leases are charged and recognized
based upon the number of containers leased, the applicable per-diem rate and the length of
the lease, irrespective of the number of days which the customer actually uses the
containers.(d)
    
    Concentrations of Credit RiskThe Partnerships financial instruments that are exposed to concentrations of credit risk
consist primarily of cash, cash equivalents and net lease receivables due from the Leasing
Agent. See note 3 for further discussion regarding the credit risk associated with cash
and cash equivalents.Net lease receivables due from the Leasing Agent (see notes 1(c) and 4 for discussion
regarding net lease receivables) subject the Partnership to a significant concentration of
credit risk. The net lease receipts, represent rentals collected from ocean carriers
after deducting payments for direct operating expenses and management fees, are remitted
by the Leasing Agent to the Partnership on a weekly basis.(e)
    
    Basis of AccountingThe Partnerships accounting records are maintained in United States dollars and the
financial statements are prepared in accordance with accounting principles generally
accepted in the United States of America (US GAAP).
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Financial Statements
 (1)
    
    Summary of Significant Accounting Policies (continued)
 (f)
    
    Use of EstimatesThe preparation of financial statements in conformity with US GAAP requires the
Partnership to make estimates and assumptions that affect the reported amounts of assets
and liabilities and disclosure of contingent assets and liabilities at the date of the
financial statements and the reported amounts of revenues and expenses during the reported
period. The most significant estimates relate to the carrying value of equipment
including estimates relating to depreciable lives, residual values and asset impairments.
Actual results could differ from those estimates.(g)
    
    Allocation of Net Income or Loss, Partnership Distributions and Partners Capital
AccountsNet income or loss has been allocated between general and limited partners in accordance
with the Partnership Agreement. The Partnership Agreement generally provides that CCC
shall at all times maintain at least a 1% interest in each item of income or loss,
including the gain arising from the sale of containers. The Partnership Agreement further
provides that the gain arising from the sale of containers be allocated first to the
partners with capital account deficit balances in an amount sufficient to eliminate any
deficit capital account balance. Thereafter, the Partnerships gains arising from the sale
of containers are allocated to the partners in accordance with their share of sale
proceeds distributed. The Partnership Agreement also provides for income (excluding the
gain arising from the sale of containers) for any period, be allocated to CCC in an amount
equal to that portion of CCCs distributions in excess of 1% of the total distributions
made to both CCC and the limited partners of the Partnership for such period, as well as
other allocation adjustments.Actual cash distributions differ from the allocations of net income or loss between the
general and limited partners as presented in these financial statements. Partnership
distributions are paid to its partners from distributable cash from operations, allocated
95% to the limited partners and 5% to CCC. Distributions of sales proceeds are allocated
99% to the limited partners and 1% to CCC. The allocations remain in effect until such
time as the limited partners have received from the Partnership aggregate distributions in
an amount equal to their capital contributions plus an 8% cumulative, compounded (daily),
annual return on their adjusted capital contributions. Thereafter, all Partnership
distributions will be allocated 85% to the limited partners and 15% to CCC. Cash
distributions from operations to CCC in excess of 5% of distributable cash will be
considered an incentive fee and will be recorded as compensation to CCC, with the
remaining distributions from operations charged to partners capital.Upon dissolution, the assets of the Partnership will be sold and the proceeds thereof
distributed as follows: (i) all of the Partnerships debts and liabilities to persons
other than CCC or the limited partners shall be paid and discharged; (ii) all of the
Partnerships debts and liabilities to CCC and the limited partners shall be paid and
discharged; and (iii) the balance of such proceeds shall be distributed to CCC and the
limited partners in accordance with the positive balances of CCC and the limited partners
capital accounts. CCC shall contribute to the Partnership, if necessary, an amount equal
to the lesser of the deficit balance in its capital account at the time of such
liquidation, or 1.01% of the excess of the limited partners capital contribution to the
Partnership over the capital contributions previously made to the Partnership by CCC,
after giving effect to the allocation of income or loss arising from the liquidation of
the Partnerships assets.(h)
    
    Acquisition FeesPursuant to the Partnership Agreement, acquisition fees paid to CCC are based on 5% of the
equipment purchase price. These fees are capitalized and included in the cost of the
rental equipment.
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Financial Statements
 (1)
    
    Summary of Significant Accounting Policies (continued)
 (i)
    
    Container Rental EquipmentContainer rental equipment is depreciated over a 15-year life using the straight-line
basis to a residual value of 10% of the original equipment cost. The Partnership and CCC
evaluate the period of depreciation and residual values to determine whether subsequent
events and circumstances warrant revised estimates of useful lives.In accordance with Statement of Financial Accounting Standard (SFAS) No. 144 Accounting
for the Impairment or Disposal of Long-Lived Assets, container rental equipment is
considered to be impaired if the carrying value of the asset exceeds the expected future
cash flows from related operations (undiscounted and without interest charges). If
impairment is deemed to exist, the assets are written down to fair value. An analysis of
projected future cash flows from container operations is prepared annually or upon
material changes in market conditions. The primary variables utilized by the analysis are
current and projected utilization rates, per-diem rental rates, direct operating expenses,
fleet size, container disposal proceeds and the timing of container disposals.
Additionally, the Partnership evaluates future cash flows and potential impairment for its
entire container fleet rather than for each container type or individual container. As a
result, future losses could result for individual container dispositions due to various
factors, including age, condition, suitability for continued leasing, as well as the
geographical location of containers when disposed.(j)
    
    Income TaxesThe Partnership is not subject to income taxes, consequently no provision for income taxes
has been made. The Partnership files federal and state annual information tax returns,
prepared on the accrual basis of accounting. Taxable income or loss is reportable by the
partners individually.(k)
    
    New Accounting Pronouncements Adopted During the PeriodIn February, 2007 the Financial Accounting Standards Board (FASB) issued SFAS No. 159,
The Fair Value Option for Financial Assets and Financial Liabilities  Including an
Amendment of FASB Statement No. 115 (SFAS 159). This standard permits an entity to
choose to measure many financial instruments and certain other items at fair value. The
unrealized gains and losses on items for which the fair value option has been elected will
be reported in earnings at each subsequent reporting date. The fair value option: (a) may
be applied instrument by instrument, with a few exceptions, such as investments otherwise
accounted for by the equity method; (b) is irrevocable (unless a new election date
occurs); and (c) is applied only to entire instruments and not to portions of instruments.
On January 1, 2008 the Partnership adopted SFAS 159, however, the Partnership has elected
not to use the fair value option for any of its existing financial assets and liabilities
and consequently, its adoption has had no impact.In September 2006 the FASB issued SFAS No. 157, Fair Value Measurements (SFAS 157),
which provides a single definition of fair value, establishes a framework for the
measurement of fair value and expands disclosure about the use of fair value to measure
assets and liabilities. SFAS 157 is effective for fiscal
years beginning after November 15, 2007, and for interim periods within those fiscal
years. In February 2008, the FASB issued FSP 157-2, Effective Date of FASB Statement No.
157, which permits a one-year deferral for the implementation of SFAS 157 with regard to
non-financial assets and liabilities that are not recognized or disclosed at fair value in
the financial statements on a recurring basis (at least annually). The Partnership
elected to defer adoption of SFAS 157 for such items and does not currently anticipate
that adoption for non-financial assets and liabilities in 2009 will have a material impact
to the financial statements. The Partnership adopted the effective provisions of SFAS 157
as of January 1, 2008. At December 31, 2008, the Partnership did not have any financial
assets or liabilities that were subject to the expanded disclosures regarding fair value
measurements; consequently its adoption has had no disclosure impact.
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Financial Statements
 (1)
    
    Summary of Significant Accounting Policies (continued)
 (k)
    
    New Accounting Pronouncements Adopted During the Period (continued)In May 2008 the FASB issued SFAS No. 162, The Hierarchy of Generally Accepted Accounting
Principles (SFAS 162). SFAS 162 identifies the sources of accounting principles and the
framework for selecting the principles to be used in the preparation of financial statements
of nongovernmental entities that are presented in conformity with generally accepted
accounting principles. SFAS 162 was adopted by the Partnership on November 15, 2008 but
adoption has had no impact on the financial statements.
 (2)
    
    Operating Segment
 An operating segment is a component of an enterprise that engages in business activities from
which it may earn revenues and incur expenses, whose operating results are regularly reviewed
by the enterprises chief operating decision maker to make decisions about resources to be
allocated to the segment and assess its performance, and about which separate financial
information is available. CCC and the Leasing Agent operate the Partnerships container fleet
as a homogenous unit and have determined that as such, it has a single reportable operating
segment.The Partnership derives revenues from dry cargo containers, refrigerated containers and tank
containers that are used by its customers in global trade routes. As of December 31, 2008, the
Partnership owned 2,733 twenty-foot, 933 forty-foot and 1,553 forty-foot high-cube marine dry
cargo containers, as well as 29 twenty-foot and 93 forty-foot refrigerated high-cube cargo
containers, and 51 tank containers. A summary of gross lease revenue earned by each
Partnership container type for the years ended December 31, 2008, 2007 and 2006 follows:
 2008
    
    
    2007
    
    
    2006Dry cargo containers
    
    $
    1,665,521
    
    
    $
    1,926,769
    
    
    $
    2,271,778Refrigerated containers
    
    
    354,761
    
    
    
    567,939
    
    
    
    975,704Tank containers
    
    
    165,428
    
    
    
    157,917
    
    
    
    154,421Total
    
    $
    2,185,710
    
    
    $
    2,652,625
    
    
    $
    3,401,903
 Due to the Partnerships lack of information regarding the physical location of its fleet
of containers when on lease in the global shipping trade, the Partnership believes that it does
not possess discernible geographic reporting segments as defined in SFAS No. 131, Disclosures
about Segments of an Enterprise and Related Information.The Partnership does not believe that its ongoing business is dependent upon a single customer
of the Leasing Agent, although the loss of one or more of the Leasing Agents customers could
have an adverse effect upon its business.Two sub-lessees of the Leasing Agent generated more than 10% of the gross lease revenue earned
on the Partnerships equipment during 2008. Mediterranean Shipping Company S.A. generated
approximately 12%, or $252,228 in gross lease revenue and Hapag-Lloyd AG generated
approximately 11%, or $235,336 in gross lease revenue. One sub-lessee of the Leasing Agent
generated more than 10% of the gross lease revenue earned on the Partnerships equipment during
2007. Hamburg Sudamerikanische Dampfschifffahrts-Gesellschaft KG generated approximately 24%,
or $635,143 in gross lease revenue. No single customer of the Leasing Agent generated more
than 10% of the gross lease revenue earned on the Partnerships equipment during 2006.
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Financial Statements
 (3)
    
    Cash and Cash Equivalents
 Cash equivalents include money market funds with original maturities of three months or less
that invest in highly-liquid securities, such as U.S. Treasury obligations, repurchase
agreements secured by U.S. Treasury obligations, and obligations whose principal and interest
are backed by the U.S. Government. Cash equivalents are carried at cost which approximates
fair value, and at times, may exceed federally insured limits. At December 31, 2008, the
Partnership held its cash on deposit in an operating bank account. The Partnership will review
its investment strategy for cash balances on a periodic basis but for the immediate future it
will hold all available balances on deposit in operating bank accounts.Cash and cash equivalents at December 31, 2008 and 2007, comprised:
 2008
    
    
    2007Cash
    
    $
    886,181
    
    
    $
    15,000Cash equivalents
    
    
    
    
    
    
    816,160$
    886,181
    
    
    $
    831,160
 (4)
    
    Net Lease Receivables Due from Leasing AgentNet lease receivables at December 31, 2008 and 2007 comprised:
 December 31,
    
    
    December 31,2008
    
    
    2007Gross lease receivables
    
    $
    607,309
    
    
    $
    599,208Less:Direct operating payables and accrued expenses
    
    
    131,180
    
    
    
    115,694Base management fees payable
    
    
    30,874
    
    
    
    35,913Reimbursed administrative expenses
    
    
    6,421
    
    
    
    9,622Allowance for doubtful accounts
    
    
    42,825
    
    
    
    47,419211,300
    
    
    
    208,648Net lease receivables due from Leasing Agent
    
    $
    396,009
    
    
    $
    390,560
 Included within the amount of gross lease receivables are $71,941 and $9,427 in respect of
amounts owed by the Leasing Agent in relation to the disposal of containers for the years ended
December 31, 2008 and 2007, respectively.Doubtful debt expense charged during the year was $4,593 and $17,919 for the years ended
December 31, 2008 and 2007, respectively.
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Financial Statements
 (5)
    
    Direct Finance Lease Receivables Due from Leasing AgentThe Leasing Agent, on behalf of the Partnership, entered into lease purchase agreements
that included bargain purchase options. The Partnership classified the lease purchase
agreements as direct finance leases and recorded direct finance lease receivables. The
underlying equipment had previously been classified as container rental equipment. At December
31, 2008, the minimum future lease rentals under these direct finance leases, net of unearned
income were:
 Gross Direct
    
    
    Unearned Direct
    
    
    Net Minimum FutureFinance Lease
    
    
    Finance Lease
    
    
    Direct Finance LeaseReceivable
    
    
    Income
    
    
    Rentals2009
    
    $
    29,632
    
    
    $
    7,250
    
    
    $
    22,3822010
    
    
    19,521
    
    
    
    4,121
    
    
    
    15,4002011
    
    
    6,479
    
    
    
    788
    
    
    
    5,691Total
    
    $
    55,632
    
    
    $
    12,159
    
    
    $
    43,473
 (6)
    
    Damage Protection PlanThe Leasing Agent offers a service to several customers of the Partnerships containers,
whereby the customer pays an additional rental fee and in return the Partnership undertakes to
cover the cost of certain damage repairs that are required when the container is redelivered.
The level of damage cover provided will vary according to the terms of each lease agreement.(7)
    
    Net Lease RevenueNet lease revenue for 2008, 2007 and 2006 comprised:
 2008
    
    
    2007
    
    
    2006Gross lease revenue
    
    $
    2,185,606
    
    
    $
    2,652,625
    
    
    $
    3,401,903Interest income from direct finance lease
    
    
    104
    
    
    
    
    
    
    
    2,185,710
    
    
    
    2,652,625
    
    
    
    3,401,903Less:Direct operating expenses
    
    
    331,077
    
    
    
    534,360
    
    
    
    679,399Base management fees (note 8)
    
    
    152,007
    
    
    
    183,230
    
    
    
    235,007Reimbursed administrative expenses (note 8):Salaries
    
    
    73,300
    
    
    
    88,107
    
    
    
    122,341Other payroll related expenses
    
    
    9,226
    
    
    
    13,773
    
    
    
    15,936General administrative expenses
    
    
    16,716
    
    
    
    25,080
    
    
    
    32,92599,242
    
    
    
    126,960
    
    
    
    171,202582,326
    
    
    
    844,550
    
    
    
    1,085,608Net lease revenue
    
    $
    1,603,384
    
    
    $
    1,808,075
    
    
    $
    2,316,295
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Financial Statements
 (7)
    
    Net Lease Revenue (continued)Contingent master lease rentals earned on the Partnerships equipment approximated $1,697,641,
$1,996,100, and $2,278,254 of gross lease revenue, respectively, in the years ended December
31, 2008, 2007 and 2006, respectively.As of December 31, 2008, the minimum lease rentals receivable on the Partnerships equipment in
future years under non-cancelable term operating leases were:
 2009
    
    $
    1,171,8132010
    
    
    633,9762011
    
    
    266,5962012
    
    
    87,9242013
    
    
    24,777Thereafter
    
    
    7,270Total
    
    $
    2,192,356
 (8)
    
    Related Party TransactionsCCC and the Leasing Agent are related parties of the Partnership.Base management fees are equal to 7% of the gross lease revenue earned on the Partnerships
equipment. Reimbursed administrative expenses are equal to the costs expended by CCC and its
affiliates for services necessary for the prudent operation of the Partnership pursuant to the
Partnership Agreement. The following compensation was earned by CCC and the Leasing Agent for
the years indicated:
 2008
    
    
    2007
    
    
    2006Base management feesLeasing Agent
    
    $
    152,007
    
    
    $
    183,230
    
    
    $
    235,007Reimbursed administrative expensesCCC
    
    
    10,308
    
    
    
    16,897
    
    
    
    22,208Leasing Agent
    
    
    88,934
    
    
    
    110,063
    
    
    
    148,99499,242
    
    
    
    126,960
    
    
    
    171,202$
    251,249
    
    
    $
    310,190
    
    
    $
    406,209
 The following compensation was payable to CCC and the Leasing Agent at December 31, 2008
and 2007:
 2008
    
    
    2007CCC
    
    $
    657
    
    
    $
    1,199Leasing Agent
    
    
    5,764
    
    
    
    44,336$
    6,421
    
    
    $
    45,535
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CRONOS GLOBAL INCOME FUND XVI, L.P.
 Notes to Financial Statements
 Limited Partners Capital
 Cash distributions made to the limited partners during 2008, 2007 and 2006 were as follows:
 2008
    
    
    2007
    
    
    2006Cash Distribution from Operations
    
    $
    1,526,346
    
    
    $
    1,746,304
    
    
    $
    2,246,201Cash Distribution from Sales Proceeds
    
    
    1,079,777
    
    
    
    1,253,072
    
    
    
    1,079,775Total Cash Distributions
    
    $
    2,606,123
    
    
    $
    2,999,376
    
    
    $
    3,325,976
 These distributions are used in determining Adjusted Capital Contributions as defined by the
Partnership Agreement.The limited partners per unit share of capital at December 31, 2008, 2007 and 2006 was $4, $6
and $8, respectively. This is calculated by dividing the limited partners capital at the end
of each year by 1,599,667, the total number of outstanding limited partnership units.
 38




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##### Table of Contents



Item 9. Changes In and Disagreements With Accountants on Accounting and Financial Disclosure
  
 Item 9A. Controls and Procedures
  
 Item 9A(T). Controls and Procedures
    
 Item 9B. Other Information
  39




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##### Table of Contents



PART III
 
 Item 10. Directors, Executive Officers and Corporate Governance
  Name
    
    OfficeDennis J. Tietz
    
    President and Director of CCC and Director of Cronos Ltd.Peter J. Younger
    
    Vice President and Director of CCC and President and Chief
Executive Officer of Cronos Ltd.John Kallas
    
    Vice President, Secretary/Treasurer and Director of CCCFrank P. Vaughan
    
    Vice President, Chief Financial Officer and Director of CCC
 Dennis
J. Tietz
   Peter
J. Younger
  John
Kallas
  Frank
P. Vaughan
 40




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##### Table of Contents



Name
    
    TitleFrank P. Vaughan
    
    Director and Secretary of Leasing Agent and Vice President, Chief Financial
Officer of Cronos Ltd.John C. Kirby
    
    Director of Leasing Agent and Vice President  Atlantic Region of Cronos Ltd.Timothy W. Courtenay
    
    Director of Leasing AgentTimothy D. May
    
    Director of Leasing Agent and Vice President  Pacific Region of Cronos Ltd.
 Frank
P. Vaughan
  John
C. Kirby
 Timothy
W. Courtenay
 Timothy
D. May
 41




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##### Table of Contents



Audit
Committee
  Audit
Committee Financial Expert
  Code
of Ethics
  ir@cronos.com
 Section 16(a)
Beneficial Ownership Reporting Compliance
  42




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##### Table of Contents



Item 11. Executive Compensation
    Cash Fees andName
    
    Description
    
    Distributions1)
    
    CCL
    
    Base management fees  equal to 7% of
gross lease revenue from the leasing of
containers subject to leases whereby the
aggregate rental payments due during the
initial term of the lease are less than
the purchase price of the equipment
subject to the lease pursuant to Section
4.3 of the Limited Partnership Agreement
    
    $
    157,0462)
    
    CCC
    
    Reimbursed administrative expenses equal to the costs
 expended by CCC and its
affiliates for services necessary to the
prudent operation of the Partnership
pursuant to Section 4.4 of the Limited
Partnership Agreement
    
    $
    10,849CCL
    

    
    $
    91,5943)
    
    CCC
    
    Interest in Fund  5% of distributions of
distributable cash for any quarter
pursuant to Section 6.1 of the Limited
Partnership Agreement
    
    $
    91,244
 43




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##### Table of Contents



Item 12. Security Ownership of Certain Beneficial Owners and Management and Related
Stockholder Matters
 (a)
    
    Securities Authorized for Issuance Under Equity Compensation Plans
  (b)
    
    Security Ownership of Certain Beneficial Owners
  (c)
    
    Security Ownership of Management
  (d)
    
    Changes in Control
  
 Item 13. Certain Relationships and Related Transactions, and Director Independence
 (a)
    
    Transactions with Related Persons
  (b)
    
    Review, Approval or Ratification of Transactions with Related Persons
    (d)
    
    Director Independence
  44




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##### Table of Contents



Item 14. Principal Accountant Fees and Services
  Audit
Fees
  Audit-Related
Fees
  Tax
Fees
  All
Other Fees
  45




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##### Table of Contents



PART IV
 
 Item 15. Exhibits and Financial Statement Schedules
 Page(1)
    
    Financial StatementsReport of Management on Internal Control over Financial Reporting
    
    
    24Report of Independent Registered Public Accounting Firm
    
    
    25(2)
    
    The following financial statements of the Partnership are included in Part II, Item 8:Balance Sheets  as of December 31, 2008 and 2007
    
    
    26Statements of Operations  for the years ended December 31, 2008, 2007 and 2006
    
    
    27Statements of Partners Capital  for the years ended December 31, 2008, 2007 and 2006
    
    
    28Statements of Cash Flows  for the years ended December 31, 2008, 2007 and 2006
    
    
    29Notes to Financial Statements
    
    
    30
  46




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##### Table of Contents



ExhibitNo.
    
    Description
    
    Method of Filing3(a)
    
    Limited Partnership Agreement of the Partnership, 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. 47




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##### Table of Contents



CRONOS GLOBAL INCOME FUND XVI, L.P.By
    
    Cronos Capital Corp.The
General PartnerBy
    
    /s/ Dennis J. TietzDennis J. TietzPresident and Director of Cronos Capital Corp. (CCC)Principal Executive Officer of CCC
   Signature
    
    Title
    
    Date/s/ Dennis J. Tietz

Dennis J. Tietz
    
    President and Director of
Cronos Capital Corp. (CCC)

(Principal Executive Officer of
CCC)
    
    March 6, 2009/s/ John Kallas

John Kallas
    
    Vice President -
Secretary/Treasurer and Director
of CCC
    
    March 6, 2009/s/ Frank P. Vaughan

Frank P. Vaughan
    
    Vice President, Chief Financial
Officer and Director of CCC
(Principal Financial and
Accounting Officer of CCC)
    
    March 6, 2009/s/ Peter J. Younger
    
    Vice President and Director of CCC
    
    March 6, 2009Peter J. Younger






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##### Table of Contents



Exhibit Index
 ExhibitNo.
    
    Description
    
    Method of Filing3(a)
    
    Limited Partnership Agreement of the Partnership, 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.