UNITED STATES SECURITIES AND EXCHANGE COMMISSION


Washington, D.C. 20549


Form 10-K




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


For the year ended December 31, 2010




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


For the transition period from          to




Commission File number 000-28368




ATEL Cash Distribution Fund VI, L.P.


(Exact name of registrant as specified in its charter)




California
94-3207229(State or other jurisdiction of
(I. R. S. Employerincorporation or organization)
Identification No.)




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


(Address of principal executive offices)




Registrant’s telephone number, including area code:(415) 989-8800




Securities registered pursuant to section 12(b) of the Act:  None




Securities registered pursuant to section 12(g) of the Act:Limited Partnership Units




Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes  ̈ No x
 
 If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Act of 1934. Yes  ̈ No x
 
 Indicate by a check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No  ̈
 
 Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes  ̈ No ̈
 
 Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K.x


Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act. (Check one):


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




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




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





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





The number of Limited Partnership Units outstanding as of February 28, 2011 was 12,478,676.





DOCUMENTS INCORPORATED BY REFERENCE


None.











PART I




Item 1.  BUSINESS


General Development of Business


ATEL Cash Distribution Fund VI, L.P. (the “Partnership”) was formed under the laws of the State of California on June 29, 1994 for the purpose of engaging in the sale of limited liability investment units and acquiring equipment to engage in equipment leasing and sales activities, primarily in the United States. The Partnership may continue until December 31, 2015. The General Partner of the Partnership is ATEL Financial Services, LLC (“AFS”). Prior to converting to a limited liability company structure, AFS was formerly known as ATEL Financial Corporation.


The Partnership conducted a public offering of 12,500,000Limited Partnership units,at a price of $10 per Unit. Upon the sale of the minimum amount of Units of Limited Partnership interest Units of $1.2 million and the receipt of the proceeds thereof on January 3, 1995, the Partnership commenced operations in its primary business (acquiring equipment to engage in equipment leasing and sales activities). On November 23, 1996, subscriptions for 12,500,000 ($125 million) Limited Partnership Units had been received, in addition to the Initial Limited Partners’ Units, and the offering terminated. As of December 31, 2010, 12,478,676 Units were issued and outstanding.


The Partnership’s principal objectives have been to invest in a diversified portfolio of equipment that (i) preserves, protects and returns the Partnership’s invested capital; (ii) generates regular distributions to the partners of cash from operations and cash from sales or refinancing, with any balance remaining after certain minimum distributions to be used to purchase additional equipment during the reinvestment period (“Reinvestment Period”) (defined as six full years following the year the offering was terminated), which ended December 31, 2002 and (iii) provides additional distributions following the Reinvestment Period and until all equipment has been sold. The Partnership is governed by its Partnership Agreement (“Partnership Agreement”).


Pursuant to the Partnership Agreement, AFS receives compensation and reimbursements for services rendered on behalf of the Partnership (see Note 6 to the financial statements included in Item 8 of this report). AFS is required to maintain in the Partnership reasonable cash reserves for working capital, the repurchase of Units and contingencies. The repurchase of Units is solely at the discretion of AFS.


As of December 31, 2010, the Partnership remains in the liquidation phase of its life cycle as defined in the Partnership Agreement.


Narrative Description of Business


The Partnership has acquired various types of equipment, and leased such equipment pursuant to Operating Leases and Full Payout leases, whereby Operating Leases are defined as being leases in which the minimum lease payments during the initial lease term do not recover the full cost of the equipment and Full Payout leases recover such cost. Guidelines provided by the offering indicated that no more than 50% of the aggregate purchase price of equipment would represent equipment leased as operating leases upon final investment of the net proceeds of the offering and that no more than 20% of the aggregate purchase price of equipment would be invested in equipment acquired from a single manufacturer.
  The Partnership only purchased equipment under pre-existing leases or for which a lease would be concurrently entered into at the time of the purchase. From inception through December 31, 2010, the Partnership had purchased equipment with a total acquisition price of $208.3 million.
  The Partnership’s objective was to lease a minimum of 75% of the equipment acquired with the net proceeds of the offering to lessees that (i) had an average credit rating by Moody’s Investor Service, Inc. of Baa or better, or the credit equivalent as determined by AFS, with the average rating weighted to account for the original equipment cost for each item leased or (ii) were established hospitals with histories of profitability or municipalities. The balance of the original equipment portfolio could include equipment leased to lessees which, although deemed creditworthy by AFS, would not satisfy the general credit rating criteria for the portfolio. In excess of 75% of the equipment acquired with the net proceeds of the offering (based on original purchase cost) was originally leased to lessees with an
average credit rating of Baa or better or to such hospitals or municipalities as described in (ii) above.
  2


During 2010 and 2009, certain lessees generated significant portions (defined as 10% or more) of the Partnership’s total lease revenues as follows:


Percentage of Total

Lease RevenuesLessee

Type of Equipment

2010


2009Central States Enterprises

Railcars


42
%


40
%Transamerica Leasing

Containers


14
%


18
%Interstate Commodities

Railcars


16
%


14
%Bunge Corporation

Railcars


12
%


12
%Rail Tex, Inc.

Railcars


*



11
%





* Less than 10%





These percentages are not expected to be comparable between periods.
  The equipment leasing industry is highly competitive. Equipment manufacturers, corporations, partnerships and others offer users an alternative to the purchase of most types of equipment with payment terms that vary widely depending on the lease term, type of equipment and creditworthiness of the lessee. The ability of the Partnership to keep the equipment leased and/or operating and the terms of the acquisitions, leases and dispositions of equipment depends on various factors (many of which are not in the control of AFS or the Partnership), such as raw material costs to manufacture equipment as well as general economic conditions, including the effects of inflation or recession, and fluctuations in supply and demand for various types of equipment resulting from, among other things, technological and economic
obsolescence.


The business of the Partnership is not seasonal.


The Partnership has no full time employees. AFS’ employees and affiliates provide the services the Partnership requires to effectively operate. The cost of these services is reimbursed by the Partnership to AFS and affiliates per the Partnership Agreement.


Equipment Leasing Activities





The Partnership had acquired a diversified portfolio of equipment. The equipment had been leased to lessees in various industries. The following tables set forth the types of equipment acquired by the Partnership through December 31, 2010 and the industries to which the assets were leased (dollars in thousands):
  Asset Types

Purchase Price

Excluding


Acquisition Fees


Percentage

of Total

AcquisitionsRailcars and locomotives

$
60,101



28.85
%Manufacturing


36,342



17.45
%Transportation


27,465



13.18
%Construction


24,507



11.76
%Materials handling


16,237



7.80
%Office automation


16,048



7.70
%Containers


15,379



7.38
%Mining


7,919



3.80
%Other *


4,322



2.08
%$
208,320



100.00
%


* Individual amounts included in “Other” represent no more than 2% of the total.


3





Purchase Price


PercentageExcluding


of TotalIndustry of Lessee

Acquisition Fees


AcquisitionsTransportation, rail

$
55,996



26.88
%Electronics and manufacturing


29,031



13.94
%Business services


28,361



13.61
%Mining


24,793



11.90
%Transportation, other


23,217



11.14
%Manufacturing, other


18,922



9.08
%Oil and gas


16,536



7.94
%Communications


5,282



2.54
%Other *


6,182



2.97
%$
208,320



100.00
%





* Individual amounts included in “Other” represent less than 1% of the total.


Through December 31, 2010, the Partnership had disposed of certain leased assets as set forth below (in thousands):


OriginalEquipment Cost,Excluding





Excess of RentsAsset Types

Acquisition Fees


Sales Price


Over Expenses*Railcars and locomotives

$
39,463


$
25,549


$
34,475Manufacturing


36,342



8,151



32,015Transportation


25,191



5,921



24,769Construction


24,507



4,355



27,631Office automation


16,048



1,786



15,559Materials handling


16,037



3,994



19,238Containers


15,379



1,977



16,388Mining


7,919



2,064



7,866Other


3,238



494



2,665$
184,124


$
54,291


$
180,606


* Includes only those expenses directly related to the production of the related rents
  For further information regarding the Partnership’s equipment lease portfolio as of December 31, 2010, see Note 5 to the financial statements, Investments in equipment and leases, net, as set forth in Part II, Item 8, Financial Statements and Supplementary Data.
  Certain of the Partnership’s lessee customers have international operations. In these instances, the Partnership is aware that certain equipment, primarily rail and transportation, may periodically exit the country. However, these lessee customers are US-based, and it is impractical for the Partnership to track, on an asset-by-asset day-by-day basis, where these assets are deployed. For further information regarding the Partnership’s geographic revenues and assets, and major customers, see Notes 2 and 3 to the financial statements as set forth in Part II, Item 8, Financial Statements and Supplementary Data.


4


Item 2.  PROPERTIES
 
 The Partnership does not own or lease any real property, plant or material physical properties other than the equipment held for lease as set forth in Item 1, Business.
 
 Item 3.  LEGAL PROCEEDINGS
 
 In the ordinary course of conducting business, there may be certain claims, suits, and complaints filed against the Partnership. In the opinion of management, the outcome of such matters, if any, will not have a material impact on the Partnership’s financial position or results of operations. No material legal proceedings are currently pending against the Partnership or against any of its assets.





Item 4.  [RESERVED]
 
 5


PART II


Item 5.
MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES


Market Information


There are certain material conditions and restrictions on the transfer of Units imposed by the terms of the Partnership Agreement. Consequently, there is no public market for Units and it is not anticipated that a public market for Units will develop. In the absence of a public market for the Units, there is no currently ascertainable fair market value for the Units.


Holders




As of December 31, 2010, a total of 5,863 investors were Unitholders of record in the Partnership.


ERISA Valuation


In order to permit ERISA fiduciaries who hold Units to satisfy their annual reporting requirements, AFS estimated the value per Unit of the Partnership’s assets as of December 31, 2010. AFS calculated the estimated liquidation proceeds that would be realized by the Partnership, assuming an orderly disposition of all of the Partnership’s assets as of December 31, 2010. The estimates were based on the amount of remaining lease payments on existing Partnership leases, and the estimated residual values of the equipment held by the Partnership upon the termination of those leases. This valuation was based solely on AFS’s perception of market conditions and the types and amounts of the Partnership’s assets. No independent valuation was sought.
  After calculating the aggregate estimated disposition proceeds, AFS then calculated the portion of the aggregate estimated value of the Partnership assets that would be distributed to Unitholders on liquidation of the Partnership, and divided the total so distributable by the number of outstanding Units. As of December 31, 2010, the value of the Partnership’s assets, calculated on this basis, was approximately $0.62 per Unit. The foregoing valuation was performed solely for the ERISA purposes described above. There is no market for the Units, and, accordingly, this value does not represent an estimate of the amount a Unitholder would receive if he were to seek to sell his Units. Furthermore, there can be no assurance as to the amount the Partnership may actually receive if and when it seeks to liquidate its
assets or the amount of lease payments and equipment disposition proceeds it will actually receive over the remaining term of the Partnership.




Distributions




The Partnership does not make dividend distributions. However, the Limited Partners of the Partnership are entitled to certain distributions as provided under the Partnership Agreement.


AFS has sole discretion in determining the amount of distributions; provided, however, that AFS will not reinvest in equipment, but will distribute, subject to payment of any obligations of the Partnership.





Distributions were paid in March and December 2010, and December 2009. The annualized rate for distributions from 2010 and 2009 operations was $0.15 and $0.10 per Unit, respectively.  The rates and frequency of periodic distributions paid by the Fund during its liquidation phase are solely at the discretion of the General Partner.




Item 6. SELECTED FINANCIAL DATA




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




6


Item 7.
MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS





Statements contained in this Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” (“MD&A”) and elsewhere in this Form 10-K, which are not historical facts, may be forward-looking statements. Such statements are subject to risks and uncertainties that could cause actual results to differ materially from those projected. In particular, the economic recession and changes in general economic conditions, including fluctuations in demand for equipment, lease rates, and interest rates, may result in delays in leasing, re-leasing, and disposition of equipment, and reduced returns on invested capital. The Partnership’s performance is subject to risks relating to lessee defaults and the creditworthiness of its lessees. The Partnership’s
performance is also subject to risks relating to the value of its equipment at the end of its leases, which may be affected by the condition of the equipment, technological obsolescence and the markets for new and used equipment at the end of lease terms. Investors are cautioned not to attribute undue certainty to these forward-looking statements, which speak only as of the date of this Form 10-K. We undertake no obligation to publicly release any revisions to these forward-looking statements to reflect events or circumstances after the date of this Form 10-K or to reflect the occurrence of unanticipated events, other than as required by law.





Overview


ATEL Cash Distribution Fund VI, L.P. (the “Partnership”) is a California partnership that was formed in June 1994 for the purpose of engaging in the sale of limited liability investment units and acquiring equipment to generate revenues from equipment leasing and sales activities, primarily in the United States. The General Partner of the Partnership is ATEL Financial Services, LLC (“AFS”), a California limited liability company.
  The Partnership conducted a public offering of 12,500,000 Limited Partnership units (“Units”), at a price of $10 per Unit. The offering was terminated in November 1996. During early 1997, the Partnership completed its initial acquisition stage with the investment of the net proceeds from the public offering of Units. Subsequently, throughout the reinvestment period (“Reinvestment Period”) (defined as six full years following the year the offering was terminated), the Partnership reinvested cash flow in excess of certain amounts required to be distributed to the Limited Partners and/or utilized its credit facilities to acquire additional equipment.
 
 Pursuant to the guidelines of the Limited Partnership Agreement, the Partnership began to liquidate its assets and distribute the proceeds thereof after the end of the Reinvestment Period which ended in December 2002. As of December 31, 2010, the Partnership remains in its liquidation phase. Accordingly, assets that mature will be returned to inventory and most likely will be subsequently sold, which will result in decreasing revenue as earning assets decrease. The Partnership continues to generally make distributions on an annual basis or at the discretion of the General Partner.





Results of Operations




As of December 31, 2010 and 2009, there were concentrations (defined as greater than 10%) of equipment leased to lessees in certain industries (as a percentage of total equipment cost) as follows:





2010


2009Transportation, rail


82
%


74
%Transportation, containers


16
%


20
%





As previously indicated, certain lessees generated significant portions (defined as 10% or more) of the Partnership’s total lease revenues during 2010 and 2009 as follows:


Percentage of Total

Lease RevenuesLessee

Type of Equipment

2010


2009Central States Enterprises

Railcars


42
%


40
%Transamerica Leasing

Containers


14
%


18
%Interstate Commodities

Railcars


16
%


14
%Bunge Corporation

Railcars


12
%


12
%Rail Tex, Inc.

Railcars


*



11
%* Less than 10%


7


These percentages are not expected to be comparable in future periods due to the expiration of lessee contracts during the Fund’s liquidation period.




It has been the Partnership’s objective to maintain a 100% utilization rate for all equipment purchased in any given year. All equipment transactions were acquired subject to binding lease commitments, so equipment utilization remained high throughout the reinvestment stage. Initial lease terms of these leases were generally from 36 to 120 months, and as they expired, the Partnership attempted to re-lease or sell the equipment; as such, utilization rates may tend to decrease during the liquidation stage of the Partnership. All of the Partnership’s equipment on lease was acquired in the years 1995 through 1997. The utilization percentage of existing assets under lease was 100% and 97% when calculated at December 31, 2010 and 2009, respectively.





Cost reimbursements to the General Partner are based on its costs incurred in performing administrative services for the Partnership. These costs are allocated to each managed entity based on certain criteria such as total assets, number of investors or contributed capital based upon the type of cost incurred.





2010 versus 2009





The Partnership had net income of $473 thousand and $65 thousand for the years ended December 31, 2010 and 2009, respectively. The 2010 results reflect a decline in operating expenses offset, in part, by a decrease in total revenues when compared to the prior year.





Revenues





Total revenues for 2010 decreased by $64 thousand, or 2%, as compared to the prior year. The decline was primarily due to decreases in operating and direct financing lease revenues and gains recognized on sales of lease assets.





Operating lease revenues decreased by $32 thousand primarily due to a year over year decline in usage-based rental revenues combined with continued run-off and disposition of lease assets. Likewise, direct financing lease revenues was reduced by $14 thousand largely due to run-off of the lease portfolio.





Gains on sales of lease assets declined by $12 thousand as fewer railcar units were disposed of at prices similar to those of the prior year, coupled with the year over year change in the mix of assets sold.





Expenses





Total expenses for 2010 decreased by $472 thousand, or 17%, as compared to the prior year. The net decline in expenses was primarily due to decreases in costs reimbursed to AFS, depreciation expense, railcar maintenance costs, and income and franchise tax fees offset, in part, by increases in other management fees and other expense.





Costs reimbursed to AFS declined by $327 thousand largely due to lower administrative costs allocated to the Fund to better align costs with the Partnership’s dwindling operations. Depreciation expense was reduced by $127 thousand mainly as a result of continued run-off and disposition of lease assets. In addition, railcar maintenance costs declined by $49 thousand as the prior year amount included repairs and maintenance expenses relative to off-lease railcars which were subsequently re-leased in 2010; and, franchise fees and state taxes declined by $20 thousand primarily as a result of a year over year reduction in estimated tax liabilities.





Partially offsetting the aforementioned decreases in expenses were increases in other management fees and other expense totaling $22 thousand and $20 thousand, respectively. The increase in other management fees was primarily a result of an increase in the number of railcars managed by a third party manager as inventoried railcars were re-leased during 2010; and, the increase in other expense was largely due to higher printing, postage and photocopying costs related to investor communications, as well as higher freight and shipping costs.





Capital Resources and Liquidity





At December 31, 2010 and 2009, the Partnership’s cash and cash equivalents totaled $446 thousand and $979 thousand, respectively. The liquidity of the Partnership varies, increasing to the extent cash flows from leases and proceeds from lease asset sales exceed expenses and decreasing as distributions are made to the partners and to the extent expenses exceed cash flows from leases and proceeds from asset sales.
  8


The primary source of liquidity for the Partnership has been its cash flow from leasing activities. As the initial lease terms have expired, the Partnership ventured to re-lease or sell the equipment. Future liquidity will depend on the Partnership’s success in remarketing or selling the equipment as it comes off rental.
  In a normal economy, if inflation in the general economy becomes significant, it may affect the Partnership in as much as the residual (resale) values of the Partnership’s leased assets may increase as the costs of similar assets increase. However, the Partnership’s revenues from existing leases would not increase as such rates are generally fixed for the terms of the leases without adjustment for inflation. In addition, if interest rates increase significantly under such circumstances, the lease rates that the Partnership can obtain on future leases will be expected to increase as the cost of capital is a significant factor in the pricing of lease financing. Leases already in place, for the most part, would not be affected by changes in interest rates.
 
 The Partnership currently believes it has available adequate reserves to meet its immediate cash requirements and those of the next twelve months, but in the event those reserves were found to be inadequate, the Partnership would likely be in a position to borrow against its current portfolio to meet such requirements. AFS envisions no such requirements for operating purposes.





Cash Flows





The following table sets forth summary cash flow data (in thousands):




December 31,2010


2009Net cash provided by (used in):Operating activities

$
1,000


$
1,158Investing activities


358



417Financing activities


(1,891
)


(1,260
)Net (decrease) increase in cash and cash equivalents

$
(533
)

$
315


Operating Activities


Cash provided by operating activities for the year of 2010 decreased by $158 thousand, or 14%, as compared to the prior year.The net decrease in cash flow was largely due to an increase in receivables, and a decrease in the Partnership’s accrued liabilities offset, in part, by the year over year increase in net income from operations.




The increase in receivables was largely due to a higher level of billings accrued at December 31, 2010 as compared to the prior year. The decrease in the Partnership’s accrued liabilities was mainly due to the resolution of an item previously held in suspense.




Investing Activities
 
 Cash provided by investing activities for 2010 decreased by $59 thousand, or 14%, as compared to the prior year. The decrease in cash flow was a result of $45 thousand of capitalized improvement costs associated with certain railcars coupled with a $14 thousand decrease in proceeds from sales of lease assets, which decreased as fewer railcar units were sold at prices similar to those realized in 2009, coupled with the change in the mix of assets sold.
 
 Financing Activities
 
 Cash used in financing activities during 2010 increased by $631 thousand when compared to the prior year. The increase represents a year over year increase in distributions paid to both Limited Partners and the General Partner totaling $624 thousand and $7 thousand, respectively.





Non-Recourse Long-Term Debt





The Partnership’s long-term borrowings were generally non-recourse to the Partnership, that is, the only recourse of the lender was to the equipment or corresponding lease acquired with the loan proceeds. As of December 31, 2010 and 2009, the Partnership had no outstanding non-recourse debt.The General Partner does not anticipate any future non-recourse borrowings on behalf of the Partnership.
  9


Distributions





The Partnership commenced periodic distributions, based on cash flows from operations, beginning with the month of January 1995. See Item 5, Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities, for additional information regarding the distributions.


Commitments and Contingencies and Off-Balance Sheet Transactions





Commitments and Contingencies





At December 31, 2010, the Partnership had no commitments to purchase lease assets and pursuant to the Partnership Agreement, the Partnership will no longer purchase any new lease assets.





Off-Balance Sheet Transactions





None.





Recent Accounting Pronouncements





Information regarding recent accounting pronouncements is included in Note 2 to the financial statements, Summary of significant accounting policies, as set forth in Part II, Item 8, Financial Statements and Supplementary Data.





Critical Accounting Policies and Estimates





The policies discussed below are considered by management of the Partnership to be critical to an understanding of the Partnership’s financial statements because their application requires significant complex or subjective judgments, decisions, or assessments, with financial reporting results relying on estimation about the effect of matters that are inherently uncertain. Specific risks for these critical accounting policies are described in the following paragraphs. The Partnership also states these accounting policies in the notes to the financial statements and in relevant sections in this discussion and analysis. For all of these policies, management cautions that future events may not develop exactly as forecast, and the best estimates routinely require adjustment.




Use of estimates:




The preparation of financial statements in conformity with accounting principles generally accepted in the United States (“GAAP”) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Such estimates primarily relate to the determination of residual values at the end of the lease term, expected future cash flows used for impairment analysis purposes and determination of the allowance for doubtful accounts.




Equipment on operating leases and related revenue recognition:




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





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





Operating leases are generally placed in a non-accrual status (i.e., no revenue is recognized) when payments are more than 90 days past due. Additionally, management considers the equipment underlying the lease contracts for impairment and periodically reviews the credit worthiness of all operating lessees with payments outstanding less than 90 days. Based upon management’s judgment, the related operating leases may be placed on non-accrual status. Leases placed on non-accrual status are only returned to an accrual status when the account has been brought current and management believes recovery of the remaining unpaid lease payments is probable. Until such time, all payments received are applied only against outstanding principal balances.




10





The Partnership earns revenues from certain lease assets based on utilization of such assets. Such contingent rentals and the associated expenses are recorded when earned and/or incurred.





Asset valuation:





Recorded values of the Partnership’s asset portfolio are periodically reviewed for impairment. An impairment loss is measured and recognized only if the estimated undiscounted future cash flows of the asset are less than their net book value. The estimated undiscounted future cash flows are the sum of the estimated residual value of the asset at the end of the asset’s expected holding period and estimates of undiscounted future rents. The residual value assumes, among other things, that the asset is utilized normally in an open, unrestricted and stable market. Short-term fluctuations in the market place are disregarded and it is assumed that there is no necessity either to dispose of a significant number of the assets, if held in quantity, simultaneously or to dispose of the asset quickly. Impairment is
measured as the difference between the fair value (as determined by a valuation method using discounted estimated future cash flows, third party appraisals or comparable sales of similar assets as applicable based on asset type) of the assets and its carrying value on the measurement date.


Item 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA




See the Report of Independent Registered Public Accounting Firm, Financial Statements and Notes to Financial Statements attached hereto at pages12through 26.


11




REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM




The Partners


ATEL Cash Distribution Fund VI, L.P.




We have audited the accompanying balance sheets of ATEL Cash Distribution Fund VI, L.P. (“Partnership”) as of December 31, 2010 and 2009,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 Management of the Partnership’s General Partner. Our responsibility is to express an opinion on these financial statements based on our audits.




We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement. We were not engaged to perform an audit of the Partnership’s 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. An audit includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.





In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of ATEL Cash Distribution Fund VI, L.P. as of December 31, 2010 and 2009,and the results of its operations and its cash flows for the years then ended, in conformity with U.S. generally accepted accounting principles.





/s/ Moss Adams LLP




San Francisco, California


March 22, 2011




12





ATEL CASH DISTRIBUTION FUND VI, L.P.
  BALANCE SHEETS
  DECEMBER 31, 2010 AND 2009
 (In Thousands)


2010


2009ASSETSCash and cash equivalents

$
446


$
979Accounts receivable


183



118Prepaid expenses


4



6Investments in equipment and leases, net of accumulated depreciation of $20,773 at December 31, 2010 and $20,794 at December 31, 2009


4,410



5,545Total assets

$
5,043


$
6,648LIABILITIES AND PARTNERS’ CAPITALAccounts payable and accrued liabilities:General Partner

$
49


$
51Lessees and other


132



328Unearned operating lease income


33



22Total liabilities


214



401Commitments and contingenciesPartners’ capital:General Partner


-



-Limited Partners


4,829



6,247Total Partners’ capital


4,829



6,247Total liabilities and Partners’ capital

$
5,043


$
6,648





See accompanying notes.




13





ATEL CASH DISTRIBUTION FUND VI, L.P.




STATEMENTS OF INCOME
  FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009


(In Thousands Except for Units and Per Unit Data)





2010


2009Revenues:Leasing activities:Operating leases

$
2,578


$
2,610Direct financing leases


13



27Gain on sales of assets


109



121Other revenue


4



10Total revenues


2,704



2,768Expenses:Depreciation of operating lease assets


899



1,026Cost reimbursements to General Partner


308



635Railcar maintenance


552



601Equipment and incentive management fees to General Partner


110



110Taxes on income and franchise fees


(10
)


10Other management fees


121



99Professional fees


50



56Outside services


67



68Reversal of provision for doubtful accounts


-



(16
)Other


134



1142,231



2,703Net income

$
473


$
65Net income:General Partner

$
19


$
12Limited Partners


454



53$
473


$
65Net income per Limited Liability Partnership Unit

$
0.04


$
0.00Weighted average number of Units outstanding


12,478,676



12,478,676





See accompanying notes.




14


ATEL CASH DISTRIBUTION FUND VI, L.P.
  STATEMENT OF CHANGES IN PARTNERS’ CAPITAL
  FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009


(In Thousands Except for Units and Per Unit Data)





Limited Partners


GeneralUnits


Amount


Partner


TotalBalance December 31, 2008


12,478,676


$
7,442


$
-


$
7,442Distributions to Limited Partners ($0.10 per Unit)


-



(1,248
)


-



(1,248
)Distributions to General Partner


-



-



(12
)


(12
)Net income


-



53



12



65Balance December 31, 2009


12,478,676



6,247



-



6,247Distributions to Limited Partners ($0.15 per Unit)


-



(1,872
)


-



(1,872
)Distributions to General Partner


-



-



(19
)


(19
)Net income


-



454



19



473Balance December 31, 2010


12,478,676


$
4,829


$
-


$
4,829





See accompanying notes.




15





ATEL CASH DISTRIBUTION FUND VI, L.P.




STATEMENTS OF CASH FLOWS


FOR THE YEARS ENDED DECEMBER 31, 2010 AND 2009
 (In Thousands)


2010


2009Operating activities:Net income

$
473


$
65Adjustment to reconcile net income to cash provided by operating activities:Depreciation of operating lease assets


899



1,026Reversal of provision for doubtful accounts


-



(16
)Amortization of unearned income on direct financing leases


(13
)


(27
)Gain on sales of assets


(109
)


(121
)Changes in operating assets and liabilities:Accounts receivable


(65
)


199Prepaid expenses and other assets


2



-Accounts payable and accruals due to General Partner


(2
)


9Accounts payable and accruals due to lessees and other


(196
)


16Unearned operating lease income


11



7Net cash provided by operating activities


1,000



1,158Investing activities:Proceeds from sales of lease assets


334



348Payments received on direct financing leases


69



69Improvements to lease equipment


(45
)


-Net cash provided by investing activities


358



417Financing activities:Distributions to Limited Partners


(1,872
)


(1,248
)Distributions to General Partner


(19
)


(12
)Net cash used in financing activities


(1,891
)


(1,260
)Net (decrease) increase in cash and cash equivalents


(533
)


315Cash and cash equivalents at beginning of year


979



664Cash and cash equivalents at end of year

$
446


$
979Supplemental disclosures of cash flow information:Cash paid during the year for taxes

$
8


$
16





See accompanying notes.




16


ATEL CASH DISTRIBUTION FUND VI, L.P.
  NOTES TO FINANCIAL STATEMENTS




1.  Organization and Limited Partnership matters:
  ATEL Cash Distribution Fund VI, L.P. (the “Partnership”) was formed under the laws of the State of California on June 29, 1994 for the purpose of engaging in the sale of limited liability investment units and acquiring equipment to engage in equipment leasing and sales activities, primarily in the United States. The Partnership may continue until December 31, 2015. The General Partner of the Partnership is ATEL Financial Services, LLC (“AFS”), a wholly owned subsidiary of ATEL Capital Group. Prior to converting to a limited liability company structure, AFS was formerly known as ATEL Financial Corporation.


The Partnership conducted a public offering of 12,500,000Limited Partnership units,at a price of $10 per Unit. Upon the sale of the minimum amount of Units of Limited Partnership interest Units of $1.2 million and the receipt of the proceeds thereof on January 3, 1995, the Partnership commenced operations in its primary business (acquiring equipment to engage in equipment leasing and sales activities). On November 23, 1996, subscriptions for 12,500,000 ($125 million) Limited Partnership Units had been received, in addition to the Initial Limited Partners’ Units, and the offering terminated. As of December 31, 2010, 12,478,676 Units were issued and outstanding.


The Partnership’s principal objectives have been to invest in a diversified portfolio of equipment that (i) preserves, protects and returns the Partnership’s invested capital; (ii) generates regular distributions to the partners of cash from operations and cash from sales or refinancing, with any balance remaining after certain minimum distributions to be used to purchase additional equipment during the reinvestment period (“Reinvestment Period”) (defined as six full years following the year the offering was terminated), which ended December 31, 2002 and (iii) provides additional distributions following the Reinvestment Period and until all equipment has been sold. The Partnership is governed by its Partnership Agreement (“Partnership Agreement”).


Pursuant to the Partnership Agreement, AFS receives compensation and reimbursements for services rendered on behalf of the Partnership (see Note 6). The Partnership is required to maintain reasonable cash reserves for working capital, the repurchase of Units and contingencies. The repurchase of Units is solely at the discretion of AFS.





As of December 31, 2010, the Partnership remains in the liquidation phase of its life cycle, as defined in the Partnership Agreement, and is generally making distributions on an annual basis or at the discretion of the General Partner.





2.  Summary of significant accounting policies:


Basis of presentation:


The accompanying balance sheets as of December 31, 2010 and 2009, and the related statements of income, changes in partners’ capital, and cash flows for the years then ended, have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the Securities and Exchange Commission.
 
 Certain prior year amounts have been reclassified to conform to the current year presentation. These reclassifications had no effect on capital or net income.





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




In preparing the accompanying financial statements, the Partnership has reviewed, as determined necessary by the General Partner, events that have occurred after December 31, 2010, up until the issuance of the financial statements. No events were noted which would require disclosure in the footnotes to the financial statements.




17




ATEL CASH DISTRIBUTION FUND VI, L.P.
  NOTES TO FINANCIAL STATEMENTS




2.  Summary of significant accounting policies (continued):




Use of estimates:




The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Such estimates primarily relate to the determination of residual values at the end of the lease term and expected future cash flows used for impairment analysis purposes and determination of the allowance for doubtful accounts.





Cash and cash equivalents:





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





Credit risk:




Financial instruments that potentially subject the Partnership to concentrations of credit risk include cash and cash equivalents and accounts receivable. The Partnership places the majority of its cash deposits and temporary cash investments in U.S. Treasury denominated instruments with the remainder placed in financial institutions with no less than $10 billion in assets, so as to meet ongoing working capital requirements. The concentration of such deposits and temporary cash investments is not deemed to create a significant risk to the Partnership. Accounts receivable represent amounts due from lessees in various industries related to equipment on operating or direct financing leases.




Accounts receivable:




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





Equipment on operating leases and related revenue recognition:





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





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





Operating leases are generally placed in a non-accrual status (i.e., no revenue is recognized) when payments are more than 90 days past due. Additionally, management considers the equipment underlying the lease contracts for impairment and periodically reviews the credit worthiness of all operating lessees with payments outstanding less than 90 days. Based upon management’s judgment, the related operating leases may be placed on non-accrual status. Leases placed on non-accrual status are only returned to an accrual status when the account has been brought current and management believes recovery of the remaining unpaid lease payments is probable. Until such time, all payments received are applied only against outstanding principal balances.





The Partnership earns revenues from certain lease assets based on utilization of such assets. Such contingent rentals and the associated expenses are recorded when earned and/or incurred.


18
 
 ATEL CASH DISTRIBUTION FUND VI, L.P.
  NOTES TO FINANCIAL STATEMENTS




2.  Summary of significant accounting policies (continued):




Direct financing leases and related revenue recognition:





Income from direct financing lease transactions is reported using the financing method of accounting, in which the Partnership’s investment in the leased property is reported as a receivable from the lessee to be recovered through future rentals. The income portion of each rental payment is calculated so as to generate a constant rate of return on the net receivable outstanding.





Allowances for losses on direct financing leases are typically established based on historical charge-off and collection experience and the collectability of specifically identified lessees and billed and unbilled receivables.Direct financing leases are written-off as they are deemed uncollectible.





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





Asset valuation:





Recorded values of the Partnership’s asset portfolio are periodically reviewed for impairment. An impairment loss is measured and recognized only if the estimated undiscounted future cash flows of the asset are less than their net book value. The estimated undiscounted future cash flows are the sum of the estimated residual value of the asset at the end of the asset’s expected holding period and estimates of undiscounted future rents. The residual value assumes, among other things, that the asset is utilized normally in an open, unrestricted and stable market. Short-term fluctuations in the market place are disregarded and it is assumed that there is no necessity either to dispose of a significant number of the assets, if held in quantity, simultaneously or to dispose of the
asset quickly. Impairment is measured as the difference between the fair value (as determined by a valuation method using discounted estimated future cash flows, third party appraisals or comparable sales of similar assets as applicable based on asset type) of the assets and its carrying value on the measurement date.





Segment reporting:





The Partnership is not organized by multiple operating segments for the purpose of making operating decisions or assessing performance. Accordingly, the Partnership operates in one reportable operating segment in the United States.





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





However, certain of the Partnership’s lessee customers may have international operations. In these instances, the Partnership is aware that certain equipment, primarily rail and transportation, may periodically exit the country. However, these lessee customers are US-based, and it is impractical for the Partnership to track, on an asset-by-asset, day-by-day basis, where these assets are deployed.




19


ATEL CASH DISTRIBUTION FUND VI, L.P.
  NOTES TO FINANCIAL STATEMENTS




2.  Summary of significant accounting policies (continued):


The primary geographic regions in which the Partnership sought leasing opportunities were North America and Europe. Currently, 100% of the Partnership’s operating revenues are from customers domiciled in North America.





Unearned operating lease income:





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




Income taxes:




Pursuant to the provisions of Section 701 of the Internal Revenue Code, a partnership is not subject to federal income taxes. All income and losses of the Partnership are the liability of the individual partners and are allocated to the partners for inclusion in their individual tax returns.Accordingly, the Partnership has provided current income and franchise taxes for only those states which levy taxes on partnerships. Interest and penalties on such taxes are considered to be insignificant. For the year ended December 31, 2010, the Partnership recorded an estimated income and franchise tax benefit of $10 thousand as compared to an expense of $10 thousand for
the year ended December 31, 2009. The Partnership does not have any entity level uncertain tax positions. The Partnership files income tax returns in the U.S. federal jurisdiction and various state jurisdictions and is generally subject to examination by U.S. federal (or state and local) income tax authorities for three years from the filing of a tax return.


The tax bases of the Partnership’s net assets and liabilities vary from the amounts presented in these financial statements as of December 31, 2010 and 2009 as follows (in thousands):


2010


2009Financial statement basis of net assets

$
4,829


$
6,247Tax basis of net assets (unaudited)


13,586



13,975Difference (unaudited)

$
(8,757
)

$
(7,728
)


The primary differences between the tax bases of net assets and the amounts recorded in the financial statements are the result of differences in accounting for impairment losses, syndication costs and differences between the depreciation methods used in the financial statements and the Partnership’s tax returns.





The following reconciles the net income reported in these financial statements to the income reported on the Partnership’s federal tax return (unaudited) for each of the years ended December 31, 2010 and 2009 (in thousands):


2010


2009Net income per financial statements

$
473


$
65Tax adjustments (unaudited):Adjustment to depreciation expense


892



1,026Provision for losses and doubtful accounts


-



(16
)Adjustments to gain on sales of assets


225



226Adjustments to revenues and other items


(88
)


49Income per federal tax return (unaudited)

$
1,502


$
1,350


Per unit data:
  Net income and distributions per unit are based upon the weighted average number of units outstanding during the year.


20


ATEL CASH DISTRIBUTION FUND VI, L.P.
  NOTES TO FINANCIAL STATEMENTS
 2.  Summary of significant accounting policies (continued):
 
 Recent accounting pronouncements:
 In January 2011, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2011-01, “Deferral of the Effective Date of Disclosures about Troubled Debt Restructurings in Update No. 2010-20.” ASU 2011-01 temporarily delays the effective date of the disclosures about troubled debt restructurings in Update 2010-20 for public entities. The delay is intended to allow the Board time to complete its deliberations on what constitutes a troubled debt restructuring. The effective date of the new disclosures about troubled debt restructurings for public entities and the guidance for determining what constitutes a troubled debt restructuring will then be coordinated. Currently, that guidance is anticipated to be effective for interim and annual periods
ending after June 15, 2011. The Partnership anticipates that adoption of these additional disclosures will not have a material effect on its financial position or results of operations.
 
 In July 2010, the FASB issued ASU No. 2010-20, “Disclosures about the Credit Quality of Financing Receivables and the Allowance for Credit Losses.” ASU 2010-20 requires entities to provide disclosures designed to facilitate financial statement users’ evaluation of (i) the nature of credit risk inherent in the entity’s portfolio of financing receivables, (ii) how that risk is analyzed and assessed in arriving at the allowance for credit losses and (iii) the changes and reasons for those changes in the allowance for credit losses. Disclosures must be disaggregated by portfolio segment, the level at which an entity develops and documents a systematic method for determining its allowance for credit losses, and class of financing receivable, which is generally a disaggregation of portfolio
segment. The required disclosures include, among other things, a rollforward of the allowance for credit losses as well as information about modified, impaired, non-accrual and past due loans and credit quality indicators. ASU 2010-20 is effective as of December 31, 2010, as it relates to disclosures required as of the end of a reporting period. Disclosures that relate to activity during a reporting period will be required for the Partnership’s financial statements that include periods beginning on or after December 15, 2010. The adoption of this ASU did not have a material effect on the Partnership’s financial position or results of operations; however, it did add additional disclosures which have been included in Note 2.
 
 In January 2010, the FASB issued ASU No. 2010-06, “Improving Disclosure about Fair Value Measurement.” ASU 2010-06 requires additional disclosures related to recurring or nonrecurring fair-value measurements including significant transfers into and out of Level 1 and Level 2 fair-value measurements, and information on purchases, sales, issuances, and settlements in a rollforward reconciliation of Level 3 fair-value measurements. Except for the Level 3 reconciliation disclosures, which are effective for fiscal years beginning after December 15, 2010, the guidance became effective for the Partnership beginning January 1, 2010 and was adopted during the first quarter of 2010 with no impact on the Partnership’s financial position, results of operations or cash flows.
 
 3.  Concentration of credit risk and major customers:
 The Partnership leases equipment to lessees in diversified industries. Leases are subject to AFS’s credit committee review. The leases provide for the return of the equipment upon default.
 
 The Partnership is no longer acquiring equipment. As assets have been sold upon maturity of the related leases, concentrations have arisen in certain industries due to the decreasing number of remaining leases and assets.
 
 As of December 31, 2010 and 2009, there were concentrations (defined as greater than 10%) of equipment leased to lessees in certain industries (as a percentage of total equipment cost) as follows:
 2010


2009Transportation, rail


82
%


74
%Transportation, containers


16
%


20
%
  21
 ATEL CASH DISTRIBUTION FUND VI, L.P.
 
 NOTES TO FINANCIAL STATEMENTS
 3.  Concentration of credit risk and major customers (continued):
 
 During 2010 and 2009, certain lessees generated significant portions (defined as 10% or more) of the Partnership’s total lease revenues as follows:
 
 Percentage of Total

Lease RevenuesLessee

Type ofEquipment

2010


2009Central States Enterprises

Railcars


42
%


40
%Transamerica Leasing

Containers


14
%


18
%Interstate Commodities

Railcars


16
%


14
%Bunge Corporation

Railcars


12
%


12
%Rail Tex, Inc.

Railcars


*



11
%
 * Less than 10%
 
 4.  Provision for credit losses:
 Activity in the allowance for doubtful accounts consists of the following (in thousands):
 Allowance for

Doubtful

AccountsBalance December 31, 2008

$
16Adjustments to provision


(16
)Balance December 31, 2009


-Adjustments to provision


-Balance December 31, 2010

$
-
 
 The Partnership did not record an allowance for credit losses against its financing receivables and/or its operating lease receivables during the years ended December 31, 2010 and 2009. At December 31, 2010, the Partnership’s net investment in financing receivables was nominal.
 5.  Investments in equipment and leases, net:
 
 The Partnership’s investments in equipment and leases consist of the following (in thousands):
 Balance

December 31,

2009


Reclassifications

&

Additions /

Dispositions


Depreciation/

Amortization

Expense or

Amortization

of Leases


Balance

December 31,

2010Net investment in operating leases

$
5,003


$
286


$
(899
)

$
4,390Net investment in direct financing leases


76



-



(56
)


20Assets held for sale or lease, net


466



(466
)


-



-Total

$
5,545


$
(180
)

$
(955
)

$
4,410
  Impairment of investments in leases and assets held for sale or lease:
 
 Management periodically reviews the carrying values of its assets on leases and assets held for lease or sale. As a result of these reviews, management determined that no impairment losses existed in either 2010 or 2009.
 
 The Partnership utilizes a straight-line depreciation method over the term of the equipment lease for equipment in all of the categories currently in its portfolio of lease transactions. Depreciation expense on the Partnership’s equipment was $899 thousand and $1.0 million for 2010 and 2009, respectively.
  22
 ATEL CASH DISTRIBUTION FUND VI, L.P.
 
 NOTES TO FINANCIAL STATEMENTS
 5.  Investments in equipment and leases, net (continued):
 
 All of the property on leases was acquired from 1995 through 1997.
 Operating leases:
 
 Equipment on operating leases consists of the following (in thousands):
 Balance

December 31,

2009


Additions


Reclassifications

or Dispositions


Balance

December 31,

2010Transportation, rail

$
23,698


$
45


$
936


$
24,679Materials handling


199



-



-



199Transportation, other


285



-



-



28524,182



45



936



25,163Less accumulated depreciation


(19,179
)


(899
)


(695
)


(20,773
)Total

$
5,003


$
(854
)

$
241


$
4,390
 The average estimated residual value for assets on operating leases was 15% and 16% of the assets’ original cost at December 31, 2010 and 2009, respectively.
 
 The Partnership earns revenues from certain lease assets based on utilization of such assets. Such contingent rentals and the associated expenses are recorded when earned and/or incurred. The revenues associated with these rentals are included as a component of Operating Lease Revenues, and totaled $370 thousand and $489 thousand for the years ended December 31, 2010 and 2009, respectively. There were no operating leases in nonaccrual status as of December 31, 2010 and 2009.
 Direct financing leases:
 Investment in direct financing leases consists of various transportation and ground support equipment. The following lists the components of the Partnership’s investment in direct financing leases as of December 31, 2010 and 2009 (in thousands):
 2010


2009Total minimum lease payments receivable

$
-


$
69Estimated residual values of leased equipment (unguaranteed)


20



20Investment in direct financing leases


20



89Less unearned income


-



(13
)Net investment in direct financing leases

$
20


$
76
 There were no investments in direct financing leases, net in nonaccrual status as of December 31, 2010 and 2009.
 
 At December 31, 2010, the aggregate amounts of future minimum lease payments under operating and direct financing leases are as follows (in thousands):
 Operating

Leases


Direct

Financing

Leases


TotalYear ending December 31, 2011

$
1,068


$
-


$
1,0682012


237



-



237$
1,305


$
-


$
1,305
 23
 
 ATEL CASH DISTRIBUTION FUND VI, L.P.
 
 NOTES TO FINANCIAL STATEMENTS
 6.  Related party transactions:
 The terms of the Partnership Agreement provide that AFS and/or affiliates are entitled to receive certain fees for equipment acquisition, management and resale and for management of the Partnership.
 The Partnership Agreement allows for the reimbursement of costs incurred by AFS in providing administrative services to the Partnership. Administrative services provided include Partnership accounting, investor relations, legal counsel and lease and equipment documentation. AFS is not reimbursed for services whereby it is entitled to receive a separate fee as compensation for such services, such as management of equipment. The Partnership would be liable for certain future costs to be incurred by AFS to manage the administrative services provided to the Partnership.
 
 Each of ATEL Leasing Corporation (“ALC”) and AFS is a wholly-owned subsidiary of ATEL Capital Group and performs services for the Partnership. Acquisition services, equipment management, lease administration and asset disposition services are performed by ALC; investor relations, communications services and general administrative services are performed by AFS.
 
 Cost reimbursements to the General Partner are based on its costs incurred in performing administrative services for the Partnership. These costs are allocated to each managed entity based on certain criteria such as total assets, number of investors or contributed capital based upon the type of cost incurred.
 Incentive management fees are computed as 4% of distributions of cash from operations, as defined in the Partnership Agreement. Equipment management fees are computed as 3.5% of gross revenues from operating leases, as defined in the Partnership Agreement plus 2% of gross revenues from full payout leases, as defined in the Partnership Agreement.
 
 During the years ended December 31, 2010 and 2009, AFS and/or affiliates earned fees, commissions and reimbursements, pursuant to the Partnership Agreement as follows (in thousands):
 
 2010


2009Cost reimbursements to General Partner and/or affiliates

$
308


$
635Equipment and incentive management fees to General Partner


110



110$
418


$
745
 7.  Guarantees:
 
 The Partnership enters into contracts that contain a variety of indemnifications. The Partnership’s maximum exposure under these arrangements is unknown. However, the Partnership has not had prior claims or losses pursuant to these contracts and expects the risk of loss to be remote.
 
 The General Partner knows of no facts or circumstances that would make the Partnership’s contractual commitments outside standard mutual covenants applicable to commercial transactions between businesses. Accordingly, the Partnership believes that these indemnification obligations are made in the ordinary course of business as part of standard commercial and industry practice, and that any potential liability under the Partnership’s similar commitments is remote. Should any such indemnification obligation become payable, the Partnership would separately record and/or disclose such liability in accordance with GAAP.
 
 8.  Partners’ capital:
 
 As of December 31, 2010 and 2009, 12,478,676 Units were issued and outstanding, including the 50 Units issued to the Initial Limited Partners, as defined. The Partnership was authorized to issue up to 12,500,000 Units, in addition to the 50 Units issued to the Initial Limited Partners.
 24
 
 ATEL CASH DISTRIBUTION FUND VI, L.P.
 
 NOTES TO FINANCIAL STATEMENTS
 
 8.  Partners’ capital (continued):
 
 The Partnership has the right, exercisable at the General Partner’s discretion, but not the obligation, to repurchase Units of a Unit holder who ceases to be a U.S. Citizen, for a price equal to 100% of the holder’s capital account. The Partnership is otherwise permitted, but not required, to repurchase Units upon a holder’s request. The repurchase of Fund units is made in accordance with Section 13 of the Amended and Restated Agreement of Limited Partnership. The repurchase would be at the discretion of the General Partner on terms it determines to be appropriate under given circumstances, in the event that the General Partner deems such repurchase to be in the best interest of the Partnership; provided, the Partnership is never required to repurchase any Units. Upon the repurchase of any Units by
the Fund, the tendered Units are cancelled. Units repurchased in prior periods were repurchased at amounts representing the original investment less cumulative distributions made to the unit-holder with respect to the Units. All Units repurchased during a quarter are deemed to be repurchased effective the last day of the preceding quarter, and are not deemed to be outstanding during, or entitled to allocations of net income, net loss or distributions for the quarter in which such repurchase occurs.
 
 As defined in the Partnership Agreement, the Partnership’s Net Profits, Net Losses, and Tax Credits are to be allocated 99% to the Limited Partners and 1% to AFS. The Partnership Agreement allows the Partnership to make an allocation of income to AFS in order to maintain the capital account of AFS at zero. In accordance with the terms of the Partnership Agreement, additional allocations of income were made to AFS in 2010 and 2009. The amounts allocated were determined so as to bring AFS’s ending capital account balance to zero at the end of each year.
 
 As defined in the Partnership Agreement, Available Cash from Operations and Cash from Sales and Refinancing are to be distributed as follows:
 Cash from Operations
 Cash from Operations is distributed 95% to the Limited Partners, 1% to AFS and 4% to an affiliate of AFS as an Incentive Management Fee.
 
 Cash from Sales and Refinancing
 First, 99% to the Limited Partners and 1% to AFS until each Limited Partner has received Aggregate Distributions in an amount equal to their Original Invested Capital, as defined, plus a 10% per annum cumulative (compounded daily) return on their Adjusted Invested Capital; and
 
 Thereafter, 95% to the Limited Partners, 1% to AFS and 4% to an affiliate of AFS as an Incentive Management Fee.
 
 Distributions to the Limited Partners for the years ended December 31, 2010 and 2009 were as follows (in thousands except Units and per Unit data):
 
 2010


2009Distributions

$
1,872


$
1,248Weighted average number of Units outstanding


12,478,676



12,478,676Weighted average distributions per Unit

$
0.15


$
0.10
 9.  Fair value measurements:
 Fair value measurements and disclosures are based on a fair value hierarchy as determined by significant inputs used to measure fair value. The three levels of inputs within the fair value hierarchy are defined as follows:
 
 Level 1 – Quoted prices in active markets for identical assets or liabilities. An active market for the asset or liability is a market in which transactions for the asset or liability occur with sufficient frequency and volume to provide pricing information on an ongoing basis, generally on a national exchange.
  25
  ATEL CASH DISTRIBUTION FUND VI, L.P.
 
 NOTES TO FINANCIAL STATEMENTS
 9.  Fair value measurements (continued):
 
 Level 2 – Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-based valuations in which all significant inputs are observable in the market.
 
 Level 3 – Valuation is modeled using significant inputs that are unobservable in the market. These unobservable inputs reflect the Partnership's own estimates of assumptions that market participants would use in pricing the asset or liability.
 
 At December 31, 2010 and 2009, the Partnership had no assets or liabilities that require measurement at fair value on a recurring or non-recurring basis.
 
 The following disclosure of the estimated fair value of financial instruments is made in accordance with the guidance provided by the Financial Instruments Topic of the FASB Accounting Standards Codification. Fair value estimates, methods and assumptions, set forth below for the Partnership’s financial instruments, are made solely to comply with the requirements of the Financial Instruments Topic and should be read in conjunction with the Partnership’s financial statements and related notes.
 
 The Partnership has determined the estimated fair value amounts by using market information and valuation methodologies that it considers appropriate and consistent with the fair value accounting guidance. Considerable judgment is required to interpret market data to develop the estimates of fair value. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Partnership could realize or has realized in a current market exchange. The use of different market assumptions and/or estimation methodologies may have a material effect on the estimated fair value amounts.
 
 At December 31, 2010 and 2009, the only financial instrument reflected on the Partnership’s financial statements is its cash and cash equivalents. Such cash and cash equivalents approximate fair value because of the liquidity and short-term maturity of these instruments.
 
 26
  Item 9.
CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES
 
 None.
 Item 9A.  CONTROLS AND PROCEDURES
 
 Evaluation of disclosure controls and procedures
 
 The Partnership’s General Partner’s President and Chief Executive Officer, and Executive Vice President and Chief Financial Officer and Chief Operating Officer (“Management”), evaluated the effectiveness of the Partnership’s disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e)) as of the end of the period covered by this report. Based on the evaluation of the Partnership’s disclosure controls and procedures, Management concluded that as of the end of the period covered by this report, the design and operation of these disclosure controls and procedures were effective.
 
 The Partnership does not control the financial reporting process, and is solely dependent on the Management of the General Partner, who is responsible for providing the Partnership with financial statements in accordance with generally accepted accounting principles in the United States. The General Partner’s disclosure controls and procedures, as they are applicable to the Partnership, means controls and other procedures of an issuer that are designed to ensure that information required to be disclosed by the issuer in the reports that it files or submits under the Act (15 U.S.C. 78a et seq.) is recorded, processed, summarized and reported, within the time periods specified in the Commission’s rules and forms. Disclosure controls and procedures
include, without limitation, controls and procedures designed to ensure that information required to be disclosed by an issuer in the reports that it files or submits under the Act is accumulated and communicated to the issuer’s management, including its principal executive and principal financial officers, or persons performing similar functions, as appropriate to allow timely decisions regarding required disclosure.
 
 Management’s Annual Report on Internal Control over Financial Reporting
 
 The Management of the General Partner is responsible for establishing and maintaining adequate internal control over financial reporting as that term is defined in Exchange Act Rule 13a-15(f) for the Partnership, and for performing an assessment of the effectiveness of internal control over financial reporting as of December 31, 2010. The internal control process of the General Partner, as it is applicable to the Partnership, was designed to provide reasonable assurance to Management regarding the preparation and fair presentation of published financial statements, and includes those policies and procedures that:
 
 (1)
Provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles in the United States, and that the Partnership’s receipts and expenditures are being made only in accordance with authorization of the Management of the General Partner; and
 
 (2)
Provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of the Partnership’s assets that could have a material effect on the financial statements.
 
 All internal control processes, no matter how well designed, have inherent limitations. Therefore, even those processes determined to be effective can provide only reasonable assurance with respect to the reliability of financial statement preparation and presentation. Further, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.
 
 Management of the General Partner assessed the effectiveness of its internal control over financial reporting, as it is applicable to the Partnership, as of December 31, 2010. In making this assessment, it used the criteria set forth in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on its assessment, Management of the General Partner concluded that the General Partner’s internal control over financial reporting, as it is applicable to the Partnership, was effective as of December 31, 2010.
  27
 
 This annual report does not include an attestation report of the Partnership’s independent registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Partnership’s independent registered public accounting firm pursuant to Section 989G of the Dodd-Frank Wall Street Reform and Consumer Protection Act, which exempts non-accelerated filers from Section 404(b) of the Sarbanes-Oxley Act of 2002.
 
 Changes in internal control
 
 There were no changes in the General Partner’s internal control over financial reporting, as it is applicable to the Partnership, during the quarter ended December 31, 2010 that have materially affected, or are reasonably likely to materially affect, the General Partner’s internal control over financial reporting, as it is applicable to the Partnership.
 28
 
 PART III
 Item 10.  DIRECTORS AND EXECUTIVE OFFICERS
 
 The registrant is a Limited Partnership and, therefore, has no officers or directors.
 
 All of the outstanding capital stock of ATEL Financial Services, LLC (“AFS”) (the General Partner) is held by ATEL Capital Group (“ACG”), a holding company formed to control ATEL and affiliated companies. The outstanding voting capital stock of ACG is owned 100% by Dean L. Cash.
 
 Each of ATEL Leasing Corporation (“ALC”) and AFS is a subsidiary under the control of ACG and performs services for the Partnership. Acquisition services, equipment management, lease administration and asset disposition services are performed by ALC; investor relations, communications services and general administrative services are performed by AFS.
 The officers and directors of ACG and its affiliates are as follows:
 Dean L. Cash
President and Chief Executive Officer of ATEL Financial Services, LLC (General Partner)Paritosh K. Choksi
Executive Vice President and Chief Financial Officer and Chief Operating Officer of ATEL Financial Services, LLC (General Partner)Vasco H. Morais
Executive Vice President, Secretary and General Counsel of ATEL Financial Services, LLC (General Partner)
 Dean L. Cash, age 60, joined ATEL as director of marketing in 1980 and has been a vice president since 1981, executive vice president since 1983 and a director since 1984. He has been President and CEO since April 2001. Prior to joining ATEL, Mr. Cash was a senior marketing representative for Martin Marietta Corporation, data systems division, from 1979 to 1980. From 1977 to 1979, he was employed by General Electric Corporation, where he was an applications specialist in the medical systems division and a marketing representative in the information services division. Mr. Cash was a systems engineer with Electronic Data Systems from 1975 to 1977, and was involved in maintaining and developing software for commercial applications. Mr. Cash received a B.S. degree in psychology and mathematics in 1972 and an M.B.A.
degree with a concentration in finance in 1975 from Florida State University. Mr. Cash is an arbitrator with the American Arbitration Association.
 
 Paritosh K. Choksi, age 57, joined ATEL in 1999 as a director, senior vice president and its chief financial officer. He became its executive vice president and CFO/COO in April 2001. Prior to joining ATEL, Mr. Choksi was chief financial officer at Wink Communications, Inc. from 1997 to 1999. From 1977 to 1997, Mr. Choksi was with Phoenix American Incorporated, a financial services and management company, where he held various positions during his tenure, and was senior vice president, chief financial officer and director when he left the company. Mr. Choksi was involved in all corporate matters at Phoenix and was responsible for Phoenix’s capital market needs. He also served on the credit committee overseeing all corporate investments, including its venture lease portfolio. Mr. Choksi was a part of the
executive management team which caused Phoenix’s portfolio to increase from $50 million in assets to over $2 billion. Mr. Choksi received a bachelor of technology degree in mechanical engineering from the Indian Institute of Technology, Bombay; and an M.B.A. degree from the University of California, Berkeley.
 
 Vasco H. Morais, age 52, joined ATEL in 1989 as general counsel to provide legal support in the drafting and reviewing of lease documentation, advising on general corporate law matters, and assisting on securities law issues. From 1986 to 1989, Mr. Morais was employed by the BankAmeriLease Companies, Bank of America’s equipment leasing subsidiaries, providing in-house legal support on the documentation of tax-oriented and non-tax oriented direct and leveraged lease transactions, vendor leasing programs and general corporate matters. Prior to the BankAmeriLease Companies, Mr. Morais was with the Consolidated Capital Companies in the corporate and securities legal department involved in drafting and reviewing contracts, advising on corporate law matters and securities law issues. Mr. Morais received a B.A.
degree in 1982 from the University of California in Berkeley, a J.D. degree in 1986 from Golden Gate University Law School and an M.B.A. (Finance) in 1997 from Golden Gate University. Mr. Morais has been an active member of the State Bar of California since 1986.
 29
 
 Audit Committee
 
 The board of directors of the General Partner acts as the audit committee of the Partnership. Dean L. Cash and Paritosh K. Choksi are members of the board of directors of the General Partner and are deemed to be financial experts. They are not independent of the Partnership.
 
 Section 16(a) Beneficial Ownership Reporting Compliance
 
 Based solely on a review of Forms 3, 4 and 5, the Partnership is not aware of any failures to file reports of beneficial ownership required to be filed during or for the year ended December 31, 2010.
 
 Code of Ethics
 
 A Code of Ethics that is applicable to the Partnership, including the Chief Executive Officer and Chief Financial Officer and Chief Operating Officer of its General Partner, AFS, or persons acting in such capacity on behalf of the Partnership, is included as Exhibit 14.1 to this report.
 Item 11. EXECUTIVE COMPENSATION
 
 The registrant is a Limited Partnership and, therefore, has no officers or directors.
 
 Set forth hereinafter is a description of the nature of remuneration paid and to be paid to AFS and its Affiliates. The amount of such remuneration paid for the years ended December 31, 2010 and 2009 is set forth in Item 8 of this report under the caption “Financial Statements and Supplementary Data - Notes to Financial Statements - Related party transactions,” at Note 6 thereof, which information is hereby incorporated by reference.
 
 Through December 31, 1996, $11.9 million of commissions (the maximum allowable) had been paid to AFS or its affiliates. Of that amount, $10.2 million was re-allowed to other broker/dealers. None have been paid since 1996, nor will any additional amounts be paid in future periods.
 
 Acquisition Fees
 
 Acquisition fees were paid to AFS for services rendered in finding, reviewing and evaluating equipment to be purchased by the Partnership and rejecting equipment not to be purchased by the Partnership. The total amount of acquisition fees paid to AFS or their affiliates was not to exceed 3% of the aggregate purchase price of equipment acquired with the net proceeds of the offering and was not to exceed 4.5% of the Gross Proceeds of the Offering.
 
 Through December 31, 1996, $5.6 million of such fees (the maximum allowable amount) had been paid to AFS or its affiliates. No such fees have been paid subsequent to that date.
 
 Equipment Management Fees
 
 As compensation for its services rendered generally in managing or supervising the management of the Partnership’s equipment and in supervising other ongoing services and activities including, among others, arranging for necessary maintenance and repair of equipment, collecting revenue, paying operating expenses, determining the equipment is being used in accordance with all operative contractual arrangements, property and sales tax monitoring and preparation of financial data, AFS or its affiliates are entitled to receive management fees which are payable for each fiscal quarter and are to be in an amount equal to (i) 3.5% of the gross lease revenues from “operating” leases, as defined, and (ii) 2% of gross lease revenues from “full payout” leases, as defined, which contain
net lease provisions. See Note 6 to the Financial Statements included at Part II, Item 8, Financial Statements and Supplementary Data, of this report for amounts paid.
  30
 
 Incentive Management Fees
 
 As compensation for its services rendered in establishing and maintaining the composition of the Partnership’s equipment portfolio and its acquisition and debt strategies and supervising fund administration including supervising the preparation of reports and maintenance of financial and operating data of the Partnership, Securities and Exchange Commission and Internal Revenue Service filings, returns and reports, AFS is entitled to receive the Incentive management fee which shall be payable for each fiscal quarter and shall be an amount equal to 1% of cash distributions from operations, sales or refinancing and 3.25% (4% prior to July 1, 1995) of cash distributions from operations to an affiliate of AFS until such time as the Limited Partners have received
aggregate distributions of cash from operations in an amount equal to their original invested capital plus a 10% per annum return on their average adjusted invested capital (as defined in the Partnership Agreement). Thereafter, the incentive management fee paid to the affiliate of AFS shall be 4% of all distributions of cash from operations, sales or refinancing. See Note 6 to the Financial Statements included at Part II, Item 8,Financial Statements and Supplementary Data, of this report for amounts paid.
 
 Equipment Resale Fees
 
 As compensation for services rendered in connection with the sale of equipment, AFS is entitled to receive an amount equal to the lesser of (i) 3% of the sales price of the equipment, or (ii) one-half the normal competitive equipment sales commission charged by unaffiliated parties for such services. Such fee is payable only after the Limited Partners have received a return of their adjusted invested capital (as defined in the Partnership Agreement) plus 10% of their adjusted invested capital per annum calculated on a cumulative basis, compounded daily, commencing the last day of the quarter in which the limited partner was admitted to the Partnership. To date, none have been accrued or paid.
 
 Equipment Re-lease Fee
 
 As compensation for providing re-leasing services, AFS is entitled to receive fees equal to 2% of the gross rentals or the comparable competitive rate for such services relating to comparable equipment, whichever is less, derived from the re-lease provided that (i) AFS or their affiliates have and will maintain adequate staff to render such services to the Partnership, (ii) no such re-lease fee is payable in connection with the re-lease of equipment to a previous lessee or its affiliates, (iii) AFS or its affiliates have rendered substantial re-leasing services in connection with such re-lease and (iv) AFS or its affiliates are compensated for rendering equipment management services. To date, none have been accrued or paid.
 
 General Partner’s Interest in Operating Proceeds
 
 As defined in the Partnership Agreement, the Partnership’s Net income, Net losses Distributions and investment tax credits are allocated 99% to the Limited Partners and 1% to AFS. See the statements of income included in Part II, Item 8, Financial Statements and Supplementary Data, of this report for the amounts allocated to the General and Limited Partners in 2010 and 2009.
 Item 12.
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
 Security Ownership of Certain Beneficial Owners
 At December 31, 2010, no investor is known to hold beneficially more than 5% of the issued and outstanding Units.
 Security Ownership of Management
 The parent of AFS is the beneficial owner of Limited Partnership Units as follows:
 (1)

(2)

(3)

(4)Name and Address of

Amount and Nature of

PercentTitle of Class

Beneficial Owner

Beneficial Ownership

of ClassLimited Partnership Units

Dean Cash

Initial Limited Partner Units


0.0002
%600 California Street, 6th Floor

25 Units ($250)San Francisco, CA 94108

(owned by wife)
 Changes in Control
 
 The Limited Partners have the right, by vote of the Limited Partners owning more than 50% of the outstanding limited Partnership units, to remove a General Partner.
 
 AFS may at any time call a meeting of the Limited Partners or a vote of the Limited Partners without a meeting, on matters on which they are entitled to vote, and shall call such meeting or for vote without a meeting following receipt of a written request therefore of Limited Partners holding 10% or more of the total outstanding Limited Partnership units.
  31
 
 Item 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 The responses to Item 1 of this report under the caption “Equipment Leasing Activities,” Item 8 of this report under the caption “Financial Statements and Supplementary Data - Notes to Financial Statements - Related party transactions” at Note 6 thereof, and Item 11 of this report under the caption “Executive Compensation,” are hereby incorporated by reference.
 
 Item 14.  PRINCIPAL ACCOUNTING FEES AND SERVICES
 
 During the most recent two years, the Partnership incurred audit fees with its principal auditors as follows (in thousands):
 
 2010


2009Audit fees

$
32


$
37Other


1



1$
33


$
38
 
 Audit fees consist of the aggregate fees and expenses billed in connection with the audit of the Partnership’s annual financial statements and review of the financial statements included in the Partnership’s quarterly reports on Form 10-Q.
 
 Other fees represent costs incurred in connection with various Agreed-Upon Procedures engagements.
 
 The board of directors of the General Partner acts as the audit committee of the Partnership. Engagements for audit services, audit related services and tax services are approved in advance by the Chief Financial Officer of the General Partner acting on behalf of the board of directors of the General Partner in its role as the audit committee of the Partnership.
 PART IV
 
 Item 15.  EXHIBITS AND FINANCIAL STATEMENT SCHEDULES
 
 (a)
Financial Statements and Schedules
 1.
Financial Statements
 Included in Part II of this report:
 Report of Independent Registered Public Accounting Firm
 Balance Sheets at December 31, 2010 and 2009
 Statements of Income for the years ended December 31, 2010 and 2009
 Statements of Changes in Partners’ Capital for the years ended December 31, 2010 and 2009
 Statements of Cash Flows for the years ended December 31, 2010 and 2009
 Notes to Financial Statements
 
 2.
Financial Statement Schedules
 All schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions or are inapplicable and, therefore, have been omitted.
 
 (b)
Exhibits
 
 (3) and (4) Agreement of Limited Partnership, included as exhibit B to the Prospectus filed as exhibit 28.1 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 1994 (File No. 33-81952), is hereby incorporated herein by reference
 (14.1)  Code of Ethics
 (31.1)  Certification of Dean L. Cash pursuant to Rules 13a-14(a)/15d-14(a)
 (31.2)  Certification of Paritosh K. Choksi pursuant to Rules 13a-14(a)/15d-14(a)
 (32.1)  Certification of Dean L. Cash pursuant to 18 U.S.C. section 1350
 (32.2)  Certification of Paritosh K. Choksi pursuant to 18 U.S.C. section 1350
  32
  SIGNATURES
 Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
 Date: March 22, 2011
 ATEL Cash Distribution Fund VI, L.P.
 (Registrant)
 By:
ATEL Financial Services, LLC,
 General Partner of Registrant
 By:
/s/ Dean L. CashDean L. Cash,President and Chief Executive Officer ofATEL Financial Services, LLC (General Partner)By:
/s/ Paritosh K. ChoksiParitosh K. Choksi,Executive Vice President and Chief Financial Officer and Chief

Operating Officer of ATEL Financial Services, LLC (General

Partner)By:
/s/ Samuel SchusslerSamuel Schussler,Vice President and Chief Accounting Officer of ATEL Financial

Services, LLC (General Partner)
 
 Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the persons in the capacities and on the dates indicated.
 SIGNATURE

CAPACITIES

DATE/s/ Dean L. Cash

President and Chief Executive Officer ofDean L. Cash

ATEL Financial Services, LLC (General Partner)

March 22, 2011/s/ Paritosh K. Choksi

Executive Vice President and Chief Financial Officer and ChiefParitosh K. Choksi

Operating Officer of  ATEL Financial Services, LLC (General

Partner)

March 22, 2011/s/ Samuel Schussler

Vice President and Chief Accounting Officer of ATEL FinancialSamuel Schussler

Services, LLC (General Partner)

March 22, 2011
  No proxy materials have been or will be sent to security holders. An annual report will be furnished to security holders subsequent to the filing of this report on Form 10-K, and copies thereof will be furnished supplementally to the Commission when forwarded to the security holders.
  33