Business Description
Commonwealth Income & Growth Fund VI (the “Partnership”) is
a limited partnership organized in the Commonwealth of Pennsylvania on January
6, 2006. The Partnership offered for sale up to 2,500,000 units of the limited
partnership at the purchase price of $20 per unit (the “offering”).
The Partnership reached the minimum amount in escrow and commenced operations
on May 10, 2007. The offering terminated on March 6, 2009 with 1,810,311 units
sold for a total of approximately $36,000,000 in limited partner contributions.
The Partnership was formed for the purpose of acquiring various types of equipment,
including computer information technology and other similar capital equipment.
The Partnership utilized the net proceeds of the offering to purchase information
technology and other similar capital equipment. The Partnership has utilized
retained proceeds and debt financing (not in excess of 30% of the aggregate
cost of the equipment owned or subject to conditional sales contract by the
Partnership at the time the debt is incurred) to purchase additional equipment.
The Partnership acquires and leases equipment principally to U.S. corporations
and other institutions pursuant to operating leases. The Partnership retains
the flexibility to enter into full payout net leases and conditional sales contracts,
but has not done so.
The Partnership’s principal investment objectives are to:
acquire, lease and sell equipment to generate revenues from operations sufficient
to provide annual cash distributions to Limited Partners;
preserve and protect Limited Partners’ capital;
use a portion of cash flow and net disposition proceeds derived from the sale,
refinancing or other disposition of equipment to purchase additional equipment;
and
refinance, sell or otherwise dispose of equipment in a manner that will maximize
the proceeds to the Partnership.
The Partnership invests in various types of equipment subject to leases. Our
investment objective is to acquire primarily high technology equipment including,
but not limited to: servers, desktops, laptops, workstations, printers, copiers,
and storage devices. Our General Partner believes that dealing in high technology
equipment is particularly advantageous due to a robust aftermarket. Information
technology has developed rapidly in recent years and is expected to continue
to do so. Technological advances have permitted reductions in the cost of computer
processing capacity, speed, and utility. In the future, the rate and nature
of equipment development may cause equipment to become obsolete more rapidly.
We also may acquire high technology medical, telecommunications and inventory
management equipment. Our General Partner will seek to maintain an appropriate
balance and diversity in the types of equipment acquired. The medical equipment
we acquire may consist of IV pumps, long acute care beds, CT scanners, MRIs,
flow cytometers, and other medical technology devices. The telecom equipment
we acquire may include Cisco switches, routers, blade switches, wireless access
points, and video conferencing systems. The inventory management equipment we
acquire may consist of inventory control systems, lift trucks and tractors.
The market for high technology medical equipment is growing each year. Generally
this type of equipment will have a longer useful life than information technology
equipment. This allows for increased re-marketability, if it is returned before
its economic or announcement cycle is depleted.
Other Equipment-Restrictions. The Partnership generally acquires information
technology, telecommunications, medical technology and inventory management
equipment. The General Partner is also authorized to cause the Partnership to
invest in other types of business-essential capital equipment. The Partnership
may not invest in any of such other types of equipment (i) to the extent that
the purchase price of such equipment, together with the aggregate purchase price
of all such other types of equipment then owned by the Partnership, is in excess
of 25% of the total cost of all of the assets of the Partnership at the time
of the Partnership’s commitment to invest therein and (ii) unless the
General Partner determines that such purchase is in the best economic interest
of the Partnership at the time of the purchase. There can be no assurance that
any equipment investments can be found which meet this standard. Accordingly,
there can be no assurance that investments of this type will be made by the
Partnership.
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