10QSB

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

___________________

FORM 10-QSB

[X]Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended June 30, 2004

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

For the transition period from to

Commission file number 0-21806

_______________________

PLM EQUIPMENT GROWTH FUND VI

(Exact name of registrant as specified in its charter)

California	94-3135515
(State or other jurisdiction of	(I.R.S. Employer
incorporation or organization)	Identification No.)
200 Nyala Farms Road
Westport, CT	06880
(Address of principal	(Zip code)
executive offices)

Former Address: 235 3rd Street South, Suite 200, St. Petersburg, FL. 33701

Registrant's telephone number, including area code: (203) 341-0555

_______________________

Indicate by 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 ____

Transitional Small Business Disclosure Format: YesNo X

Aggregate market value of voting stock: N/A

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

CONDENSED BALANCE SHEETS

(in thousands of dollars, except unit amounts)

(unaudited)

	June 30,		December 31,
		2004		2003
Assets
Equipment held for operating leases, at cost	$68,289		$65,675
Less accumulated depreciation	(47,075)		(48,220)
Net equipment	21,214		17,455
Cash and cash equivalents	8,106		13,294
Restricted cash	--		410
Accounts receivable, less allowance for doubtful accounts
of $428 in 2004 and $444 in 2003	1,249		1,060
Equity investments in affiliated entities	9,093		9,241
Deferred charges, net of accumulated amortization of
$290 in 2004 and $508 in 2003	291		302
Prepaid expenses and other assets	276		241
Total assets	$40,229		$42,003

Liabilities and partners’ capital
Liabilities:
Accounts payable and accrued expenses	$	525	$	495
Due to affiliates		1,250		1,552
Notes payable		12,000		14,000
Total liabilities		13,775		16,047
Commitments and contingencies
Partners’ capital:
Limited partners (7,730,965 limited partnership units)		26,454		25,956
General Partner		--		--
Total partners’ capital		26,454		25,956
Total liabilities and partners’ capital	$	40,229	$	42,003

See accompanying notes to unaudited condensed financial statements.

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

CONDENSED STATEMENTS OF OPERATIONS

(in thousands of dollars, except weighted-average limited partnership unit amounts)

(unaudited)

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
		2004		2003		2004		2003
Revenues
Lease revenue	$2,153		$2,128		$4,294		$4,122
Interest and other income	11		17		31		41
Gain on disposition of equipment	429		35		503		71
Loss on disposition of equipment	(1)		(5)		--		(22)
Total revenues	2,592		2,175		4,828		4,212
Expenses
Depreciation and amortization	1,021		1,364		2,018		2,389
Repairs and maintenance	433		219		808		517
Insurance expense	71		61		134		125
Management fees to affiliate	89		103		186		184
Interest expense	149		160		322		314
General and administrative expenses
to affiliates	118		25		270		70
Other general and administrative expenses	309		363		629		641
Impairment loss on equipment	--		--		--		77
(Recovery of) provision for bad debts	--		(3)		(9)		33
Total expenses	2,190		2,292		4,358		4,350
Equity in net (loss) Income of equity
investments	(18)		(753)		28		(469)
Net income (loss)	$384		$(870)		$498		$(607)
Partners' share of net income (loss)
Limited partners	$384		$(870)		$498		$(607)
General Partner	--		--		--		--
Total	$384		$(870)		$498		$(607)
Limited partners' net income (loss) per
weighted-average limited partnership unit	$0.05		$(0.11)		$0.06		$(0.08)

See accompanying notes to unaudited condensed financial statements.

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

CONDENSED STATEMENTS OF CHANGES IN PARTNERS’ CAPITAL

For the Period from December 31, 2003 to June 30, 2004

(in thousands of dollars)

(unaudited)

	Limited Partners	General Partner	Total
Partners’ capital as of December 31, 2003	$25,956	$     --	$25,956
Net income	498	--	498
Partners’ capital as of June 30, 2004	$26,454	$     --	$26,454

See accompanying notes to unaudited condensed financial statements.

PLM EQUIPMENT GROWTH FUND VI
(A Limited Partnership)
CONDENSED STATEMENTS OF CASH FLOWS
(in thousands of dollars)
(unaudited)
	For the Six Months       Ended June 30,
			2004		2003
Operating activities
Net income (loss)		$498		$(607)
Adjustments to reconcile net income (loss)
to net cash provided by (used in) operating activities:
Depreciation and amortization		2,018		2,389
Amortization of debt issuance costs		55		63
(Recovery of) provision for bad debts		(9)		33
Impairment loss on equipment		--		77
Net gain on disposition of equipment		(503)		(49)
Equity in net (income) loss from equity investments		(28)		469
Distribution from equity investments		176		1,163
Changes in operating assets and liabilities:
Accounts receivable		(180)		(140)
Prepaid expenses and other assets		(35)		44
Accounts payable and accrued expenses		30		(253)
Due to affiliates		(302)		220
Lessee deposits		--		1
Net cash provided by operating activities		1,720		3,410
Investing activities
Payments for purchase of equipment and capitalized repairs		(5,969)		(4,100)
Payments of acquisition fees to affiliate		(269)		(184)
Payments of lease negotiation fees to affiliate		(60)		(41)
Proceeds from disposition of equipment		980		171
Net cash used in investing activities		(5,318)		(4,154)
Financing activities
Payments of notes payable		(2,000)		(2,250)
Decrease in restricted cash		410		--
Net cash used in financing activities		(1,590)		(2,250)
Net decrease in cash and cash equivalents		(5,188)		(2,994)
Cash and cash equivalents at beginning of period		13,294		8,286
Cash and cash equivalents at end of period		$8,106		$5,292
Supplemental information
Interest paid		$275		$403

See accompanying notes to unaudited condensed financial statements.

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

NOTES TO CONDENSED FINANCIAL STATEMENTS

(unaudited)

1.Basis of Presentation

The unaudited financial statements presented herein are prepared in conformity with generally accepted accounting principles in the United States of America and the instructions for preparing Form 10-QSB under Rule 310 of Regulation S-B of the Securities and Exchange Commission. Rule 310 provides that disclosures that would substantially duplicate those contained in the most recent annual report to the limited partners may be omitted from interim financial statements. The accompanying unaudited condensed financial statements have been prepared on that basis and, therefore, should be read in conjunction with the financial statements and notes presented in the 2003 Annual Report (Form 10-KSB) of PLM Equipment Growth Fund VI (the Partnership) on file with the United States Securities and Exchange Commission. Except as disclosed herein, there have been no material changes to the information presented in the notes to the 2003 Annual Report in Form 10-KSB.

In the opinion of the management of PLM Financial Services, Inc. (FSI or the General Partner) all adjustments necessary, consisting primarily of normal recurring accruals, to present fairly the Partnership’s unaudited condensed balance sheets at June 30, 2004, condensed statements of operations for the three and six months ended June 30, 2004 and 2003, condensed statements of changes in partners’ capital for the period from December 31, 2003 to June 30, 2004, and the condensed statements of cash flows for the six months ended June 30, 2004 and 2003 have been made and are reflected.

2.Schedule of Partnership Phases

The Partnership is currently in its investment phase during which the Partnership uses cash generated from operations and proceeds from asset dispositions to purchase additional equipment. The General Partner believes these acquisitions may cause the Partnership to generate additional earnings and cash flow for the Partnership.

The Partnership may commit its cash flow, surplus cash and equipment disposition proceeds to purchase additional equipment, consistent with the objectives of the Partnership, until December 31, 2004. The Partnership will terminate on December 31, 2011, unless terminated earlier upon sale of all equipment and by certain other events.

3.Reclassification

Certain amounts previously reported have been reclassified to conform to the 2004 presentation. This reclassification did not have any effect on total assets, total liabilities, partners’ capital, or net income (loss).

4.Transactions with General Partner and Affiliates

The balance due to affiliates as of June 30, 2004 and December 31, 2003, included $0.1 million due to FSI or its affiliates for management fees and $1.1 million and $1.4 million, respectively, due to equity investments in affiliated entities.

The Partnership’s proportional share of the affiliated expenses incurred by affiliated equity investments during 2004 and 2003 is listed in the following table (in thousands of dollars):

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
		2004		2003			2004		2003
Management fees	$	37	$	61		$	75	$	121
Data processing and administrative
expenses		4		3			13		8

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

NOTES TO CONDENSED FINANCIAL STATEMENTS

(unaudited)

4.Transactions with General Partner and Affiliates (continued)

These affiliate expenses reduced the Partnership's proportional share of the equity interest in the income of equity investments.

During the six months ended June 30, 2004, the Partnership purchased $6.0 million in railcars from FSI or its affiliates and paid $0.3 million for acquisition fees and $0.1 million for lease negotiation fees. The Partnership's cost for these railcars was the lower of FSI's or its affiliates cost or the fair market value at the time of purchase. During the six months ended June 30, 2003, the Partnership purchased railcars from an unaffiliated third party and paid FSI or its affiliates $0.2 million for acquisition fees and $41,000 for lease negotiation fees

5.Equipment

Owned equipment held for operating leases is stated at cost. The components of owned equipment were as follows (in thousands of dollars):

	June 30,		December 31,
		2004	2003
Railcars	$24,523		$21,095
Marine containers	22,893		23,381
Aircraft and rotables	15,708		15,987
Trailers	5,165		5,212
	68,289		65,675
Less accumulated depreciation	(47,075)		(48,220)
Net equipment	$21,214		$17,455

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

As of June 30, 2004, all owned equipment in the Partnership’s portfolio was on lease except for aircraft rotables and 120 railcars with an aggregate net book value of $0.9 million. As of December 31, 2003, all owned equipment in the Partnership's portfolio was on lease except for a portfolio of aircraft rotables and 218 railcars with an aggregate net book value of $1.3 million.

During the six months ended June 30, 2004 and 2003, the Partnership purchased railcars for $6.2 million and $4.3 million including acquisition fees of $0.3 million and $0.2 million, respectively.

During the six months ended June 30, 2004, the Partnership disposed of aircraft rotables, marine containers, railcars and trailers, with an aggregate net book value of $0.5 million for proceeds of $1.0 million. During the six months ended June 30, 2003, the Partnership disposed of marine containers and railcars, with an aggregate net book value of $0.1 million for proceeds of $0.2 million.

During the six months ended June 30, 2003, the Partnership recorded an impairment of $0.1 million to owned aircraft rotables. The Partnership marketed the aircraft rotables for re-lease or sale and this indicated to the General Partner that an impairment may exist. The General Partner determined the fair value of the aircraft rotables based on the valuation given by its independent third party aircraft equipment manager that considered, among other factors, expected income to be earned from the asset, condition of the aircraft rotables, estimated sales proceeds and holding costs excluding interest. As a result of this, the Partnership recorded an impairment of $0.1 million to owned aircraft rotables.

No reductions were required to the carrying value of the owned equipment during the six months ended June 30, 2004.

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

NOTES TO CONDENSED FINANCIAL STATEMENTS

(unaudited)

6.Equity Investments in Affiliated Entities

The Partnership owns equipment and other assets jointly with affiliated programs.

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

The tables below set forth 100% of the revenues, direct and indirect expenses, impairment loss on equipment, and net income (loss) of the entities in which the Partnership has an interest, and the Partnership‘s proportional share of income (loss) in each entity for the three and six months ended June 30, 2004 and 2003 (in thousands of dollars):

		Aero	Boeing	PLM
For the three months ended	Lion	California	737-300	Worldwide
June 30, 2004	Partnership1	Trust2	Trust3	Leasing4	Total

Revenues	$	1,351		$	38	$	390
Less: Direct expenses		1,109			6		5
Indirect expenses		354			25		407
Net (loss) income	$	(112	)	$	7	$	(22	)
Partnership’s share of net (loss) income	$	(58	)	$	3	$	(11	)	$	48	$	(18	)

		Aero	Boeing
For the three months ended	Lion	California	737-300
June 30, 2003	Partnership1	Trust2	Trust3	Total

Revenues	$	2,096	$	95	$	465
Less: Direct expenses		1,508		5		2
Indirect expenses		423		29		547
Impairment loss on equipment		--		--		1,321
Net income (loss)	$	165	$	61	$	(1,405	)
Partnership’s share of net income (loss)	$	80	$	25	$	(858	)	$	(753	)

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

2The Partnership owns a 40% interest in the Aero California Trust that owns two stage III commercial aircraft on a direct finance lease.

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

4The Partnership owns a 25% interest in PLM Worldwide Leasing Corp.

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

NOTES TO CONDENSED FINANCIAL STATEMENTS

(unaudited)

6.Equity Investments in Affiliated Entities (continued)

		Aero	Boeing	PLM
For the six months ended	Lion	California	737-300	Worldwide
June 30, 2004	Partnership1	Trust2	Trust3	Leasing4	Total

Revenues	$	2,722		$	87	$	780
Less: Direct expenses		2,020			15		12
Indirect expenses		712			51		816
Net income	$	(10	)	$	21	$	(48	)
Partnership’s share of net (loss) income	$	(5	)	$	8	$	(23	)	$	48	$	28

		Aero	Boeing
For the six months ended	Lion	California	737-300
June 30, 2003	Partnership1	Trust2	Trust3	Total

Revenues	$	3,957	$	198	$	930
Less: Direct expenses		2,358		10		7
Indirect expenses		841		59		1,097
Impairment loss on equipment		--		--		1,321
Net income (loss)	$	758	$	129	$	(1,495	)
Partnership’s share of net income (loss)	$	386	$	52	$	(907	)	$	(469	)

During the six months ended June 30, 2003 the General Partner recorded an impairment of $1.3 million to a Boeing 737-300 commercial aircraft. Declining fair values of aircraft similar to the one owned by the equity investment, indicated to the General Partner that an impairment to this aircraft may exist. The General Partner determined the fair value of the aircraft based on the valuation given by its independent third party aircraft equipment manager that considered, among other factors, expected income to be earned from the asset, condition of the aircraft, estimated sales proceeds and holding costs excluding interest. No reductions were required to the carrying value of jointly-owned equipment during the six months ended June 30, 2004.

As of June 30, 2004 and December 31, 2003, all jointly-owned equipment in the Partnership’s equity investment portfolio was on lease.

7.Operating Segments

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

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

2The Partnership owns a 40% interest in the Aero California Trust that owns two stage III commercial aircraft on a direct finance lease.

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

4The Partnership owns a 25% interest in PLM Worldwide Leasing Corp.

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

NOTES TO CONDENSED FINANCIAL STATEMENTS

(unaudited)

7.Operating Segments (continued)

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

	Marine				Marine
For the three months ended	Vessel	Aircraft	Railcar	Trailer	Container
June 30, 2004	Leasing	Leasing	Leasing	Leasing	Leasing	Other1	Total

Revenues
Lease revenue	$--	$308	$949	$209	$687	$--	$2,153
Interest income and other income	--	--	--	--	--	11	11
Gain (loss) on disposition of equipment	--	--	340	(1)	89	--	428
Total revenues	--	308	1,289	208	776	11	2,592
Expenses
Depreciation and amortization	--	--	531	72	415	3	1,021
Operations support	--	--	298	157	17	32	504
Management fees to affiliate	--	1	55	8	25	--	89
Interest expense	--	--	--	--	--	149	149
General and administrative expenses	--	(5)	206	1	--	225	427
(Recovery of) provision for bad debts	--	--	(1)	1	--	--	--
Total expenses	--	(4)	1,089	239	457	409	2,190
Equity in net (loss) income of equity
investments	(58)	40	--	--	--	--	(18)
Net (loss) income	$(58)	$352	$200	$(31)	$319	$(398)	$384
Total assets as of June 30, 2004	$3,379	$6,139	$12,137	$616	$9,421	$8,537	$40,229

	Marine				Marine
For the three months ended	Vessel	Aircraft	Railcar	Trailer	Container
June 30, 2003	Leasing	Leasing	Leasing	Leasing	Leasing	Other2	Total

Revenues
Lease revenue	$--	$310	$998	$82	$738	$--	$2,128
Interest income and other income	--	5	--	--	--	12	17
(Loss) gain on disposition of equipment	--	--	(5)	--	35	--	30
Total revenues	--	315	993	82	773	12	2,175
Expenses
Depreciation and amortization	--	--	774	73	515	2	1,364
Operations support	--	(1)	170	81	11	19	280
Management fees to affiliate	--	18	52	4	29	--	103
Interest expense	--	--	--	--	--	160	160
General and administrative expenses	--	90	61	35	(19)	221	388
Recovery of bad debts	--	--	(3)	--	--	--	(3)
Total expenses	--	107	1,054	193	536	402	2,292
Equity in net income (loss) of equity
investments	80	(833)	--	--	--	--	(753)
Net income (loss)	$80	$(625)	$(61)	$(111)	$237	$(390)	$(870)

1Includes certain assets not identifiable to a specific segment such as cash, certain deferred charges and prepaid expenses. Also includes interest income and costs not identifiable to a particular segment, such as interest expense, and certain amortization, general and administrative and operations support expenses.

2Includes interest income and costs not identifiable to a particular segment, such as interest expense, and certain amortization, general and administrative and operations support expenses.

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

NOTES TO CONDENSED FINANCIAL STATEMENTS

(unaudited)

7.Operating Segments (continued)

	Marine				Marine
For the six months ended	Vessel	Aircraft	Railcar	Trailer	Container
June 30, 2004	Leasing	Leasing	Leasing	Leasing	Leasing	Other1	Total

Revenues
Lease revenue	$--	$632	$1,851	$427	$1,384	$--	$4,294
Interest income and other	--	--	--	--	--	31	31
Gain on disposition of equipment	--	--	374	3	126	--	503
Total revenues	--	632	2,225	430	1,510	31	4,828
Expenses
Depreciation and amortization	--	--	1,020	145	848	5	2,018
Operations support	--	--	564	286	30	62	942
Management fees to affiliate	--	11	107	16	52	--	186
Interest expense	--	--	--	--	--	322	322
General and administrative expenses	2	27	354	29	--	487	899
Recovery of bad debts	--	--	(9)	--	--	--	(9)
Total expenses	2	38	2,036	476	930	876	4,358
Equity in net (loss) income of equity
investments	(5)	33	--	--	--	--	28
Net (loss) income	$(7)	$627	$189	$(46)	$580	$(845)	$498
Equipment purchases and
capitalized repairs	$--	$--	$5,969	$--	$--	$--	$5,969
Acquisition fees to affiliate	$--	$--	$269	$--	$--	$--	$269

	Marine				Marine
For the six months ended	Vessel	Aircraft	Railcar	Trailer	Container
June 30, 2003	Leasing	Leasing	Leasing	Leasing	Leasing	Other1	Total

Revenues
Lease revenue	$--	$656	$1,667	$299	$1,500	$--	$4,122
Interest income and other income	--	5	--	--	--	36	41
(Loss) gain on disposition of equipment	--	--	(22)	--	71	--	49
Total revenues	--	661	1,645	299	1,571	36	4,212
Expenses
Depreciation and amortization	--	36	1,155	146	1,048	4	2,389
Operations support	--	(1)	392	191	23	37	642
Management fees to affiliate	--	27	89	12	56	--	184
Interest expense	--	--	--	--	--	314	314
General and administrative expenses	--	90	126	71	--	424	711
Impairment loss on equipment	--	77	--	--	--	--	77
Provision for bad debts	--	--	33	--	--	--	33
Total expenses	--	229	1,795	420	1,127	779	4,350
Equity in net income (loss) of equity
investments	386	(855)	--	--	--	--	(469)
Net income (loss)	$386	$(423)	$(150)	$(121)	$444	$(743)	$(607)
Equipment purchases and
capitalized repairs	$--	$--	$4,100	$--	$--	$--	$4,100
Acquisition fees to affiliate	$--	$--	$184	$--	$--	$--	$184

8.Net Income (Loss) Per Weighted-Average Limited Partnership Unit

Net income (loss) per weighted-average limited partnership unit was computed by dividing net income or loss attributable to limited partners by the weighted-average number of limited partnership units deemed outstanding during the period. The weighted-average number of limited partnership units deemed outstanding during the three and six months ended June 30, 2004 and 2003 was 7,730,965.

1Includes interest income and costs not identifiable to a particular segment, such as interest expense, and certain amortization, general and administrative and operations support expenses.

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

NOTES TO CONDENSED FINANCIAL STATEMENTS

(unaudited)

9.Accounts Receivable

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

	June 30,		December 31,
		2004		2003
Trade accounts receivable	$1,677		$1,504
Allowance for doubtful accounts	(428)		(444)
	$1,249		$1,060

10.Debt

The Partnership is a participant in a $7.5 million warehouse facility. The warehouse facility is scheduled to expire on December 31, 2004 with all advances due no later than December 31, 2004. As of June 30, 2004 and December 31, 2003, the Partnership had no borrowings outstanding under this facility.

The Partnership made the regularly scheduled principal payments totaling $2.0 million to the lender of the notes payable during the six months ended June 30, 2004.

11.Commitments and Contingencies

PLM Transportation Equipment Corp. (TEC), an affiliate of the General Partner, arranged for the lease or purchase of up to 1,050 railcars with a delivery date between 2002 and 2004. The commitment requires a minimum of 30% of the railcars delivered under the arrangement be purchased and the remaining 70% of the railcars may be leased or purchased. As of June 30, 2004, TEC or an affiliated program have purchased 354 railcars, at a cost of $25.8 million, and have leased 494 railcars, exceeding the minimum purchase requirement under this commitment. The remaining 202 railcars to be purchased or leased under this commitment with a cost of $15.0 million, will be delivered in 2004 and may be purchased or leased by TEC, the Partnership, an affiliated program, or an unaffiliated third party.

In the fourth quarter of 2003, FSI exercised its option under the above agreement to purchase or lease 400 additional railcars which will be delivered in 2004 and 2005. The commitment requires that a minimum of 30% of the total railcars to be delivered under the original agreement and the option be purchased and the remaining railcars may be leased or purchased. If purchased, the total cost for the 400 railcars is $30.3 million. The Partnership, an affiliate, or unaffiliated third party may purchase or lease these railcars. While FSI has not determined which managed program will buy these railcars, it is possible that they will be purchased by the Partnership.

As of June 30, 2004, TEC is required to purchase an additional 13% of the total remaining railcars under the commitment to meet its overall requirement that 30% of the total commitment be purchased.

At June 30, 2004, railcars with an original equipment cost of $3.4 million were owned by FSI, some of which were purchased from the above transaction. While FSI has neither determined if a Program Affiliate will purchase these railcars nor the timing of any purchases, it is possible the Partnership may purchase some of these railcars.

PLM EQUIPMENT GROWTH FUND VI

(A Limited Partnership)

NOTES TO CONDENSED FINANCIAL STATEMENTS

(unaudited)

Litigation

On December 31, 2003 and during 2004, in the Court of Common Pleas for Williamsburg County, South Carolina, actions have been filed by Harold H. Collins, Dianne Collins his wife, and Rickey Thomas, Sr. against South Carolina Central Railroad Company, Inc., CSX Transportation, Inc., TradeMark Nitrogen, Inc. and PLM Investment Management, Inc. The actions involve a chemical spill from a railcar owned by the Partnership. All three law suits claim permanent injuries and alleges negligence on the part of all four defendants in their duty to exercise reasonable care in the inspection, maintenance and repair of the railcar. The complaints do not allege a specific amount of damages. The General Partner expects that these actions will be amended at some point and that the Partnership will also be named as a defendant.

The attorney for these plaintiffs states that he also represents a number of additional potential plaintiffs. Published reports indicate that several nearby residents were evacuated. While no additional actions have been served as of this time, the potential exists for additional claims to be filed.

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

The Partnership is involved as plaintiff or defendant in various legal actions incidental to its business. Management does not believe that any of these actions will be material to the financial condition or results of operations of the Partnership.

12.Recent Accounting Pronouncements

In January 2003, Financial Accounting Standards Board issued Interpretation No. 46, “Consolidation of Variable Interest Entities” (FIN 46). FIN 46 requires the Partnership to evaluate all existing arrangements to identify situations where the Partnership has a “variable interest,” commonly evidenced by a guarantee arrangement or other commitment to provide financial support, in a “variable interest entity,” commonly a thinly capitalized entity, and further determine when such variable interest requires the Partnership to consolidate the variable interest entities’ financial statements with its own. The Partnership is required to perform this assessment by December 31, 2004 and consolidate any variable interest entities for which the Partnership will absorb a majority of the entities’ expected losses or receive a majority of the expe cted residual gains.

The General Partner is still in the process of evaluating its impact and has not completed its analysis or concluded on the impact that FIN 46 will have on the Partnership.

13.Subsequent Events

In July 2004, the Partnership transferred 774 railcars with a net book value of $11.4 million to PLM Rail Partners, LLC (PLM Rail Partners), a limited liability company jointly owned with two affiliated programs. The manager of PLM Rail Partners is PLM Financial Services, Inc. The Partnership owns a 43.3% interest in PLM Rail Partners. In July, PLM Rail Partners borrowed $25.3 million on a non-recourse basis. The loan is collateralized by railcars and future lease payments. This loan bears interest at rates from 5.65% to 7.25% and is to be amortized over 8 years.

During July 2004, PLM Rail Partners distributed $9.9 million to the Partnership from the proceeds of this loan. The Partnership intends to purchase additional equipment with these proceeds.

ITEM 2.   MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(I)RESULTS OF OPERATIONS

Comparison of PLM Equipment Growth Fund VI’s (the Partnership’s) Operating Results for the Three Months Ended June 30, 2004 and 2003

(A)Owned Equipment Operations

Lease revenues less direct expenses (defined as repairs and maintenance and asset-specific insurance expenses) on owned equipment decreased during the three months ended June 30, 2004, compared to the same period of 2003. Gains or losses from the disposition of equipment, interest and other income, and certain expenses such as management fees to affiliate, depreciation and amortization, impairment loss on equipment and general and administrative expenses relating to the operating segments (see Note 7 to the unaudited condensed financial statements), are not included in the owned equipment operation discussion because these expenses are indirect in nature and not a result of operations, but the result of owning a portfolio of equipment. The following table presents lease revenues less direct expenses by segment (in thousands of dollars):

	For the Three Months
	Ended June 30,
	2004			2003
Marine containers		$	670		$	727
Railcars			651			828
Aircraft and rotables			308			311
Trailers			52			1

Marine containers: Marine container lease revenues and direct expenses were $0.7 million and $17,000, respectively, for the three months ended June 30, 2004, compared to $0.7 million and $11,000, respectively, during the same period of 2003. The decrease in lease revenues of $0.1 million during the three months ended June 30, 2004 was due to lower lease rates earned on the Partnership's marine containers.

Railcars: Railcar lease revenues and direct expenses were $0.9 million and $0.3 million, respectively, for the three months ended June 30, 2004, compared to $1.0 million and $0.2 million, respectively, during the same period of 2003. Railcar lease revenues decreased $0.3 million during the three months ended June 30, 2004 due to the sale of railcars in 2003 and 2004 that were on lease during the second quarter of 2003. The decrease was partially offset by the increase of $0.3 million due the purchase and lease of railcars during 2004.

Aircraft and rotables: Aircraft and rotables lease revenues were $0.3 million for the three months ended June 30, 2004 and 2003. The Partnership's wholly owned aircraft is on lease through July 2008 and as such, lease revenues are expected to remain at their current level through the end of the lease.

Trailers:Trailer lease revenues and direct expenses were $0.2 million and $0.2 million, respectively, for the three months ended June 30, 2004, compared to $0.1 million and $0.1 million, respectively, during the same period of 2003.

(B)Indirect Expenses Related to Owned Equipment Operations

Total indirect expenses of $1.7 million for the three months ended June 30, 2004 decreased from $2.0 million for the same period in 2003. Significant variances are explained as follows:

(i)A $0.3 million decrease in depreciation and amortization expenses from 2003 levels reflects the decrease of $0.2 caused by the sale of railcars during the second quarter of 2004 and a $0.2 million decrease caused by the double-declining balance method of depreciation which results in greater depreciation in the first years an asset is owned. These decreases were partially offset by an increase of approximately $0.1 million caused by the purchase of railcars during 2004;

(ii)A $11,000 decrease in interest expense resulted from lower average borrowings outstanding in the three months ended June 30, 2004 compared to the same period of 2003; and

(iii)A $39,000 increase in general and administrative expenses during the three months ended June 30, 2004 was primarily due to additional professional costs associated with equipment acquisitions.

(C)Net Gain on Disposition of Owned Equipment

The net gain on the disposition of owned equipment for the three months ended June 30, 2004 totaled $0.4 million, and resulted from the disposition of aircraft rotables, marine containers, railcars and trailers, with an aggregate net book value of $0.3 million for proceeds of $0.8 million. The net gain on the disposition of owned equipment for the second quarter of 2003 totaled $30,000, and resulted from the sale of marine containers and railcars, with an aggregate net book value of $0.1 million for proceeds of $0.1 million.

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

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

	For the Three Months
	Ended June 30,
	2004				2003
Aircraft		$	40		$	(833	)
Marine vessel			(58)			80
Equity in net loss of equity investments		$	(18	)	$	(753	)

The following equity investment discussion by equipment type is based on the Partnership's proportional share of revenues, depreciation expense, direct expenses, administrative expenses, and impairment loss on equipment in the equity investments:

Aircraft: As of June 30, 2004 and 2003, the Partnership owned an interest in entities owning two commercial aircraft on a direct finance lease, an interest in an entity owning a Boeing 737-300 commercial aircraft and an interest in an entity owning other assets. During the three months ended June 30, 2004, equipment owning entities generated revenues of $0.3 million which were partially offset by depreciation expense, direct expenses and administrative expenses of $0.3 million. During the same period of 2003, entities owning equipment generated revenues of $0.3 million which were offset by depreciation expense, direct expenses and administrative expenses of $0.3 million and an impairment loss on equipment of $0.8 million. During the three months ended June 30, 2004, contribution from an entity owning other assets increased $48,000 compared to 2003.

Aircraft revenues decreased $47,000 due to a lower lease rate being earned on the Boeing 737-300 commercial aircraft compared to the same period 2003 and decreased $23,000 due to a lower outstanding principal balance on the finance lease compared to 2003.

Direct expenses decreased $0.1 million caused by the double-declining balance method of depreciation which results in greater depreciation in the first years an asset is owned. During the second quarter 2003, impairment loss of $0.8 million resulted from the reduction of the carrying value of a Boeing 737-300 commercial aircraft to its estimated fair value. No impairment was required during the second quarter of 2004.

Marine vessel:As of June 30, 2004 and 2003, the Partnership owned an interest in an entity that owned a marine vessel. During the three months ended June 30, 2004, lease revenues of $0.7 million were partially offset by depreciation expense, direct expenses, and administrative expenses of $0.8 million. During the same period of 2003, lease revenues of $1.1 million were offset by depreciation expense, direct expenses, and administrative expenses of $1.0 million.

Marine vessel lease revenues decreased $0.4 million during the three months ended June 30, 2004 compared to the same period 2003. Lease revenues decreased $0.2 million during the second quarter 2004 due to being off-hire approximately 20 days and decreased $0.2 million due to the marine vessel earning a lower lease rate compared to 2003.

Direct expenses decreased $0.3 million due to lower operation expenses of $0.1 million, lower repairs and maintenance of $45,000 and lower management fees to affiliate of $28,000.

(E)Net Income (Loss)

As a result of the foregoing, the Partnership's net income for the three months ended June 30, 2004 was $0.4 million, compared to a net loss of $0.9 million during the same period of 2003. The Partnership's ability to acquire, operate, and liquidate assets, secure leases and re-lease those assets whose leases expire is subject to many factors. Therefore, the Partnership's performance in the second quarter of 2004 is not necessarily indicative of future periods.

Comparison of the Partnership’s Operating Results for the Six Months Ended June 30, 2004 and 2003

(A)Owned Equipment Operations

Lease revenues less direct expenses on owned equipment decreased during the six months ended June 30, 2004, compared to the same period of 2003. The following table presents lease revenues less direct expenses by segment (in thousands of dollars):

	For the Six Months
	Ended June 30,
	2004			2003
Marine containers		$	1,354		$	1,477
Railcars			1,287			1,275
Aircraft and rotables			632			657
Trailers			141			108

Marine containers: Marine container lease revenues and direct expenses were $1.4 million and $30,000, respectively, for the six months ended June 30, 2004, compared to $1.5 million and $23,000, respectively, during the same period of 2003. The decrease in lease revenues of $0.1 million during the six months ended June 30, 2004 was due to lower lease rates earned on the Partnership's marine containers.

Railcars: Railcar lease revenues and direct expenses were $1.9 million and $0.6 million, respectively, for the six months ended June 30, 2004, compared to $1.7 million and $0.4 million, respectively, during the same period of 2003. Railcar lease revenues increased $0.4 million due the purchase and lease of railcars during 2004 and 2003. The increase was partially offset by a decrease of $0.2 million caused by the sale of railcars that were on lease during the six months ended June 30, 2003.

Aircraft and rotables: Aircraft and rotables lease revenues were $0.6 million for the six months ended June 30, 2004, compared to $0.7 million during the same period of 2003. The Partnership's wholly owned aircraft is on lease through July 2008 and as such, lease revenues are expected to remain at their current level through the end of the current lease.

Trailers:Trailer lease revenues and direct expenses were $0.4 million and $0.3 million, respectively, for the six months ended June 30, 2004, compared to $0.3 million and $0.2 million, respectively, during the same period of 2003. Trailer direct expenses increased $0.1 million due to an increase in repairs and maintenance in order to prepare trailers for hire.

(B)Indirect Expenses Related to Owned Equipment Operations

Total indirect expenses of $3.5 million for the six months ended June 30, 2004 decreased from $3.7 million for the same period in 2003. Significant variances are explained as follows:

(i)A $0.4 million decrease in depreciation and amortization expenses from 2003 levels reflects the decrease of $0.4 million decreased caused by the double-declining balance method of depreciation which results in greater depreciation in the first years an asset is owned and a $0.2 decrease caused by the sale of railcars during 2004 and 2003. These decreases were partially offset by an increase of approximately $0.2 million caused by the purchase of railcars during 2004;

(ii)A $0.1 million decrease in the impairment loss on equipment resulted from the Partnership reducing the carrying value of the owned aircraft rotables to their estimated fair value during the six months ended June 30, 2003. No impairment of equipment was required during the same period of 2004;

(iii)(Recovery of) provision for bad debts decreased $42,000 compared to 2003 was primarily based on the General Partner’s evaluation of the collectability of receivables; and

(iv)A $0.2 million increase in general and administrative expenses during the six months ended June 30, 2004 was primarily due to additional professional costs associated with equipment acquisitions.

(C)Net Gain on Disposition of Owned Equipment

The net gain on the disposition of owned equipment for the six months ended June 30, 2004 totaled $0.5 million, and resulted from the disposition of aircraft rotables, marine containers, railcars and trailers, with an aggregate net book value of $0.5 million for proceeds of $1.0 million. The net gain on the disposition of owned equipment for the six months ended June 30, 2003 totaled $49,000, and resulted from the sale of marine containers and railcars, with an aggregate net book value of $0.1 million for proceeds of $0.2 million.

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

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

	For the Six Months
	Ended June 30,
	2004				2003
Aircraft		$	33		$	(855	)
Marine vessel			(5	)		386
Equity in net income (loss) of equity investments		$	28		$	(469	)

The following equity investment discussion by equipment type is based on the Partnership's proportional share of revenues, depreciation expense, direct expenses, administrative expenses, and impairment loss on equipment in the equity investments:

Aircraft: As of June 30, 2004 and 2003, the Partnership owned an interest in entities owning two commercial aircraft on a direct finance lease, an interest in an entity owning a Boeing 737-300 commercial aircraft and an interest in an entity owning other assets. During the six months ended June 30, 2004, entities owning equipment generated revenues of $0.5 million which were offset by depreciation expense, direct expenses and administrative expenses of $0.5 million. During the same period of 2003, entities owning equipment generated revenues of $0.7 million which were offset by depreciation expense, direct expenses and administrative expenses of $0.7 million and the impairment loss on equipment of $0.8 million. During the six months ended June 30, 2004, contribution from an entity owning other assets increased $48,000 compared to 2003.

Aircraft revenues decreased $0.1 million due to a lower lease rate being earned on the Boeing 737-300 commercial aircraft compared to the same period 2003 and decreased $44,000 due to a lower outstanding principal balance on the finance lease compared to 2003.

Direct expenses decreased $0.2 million caused by the double-declining balance method of depreciation which results in greater depreciation in the first years an asset is owned. During the six months ended June 30, 2003, impairment loss of $0.8 million resulted from the reduction of the carrying value of a Boeing 737-300 commercial aircraft to its estimated fair value. No impairment was required during the period of 2004.

Marine vessel:As of June 30, 2004 and 2003, the Partnership owned an interest in an entity that owned a marine vessel. During the six months ended June 30, 2004, lease revenues of $1.4 million were partially offset by depreciation expense, direct expenses, and administrative expenses of $1.4 million. During the same period of 2003, lease revenues of $2.1 million were offset by depreciation expense, direct expenses, and administrative expenses of $1.7 million.

Marine vessel lease revenues decreased $0.6 million during the six months ended June 30, 2004 compared to the same period 2003. Lease revenues decreased approximately $0.3 million during the six months ended June 30, 2004 due to being off-hire while in dry-dock approximately 30 days in 2004 compared to 2003 and decreased $0.3 million due to earning a lower lease rate during 2004 compared to 2003.

(E)Net Income (Loss)

As a result of the foregoing, the Partnership's net income for the six months ended June 30, 2004 was $0.5 million, compared to a net loss of $0.6 million during the same period of 2003. The Partnership's ability to acquire, operate, and liquidate assets, secure leases and re-lease those assets whose leases expire is subject to many factors. Therefore, the Partnership's performance in the six months ended June 30, 2004 is not necessarily indicative of future periods.

(II)CRITICAL ACCOUNTING POLICIES AND ESTIMATES

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

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

Revenue recognition: Lease revenues are earned by the Partnership monthly and no significant amounts are calculated on factors other than the passage of time. The Partnership’s leases are accounted for as operating leases and are non-cancelable. Rents received prior to their due dates are deferred.

The Partnership has an equity investment that owns aircraft jointly with other affiliated programs. These aircraft are leased on a direct finance lease. The equity investment’s revenues from the direct finance lease are based on a monthly amortization schedule.

Asset lives and depreciation methods: The Partnership’s primary business involves the purchase and subsequent lease of long-lived transportation and related equipment. The General Partner has chosen asset lives that it believes correspond to the economic life of the related asset. Depreciation is computed using the double-declining balance method, taking a full month's depreciation in the month of acquisition based upon estimated useful lives of 15 years for railcars and 12 years for all other equipment. The depreciation method changes to straight line when annual depreciation expense using the straight-line method exceeds that calculated by the double-declining balance method. The General Partner has chosen a depreciation method that it believes matches the benefit to the Partnership from the asset with the associated costs. These judgments have been made based on t he General Partner’s expertise in each equipment segment that the Partnership operates. If the asset life and depreciation method chosen does not reduce the book value of the asset to at least the potential future cash flows from the asset to the Partnership, the Partnership would be required to record an impairment loss. Likewise, if the net book value of the asset was less than the economic value, the Partnership may record a gain on sale upon final disposition of the asset.

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

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

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

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

(III)FINANCIAL CONDITION -- CAPITAL RESOURCES AND LIQUIDITY

For the six months ended June 30, 2004, the Partnership generated cash from operations of $1.7 million to meet its operating obligations, purchase additional equipment, pay debt and interest, and maintain working capital reserves.

During the six months ended June 30, 2004, the Partnership purchased railcars for $6.0 million and paid FSI or its affiliates $0.3 million for acquisition fees and $0.1 million for lease negotiation fees. During the six months ended June 30, 2004, the Partnership disposed of owned equipment and received aggregate proceeds of $1.0 million.

Restricted cash decreased $0.4 million resulting from the withdrawal of the lender from the Partnership's debt facilities that required these deposits. No such deposits were required from the new lender.

Accounts receivable increased $0.2 million during the six months ended June 30, 2004 due to the timing of cash receipts.

Equity investments in affiliated entities decreased $0.1 million during the six months ended June 30, 2004 due to cash distributions of $0.2 million from the equity investments to the Partnership partially offset by an increase from income of $28,000 that was recorded by the Partnership for its interests in the equity investments.

Due to affiliates decreased $0.3 million during the six months ended June 30, 2004 due to the payment of $0.4 million in engine reserves due to an equity investment to repair the engines on an aircraft. This decrease was partially offset by an increase of $0.1 million in additional engine reserves deposits during 2004.

The Partnership made its scheduled principal payments totaling $2.0 million on the notes payable during the six months ended June 30, 2004. The Partnership is scheduled to make quarterly debt payments of $1.0 million plus interest to the lenders of the notes payable during 2004. The cash for these payments will come from operations and equipment dispositions.

In July 2004, the Partnership transferred 774 railcars with a net book value of $14.6 million to PLM Rail Partners, LLC (PLM Rail Partners), a limited liability company jointly owned with two affiliated programs. The manager of PLM Rail Partners is PLM Financial Services, Inc. The Partnership owns a 43.3% interest in PLM Rail Partners. In July, PLM Rail Partners borrowed $25.3 million on a non-recourse basis. The loan is collateralized by railcars and future lease payments. This loan bears interest at rates from 5.65% to 7.25% and is to be amortized over 8 years.

During July 2004, PLM Rail Partners distributed $9.9 million to the Partnership from the proceeds of this loan. The Partnership intends to purchase additional equipment with these proceeds.

The Partnership is a participant in a $7.5 million warehouse facility. The warehouse facility is shared by the Partnership, PLM Equipment Growth Fund V, PLM Equipment Growth & Income Fund VII, and MILPI Holdings LLC (MILPI), all of which are related parties. The facility provides for financing up to 100% of the cost of the equipment and expires on December 31, 2004. Any borrowings by the Partnership are collateralized by equipment purchased with the proceeds of the loan. Outstanding borrowings by one borrower reduce the amount available to each of the other borrowers under the facility. Individual borrowings may be outstanding for no more than 270 days, with all advances due no later than December 31, 2004. Interest accrues either at the prime rate or LIBOR plus 2.0% at the borrower’s option and is set at the time of an advance of funds. Borrowings by the Partner ship are guaranteed by PLM International, Inc. and MILPI, the parent companies of the General Partner. The Partnership is not liable for the advances made to the other borrowers.

As of August 13, 2004, there were no outstanding borrowings on this facility by the Partnership or any of the other eligible borrowers.

PLM Transportation Equipment Corp. (TEC), an affiliate of the General Partner, arranged for the lease or purchase of up to 1,050 railcars with a delivery date between 2002 and 2004. The commitment requires a minimum of 30% of the railcars delivered under the arrangement be purchased and the remaining 70% of the railcars may be leased or purchased. As of June 30, 2004, TEC or an affiliated program have purchased 354 railcars, at a cost of $25.8 million, and have leased 494 railcars, exceeding the minimum purchase requirement under this commitment. The remaining 202 railcars to be purchased or leased under this commitment with a cost of $15.0 million, will be delivered in 2004 and may be purchased or leased by TEC, the Partnership, an affiliated program, or an unaffiliated third party.

In the fourth quarter of 2003, FSI exercised its option under the above agreement to purchase or lease 400 additional railcars which will be delivered in 2004 and 2005. The commitment requires that a minimum of 30% of the total railcars to be delivered under the original agreement and the option be purchased and the remaining railcars may be leased or purchased. If purchased, the total cost for the 400 railcars is $30.3 million. The Partnership, an affiliate, or unaffiliated third party may purchase or lease these railcars. While FSI has not determined which managed program will buy these railcars, it is possible that they will be purchased by the Partnership.

As of June 30, 2004, TEC is required to purchase an additional 13% of the total remaining railcars under the commitment to meet its overall requirement that 30% of the total commitment be purchased.

At June 30, 2004, railcars with an original equipment cost of $3.4 million were owned by FSI, some of which were purchased from the above transaction. While FSI has neither determined if a Program Affiliate will purchase these railcars nor the timing of any purchases, it is possible the Partnership may purchase some of these railcars.

Commitments and contingencies as of June 30, 2004 are as follows (in thousands of dollars):

				Less than		1-3
Partnership Obligations:	Total			1 Year			Years
Notes payable		$12,000			$4,000			$8,000
Affiliate Obligations:
Commitment to purchase railcars		$44,982	1		$23,329			$21,653

1   While FSI has neither determined if a Program Affiliate will purchase these railcars nor the timing of any purchases, it is possible the Partnership may purchase some of the railcars.

(IV)RECENT ACCOUNTING PRONOUNCEMENTS

In January 2003, Financial Accounting Standards Board issued Interpretation No. 46, “Consolidation of Variable Interest Entities” (FIN 46). FIN 46 requires the Partnership to evaluate all existing arrangements to identify situations where the Partnership has a “variable interest,” commonly evidenced by a guarantee arrangement or other commitment to provide financial support, in a “variable interest entity,” commonly a thinly capitalized entity, and further determine when such variable interest requires the Partnership to consolidate the variable interest entities’ financial statements with its own. The Partnership is required to perform this assessment by December 31, 2004 and consolidate any variable interest entities for which the Partnership will absorb a majority of the en tities’ expected losses or receive a majority of the expected residual gains.

The General Partner is still in the process of evaluating its impact and has not completed its analysis or concluded on the impact that FIN 46 will have on the Partnership.

(V)OUTLOOK FOR THE FUTURE

The ability of the Partnership to realize acceptable lease rates on its equipment in the different equipment markets is contingent on many factors, such as specific market conditions and economic activity, technological obsolescence, and government or other regulations. The unpredictability of these factors makes it difficult for the General Partner to clearly define trends or influences that may impact the performance of the Partnership's equipment. The General Partner continually monitors both the equipment markets and the performance of the Partnership's equipment in these markets. The General Partner may decide to reduce the Partnership's exposure to equipment markets in which it determines it cannot operate equipment to achieve acceptable rates of return. Alternatively, the General Partner may make a determination to enter equipment markets in which it perceives oppo rtunities to profit from supply/demand instabilities or other market imperfections.

Several factors may affect the Partnership's operating performance during the remainder of 2004 and beyond, including changes in the markets for the Partnership's equipment and changes in the regulatory environment in which that equipment operates.

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

Other factors affecting the Partnership’s operations during the remainder of 2004 and beyond include:

(1)In 2003 a significant number of the Partnership’s marine containers on a fixed rate lease switched to a lease based on utilization. This will result in a significant decrease in lease revenues in 2004 compared to 2003;

(2)Economic recovery in the railcar segment continues to be strong. Orders for new tank railcars, a key leading indicator for the railcar fleet, indicate a backlog of a full year production of approximately 11,000 units. Overall railcar loadings are now forecast to grow approximately 6% in 2004 which is an extremely strong outlook and an increase in the industry consensus forecast since last quarter. The railcar fleet is largely used by a broadly defined chemical sector. Chemical production has grown 3% per year on average over the last two decades.

Although chemical and petroleum railcar loadings are projected to grow by 5% this year, the rapid increase in steel prices which has resulted in increases in the price of a new tank car by over 20%, may cause the industry recovery to slow. The speed of recovery in lease rates continues to lag behind this price increase and lease rates remain low compared to historical norms. While this is likely to change, reduced railcar availability and higher lease costs may slow the industry growth and perhaps cause a shift to other forms of transportation;

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

The charter market for tankers is expected to remain strong for the remainder of 2004;

(4)Market demand for new and used aircraft has been severely impacted by the poor financial condition of the airline industry. The General Partner believes that there is a significant oversupply of commercial aircraft available that has caused a decrease in aircraft fair market values. The General Partner believes aircraft prices have decreased to a level which may make them attractive investment opportunities. Accordingly, the Partnership may purchase aircraft in 2004.

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

During 2004, the lessee of the Partnership’s two partially owned DC-9's on a direct finance lease fell behind in its monthly payments. As of August 13, 2004, payments on these aircraft are four months in arrears. The General Partner is currently reviewing its options including the possibility of sending the lessee a notification of default and the age of these aircraft. Due to the economic condition of the airline industry, should the General Partner repossess these aircraft, it will be difficult to remarket and may be off-lease for a considerable period of time.

During 2004, the General Partner renegotiated the lease for the partially owned Boeing 737-300. The lease was extended from April 2005 to July 2008 and the monthly lease rate was lowered by 6%.

(5)The management fee rate paid by the Partnership is reduced by 25% for the period starting January 1, 2003 and ending June 30, 2005;

(6)The Partnership is expected to continue to have increased general and administrative costs due to costs associated with the acquisition of additional equipment and as it liquidates other investment programs that currently share certain shared general and administrative expenses; and

(7)General and administrative expenses are expected to increase over the next 18 months due to additional expenses required to meet compliance standards of the Sarbanes - Oxley Act.

The Partnership may commit to purchase additional equipment with its cash flow, surplus cash, and equipment sale proceeds generated prior to December 31, 2004, consistent with the objectives of the Partnership. The General Partner believes that these acquisitions may cause the Partnership to generate additional earnings and cash flow for the Partnership. The Partnership will terminate on December 31, 2011, unless terminated earlier upon sale of all equipment and by certain other events.

The Partnership intends to use cash flow from operations to satisfy its operating requirements, pay loan principal and interest on debt, and purchase additional equipment.

The General Partner believes prices on certain transportation equipment, primarily railcar equipment and selected aircraft equipment, have reached attractive levels and is currently in the market to make investments in 2004. The General Partner believes that transportation equipment purchased in today's economic environment may appreciate. Accordingly, the General Partner believes that most of the cash currently held by the Partnership will be used to purchase additional equipment.

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

(VI)FORWARD-LOOKING INFORMATION

Except for the historical information contained herein, this Form 10-QSB contains forward-looking statements that involve risks and uncertainties, such as statements of the Partnership’s plans, objectives, expectations, and intentions. The cautionary statements made in this Form 10-QSB should be read as being applicable to all related forward-looking statements wherever they appear in this Form 10-QSB. There are a number of important factors that could cause actual results to differ materially from those expressed in any forward-looking statements made herein. These factors include, but are not limited to, the collection of the Partnership’s contracted rents, the realization of residual proceeds, and future economic conditions.

ITEM 3.CONTROLS AND PROCEDURES

Limitations on the Effectiveness of Controls

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

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

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

Quarterly Evaluation of the Partnership’s Disclosure Controls and Internal Controls

(1)Within the 90-day period prior to the filing of this report, the General Partner carried out an evaluation, under the supervision and with the participation of the General Partner’s management, including it’s President and CFO, of the effectiveness of the design and operation of the Partnership’s disclosure controls and procedures pursuant to Rule 13a-14 under the Securities Exchange Act of 1934 (the “Exchange Act”). Based upon that evaluation, the President and CFO concluded that the Partnership’s disclosure controls and procedures are effective in timely alerting them to material information relating to the Partnership’s required to be included in the Partnership’s exchange act filings.

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

PART II -- OTHER INFORMATION

ITEM 6.EXHIBITS AND REPORTS ON FORM 8-K

(a)Exhibits

10.1Loan agreement between PLM Rail Partners, LLC and HSH Nordbank AG, New York, dated June 30, 2004.

10.2Asset Transfer Agreement between PLM Equipment Growth Fund VI and PLM Rail Partners, LLC, dated July 1, 2004.

10.3Limited Liability Company Agreement of PLM Railcars Partners dated June 29, 2004.

31.1 Certificate of President of the General Partner pursuant to Section 302 of Sarbanes - Oxley Act.

31.2 Certificate of Chief Financial Officer of the General Partner pursuant to Section 302 of Sarbanes - Oxley Act.

32.1 Certificate of President of the General Partner pursuant to Section 906 of Sarbanes - Oxley Act.

32.2 Certificate of Chief Financial Officer of the General Partner pursuant to Section 906 of Sarbanes - Oxley Act.

(b) Reports on Form 8-K

None.

(This space intentionally left blank)

Pursuant to the requirements 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.

PLM EQUIPMENT GROWTH FUND VI

By: PLM Financial Services, Inc.

   General Partner

Date:August 13, 2004By:/s/ Richard B Brock

                                                                         Richard K Brock

                                                                           Chief Financial Officer

EX-10.1

EXECUTION COPY

$25,314,750

LOAN AGREEMENT

Among

PLM RAIL PARTNERS, LLC,

Borrower

THE LENDERS LISTED ON THE SIGNATURE PAGES HEREOF

and

HSH NORDBANK AG, NEW YORK BRANCH,

Administrative Agent

Dated as of June 30, 2004

	TABLE OF CONTENTS
		Page
ARTICLE 1 CREDIT FACILITY		1
Section 1.01	Commitment to Lend.	1
Section 1.02	Making the Loans.	2
Section 1.03	Repayment of Loans; Interest.	3
Section 1.04	Payment on Non-Business Days.	4
Section 1.05	Prepayments.	5
Section 1.06	Taxes.	6
Section 1.07	Use of Proceeds.	7
Section 1.08	Special Provisions Relating to LIBOR Rate.	8
Section 1.09	Regulatory Changes.	8
Section 1.10	Capital Requirements.	9
Section 1.11	Fees.	9
Section 1.12	Distribution of Payments by the Administrative Agent.	9
Section 1.13	Pro Rata Treatment.	10
Section 1.14	Authorization to Charge Accounts.	10
Section 1.15	Distribution of Collateral Proceeds.	10
Section 1.16	Additional Commitments.	12
Section 1.17	Change of Lending Office.	12
ARTICLE 2 CONDITIONS OF LENDING		13
Section 2.01	Conditions Precedent to Loans.	13
ARTICLE 3 REPRESENTATIONS AND WARRANTIES		15
Section 3.01	Representations and Warranties of the Borrower.	15
Section 3.02	Representation of Borrower and the Lenders.	20
ARTICLE 4 COVENANTS OF THE BORROWER		20
Section 4.01	Covenants.	20
ARTICLE 5 EVENTS OF DEFAULT		27
Section 5.01	Events of Default.	27
Section 5.02	Remedies upon Event of Default	30
ARTICLE 6 REGISTRATION OF THE NOTE		30
Section 6.01	Registered Notes.	30
ARTICLE 7 THE ADMINISTRATIVE AGENT		31
Section 7.01	Appointment and Powers.	31
Section 7.02	Limitation on Administrative Agent's Liability.	31
Section 7.03	Defaults.	32
Section 7.04	Rights as a Lender.	32
Section 7.05	Indemnification.	32
Section 7.06	Non Reliance on Administrative Agent and Other Lenders.	33
Section 7.07	Execution and Amendment of Loan Documents on Behalf of the Lenders	33
Section 7.08	Resignation of the Administrative Agent.	34
ARTICLE 8 MISCELLANEOUS		34
Section 8.01	Notices and Deliveries.	34
Section 8.02	Expenses; Indemnification.	37
Section 8.03	Amounts Payable Due upon Request for Payment.	38
Section 8.04	Remedies of the Essence.	38
Section 8.05	Rights Cumulative.	38
Section 8.06	Amendments; Waivers.	38
Section 8.07	Set-Off; Suspension of Payment and Performance.	39
Section 8.08	Sharing of Recoveries.	39
Section 8.09	Assignments and Participations.	40
Section 8.10	Governing Law.	42
Section 8.11	Submission to Jurisdiction.	42
Section 8.12	LIMITATION OF LIABILITY.	43
Section 8.13	Severability of Provisions.	43
Section 8.14	Counterparts.	43
Section 8.15	Survival of Obligations.	43
Section 8.16	Entire Agreement.	43
Section 8.17	Successors and Assigns.	43
Section 8.18	WAIVER OF JURY TRIAL.	44
ARTICLE 9 DEFINITIONS		44
Section 9.01	Definitions.	44
Section 9.02	Other Interpretive Provisions.	57
Section 9.03	Accounting Matters.	58
Section 9.04	Representations and Warranties.	58
Section 9.05	Captions.	58
Section 9.06	Interpretation of Related Documents.	58

ANNEX ACOMMITMENTS

ANNEX BFORM OF TRANSFER AGREEMENTS

ANNEX CFORM OF ASSIGNMENTS

SCHEDULE AEQUIPMENT LEASES

SCHEDULE BAPPROVED LESSEES

EXHIBIT A-1FORM OF TRANCHE A PROMISSORY NOTE

EXHIBIT A-2FORM OF TRANCHE B PROMISSORY NOTE

EXHIBIT BFORM OF EQUIPMENT LEASE

EXHIBIT CFORM OF NOTICE OF ASSIGNMENT

EXHIBIT DFORM OF NOTICE OF NOTE ASSIGNMENT

EXHIBIT EFORM OF ASSIGNMENT AND ACCEPTANCE

EXHIBIT FFORM OF IRREVOCABLE POWER OF ATTORNEY

LOAN AGREEMENT dated as of June 30, 2004 (this “Agreement”) among PLM Rail Partners, LLC, a limited liability company organized and existing under the laws of Delaware (the “Borrower”), the Lenders listed on the signature pages hereof, and HSH Nordbank AG, New York Branch, a banking institution organized under the laws of Germany, acting through its New York Branch, as Administrative Agent (the “Administrative Agent”).

W I T N E S S E T H:

WHEREAS, as of the Agreement Date, the Borrower is the owner of the Equipment which is comprised of 1,562 railcars, which railcars are more fully described in Schedule A to the Security Agreement;

WHEREAS, the PLM Growth Funds wish to transfer all of their rights, title and interests to and in the Equipment pursuant to the Asset Transfer Agreements, and wish to assign to the Borrower pursuant to the Assignments all of their rights, title and interests in the operating leases relating to the Equipment, which leases and lessees are more fully described in Schedule A to this Agreement; and

WHEREAS, the Borrower wishes to borrow funds from the Lenders for general business purposes relating to its ownership of the Equipment;

NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants contained herein, the parties hereto agree as follows (with certain terms used herein being defined in Article 9 hereof):

ARTICLE 1

CREDIT FACILITY

Section 1.01Commitment to Lend.  (a)Tranche A Loans.

Upon the terms and subject to the conditions of this Agreement, each Tranche A Lender agrees to make a Tranche A Loan in a single advance to the Borrower on any Business Day during the Availability Period (the “Closing Date”) in a principal amount not exceeding such Tranche A Lender’s Commitment; provided that the aggregate of all Tranche A Loans made on the Closing Date shall not exceed $15,710,054. Any unutilized Tranche A Lender’s Commitment outstanding immediately after the disbursement of the Tranche A Loans on the Closing Date shall terminate and not be reinstated.

(b)Tranche B Loans.Upon the terms and subject to the conditions of this Agreement, each Tranche B Lender agrees to make a Tranche B Loan in a single advance to the Borrower on the Closing Date in a principal amount not exceeding such Tranche B Lender’s Commitment; provided that the aggregate of all Tranche B Loans made on the Closing Date shall not exceed $9,604,696. Any unutilized Tranche B Lender’s Commitment outstanding immediately after the disbursement of the Tranche B Loans on the Closing Date shall terminate and not be reinstated.

(c)Unutilized Commitments. Any unutilized portion of the Commitments after the Availability Period shall terminate and not be reinstated and Lender shall not be obligated to lend any amounts hereunder to the Borrower after the expiration of the Availability Period.

Section 1.02Making the Loans. (a) The Borrower shall give the Administrative Agent notice (the “Notice of Borrowing”) (which notice shall be irrevocable) no later than 11:00 A.M. (New York City time) on the third Business Day before the requested date for the making of the Loans. The Notice of Borrowing shall specify (i) the requested date for the making of the requested Loans, which shall be a Business Day and (ii) the principal amount of each requested Tranche A Loan and Tranche B Loan. Upon receipt of the Notice of Borrowing, the Administrative Agent shall promptly notify each Lender of the content s thereof and of the principal amount of each Loan to be made by such Lender on the requested date specified therein.

(b)Not later than 11:00 A.M. (New York City time) on the requested date on which the Loans are to be disbursed, each Lender shall make available to the Administrative Agent, in Dollars in funds immediately available to the Administrative Agent at the offices of the Administrative Agent, the Loan(s) to be made by such Lender on such date. Any Lender’s failure to make any Loan to be made by it on the requested date therefor shall not relieve any other Lender of its obligation to make any Loan to be made by such other Lender on such date, but such other Lender shall not be liable for such failure.

(c)Unless the Administrative Agent shall have received notice from a Lender prior to 10:00 A.M. (New York City time) on the requested date on which the Loans are to be disbursed that such Lender will not make available to the Administrative Agent funds with respect to the Loan(s) requested to be made by such Lender on such date, the Administrative Agent may assume that such Lender has made such funds available to the Administrative Agent on such date in accordance with Section 1.02(b) and the Administrative Agent in its sole discretion may, in reliance upon such assumption, make available to the Borrower on such date funds in an amount equal to the principal amount of the Loan(s) to be made by such Lender on behalf of such Lender. If and to the extent such Lender shall not have so made available to the Administrative Agent funds with respect to the Loan(s) requested to be made by such Lender on such date and the Administrative Agent shall have so made available to the Borrower funds in an amount equal to the principal amount of the Loan(s) to be made by such Lender on behalf of such Lender, such Lender shall, on demand, pay to the Administrative Agent funds in an amount equal to the principal amount of the Loan(s) to be made by such Lender together with interest thereon for each day from the date such funds shall have been so made available by the Administrative Agent to the Borrower until the date such amount shall have been repaid to the Administrative Agent at the applicable Interest Rate until (and including) the third Business Day after demand is made and thereafter at the Default Rate.

(d)All Loans made available to the Administrative Agent in accordance with Section 1.02(b) shall be disbursed by the Administrative Agent not later than 3:00 P.M. (New York City time) on the requested date therefor, to the Borrower or to its order by wire transfer of immediately available funds in the aggregate principal amount of such Loans in accordance with the payment instructions of the Borrower set forth in the letter to the Administrative Agent (the “Pay Proceeds Letter”) along with the Notice of Borrowing.

Section 1.03Repayment of Loans; Interest. (a)Tranche A Loans. Subject to any prepayments permitted or required in accordance with Sections 1.05 and 1.08(b) hereof and Section 5.03 of the Security Agreement, the Borrower hereby promises and agrees to pay to the Administrative Agent, for account of the Tranche A Lenders, the Tranche A Loans evidenced by the Tranche A Notes on the following terms:

(i)the Borrower shall pay the aggregate principal amount of the Tranche A Loans on successive Tranche A Installment Payment Dates commencing with the first Tranche A Installment Payment Date and ending on the Maturity Date of the Tranche A Loans, all as set forth on the Tranche A Installment Payment Schedule, provided that the final installment of principal shall in any event for each Tranche A Loan be equal to the then remaining unpaid principal amount of such Tranche A Loan.

(ii)the Borrower shall pay interest accrued on each Tranche A Loan at the applicable Tranche A Interest Rate on the then outstanding principal amount of such Tranche A Loan. Interest on each Tranche A Loan shall be due and payable on each Interest Payment Date and on the date of any prepayment of principal on the Tranche A Loans, whether voluntary or mandatory; provided that all accrued and unpaid interest on the Tranche A Loans shall be due and payable on the final Tranche A Installment Payment Date.

(b)Tranche B Loans. The Borrower hereby promises and agrees to pay the Administrative Agent, for account of the Tranche B Lenders, the Tranche B Loans evidenced by the Tranche B Notes on the following terms:

(i)the Borrower shall pay the aggregate principal amount of the Tranche B Loans on successive Tranche B Installment Payment Dates commencing on the Maturity Date of the Tranche A Loans and ending on the Maturity Date of the Tranche B Loans, all as set forth on the Tranche B Installment Payment Schedule, provided that the final installment of principal shall in any event for each Tranche B Loan be equal to the then remaining unpaid principal amount of such Tranche B Loan.

(ii)the Borrower shall pay interest accrued on each Tranche B Loan at the applicable Tranche B Interest Rate on the then outstanding principal amount of such Tranche B Loan. Interest on each Tranche B Loan shall be due and payable on each Interest Payment Date and on the date of any prepayment of principal in the Tranche B Loans, whether voluntary or mandatory; provided that all accrued and unpaid interest on the Tranche B Loans shall be due and payable on the final Tranche B Installment Payment Date.

(c)Default Rate. During an Event of Default (and whether before or after judgment), each Loan (whether or not due) and, to the maximum extent permitted by Applicable Law, each other amount due and payable under the Loan Documents, shall bear interest at the rate (the “Default Rate”) of two percent (2%) per annum in excess of the applicable Interest Rate. Interest at the Default Rate shall be payable upon demand of the Administrative Agent.

(d)Calculation of Interest Rate. Interest on each Loan and on each other amount due and payable under the Loan Documents shall in each case be calculated on the basis of a year of 360 days consisting of twelve 30-day months.

(e)Maximum Permissible Rate. Nothing contained in the Loan Documents shall require the Borrower at any time to pay interest at a rate exceeding the Maximum Permissible Rate. If interest payable by the Borrower on any date would exceed the maximum amount permitted by the Maximum Permissible Rate, such interest payment shall automatically be reduced to such maximum permitted amount, and interest for any subsequent period, to the extent less than the maximum amount permitted for such period by the Maximum Permissible Rate (such excess being hereinafter referred to as the “Interest Excess”), shall be increased by the unpaid amount of the Interest Excess. Any interest actually received for any period in excess of such maximum amount permitted for such p eriod shall be deemed to have been applied as a prepayment of the principal amount of the Loans.

(f)Interest Rate Swaps. The Borrower shall obtain and maintain interest rate swaps agreements (each, a “Swap Agreement”) with a Swap Counterparty in respect of the outstanding principal amount of the outstanding Loans from time to time, mutually agreed upon by each of the Administrative Agent and the Borrower acting reasonably and in good faith, at the Borrower’s sole expense, which shall be satisfactory in form and substance to the Administrative Agent.

Section 1.04Payment on Non-Business Days.Whenever any payment to be made hereunder or under the Notes shall be stated to be due on a day that is not a Business Day, such payment may be made on the next succeeding Business Day, together with interest thereon to the date of payment, unless such succeeding Business Day would fall in the next calendar month or after the Maturity Date, in which case, such payment shall be made on the immediately preceding Business Day.

Section 1.05Prepayments. (a)Sale, Casualty Loss, etc. If at any time the Borrower shall have received and accumulated proceeds (the “Accumulated Proceeds”) from (i) any sale, transfer or other disposition of any Item of Equipment (pursuant to a purchase option under an Equipment Lease or otherwise), (ii) any prepayment of an Equipment Lease by an Equipment Lessee, or (iii) any Casualty Loss, which proceeds have not been previously used to make a prepayment under this Section 1.05(a), and which on a cumulative and aggregate basis are i n excess of $500,000, the Borrower shall, within 5 Business Days from the date the Accumulated Proceeds exceed $500,000, prepay the Loans in an amount equal to the amount of such Accumulated Proceeds. For the avoidance of doubt, immediately following a prepayment under this Section 1.05(a), the amount of Accumulated Proceeds shall be reset to zero. Upon receipt of any prepayment pursuant to this Section 1.05(a), the Administrative Agent shall promptly release the Equipment related to such prepayment from the Lien of the Security Agreement and such Equipment shall no longer constitute Equipment for purposes of this Agreement or any other Loan Documents.

(b)Equipment Lessee Bankruptcy, Etc. If at any time the Administrative Agent is notified by the Borrower in accordance with Section 4.01(a)(i)(C), or by a Lender in a notice entitled “Notice of Lessee Bankruptcy”, that an Equipment Lessee has commenced bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debts proceedings (hereinafter, a “Filing Lessee”), the Administrative Agent will recalculate the Concentration Ratios (i) using the most recent Appraisal and (ii) if applicable, removing the Filing Lessee from the list of Approved Lessees, and if any such Concentration Ratios shall not be in compliance with the limitations set forth in Section 4.01(x) (the “Concentration Limits”) after such recalcu lation, the Borrower shall, within forty-five (45) days after receiving written notice thereof from the Administrative Agent, prepay the Loans in an amount equal to the aggregate Fair Market Value of all Items of Equipment on lease to such Filing Lessee (based on the most recent Appraisal available prior to such proceedings); provided that in lieu of making such prepayment, the Borrower may cause the Items of Equipment leased to the Filing Lessee to be leased to one or more new Approved Lessees under one or more Replacement Leases and take all such other actions as are required pursuant to Section 3.05(a) of the Security Agreement such that each such Replacement Lease shall be subject to the first priority Lien of the Security Agreement.

(c)Loan to Fair Market Value Ratio. If at any time the LTV Ratio exceeds 0.75 to 1.0, within forty-five (45) days after receiving written notice thereof from the Administrative Agent, the Borrower shall prepay the Loans in an amount equal to the amount by which the aggregate principal amount of the Loans then outstanding exceeds 75% of the aggregate Fair Market Value of the Equipment at such time; provided that, in lieu of making such prepayment, the Borrower may acquire such Additional Equipment subject to one or more Equipment Leases (such Additional Equipment and Equipment Leases to be reasonably satisfactory to the Administrative Agent) with Approved Lessees as is necessary to cause the LTV Ratio (as recalcu lated using the Fair Market Value of such Additional Equipment) to not exceed 0.75 to 1.0 at such time, provided, further, that in the event that the Borrower acquires Additional Equipment pursuant to this Section 1.05(c), the Borrower shall have (x) complied with the provisions of Section 3.14 of the Security Agreement in respect of the Additional Equipment and the Equipment Leases related thereto and (y) executed and delivered to the Secured Party under the Security Agreement a supplement to the Security Agreement substantially in the form of Exhibit A to the Security Agreement and taken all such other actions as are required pursuant to Section 3.05(a) of the Security Agreement such that the Additional Equipment and each Equipment Lease relating thereto shall have become subject to the first priority Lien of the Security Agreement.

(d)Excess Cash Flow. On each Payment Date, the Borrower shall prepay the Loans in the amount as specified in clause Tenth of Section 1.15(a).

(e)Voluntary Prepayments.Borrower may elect to prepay any Loan as provided in this Section 1.05(e), in whole or in part, prior to the Maturity Date applicable thereto; provided that the Tranche B Loans may not be prepaid pursuant to this Section 1.05(e) unless all of the Tranche A Loans shall have been repaid in full. The Borrower may exercise its election to prepay the Notes pursuant to this Section 1.05(e) by delivering written notice, which notice shall be irrevocable, to the Administrative Agent specifying the principal amount to be repaid and a proposed repayment date, which shall be a Business Day not less than five (5) Business Days after the date on which notice is delivere d. Any prepayment made pursuant to this Section 1.05(e) shall be applied (i) to the prepayment of the Tranche A Loans, and (ii) if all of the Tranche A Loans shall have been repaid in full, to the prepayment of the Tranche B Loans.

(f)Application of Prepayments. The amount of each prepayment required to be made under the Loan Documents shall be equal to the portion of the principal amount of the Loans to be prepaid and accrued interest on the principal amount to be prepaid and Funding Loss Amount, if any. Subject to Section 1.05(e), any prepayments of the Loans made under the Loan Documents shall be applied to the outstanding principal amount of Tranche A Loans and Tranche B Loans, pro rata.

(g)Reborrowing. Any Loans, or any portion thereof, which has been prepaid may not be reborrowed.

Section 1.06Taxes. (a)Taxes Payable by the Borrower. If under Applicable Law any Tax is required to be withheld or deducted by the Borrower from, or is otherwise payable by the Borrower in connection with, any payment to the Administrative Agent or any Lender under the Loan Documents, excluding, in the case of the Administrative Agent and any such Lender, Taxes imposed on or measured by its net income and franchise Taxes imposed on it (in lieu of net income Taxes), the Borrower (i) shall (A) if so required, withhold or deduct the amo unt of such Tax from such payment and, in any case, pay such Tax to the appropriate taxing authority in accordance with Applicable Law and (B) indemnify the Administrative Agent and such Lender in accordance with the provisions of Section 8.02(d) against Borrower’s failure so to do and (ii) shall, subject to Section 1.06(b), pay to the Administrative Agent or such Lender, as applicable, (A) such additional amounts as may be necessary so that the net amount received by the Administrative Agent or such Lender with respect to such payment, after withholding or deducting all Taxes required to be withheld or deducted by the Borrower, is equal to the full amount payable under the Loan Documents and (B) an amount equal to all Taxes payable by the Administrative Agent or such Lender as a result of payments made by the Borrower (whether to a taxing authority or to the Administrative Agent or such Lender) pursuant to this Section 1.06(a). If any Tax is withheld or deducted by the Borrower from, or is otherwise pa yable by the Borrower in connection with, any payment payable to the Administrative Agent or any Lender under the Loan Documents, the Borrower shall, as soon as possible after the date of such payment, furnish to the Administrative Agent or such Lender, as applicable, the original or a certified copy of a receipt for such Tax from the applicable taxing authority. If any payment due to the Administrative Agent or any Lender under the Loan Documents is or is expected to be made without withholding or deducting therefrom, or otherwise paying in connection therewith, any Tax payable by the Borrower to any taxing authority, the Borrower shall, within 30 days after any request from the Administrative Agent or such Lender, as applicable, furnish to the Administrative Agent or such Lender a certificate from such taxing authority, or an opinion of counsel acceptable to the Administrative Agent or such Lender, in either case stating that no Tax payable to such taxing authority was or is, as the case may be, required t o be withheld or deducted from, or otherwise paid by the Borrower in connection with, such payment.

(b)Limitations. Notwithstanding anything to the contrary contained herein, the Borrower shall not be required to pay any additional amount in respect of withholding of any United States federal income taxes pursuant to this Section 1.06 to any Lender or participant (i) except to the extent that (A) such Taxes are required to be withheld as a result of a Regulatory Change Enacted after the date that such Lender or participant became a Lender or a participant or (B) such amounts would have been payable to such Lender's assignor or participant's grantor if such assignment had not been made or such participation not been granted, or (ii) to the extent that such withholding is required because such Lender or participant has failed to submit any form or certificate that it is entitled to submit under Applicable Law.

Section 1.07Use of Proceeds.The proceeds of the Loans shall be used by the Borrower for general business purposes relating to the acquisition and ownership of the Equipment and the leasing thereof pursuant to the Equipment Leases, which includes making distributions to the PLM Growth Funds and funding the Liquidity Reserve Account in accordance with the Security Agreement.

Section 1.08Special Provisions Relating to LIBOR Rate.ix) In the event that on the date for determining the LIBOR Rate in respect of any Interest Period, (i) the Administrative Agent shall have determined (which determination shall be presumed to be correct until the contrary shall have been established) that by reason of circumstances affecting the London interbank market, adequate and fair means do not exist for ascertaining the LIBOR Rate for such Interest Period, or (ii) any Regulatory Change shall make it unlawful for any Lender to make or maintain any Loan, or shall materially restric t the authority of any Lender to take deposits of Eurodollars, then the Administrative Agent shall promptly give to the Borrower written notice of the nature and effect of such circumstances. After receipt of such notice and during the existence of such circumstance, the interest rate applicable to the Loans and the Notes shall convert to a floating rate equal to the Reference Rate per annum, provided that nothing in this Section 1.08(a) shall affect the interest rate then in effect at the time of receipt by the Borrower of such notice until the expiration of the Interest Period in effect at such time.

(b)Upon the receipt of the written notice from the Administrative Agent provided for in Section 1.08(a), the Borrower may, upon two (2) Business Days’ written notice to the Administrative Agent, prepay in full, without penalty, the Loans, together with all interest accrued on the amount prepaid to the date of payment.

Section 1.09Regulatory Changes.If in the reasonable determination of any Lender (a) any Regulatory Change shall directly or indirectly (i) reduce the amount of any sum received or receivable by such Lender with respect to any Loan or the return to be earned by such Lender on any Loan, (ii) impose a cost on such Lender or any Affiliate of such Lender that is attributable to the making, funding or maintaining of, or such Lender’s commitment to make, any Loan, (iii) require such Lender or any Affiliate of such Lender to make any payment on or calculated by reference to the gross amo unt of any amount received by such Lender under any Loan Document or (iv) reduce, or have the effect of reducing, the rate of return on any capital of such Lender or any Affiliate of such Lender that such Lender or such Affiliate is required to maintain on account of any Loan or such Lender’s commitment to make any Loan and (b) such reduction, increased cost or payment shall not be fully compensated for by an adjustment in the applicable rates of interest payable under the Loan Documents, then the Borrower shall pay to such Lender such additional amounts as such Lender determines will, together with any adjustment in the applicable rates of interest payable hereunder, fully compensate for such reduction, increased cost or payment. Such additional amounts shall be payable, in the case of those applicable to prior periods, within 15 days after request by such Lender for such payment and, in the case of those applicable to future periods, on the dates specified, or determined in accordance with a method sp ecified, by such Lender. Each Lender will promptly notify the Borrower of any determination made by it referred to in clauses (a) and (b) above, but the failure to give such notice shall not affect such Lender’s right to compensation.

Section 1.10Capital Requirements.If in the determination of any Lender any Regulatory Change relating to capital adequacy requires such Lender or any Affiliate of such Lender to maintain capital on account of any Loan in a greater amount than such Lender or such Affiliate would otherwise have maintained on account of such Loan, then, upon request by such Lender, the Borrower shall from time to time thereafter pay to such Lender such additional amounts as such Lender reasonably determines will fully compensate for any reduction in the rate of return on the capital that such Lender or such Affiliate is so required to maintain on account of such Loan. Such additional amounts shall be payab le, in the case of those applicable to prior periods, within 15 days after request by such Lender for such payment and, in the case of those relating to future periods, on the dates specified, or determined in accordance with a method specified, by such Lender.

Section 1.11Fees. (a)Structuring and Arrangement Fees. The Borrower shall pay to the Administrative Agent, for its own account, on the Closing Date an upfront structuring and arrangement fee in the amounts specified in a separate fee letter to be agreed upon between the Administrative Agent and the Borrower.

(b)Fees Non-Refundable. None of the fees payable under this Section 1.11 shall be refundable in whole or in part.

Section 1.12Distribution of Payments by the Administrative Agent. (a) The Administrative Agent shall promptly distribute to each Lender its ratable share of each payment received by the Administrative Agent under the Loan Documents for the account of the Lenders by credit to an account of such Lender at the offices of the Administrative Agent or by wire transfer to an account of such Lender at an office of any other commercial bank located in the United States.

(b)Unless the Administrative Agent shall have received notice from the Borrower prior to the date on which any payment is due to the Lenders under the Loan Documents that the Borrower will not make such payment in full, the Administrative Agent may assume that the Borrower has made such payment in full to the Administrative Agent on such date and the Administrative Agent in its sole discretion may, in reliance upon such assumption, cause to be distributed to each Lender on such due date funds in an amount equal to the amount then due such Lender. If and to the extent the Borrower shall not have so made such payment in full to the Administrative Agent and the Administrative Agent shall have so distributed to any Lender funds in an amount equal to the amount then due such Lender, such Lender shall, on demand, repay to the Administrative Agent the amount so distributed together with interest thereon, for each day from the date funds in such amount are distributed to such Lender until the date such Lender repays such amount to the Administrative Agent, at the Administrative Agent’s cost of funds until (and including) the third Business Day after demand is made and thereafter at the Interest Rate.

Section 1.13Pro Rata Treatment.Except to the extent otherwise provided herein (a) Loans to be made on the Closing Date shall be made by the Lenders pro rata in accordance with their respective Commitments and (b) each payment of the principal of or interest on the Loans shall be made for the account of the Lenders pro rata in accordance with the respective amounts thereof then due and payable.

Section 1.14Authorization to Charge Accounts.During the continuance of an Event of Default, the Borrower hereby authorizes the Administrative Agent and each Lender, if and to the extent any amount payable by the Borrower under the Loan Documents (whether payable to such Person or to any other Person that is the Administrative Agent or a Lender) is not otherwise paid when due, to charge such amount against any or all of the accounts of the Borrower held at such Lender (whether maintained at a branch or office located within or without the United States), with the Borrower remaining liable for any deficiency.

Section 1.15Distribution of Collateral Proceeds. (a) On each Payment Date, so long as no Event of Default has occurred and is continuing, the Administrative Agent shall apply on such date the Available Amount released from the Blocked Account, any amounts released from the Liquidity Reserve Account in accordance with the terms of Section 6.06 of the Security Agreement, and any other amounts the Administrative Agent has received from the Borrower in the following order of priority:

First, to the payment of any accrued and unpaid Operating Expenses;

Second, to the payment to Manager of any accrued and unpaid indirect operating expenses in an amount equal to 4.75% of Adjusted Operating Revenues (and any arrearages thereof);

Third, to the payment of any costs, charges, expenses or liabilities incurred by the Administrative Agent and the Lenders in connection with the Loan Documents;

Fourth, if PLM or any of its Affiliates is not the Manager, to the payment to the manager of any management fees then due and payable (and any arrearages thereof);

Fifth, to the payment to each Lender of its pro rata portion of any accrued and unpaid interest due under the Notes for such Payment Date;

Sixth, to the payment to each Lender of an amount equal to its pro rata portion of the payment of principal, if any, due under the Notes, for such Payment Date;

Seventh, to the Liquidity Reserve Account, the amount necessary, if any, to restore the amount on deposit therein (calculated after giving effect to any withdrawals from the Liquidity Reserve Account on the Determination Date) to the Liquidity Reserve Required Amount;

Eighth, to the payment to each Lender and the Administrative Agent of any other amount then due and owing to such Lender and/or the Administrative Agent under the Notes or any other Loan Document and not covered by the foregoing Clauses Third, Fifth, and Sixth;

Ninth, if PLM or any of its Affiliates is the Manager, to the payment of a management fee then due and payable in an amount equal to 5.25% of Adjusted Operating Revenues (and any arrearages thereof); provided that, no such payment to the Manager shall be made if a Default under this Agreement or a Manager Event of Default (as defined in the Management Agreement) has occurred and is continuing; and

Tenth, any remaining balance shall be divided and applied as follows: (i) one-fourth (25%) of such remaining balance shall be applied to the outstanding principal of the Tranche A Loans or, if no Tranche A Loans shall remain outstanding, to the outstanding principal of Tranche B Loans, and (ii) three-fourths (75%) of such remaining balance shall be paid first to the Manager for any amounts owed to it pursuant to the Management Agreement and the remainder distributed to the Borrower or its designee.

(b)If an Event of Default has occurred and is continuing, the Administrative Agent shall hold or apply the Available Amount released from the Blocked Account, the Liquidity Reserve Account and any amounts the Administrative Agent has received from the Borrower and, subject to Section 9.03 of the Security Agreement, from the proceeds of any sale of the Collateral, or any part thereof, and the proceeds of any remedy hereunder or under the Security Agreement in the following order of priority:

(i)First, to the payment of any unpaid costs, charges, expenses or liabilities incurred by the Administrative Agent and any Lender in connection with the Loan Documents and the Collateral, including any maintenance expenses or other expenses incurred to preserve the value of the Equipment;

(ii)Second, to payment to each Lender of any accrued and unpaid interest on the Notes held by such Lender, ratably and without priority of one Lender over another;

(iii)Third, to payment to each Lender of all unpaid principal on the Notes held by such Lender, ratably without priority of one Lender over another (and for purposes of this clause, obligations under any Swap Agreement with a Swap Counterparty shall be paid on a pro rata basis with the Notes);

(iv)Fourth, to payment to each Lender and Swap Counterparty of all other amounts, if any, due and payable under any of the Loan Documents, including without limitation, the Funding Loss Amount, if any, ratably and without priority of one Person over another; and

(v)Fifth, the remaining balance, if any, to the Borrower or its designee.

(c)All payments to be made under this Loan Agreement and under any Note, including the payment of any Funding Loss Amount, shall be made only from the income and the proceeds from the Equipment, the Equipment Leases and the other Collateral. Each holder of a Note, by its acceptance of such Note, agrees that it will look solely to the income and proceeds from the Equipment, the Equipment Leases and the other Collateral for distribution to such holder as provided herein and that none of the Manager, the PLM Growth Funds or their Affiliates (other than the Borrower) or their permitted successors and assigns is or shall be personally liable to the holder of any Note for any amount payable under such Note or this Loan Agreement.

Section 1.16Additional Commitments.So long as no Default has occurred and is continuing, the Borrower may request that one or more of the Lenders establish an Additional Commitment pursuant to which such Lender shall make Additional Loans in connection with the acquisition by or contribution to the Borrower of Additional Equipment. The aggregate amount of such Additional Commitments shall not exceed 75% of the Fair Market Value of such Additional Equipment and shall be in an integral multiple of $10,000,000. Each Lender’s determination to establish or not establish an Additional Commitment, and the amount of its Additional Commitment, shall be in its sole and absolute discretion. The terms of such Additiona l Commitments and the Additional Loans to be made thereunder, including funding provisions, conditions precedent, amortization, interest, fees, prepayment requirements and other matters relating to such Additional Commitments and Additional Loans, shall be set forth in an Additional Commitment Addendum entered into by the Borrower, the Administrative Agent and the Lenders establishing such Additional Commitments. An Additional Commitment Addendum shall not amend or modify in any respect the provisions of the Loan Documents as they apply to the Tranche A Loans, the Tranche B Loans or any Additional Loans made pursuant to a previous Additional Commitment Addendum or otherwise affect the application or priority of payments from the Borrower or proceeds of collateral with respect to any Loan (other than to provide that proceeds of collateral and other payments made by the Borrower shall be shared pro rata with the Additional Loans to the extent provided in such Addendum) without the consent of the Lenders affect ed thereby.

Section 1.17    Change of Lending Office.If an event occurs with respect to a Lending Office of any Lender that obligates the Borrower to pay any amount under Section 1.06 or entitles such Lender to make a claim under Section 1.06(a), 1.09 or 1.10, such Lender shall, if requested by the Borrower, use reasonable efforts to designate another Lending Office or Offices the designation of which will reduce the amount the Borrower is so obligated to pay or reduce the amount such Lender is so entitled to claim, provided that such designation would not, in the sole and absolute discretion of such Lender, be disadvantageous to such Lender in any manner or contrary to such Lender’s policies. Each Lender may at any time and from time to time change any Lending Office and shall give notice of any such change to the Administrative Agent and the Borrower. Except in the case of a change in Lending Offices made at the request of the Borrower, the designation of a new Lending Office by any Lender shall not obligate the Borrower to pay any amount to such Lender under Section 1.06 or entitle such Lender to make a claim under Section 1.06(a), 1.09 or 1.10 if such obligation, the operability of such clause or such claim results solely from such designation and not from a Regulatory Change Enacted thereafter.

ARTICLE 2

CONDITIONS OF LENDING

Section 2.01Conditions Precedent to Loans.The obligation of each of the Lenders to make its Loan shall be subject to fulfillment of the following conditions precedent on or prior to the Closing Date in form and substance satisfactory to the Administrative Agent and its counsel:

(a)The Borrower shall have delivered to the Administrative Agent the Notice of Borrowing along with the Pay Proceeds Letter.

(b)The Borrower shall have delivered to the Administrative Agent a certificate of a Responsible Officer of the Borrower, certifying that, as of the Closing Date, all of the railcars constituting the Equipment are free of all Liens (except for Permitted Liens).

(c)The Administrative Agent shall have received on or before the Closing Date the following, each dated the Closing Date, in form and substance reasonably satisfactory to the Administrative Agent:

(i)A Note duly executed by the Borrower for each Lender;

(ii)The Security Agreement (or memorandum thereof in form and substance satisfactory to the parties hereto) duly executed by the Borrower and filed with the STB and the Registrar General of Canada and together with evidence of such filings;

(iii)A certified copy of the Borrower’s certificate of formation and limited liability company agreement, resolutions of the members or manager(s), as applicable, of the Borrower authorizing Borrower’s execution and delivery of, and performance under, this Agreement, each of the other Loan Documents to which it is a party and all documents evidencing other necessary company action and governmental approvals, if any, with respect to the Loan Documents;

(iv)A certificate of the Borrower certifying the names and true signatures of the person or persons authorized to execute and deliver on behalf of the Borrower the Loan Documents to which it is a party and the other documents to be delivered by it hereunder;

(v)A favorable opinion of each of Chapman and Cutler LLP, special New York counsel to the Borrower, of Alvord & Alvord, special STB counsel to the Borrower, and of McCarthy Tétrault LLP, special Canadian counsel to the Borrower;

(vi)Confirmation that the Uniform Commercial Code Financing Statements naming the Administrative Agent (as the Secured Party under the Security Agreement and the Pledge Agreement) as secured party in the States of California, Delaware, Florida and Illinois have been filed in the proper recording office in connection with the Collateral;

(vii)Certificates as to insurance naming the Administrative Agent as additional insured and sole loss payee, all of which satisfy the requirement of Section 3.02 of the Security Agreement;

(viii)Such other approvals, opinions, documents or filings as the Administrative Agent may reasonably request;

(ix)Receipt of an irrevocable power of attorney, in the form of Exhibit F hereto, from the Borrower, each of the PLM Growth Funds, and each other Person listed as “lessor” on Schedule C to the Security Agreement appointing the Administrative Agent its attorney-in-fact authorized to execute and deliver the Notices of Assignment with respect to each Equipment Lease in accordance with the terms of the Security Agreement;

(x)Evidence that the PLM Growth Funds have delivered to the Borrower duly executed Bills of Sale for each Item of Equipment;

(xi)A certified copy of the Escrow Agreement duly executed by the Borrower and the other parties thereto;

(xii)The Initial Appraisal;

(xiii)[Intentionally Omitted]

(xiv)The Assignments duly executed by the Borrower and each of the PLM Growth Funds;

(xv)The Management Agreement duly executed by the Borrower and PLM; and

(xvi)Each of the other Loan Documents duly executed by each of the parties thereto.

(d)The Borrower shall have made a notation on each original executed Equipment Lease constituting Collateral clearly describing the Secured Party’s security interest therein.

(e)On the Closing Date the Borrower shall have delivered to the Administrative Agent a copy of each of the Equipment Leases for the ten (10) largest Equipment Lessees (as calculated using the Fair Market Value of the Equipment on lease to such Equipment Lessees).

(f)On the Closing Date and after giving effect to the making of the Loans, the following statements shall be true on and as of such date and the Administrative Agent shall have received certificates signed by a Responsible Officer of each Loan Party dated as of such date, stating that:

(i)The representations and warranties of such Loan Party contained in each of the Loan Documents to which it is a party are true and accurate with the same effect as if made on and as of such date (except to the extent of the representations and warranties which relate to an earlier date, in which case such representations and warranties shall have been true and accurate as of such earlier date); and

(ii)No Event of Default or Default has occurred and is continuing or will exist upon the disbursement of the Loans.

(g)The Borrower shall have paid to the Administrative Agent the fees specified in Section 1.11 that are payable on the Closing Date.

(h)After giving effect to the disbursement of the Loans, the LTV Ratio shall not exceed 0.75 to 1.0.

(i)Each Pledgor shall have delivered the certificates representing or evidencing the LLC Membership Interest in the Borrower to the Secured Party and shall have taken any other action required pursuant to the Pledge Agreement.

ARTICLE 3

REPRESENTATIONS AND WARRANTIES

Section 3.01Representations and Warranties of the Borrower.The Borrower represents and warrants as follows:

(a)Organization. The Borrower is a limited liability company duly organized, validly existing and in good standing under the laws of the State of Delaware, has full power and authority to own its property and carry on the business which it is permitted to engage hereunder, including without limitation, the execution, delivery and performance of the Loan Documents to which it is a party and is duly qualified and in good standing as a foreign limited liability company, and is authorized to do business, in all jurisdictions in which the failure to so qualify would have a material adverse effect upon the operations, properties, prospects or financial condition of the Borrower.

(b)Solvency. Entering into this Agreement and the other Loan Documents and the transactions contemplated hereby and thereby and the incurrence of its liability hereunder or thereunder and contemplated hereby and thereby (i) does not leave the Borrower unable to pay its debts as they become due in the ordinary course of business, (ii) will not leave it with debts which cannot be paid from the present saleable value of its property and (iii) will not render it insolvent within the meaning of Section 101(32) of the United States Bankruptcy Code and Section 271 of the New York Debtor and Creditor Law.

(c)No Litigation. There are no actions, suits or proceedings, whether or not purportedly on behalf of the Borrower, pending or, pending against, or, to the knowledge of the Borrower, threatened against or affecting the Borrower or any property rights of the Borrower at law, or in equity, or before any commission, governmental department, board, agency or instrumentality, domestic or foreign, or before any arbitrator; and the Borrower is not in default in any material respect under any order, writ, injunction, decree, rule or regulation of any court or governmental department, commission, or agency or instrumentality.

(d)Authority of Borrower; No Conflicts. The execution, delivery and performance by the Borrower of the Loan Documents to which it is a party and the Equipment Leases are within the Borrower’s powers and the Loan Documents have been duly authorized by all necessary action on behalf of the Borrower. Neither the execution and delivery of any of the Loan Documents to which it is a party, nor the consummation of the transactions contemplated therein or in any of the Equipment Leases nor the fulfillment of, or compliance with, the terms and provisions thereof will (i) conflict with, or result in a breach of, any of the terms, conditions or provisions of (A) any law, or any regulation, order, writ, injunction or decree of any court or governmental instrumental ity, domestic or foreign, (B) the certificate of formation or limited liability company agreement of the Borrower, or (C) any bond, debenture, note, mortgage, indenture, agreement, lease or other instrument to which the Borrower is a party; (ii) constitute, with the giving of notice or the passage of time or both, a default under any such agreement or instrument; or (iii) result in the creation or imposition of any Lien upon any property of the Borrower (except for Permitted Liens) pursuant to the terms of any such agreement or instrument.

(e)Governmental Authority. No authorization or approval or other action by, and no notice to or filing with, any governmental authority or regulatory body is required for the due execution, delivery and performance by the Borrower of any of the Loan Documents or performance of any of the Equipment Leases or for the creation and perfection of the first priority security interest in the Borrower Collateral intended to be created in favor of the Secured Party under the Security Agreement, except for the filing of the Security Agreement (or memorandum thereof) with the STB pursuant to 49 U.S.C. 11301, the Uniform Commercial Code Financing Statement filings in the States of California, Delaware, Florida and Illinois, and any required filings with the Registrar Ge neral of Canada.

(f)Tax Returns. The Borrower has filed or caused to be filed, or has timely requested and, if necessary, has obtained, an extension to file all federal and material state and local tax returns which, to the Borrower’s knowledge, are required to be filed, and has paid, or made provisions for the payment of, all taxes which have or may have become due pursuant to such returns or pursuant to any assessment received by it or any of its properties, and all other taxes, fees or other charges imposed on it or any of its properties, other than taxes which are being contested in good faith by appropriate proceedings and with respect to which appropriate reserves in accordance with GAAP consistently applied have been provided on its books. On the date of the lien search performed by the Borrower, (a copy of the results of which has been delivered to the Administrative Agent) and thereafter, to the Borrower’s knowledge, no tax liens have been filed and no claims are being asserted with respect to any such taxes, fees or other charges covered by the immediately preceding sentence, other than those the amount or validity of which is currently being contested in good faith by appropriate proceedings and with respect to which appropriate reserves in accordance with GAAP consistently applied have been provided on the books of the Borrower.

(g)Enforceability of Agreements. Assuming due authorization, execution and delivery thereof by each of the parties thereto (other than the Borrower), each Loan Document delivered by the Borrower hereunder will be legal, valid and binding obligation of the Borrower, enforceable against the Borrower in accordance with its respective terms (subject, as to enforceability, to applicable bankruptcy, insolvency, moratorium and similar laws affecting the enforcement of creditors’ rights generally and to generally applicable principles of equity).

(h)Investment Company. The Borrower is not an “investment company” as such term is defined under the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder, nor will the making of the Loans hereunder by the Lenders on the terms and conditions hereunder provided and the use of the proceeds therefrom by the Borrower result in any violation by the Borrower or any of its Affiliates of any of the provisions of the Investment Company Act of 1940, as amended, and the rules and regulations promulgated thereunder.

(i)Ownership of Borrower Collateral. Upon the receipt by the Borrower of the Bills of Sale and the execution of the Assignments and the Asset Transfer Agreements by the Borrower and each of the PLM Growth Funds, the Borrower shall have good and marketable title to the Borrower Collateral, free and clear of all Liens, other than Permitted Liens, and the Borrower will warrant and defend the title to the Borrower Collateral against all claims and demands of all persons whatsoever except persons claiming by or through any Lender.

(j)Fair Market Value of Equipment. As of the Closing Date, the LTV Ratio will not exceed 75%.

(k)Margin Regulations. The proceeds of the Loans pursuant to this Agreement will be used by the Borrower only for the purposes set forth in Section 1.07 hereof. None of the proceeds will be used, directly or indirectly, for the purpose of purchasing or carrying any Margin Stock (as such term is defined in Regulation U issued by the Board) or to extend credit to any other person for the purpose of purchasing or carrying any Margin Stock. The Borrower is not engaged principally, or as one of its important business activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock. Neither the Borrower nor any agent acting in its behalf has taken or will take any action that might cause this Agreement or any of the docume nts or instruments delivered pursuant hereto to violate any regulation of the Board or to violate the Securities Exchange Act of 1934, as amended.

(l)Securities Act of 1933. Neither the Borrower nor, to its knowledge, anyone acting on its behalf has directly or indirectly offered or sold any interest in the Borrower Collateral, other securities or beneficial interests in the Equipment to, solicited offers to buy any interest in the Borrower Collateral, other securities or beneficial interests in the Equipment from, or otherwise approached or negotiated in respect of the purchase or sale or other disposition of any interest in the Borrower Collateral, other securities or beneficial interests in the Equipment with, any Person so as to bring the transactions contemplated by this Agreement within the provisions of Section 5 of the Securities Act. The Borrower will not offer any interest in the Borrower Col lateral, or other securities or beneficial interests in the Equipment to, or solicit any offer to buy any thereof from, any other Person or approach or negotiate with any other Person in respect thereof, so as to bring the transactions contemplated by this Agreement within the provisions of Section 5 of the Securities Act.

(m)Full Disclosure. Neither this Agreement, the schedules or other attachments hereto, nor any certificate, statement, report or other documents furnished to the Administrative Agent or any Lender by the Borrower, any of the PLM Growth Funds, the Manager, MILPI or any of their respective Affiliates in connection herewith or in connection with any transaction contemplated hereby, contains any untrue statement of a material fact or omits to state any material fact necessary in order to make the statements contained therein not misleading.

(n)ERISA. No employee benefit plans are sponsored, maintained or participated in by the Borrower, nor has the Borrower or any ERISA Affiliate of the Borrower incurred any liability to the PBGC established pursuant to ERISA, other than for required insurance premiums which have been paid when due.

(o)Equipment and Equipment Leases.

            (i)The list of Equipment Leases and all information with respect thereto set forth in Schedule A to this Agreement is accurate, true and correct. To the best of Borrower’s knowledge, each of such Equipment Leases is in full force and effect and enforceable in accordance with its terms. Each Equipment Lessee is, to the best of Borrower’s knowledge, materially in compliance with all material provisions of the related Equipment Lease and the Borrower is not aware of any material default under any of the Equipment Leases.

(ii)Each Equipment Lease is non-cancelable in accordance with the express terms of such Equipment Lease, all sums payable thereunder are payable in the amounts and at the times stated therein without defense, offset or counterclaim, and no part thereof has been prepaid, released or modified, or encumbered or disposed of by the Borrower, except pursuant to the Assignments; any and all sums of money previously paid by any Equipment Lessee thereunder as advance payments or deposit of security have been fully disclosed to the Administrative Agent and assigned to the Borrower by the PLM Growth Funds; each Equipment Lease has been entered into by or on behalf of one of the PLM Growth Funds in the ordinary course of business, to the Borrower’s knowledge has been duly authorized and executed by Equipment L essees, which Equipment Lessees were approved by the PLM Growth Funds or the Manager with respect to the Equipment Lease to which it is a party based upon the PLM Growth Funds’ or the Manager’s normal credit practices, is the entire agreement with each such Equipment Lessee relating to the Equipment covered thereby, has not been modified, canceled or waived in any respect (except pursuant to the Assignment), has been assigned by the PLM Growth Funds to the Borrower pursuant to the Assignments and none of the Borrower’s rights thereunder have been released, modified, encumbered or disposed of; any consent, approval, authorization of, or registration, declaration or filing with, any governmental authority (federal, state or local, domestic or foreign) required in connection with the execution, delivery or performance of any Equipment Lease by the Borrower or PLM Growth Funds has been obtained; the Equipment covered by any Equipment Lease has been delivered, is in good working order, has been mai ntained in compliance with all the AAR’s mechanical regulations and industry commercial standards for revenue interchange loading and all other applicable laws and regulations, has been used for the purpose for which it was built and shall have been accepted by the Equipment Lessee of such Equipment as being in a condition which complies with the terms and conditions of such Equipment Lease; and all financial and credit information that the Borrower may, or cause to be, at any time furnish to the Administrative Agent or any Lender relating to the Equipment Lessee under each Equipment Lease is, to the best of the Borrower’s knowledge, true, complete and not misleading.

(iii)Schedule A to the Security Agreement sets forth a list of all Items of Equipment owned by the Borrower on the Agreement Date and all information with respect to such Items of Equipment set forth in such Schedule A is accurate, true and complete.

(iv)Each Equipment Lessee has been instructed to make all payments under such Equipment Lease to the Escrow Account.

(p)Security Interest. Upon the completion of the recordation and filing of the Security Agreement (or memorandum thereof) with the STB pursuant to and in compliance with the provisions of 49 U.S.C. Section 11301 (a), the deposit, registration and filing of the Security Agreement at the office of the Registrar General of Canada pursuant to Section 105 of the Canada Transportation Act, and the filing of the Uniform Commercial Code Financing Statements in the States of California, Delaware, Florida and Illinois, the Secured Party will have a first priority perfected security interest in the Borrower Collateral, subject only to Permitted Liens.

(q)No Other Business Activity. Since its organization, the Borrower has engaged in no business except the performance of the Equipment Leases, the negotiation and performance of the transactions contemplated by the Loan Documents and activities incidental to the foregoing.

(r)No Breach. The Borrower is not in breach of or in default under any agreement to which it is a party or that is binding on it or any of its property, which breach would have a material adverse effect upon the operations, properties, prospects or financial condition of the Borrower.

(s)No Prohibited Actions. Since its organization, the Borrower has not taken any of the actions that otherwise would be prohibited by Section 4 hereof and has conducted its activities in accordance with the covenants under Section 4 hereof.

(t)Concentration Limits. As of the Closing Date, none of the Concentration Ratios exceed the corresponding Concentration Limits set forth in clauses (i) through (iv) of Section 4.01(x).

Section 3.02Representation of Borrower and the Lenders.The Borrower and each of the Lenders represents and warrants that no brokers’ commissions related to this Agreement, the Notes or the Security Agreement are payable by or through it.

ARTICLE 4

COVENANTS OF THE BORROWER

Section 4.01Covenants.So long as any Obligation (as defined in the Security Agreement) shall remain outstanding, the Borrower agrees:

(a)Event of Default Notice; Financial Statements; Compliance Certificates.

(i)The Borrower will deliver to the Administrative Agent, promptly (but in any event within 15 days) after the occurrence of (A) any Default or Event of Default of which a Responsible Officer has knowledge, (B) any default under any Equipment Lease of which a Responsible Officer of the Borrower has actual knowledge, (C) any Equipment Lessee commencing bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debts proceedings of which a Responsible Officer of the Borrower has actual knowledge, or (D) any Escrow Bankruptcy Event of which a Responsible Officer of the Borrower has actual knowledge, written notice of the occurrence of any such event.

(ii)The Borrower will deliver to the Administrative Agent:

(A)as soon as available and in any event within 45 days after the end of the first three fiscal quarters of each year, a balance sheet of each of the Borrower and MILPI as at such fiscal quarter end and the related statements of income of each of the Borrower and MILPI for the qualified period then ended;

(B)as soon as available and in any event within 120 days after the end of each fiscal year, a balance sheet of each of the Borrower and MILPI as of the end of such fiscal year and a copy of the related statements of income and retained earnings and changes in financial position of each of the Borrower and MILPI for such year, prepared in accordance with GAAP and certified by independent public accountants; provided that, the financial statements of MILPI referred to in this Section 4.01(a)(ii)(B) may not be certified by independent public accountants in a given fiscal year if such certification has not been obtained for such fiscal year;

(C)quarterly, within 45 days after the end of each fiscal quarter of the Borrower prior to the termination of this Agreement, the Borrower shall cause Manager to deliver to the Borrower and the Administrative Agent a Location Report (as defined in the Management Agreement) setting forth the physical location of each Item of Equipment last known to the Manager (which may be based on junction reports received by the Manager);

(D)semi-annually, as soon as practicable, and in any event within forty-five (45) days after the end of each of the second and fourth fiscal quarters of the Borrower prior to the termination of this Agreement, a certificate of the Borrower, signed by a Responsible Officer of the Borrower, based on an examination sufficient to enable such officer to make an informed statement (and in the case of the LTV Ratio, based on the most recent Appraisal) and attaching any calculations, reports and other data used in such examination, stating that (x) at such time the LTV Ratio set forth in Section 4.01(e) does not exceed 0.75 to 1.0 and specifying the LTV Ratio, or if such is not the case, specifying the amount by which the LTV Ratio exceeds 0.75 to 1.0 and the steps being taken by the Borrower with respect there to, (y) at such time that none of the Concentration Ratios exceeds the corresponding Concentration Limits set forth in Section 4.01(x) and specifying the Concentration Ratios at such time, or if such not the case, specifying which of the foregoing is not the case and the steps being taken by the Borrower with respect thereto; and

(E)such other information respecting the Borrower’s financial conditions or operations or other matters pertaining to the Borrower as the Administrative Agent or any Lenders may from time to time reasonably request.

(b)Litigation. The Borrower will deliver to the Administrative Agent prompt (but in any event within 10 days) written notice of any litigation or legal proceeding affecting the Borrower involving an amount, singly or in the aggregate, in excess of $1,000,000 whether or not covered by insurance.

(c)Compliance with Laws, Equipment Leases, Etc. The Borrower will (i) comply with all laws, rules, regulations and orders applicable to the Borrower Collateral, if the failure to so comply would materially adversely affect the Borrower Collateral, such compliance to include, without limitation, paying before the same become delinquent all taxes, assessments and governmental charges imposed upon it or upon its property except to the extent contested in good faith by appropriate proceedings and for which appropriate reserves have been established on the Borrower’s books in accordance with GAAP and (ii) comply with all of the terms, provisions, restrictions, covenants and agreements set forth in the Equipment Leases and in each and every supplement to or a mendment thereof.

(d)No Liens. The Borrower will pay or discharge, at its own cost and expense, any and all claims, liens or charges (other than Permitted Liens) on or with respect to the Borrower Collateral. In the event that any of the Borrower Collateral, or any Item of Equipment thereof, shall be attached, distrained or otherwise levied upon, the Borrower shall cause such attachment, distraint or levy to be vacated within fifteen (15) days from the date such claim, lien or claim shall have attached, been distrained or levied against the Borrower Collateral. The Borrower further agrees to indemnify and hold harmless each of the Lenders and the Administrative Agent from and against any direct loss, costs or expenses (including reasonable legal fees and expenses) incurred, i n each case, as a result of the imposition or enforcement of any such claim, lien, or charge on or with respect to the Borrower Collateral. There will be no financing statements or other filed or recorded instruments in which the Borrower is named and which the Borrower has signed, as debtor or mortgagor, now on file at the STB, the Registrar General of Canada or in any other public office covering any of the Borrower Collateral, excepting the financing statements or other instruments filed or to be filed in respect of and for the security interest provided for in the Security Agreement and in the Equipment Leases and except for any of the foregoing as to which a corresponding release has been filed with the STB and the Registrar General of Canada and Uniform Commercial Code Financing Statements as to which corresponding Uniform Commercial Code Termination Statements have been filed in the appropriate state filing office in the States of California, Delaware, Florida and Illinois.

(e)No Modification to Equipment Lease Payments. The Borrower shall not modify, amend, accept any payment from any Equipment Lessee under or make any payments on behalf of or to any Equipment Lessee for the purpose or with the result, whether or not intended, of concealing or preventing an event of default under, any Equipment Lease. The Borrower agrees to cause each payment made under an Equipment Lease or otherwise relating to the Equipment to be made directly into the Escrow Account and agrees that if any such payment is received by it such payment shall be held in trust for the sole benefit of the Lenders and shall promptly be deposited in the Blocked Account in accordance with Section 7.03 of the Security Agreement.

(f)Equipment Leases. The Borrower shall deliver a copy of each of the Equipment Leases to the Administrative Agent in accordance with Section 4.02 of the Security Agreement. Within fifteen (15) days after the end of each fiscal quarter of the Borrower, the Borrower shall notify the Administrative Agent in writing regarding any change in the identity of any Equipment Lessee, in the car number assigned to any Item of Equipment, any decrease in the amount of rentals under any Equipment Lease or in any lease terms of the Equipment Leases. Nothing in this Section 4.01(f) shall be construed as a waiver of the Borrower’s obligations under the Security Agreement with respect to the Equipment Leases.

(g)Fundamental Changes. The Borrower shall not enter into any transaction of merger or consolidation, or change the form of organization of its business, or transfer its properties and assets substantially as an entirety to any other Person.

(h)Appraisals. The Borrower shall deliver to the Administrative Agent (i) a Physical Appraisal of the Fair Market Value of the Equipment (i) within forty-five (45) days from the Closing Date and (ii) within sixty (60) days after the end of the fiscal year 2007 of the Borrower, and (ii) a Desktop Appraisal of the Fair Market Value of the Equipment within forty-five (45) days after the end of each fiscal year of the Borrower, except for the fiscal year 2007; notwithstanding the foregoing, in the event that there is a Regulatory Change which in the Administrative Agent’s reasonable opinion would have a material adverse effect on the economic value of the Equipment, upon the Administrative Agent’s request, the Borrower shall deliver to the Administrati ve Agent within sixty (60) days of receipt of notice of such a Regulatory Change from the Administrative Agent, a Physical Appraisal of the Fair Market Value of the Equipment at such time.

(i)Investments. Borrower will not make any loan or advance or credit to, or guarantee (directly or indirectly or by an instrument having the effect of assuring another’s payment or performance of any obligation or capability of so doing, or otherwise), endorse or otherwise become contingently liable, in connection with the liabilities, obligations, stock or dividends of, or own, purchase, repurchase or acquire (or agree contingently to do so) any stock, obligations or securities of, or any other interest in, or make any capital contribution to, or any other investment in, any Person, other than Permitted Investments. The Borrower will not issue any memberships or other capital interest in the Borrower or any options, warrants or other rights with respec t to or securities convertible into, such interests.

(j)No Capital Expenditures. Except as expressly required or permitted by the Loan Documents, the Borrower will not make any expenditure (by long-term or operating lease or otherwise) for capital or other assets (both realty and personalty) nor will it acquire, directly or indirectly, any legal or beneficial interest in any Note or any other property. Nothing in this Section 4.01(j) shall prohibit the Borrower from making such expenditures as are necessary to (i) maintain and preserve the Equipment (and the other Borrower Collateral) and (ii) acquire Additional Equipment consistent with the terms of the Loan Documents.

(k)No Other Business; No Employees. The Borrower will not (i) engage in any business or enterprise or enter into any transaction other than as contemplated by, and in accordance with, the Loan Documents and (ii) have any employee.

(l)No Other Agreements; No Waivers. Except as expressly required or permitted by the Loan Documents, the Borrower will not enter into or be a party to any agreement or instrument other than the Loan Documents and, through the applicable Assignments, the Equipment Leases, except for such agreements and instruments as the Borrower enters into in the ordinary course of its business, nor will it amend, modify or waive any material provision of any Loan Document or give any approval, consent, permission or instruction provided for in, or take any other action under, any thereof, in each case, without the prior written consent of the Administrative Agent.

(m)No Modification of Charter Documents. The Borrower will not amend, repeal or modify the Limited Liability Company Agreement (other than Sections 4.1, 4.6, 5.3 (other than clause (a)), 5.4, 5.5 (other than clause (a)), 7.1, 7.2, 7.4, 9.2, 9.3, 9.4, 9.5, 9.6, 9.7, 9.8, 9.9, 9.10, 9.11, 9.12, and Articles X, XI, and XIV therein) or other similar organizational documents relating to the governance of the Borrower without the prior written consent of the Administrative Agent.

(n)Maintenance of Existence. The Borrower will (i) preserve and maintain its legal existence and all of its material rights, privileges and franchises, (ii) maintain its existence as a limited liability company under and in compliance with all Applicable Laws and (iii) promptly (but in any event within ten (10) days) provide the Administrative Agent with all such financial and other information concerning its affairs as the Administrative Agent may from time to time reasonably request in connection with the transactions contemplated by the Loan Documents.

(o)No Petition. To the extent it may lawfully so agree, the Borrower agrees not to (i) commence any case, proceeding or other action under any existing or future law of any jurisdiction, domestic or foreign, relating to bankruptcy, insolvency, reorganization, arrangement, adjustment, winding-up, liquidation, sequestration, dissolution, composition, or other relief with respect to it or its debts, or (ii) seek appointment of a receiver, trustee, custodian or other similar official for it or for all or any substantial part of its assets, or make a general assignment for the benefit of its creditors, or (iii) take any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the acts set forth above in clause (i) or (ii).

(p)Use of Proceeds. The Borrower will use the proceeds of the Loans in the manner specified in Section 1.07 hereof.

(q)Separate Entity. The Borrower agrees that it will (i) maintain and keep its books and records separate from any other Person; (ii) not commingle its assets with those of any other Person; (iii) conduct its business in its own name; (iv) maintain separate financial statements; (v) pay its own liabilities out of its own funds; (vi) observe all organizational formalities; (vii) maintain an arm’s length relationship with its Affiliates; and (vii) generally hold itself out as a separate entity.

(r)Recording, Further Filings, Documents, Etc. On the Closing Date and at any time thereafter, the Borrower shall take all steps as shall be required to be taken by it and as are necessary to establish and perfect the interests of the Secured Party in the Borrower Collateral, including the execution and delivery of all agreements, documents, filings and certificates (or any amendments or supplements thereto) reasonably requested by the Secured Party for such purpose. The Borrower will be responsible for and bear the expense of recording and re-recording, registering and reregistering and filing and refiling such instruments for such purpose.

(s)Authorizations. The Borrower will obtain and keep in full force and effect all authorizations from, and make and keep in full force and effect all registrations with, governmental authorities that may be required for (i) the validity or enforceability against the Borrower of this Agreement, and (ii) the validity or enforceability of the Loan Documents to which it is a party. The Borrower will in the future promptly obtain, from time to time, any and all consents, approvals, licenses and authorizations and all renewals and extensions thereof and make any and all such filings and registrations and all renewals and extensions thereof as shall now or hereafter be required under Applicable Law (including foreign exchange laws) for the entering into and perform ance by the Borrower of the Loan Documents to which it is a party and will promptly forward copies thereof to the Administrative Agent.

(t)Margin Regulations. The Borrower will not use any of the proceeds, directly or indirectly, for the purpose of purchasing or carrying any Margin Stock (as such term is defined in Regulation U issued by the Board) or to extend credit to any other person for the purpose of purchasing or carrying any Margin Stock. The Borrower will not engage principally, or as one of its important business activities, in the business of extending credit for the purpose of purchasing or carrying any Margin Stock. Neither the Borrower nor any agent acting in its behalf will take any action that might cause this Agreement or any of the documents or instruments delivered pursuant hereto to violate any regulation of the Board or to violate the Securities Exchange Act of 1934, as amended.

(u)Tax Returns. During the term of the Borrower’s obligations under this Loan Agreement and under any other Loan Documents, the Borrower, or its permitted successors or assigns, will file or cause to be filed, or will timely request an extension to file, all federal and material state and local tax returns which, to the Borrower’s knowledge, are required to be filed by the Borrower, and will pay, or make provisions to pay, all taxes which have or may become due pursuant to such returns or pursuant to any assessment received by it or any of its properties, and all other taxes, fees, or other charges imposed on it or any of its properties, other than taxes which are contested in good faith by appropriate proceedings and with respect to which the Borr ower shall provide appropriate reserves on its books in accordance with GAAP consistently applied.

(v)Solvency. The Borrower shall not incur debts which (i) cannot be paid from the then-present saleable value of its property, (ii) would be beyond its ability to pay as such debts mature, or (iii) would render it insolvent within the meaning of Section 101(32) of the United States Bankruptcy Code and Section 271 of the New York Debtor and Creditor Law.

(w)Delivery of Notices. The Borrower shall promptly deliver to the Administrative Agent copies of all notices in respect of the Borrower Collateral received by the Borrower.

(x)Concentration Limits. The Borrower shall not permit for any period in excess of sixty (60) consecutive days: (i) the ratio of the Fair Market Value of the Equipment leased to Equipment Lessees that are not Approved Lessees to the aggregate Fair Market Value of all the Equipment to exceed 0.40 to 1.0, (ii) the ratio of the Fair Market Value of the Equipment subject to leases which are on a month-to-month term to the aggregate Fair Market Value of all the Equipment to exceed 0.05 to 1.0, (iii) the ratio of the Fair Market Value of the Equipment on lease to a single Equipment Lessee that is not an Approved Lessee to the aggregate Fair Market Value of all the Equipment to exceed 0.05 to 1.0, and (iv) the ratio of the Fair Market Value of the Equipment on leas e to a single Equipment Lessee that is an Approved Lessee to the aggregate Fair Market Value of all of the Equipment to exceed 0.20 to 1.0 (the ratios specified in clauses (i) through (iv) collectively referred to as the “Concentration Ratios”).

(y)Escrow Agreement. The Borrower shall promptly (but in any event within 10 days) notify the Administrative Agent of (i) any modification or amendment to the Escrow Agreement (including any addition, withdrawal of, or assignment of the Escrow Agreement by, any Principal (as defined in the Escrow Agreement) other than the Borrower) and (ii) the receipt by the Borrower of a resignation notice from the Escrow Agent pursuant to Section 10 of the Escrow Agreement. In addition, the Borrower shall not withdraw from, agree to any amendment or modification of, or exercise any of its rights as a Principal under, the Escrow Agreement without the prior written consent of the Administrative Agent.

ARTICLE 5

EVENTS OF DEFAULT

Section 5.01Events of Default.Each of the following shall constitute an Event of Default, whatever the reason for such event and whether it shall be voluntary or involuntary, or within or without the control of the Borrower or be effected by operation of law or pursuant to any judgment or order of any court or any order, rule or regulation of any governmental or nongovernmental body:

(a)Any payment of principal of, interest on, or Funding Loss Amount related to, any of the Loans or the Notes shall not be made when and as due (whether at maturity, by reason of notice of prepayment or acceleration or otherwise) and in accordance with the terms of this Agreement and the Notes and such failure shall continue unremedied for 5 Business Days;

(b)Any Loan Document Representation and Warranty shall prove at any time to have been incorrect or misleading in any material respect when made;

(c)(i) The Borrower shall default in the performance or observance of:

(A)any term, covenant, condition or agreement contained in Clauses (a)(i), (b), (d), (e), (g), (i), (j), (k), (l), (m), (n), (o), (p), (q), (t), (v), (x) or (y) of Section 4.01 of this Agreement or Sections 3.02, 3.03 (but only to the extent that the Lien referred to therein was created or assumed by the Borrower), 3.09, 6.02 or 7.03 of the Security Agreement; or

(B)any term, covenant, condition or agreement contained in this Agreement or any other Loan Document or any Equipment Lease (other than a term, covenant, condition or agreement a default in the performance or observance of which is elsewhere in this Section specifically dealt with) and, if capable of being remedied, such default shall continue unremedied for a period of 30 days after (x) a Responsible Officer of the Borrower has become aware or, in the exercise of his or her normal duties, should have become aware of the same or (y) notice shall have been given by the Administrative Agent to the Borrower requiring that such default be cured; provided that, no such failure shall constitute an Event of Default hereunder for a period of 30 days so long as such failure is capable of being remedied and the Borrower is diligently proceeding to remedy such failure;

(ii)Any Loan Party shall default in the performance or observance of:

(A)any term, covenant, condition or agreement contained in Sections 3.01(a), (b), (c) (but only to the extent the financing statement or like instrument referred therein was filed or authorized to be filed by such Loan Party), (d)(i), (d)(ii), 3.03, 3.06, 3.08 or 3.10 of the Pledge Agreement to which such Loan Party is a party; or

(B)any term, covenant, condition or agreement contained in any Loan Document (other than any term, covenant, condition or agreement a default in the performance or observance of which is elsewhere in this Section specifically dealt with) and, if capable of being remedied, such default shall continue unremedied for a period of 30 days after notice shall have been given by the Administrative Agent to such Loan Party requiring that such default be cured; provided that, no such failure shall constitute an Event of Default hereunder for a period of 30 days so long as such failure is capable of being remedied and such Loan Party is diligently proceeding to remedy such failure;

(d)The Borrower shall fail to perform any material (i) term, (ii) condition or (iii) covenant of any bond, note, debenture, loan agreement, indenture, trust agreement, mortgage or similar instrument to which the Borrower is a party or by which it is bound, or by which any of its properties or assets may be affected, or an “Event of Default” or “event of default” shall occur under any of the foregoing instruments, and, as a result thereof, after the expiration of any applicable grace period, if any, any indebtedness included therein or secured thereby shall have been declared due and payable in accordance with the provisions of the instrument evidencing or creating or securing such indebtedness prior to the date on which such indebtedness would otherwise have become due and payable;

(e)(i) The Borrower, all Pledgors, or a Majority Pledgor, if any, shall (A) commence a voluntary case under the Federal bankruptcy laws (as now or hereafter in effect), (B) file a petition seeking to take advantage of any other laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debts, (C) consent to or fail to contest in a timely and appropriate manner any petition filed against it in an involuntary case under such bankruptcy laws or other laws, (D) apply for, or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver, custodian, trustee, liquidator or the like of itself or of a substantial part of its assets, domestic or foreign, (E) admit in writing its inabili ty to pay, or generally not be paying, its debts (other than those that are the subject of bona fide disputes) as they become due, (F) make a general assignment for the benefit of creditors, or (G) take any limited liability company action for the purpose of effecting any of the foregoing;

(ii) (A) A case or other proceeding shall be commenced against the Borrower, all Pledgors, or a Majority Pledgor, if any, seeking (1) relief under the Federal bankruptcy laws (as now or hereafter in effect) or under any other laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debts, or (2) the appointment of a trustee, receiver, custodian, liquidator or the like of the Borrower, all Pledgors, or a Majority Pledgor, if any, or of all or any substantial part of the assets, domestic or foreign, of the Borrower, all Pledgors, or a Majority Pledgor, if any, and such case or proceeding shall continue undismissed and unstayed for a period of 30 days, or (B) an order granting the relief requested in such case or proceeding against the Borrower, all Pledgors, or a Majority Pledgor, if any, (including an order for relief un der such Federal bankruptcy laws) shall be entered;

(f)A judgment or order shall be entered against the Borrower by any court, and (i) in the case of a judgment or order for the payment of money, either (A) such judgment or order shall continue undischarged and unstayed for a period of 10 days in which the aggregate amount of all such judgments and orders exceeds $100,000 or (B) enforcement proceedings shall have been commenced upon such judgment or order and (ii) in the case of any judgment or order for other than the payment of money, such judgment or order could, in the reasonable judgment of the Majority Lenders, together with all other such judgments or orders, have a Materially Adverse Effect on the Borrower;

(g)The Security Agreement shall cease to create in favor of the Secured Party a valid, perfected first priority security interest in and lien on any of the Borrower Collateral therein (except as otherwise therein provided with respect to Permitted Liens);

(h)   The Pledge Agreement shall cease to create in favor of the Secured Party a valid, perfected first priority security interest in and lien on any of the Pledgors Collateral therein;

(i)   (1) any Termination Event shall occur with respect to any Benefit Plan of the Borrower or any of its ERISA Affiliates, (2) any Accumulated Funding Deficiency, whether or not waived, shall exist with respect to any such Benefit Plan, (3) any Person shall engage in any Prohibited Transaction involving any such Benefit Plan, (4) the Borrower or any of its ERISA Affiliates shall be in “default” (as defined in ERISA Section 4219(c)(5)) with respect to payments owing to any such Benefit Plan that is a Multiemployer Benefit Plan as a result of such Person’s complete or partial withdrawal (as described in ERISA Section 4203 or 4205) therefrom, (5) the Borrower or any of its ERISA Affiliates shall fail to pay when due an amount that is payable by it to the PBGC or to any such Benefit Plan under Title IV of ERISA, (6) a proceeding shall be instituted by a fiduciary of any such Benefit Plan against the Borrower or any of its ERISA Affiliates to enforce ERISA Section 515 and such proceeding shall not have been dismissed within 30 days thereafter, or (7) any other event or condition shall occur or exist with respect to any such Benefit Plan, except that no event or condition referred to in clauses (1) through (7) shall constitute an Event of Default if it, together with all other such events or conditions at the time existing, has not subjected, and in the reasonable determination of the Majority Lenders will not subject, the Borrower to any Liability that, alone or in the aggregate with all such Liabilities under this Section 5.01(i) for all such Persons, exceed $500,000;

(j)Any Loan Party or any Affiliate of any Loan Party asserts in writing, or any Loan Party or any Affiliate of any Loan Party or any other Person institutes any proceedings seeking to establish, that (i) any provision of the Loan Documents is invalid, not binding or unenforceable, or (ii) the Security Interest is not a valid and perfected first priority security interest in the Collateral subject only to, in the case of the Security Interest under the Security Agreement, Permitted Liens;

(k)   The Borrower shall make or suffer any unauthorized assignment or transfer of any Item of Equipment or of the right to possession of any thereof (except as provided in the Equipment Leases);

(l)MILPI shall at any time beneficially own, directly or indirectly, less than 100% of the membership interest in the Manager; or

(m)  (i) The Management Agreement shall terminate or otherwise cease to be in effect for any reason and the Borrower and PLM have not entered into a new agreement that has substantially similar terms and has been approved by the Administrative Agent, (ii) PLM shall no longer act as Manager (unless removed by the Administrative Agent following a default under the Management Agreement) or (iii) PLM does not maintain a management team consistent with the quality of the existing PLM management team.

Section 5.02Remedies upon Event of Default. During the continuance of any Event of Default (other than one specified in Section 5.01(e)) and in every such event, the Administrative Agent may, or upon the request of the Majority Lenders, shall, upon notice to the Borrower, declare, in whole or, from time to time, in part, the principal of and interest on the Loans and the Notes and all other amounts owing under the Loan Documents to be, and the Loans and the Notes and all such other amounts shall thereupon and to that extent become, due and payable. Upon the occurrence of an Event of Default specified in Section 5.01(e), automatically and without any notice to the Borrower, the principal of and interest on t he Loans and the Notes and all other amounts owing under the Loan Documents shall be due and payable. Presentment, demand, protest or notice of any kind (other than the notice provided for in the first sentence of this Section 5.02) are hereby expressly waived.

ARTICLE 6

REGISTRATION OF THE NOTE

Section 6.01Registered Notes.A Lender may have its Note issued as a Registered Note, and for this purpose the Borrower shall cause to be maintained a register of the registration of any such Note (such register herein called the “Register”). Once issued, a Registered Note may not be exchanged for a Note that is not a Registered Note and the ownership of a Registered Note, and of the Loan evidenced thereby, may be transferred provided that such transfer shall not be effective unless (a) such Registered Note shall have been surrendered for registration of assignment duly endorsed by (or accompanied by a written instrument of assignment duly executed by) the Registered Holder and such assig nment shall have been recorded on the Register and (b) the transfer of such Registered Note was made in accordance with the provisions of Section 8.09(a)(ii).

ARTICLE 7

THE ADMINISTRATIVE AGENT

Section 7.01Appointment and Powers.Each Lender hereby irrevocably appoints and authorizes HSH Nordbank AG, and HSH Nordbank AG hereby agrees, to act as the agent for and representative (within the meaning of Section 9-102(a)(72) of the Uniform Commercial Code) of such Lender under the Loan Documents with such powers as are delegated to the Administrative Agent and the Secured Party by the terms thereof, together with such other powers as are reasonably incidental thereto. The Administrative Agent’s duties shall be purely ministerial and it shall have no duties or responsibilities except those express ly set forth in the Loan Documents. The Administrative Agent shall not be required under any circumstances to take any action that, in its judgment, (a) is contrary to any provision of the Loan Documents or Applicable Law or (b) would expose it to any Liability or expense against which it has not been indemnified to its satisfaction. The Administrative Agent shall not, by reason of its serving as the Administrative Agent, be a trustee or other fiduciary for any Lender.

Section 7.02Limitation on Administrative Agent’s Liability.Neither the Administrative Agent nor any of its directors, officers, employees or agents shall be liable or responsible for any action taken or omitted to be taken by it or them under or in connection with the Loan Documents, including, without limitation, any determinations the Administrative Agent may make in its capacity as Administrative Agent or Secured Party in respect of the Collateral, except for its or their own gross negligence, willful misconduct or knowing violations of law. The Administrative Agent shall not be responsible to any Lender for (a) any recita ls, statements, representations or warranties contained in the Loan Documents or in any certificate or other document referred to or provided for in, or received by any of the Lenders under, the Loan Documents, (b) the validity, effectiveness or enforceability of the Loan Documents or any such certificate or other document, (c) the value or sufficiency of the Collateral, including, without limitation, the creditworthiness of any Equipment Lessee or (d) any failure by the Borrower to perform any of its obligations under the Loan Documents. The Administrative Agent may employ agents and attorneys-in-fact and shall not be responsible for the negligence or misconduct of any such agents or attorneys-in-fact so long as the Administrative Agent was not grossly negligent in selecting or directing such agents or attorneys-in-fact. The Administrative Agent shall be entitled to rely upon any certification, notice or other communication (including any thereof by telephone, telex, telecopier, telegram or cable) believed by it to be genuine and correct and to have been signed or given by or on behalf of the proper Person or Persons, and upon advice and statements of legal counsel, independent accountants and other experts selected by the Administrative Agent. As to any matters not expressly provided for by this Agreement or any other Loan Document (including, without limitation, enforcement or collection of the Notes), the Administrative Agent shall not be required to exercise any discretion or take any action, but shall be required to act or refrain from acting (and shall be fully protected in so acting or refraining from acting) upon the instructions of the Majority Lenders and such instructions shall be binding upon all Lenders.

Section 7.03Defaults.The Administrative Agent shall not be deemed to have knowledge of the occurrence of an Event of Default (other than the non-payment to it of principal of or interest on Loans or fees) unless the Administrative Agent has received notice from a Lender or the Borrower specifying such that an Event of Default has occurred and stating that such notice is a “Notice of Default”. In the event that the Administrative Agent has knowledge of such a non-payment or receives such a Notice of Default, the Administrative Agent shall give prompt notice thereof to the Lenders. In the event of any Default, the Administrative Agent shall (a) in the case of a Default that constitutes an Event of Default, take the actions referred to in the last paragraph Section 6.01 if so directed by the Majority Lenders and (b) in the case of any other Default, take such other action with respect to such Default as shall be reasonably directed by the Majority Lenders. Unless and until the Administrative Agent shall have received such directions, in the occurrence of any Event of Default, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such Event of Default as it shall deem advisable in the best interests of the Lenders.

Section 7.04Rights as a Lender.Each Person acting as the Administrative Agent that is also a Lender shall, in its capacity as a Lender, have the same rights and powers under the Loan Documents as any other Lender and may exercise the same as though it were not acting as the Administrative Agent, and the term “Lender” or “Lenders” shall include such Person in its individual capacity. Each Person acting as the Administrative Agent (whether or not such Person is a Lender) and its Affiliates may (without having to account therefor to any Lender) accept deposits from, lend money to and generally engage in any kind of banking, trust or other business with the Borrower and its Affiliates as if it were not acting as the Administrative Agent, and such Person and its Affiliates may accept fees and other consideration from the Borrower and its Affiliates for services in connection with the Loan Documents or otherwise without having to account for the same to the Lenders.

Section 7.05Indemnification.The Lenders agree to indemnify the Administrative Agent (to the extent not reimbursed by the Borrower under the Loan Documents), ratably on the basis of the respective principal amounts of the Loans outstanding made by the Lenders (or, if no Loans are at the time outstanding, ratably on the basis of their respective Commitments), for any and all liabilities, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind and nature whatsoever that may be imposed on, incurred by or asserted against the Administrative Agent (including the costs and expenses that the Borrower is obligated to pay under the Loan Documents) in any way relating to or arising out of the Loan Documents or any other documents contemplated thereby or referred to therein or the transactions contemplated thereby or the enforcement of any of the terms thereof or of any such other documents, provided that no Lender shall be liable for any of the foregoing to the extent they arise from gross negligence, willful misconduct or knowing violations of law by the Administrative Agent.

Section 7.06Non-Reliance on Administrative Agent and Other Lenders.Each Lender agrees that it has made and will continue to make, independently and without reliance on the Administrative Agent or any other Lender, and based on such documents and information as it deems appropriate, its own credit analysis of the Borrower, its own evaluation of the Collateral, including, without limitation, the creditworthiness of any Equipment Lessee, and its own decision to enter into the Loan Documents and to take or refrain from taking any action in connection therewith. The Administrative Agent shall not be required to kee p itself informed as to the performance or observance by the Borrower of the Loan Documents or any other document referred to or provided for therein or to inspect the properties or books of the Borrower or the Collateral. The Administrative Agent shall provide to each of the Lenders copies of all reports, notices and certificates to be furnished to the Administrative Agent by the Borrower pursuant to Section 4.01(a) hereof and copies of all other reports, notices and certificates and other documents and information expressly required to be furnished to the Administrative Agent by Borrower or any other Person under the Loan Documents. Except for notices, reports, certificates and other documents and information expressly required to be furnished to the Lenders by the Administrative Agent under the Loan Documents, the Administrative Agent shall have no obligation to provide any Lender with any information concerning the business, status or condition of the Borrower, the Loan Documents or the Collateral that m ay come into the possession of the Administrative Agent or any of its Affiliates.

Section 7.07Execution and Amendment of Loan Documents on Behalf of the Lenders. Each Lender hereby authorizes the Administrative Agent to execute and deliver, in the name of and on behalf of such Lender, (a) the Security Agreement, (b) all UCC financing and continuation statements and other documents the filing or recordation of which are, in the determination of the Administrative Agent, necessary or appropriate to create, perfect or maintain the existence or perfected status of the Lien created by the Security Agreement, including, without limitation, any amendments or supplements to any of the Loan Documents and (c) any other L oan Document requiring execution by or on behalf of such Lender. The Administrative Agent shall consent to any amendment of any term, covenant, agreement or condition of the Security Agreement or any other Loan Documents, or to any waiver of any right thereunder or termination thereof, if, but only if, the Administrative Agent is directed to do so in writing by the Majority Lenders; provided, however, that (i) the Administrative Agent shall not be required to consent to any such amendment or waiver that affects its rights or duties and (ii) the Administrative Agent shall not, unless directed to do so in writing by each Lender affected thereby, (A) consent to any assignment by the Borrower of any of its rights or obligations under any such agreement, (B) release any Borrower Collateral from the Lien created by the Security Agreement, except as required or contemplated by the Loan Documents, (C) consent to any amendme nt or waiver that (w) changes the amount of such Lender’s Commitment while such Commitment remains outstanding, (x) reduces or increases the principal of or reduces the rate of interest on such Lender’s Loans or Notes or the fees or other amounts payable to such Lender hereunder, (y) postpones any date fixed (otherwise than as a result of prepayment) for any payment of principal of or interest on such Lender’s Loans or Notes or the fees payable to such Lender hereunder, (z) amends this Section 7.07 or any other provision of this Agreement requiring the consent or other action of all of the Lenders, (aa) modifies the definition of “Majority Lenders” or modifies in any manner the number or percentage of the Lenders required to make any determinations or to waive any rights hereunder, (bb) waives any of the conditions precedent to the making of Loans hereunder, (cc) modifies the obligation of the Borrower to cause the LTV Ratio not to exceed 75% at any time, or (dd) modifies the Concent ration Limits set forth in Section 4.01(x) hereof.

Section 7.08Resignation of the Administrative Agent.  (a) The Administrative Agent may at any time give notice of its resignation to the Lenders and the Borrower. Upon receipt of any such notice of resignation, the Majority Lenders may, after consultation with the Borrower or without consultation with the Borrower if an Event of Default has occurred and is continuing, appoint a successor Administrative Agent. If no successor Administrative Agent shall have been so appointed by the Majority Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent’s giving of notice of resignation, then the retiring Administrative Agent may, on behalf of the Lenders and after consultation with the Borrower, appoint a successor Administrative Agent. Upon the acceptance by any Person of its appointment as a successor Administrative Agent, (a) such Person shall thereupon succeed to and become vested with all the rights, powers, privileges, duties and obligations of the retiring Administrative Agent and the retiring Administrative Agent shall be discharged from its duties and obligations as Administrative Agent under the Loan Documents and (b) the retiring Administrative Agent shall promptly transfer all Collateral within its possession or control to the possession or control of the successor Administrative Agent and shall execute and deliver such notices, instructions and assignments as may be necessary or desirable to transfer the rights of the Administrative Agent with respect to the Collateral to the successor Administrative Agent. After any the resignation of any Administrati ve Agent as Administrative Agent, the provisions of this Article 7 shall continue in effect for its benefit in respect of any actions taken or omitted to be taken by it while it was acting as the Administrative Agent.

ARTICLE 8

MISCELLANEOUS

Section 8.01Notices and Deliveries.  (a)Notices and Materials Other than Collateral.

Except as provided in Section 8.01(b):

(i)Manner of Delivery. All notices, communications and materials to be given or delivered pursuant to the Loan Documents shall, except in those cases where giving notice by telephone is expressly permitted, be given or delivered in writing (which shall include telecopy transmissions). Notices under Sections 1.02, 1.05 and 5.02 may be by telephone, promptly, in the case of each notice other than one under Section 5.02, confirmed in writing. In the event of a discrepancy between any telephonic notice and any written confirmation thereof, such written confirmation shall be deemed the effective notice except to the extent that the Administrative Agent has acted in reliance on such telephonic notice.

(ii)Addresses. All notices, communications and materials to be given or delivered pursuant to the Loan Documents shall be given or delivered at the following respective addresses and telecopier and telephone numbers and to the attention of the following individuals or departments:

(A)if to the Borrower, at its address at:

PLM Rail Partners, LLC

One North LaSalle Street, Suite 2700

Chicago, Illinois 60602

Telecopier No.: 312-857-1030

Attention: Michael Clayton

with a copy to:

Chapman and Cutler LLP

111 West Monroe Street

Chicago, Illinois 60603

Telecopier No.: 312-701-2361

Attention: Michael G. McGee

(B)if to the Administrative Agent, at its address at:

HSH Nordbank AG, New York Branch

590 Madison Avenue, 28^th Floor

New York, NY 10022

Telecopier No.: 212-407-6033

Attention: Kristie Li

with a copy to:

Pillsbury Winthrop LLP

1540 Broadway

New York, NY 10036

Telecopier No.: 212-858-1500

Attention: Jonathan B. Whitney, Esq.

(C)if to any Lender, to it at the address or telex , telecopier or telephone number and to the attention of the individual or department, set forth below such Lender’s name under the heading “Notice Address” on Annex A or, in the case of a Lender that becomes a Lender pursuant to an assignment, set forth under the heading “Notice Address” in the Notice of Assignment given to the Borrower and the Administrative Agent with respect to such assignment;

or at such other address or telecopier or telephone number or to the attention of such other individual or department as the party to which such information pertains may hereafter specify for the purpose in a notice specifically captioned “Notice of Change of Address” given to (x) if the party to which such information pertains is the Borrower, the Administrative Agent and each Lender, (y) if the party to which such information pertains is the Administrative Agent, the Borrower and each Lender and (z) if the party to which such information pertains is a Lender, the Borrower and the Administrative Agent.

(iii)Effectiveness. Each notice and communication and any material to be given or delivered pursuant to the Loan Documents shall be deemed so given or delivered (A) if sent by registered or certified mail, postage prepaid, return receipt requested, on the third Business Day after such notice, communication or material, addressed as above provided, is delivered to a United States post office and a receipt therefor is issued thereby, (B) if sent by any other means of physical delivery, when such notice, communication or material is delivered to the appropriate address as above provided, (C) if sent by telecopier, when such notice, communication or material is transmitted to the appropriate telecopier number as above provided and is received at such number and (D) if given by tel ephone, when communicated to the individual or any member of the department specified as the individual or department to whose attention notices, communications and materials are to be given or delivered, or, in the case of notice by the Administrative Agent to the Borrower under Section 5.02 given by telephone as above provided, if any individual or any member of the department to whose attention notices, communications and materials are to be given or delivered is unavailable at the time, to any other officer or employee of the Borrower, except that (x) notices of a change of address, telecopier or telephone number or individual or department to whose attention notices, communications and materials are to be given or delivered shall not be deemed given until received and (y) notices, communications and materials to be given or delivered to the Administrative Agent or any Lender pursuant to Sections 1.02, 1.05 and 1.12(b) and Article 4 shall not be deemed given or delivered until received by the officer of the Administrative Agent or such Lender responsible, at the time, for the administration of the Loan Documents.

(iv)Reasonable Notice. Any requirement under Applicable Law of reasonable notice by the Administrative Agent or the Lenders to the Borrower of any event in connection with, or in any way related to, the Loan Documents or the exercise by the Administrative Agent or the Lenders of any of their rights thereunder shall be met if notice of such event is given to the Borrower in the manner prescribed above at least 10 days before (A) the date of such event or (B) the date after which such event will occur.

(b)Collateral. Until the Administrative Agent shall otherwise specify, all Borrower Collateral to be delivered to the Administrative Agent pursuant to the Loan Documents consisting of instruments, securities, chattel paper, letters of credit or documents shall be delivered to the Administrative Agent at the Administrative Agent’s Office either by hand delivery or by registered or certified mail, postage prepaid, return receipt requested, in either case insured in an amount not less than the greater of the aggregate face amount and the aggregate fair market value of the Borrower Collateral so being delivered. All other Borrower Collateral to be delivered to the Administrative Agent pursuant to the Loan Documents shall be delivered to such Person, at such address, by such means and in such manner as the Administrative Agent may designate.

Section 8.02Expenses; Indemnification.Whether or not any Loans are made hereunder, the Borrower shall:

(a)pay or reimburse the Administrative Agent and each Lender for all transfer, documentary, stamp and similar taxes, and all recording and filing fees and taxes, payable in connection with, arising out of, or in any way related to, the execution, delivery and performance of the Loan Documents or the making of the Loans;

(b)pay or reimburse the Administrative Agent for all costs and expenses (including fees and disbursements of legal counsel, appraisers, accountants and other experts employed or retained by the Administrative Agent) incurred by the Administrative Agent in connection with, arising out of, or in any way related to (i) the negotiation, preparation, execution and delivery of (A) the Loan Documents and (B) whether or not executed, any waiver, amendment or consent thereunder or thereto, (ii) the administration of and any operations under the Loan Documents, (iii) consulting with respect to any matter in any way arising out of, related to, or connected with, the Loan Documents, including (A) the protection or preservation of the Borrower Collateral, (B) the protection, preservation, exercise or enforcement of an y of the rights of the Administrative Agent or the Lenders in, under or related to the Borrower Collateral or the Loan Documents or (C) the performance of any of the obligations of the Administrative Agent or the Lenders under or related to the Loan Documents, (iv) protecting or preserving the Borrower Collateral or (v) protecting, preserving, exercising or enforcing any of the rights of the Administrative Agent or the Lenders in, under or related to the Borrower Collateral or the Loan Documents , including defending the Security Interest as a valid, perfected, first priority security interest in the Borrower Collateral subject only to Permitted Liens;

(c)pay or reimburse each Lender for all costs and expenses (including fees and disbursements of legal counsel and other experts employed or retained by such Lender) incurred by such Lender in connection with, arising out of, or in any way related to (i) the negotiation, preparation, execution and delivery of (A) the Loan Documents and (B) whether or not executed, any waiver, amendment or consent thereunder or thereto, (ii) consulting with respect to (A) the protection, preservation, exercise or enforcement of any of its rights in, under or related to the Borrower Collateral or the Loan Documents or (B) the performance of any of its obligations under or related to the Loan Documents or (iii) protecting, preserving, exercising or enforcing any of its rights in, under or related to the Borrower Collateral or the Loan Documents; and

(d)indemnify and hold each Indemnified Person harmless from and against all losses (including judgments, penalties and fines) suffered, and pay or reimburse each Indemnified Person for all costs and expenses (including fees and disbursements of legal counsel and other experts employed or retained by such Indemnified Person) incurred, by such Indemnified Person in connection with, arising out of, or in any way related to (i) any Loan Document Related Claim (whether asserted by such Indemnified Person or the Borrower or any other Person), including the prosecution or defense thereof and any litigation or proceeding with respect thereto (whether or not, in the case of any such litigation or proceeding, such Indemnified Person is a party thereto), or (ii) any investigation, governmental or otherwise, arising out of, related to, or in any way connected with, the Loan Documents or the relationships established thereunder, except that the foregoing indemnity shall not be applicable to any loss suffered by any Indemnified Person to the extent such loss is determined by a judgment of a court that is binding on the Borrower and such Indemnified Person, final and not subject to review on appeal, to be the result of acts or omissions on the part of such Indemnified Person constituting (x) gross negligence or willful misconduct, (y) knowing violations of law or (z) in the case of claims by the Borrower against such Indemnified Person, such Indemnified Person’s failure to observe any other standard applicable to it under any of the other provisions of the Loan Documents or, but only to the extent not waivable thereunder, Applicable Law.

Section 8.03Amounts Payable Due upon Request for Payment.All amounts payable by the Borrower under Section 8.02 and under the other provisions of the Loan Documents shall, except as otherwise expressly provided, be immediately due upon request for the payment thereof.

Section 8.04Remedies of the Essence.The various rights and remedies of the Administrative Agent and the Lenders under the Loan Documents are of the essence of those agreements, and the Administrative Agent and the Lenders shall be entitled to obtain a decree requiring specific performance of each such right and remedy.

Section 8.05Rights Cumulative.Each of the rights and remedies of the Administrative Agent and the Lenders under the Loan Documents shall be in addition to all of their other rights and remedies under the Loan Documents and Applicable Law, and nothing in the Loan Documents shall be construed as limiting any such rights or remedies.

Section 8.06Amendments; Waivers.xl) Any term, covenant, agreement or condition of the Loan Documents may be amended, and any right under the Loan Documents may be waived, if, but only if, such amendment or waiver is in writing and is signed by (i) in the case of an amendment or waiver with respect to the Loan Documents referred to in Section 7.07(a), the Administrative Agent, (ii) in the case of an amendment or waiver with respect to any other Loan Document, the Majority Lenders and, if the rights and duties of the Administrative Agent are affected thereby, by the Administrative Agent and (iii) in the case of an amendment with respect to any Loan Document, by the Borrower; provided, however, that no amendment or waiver shall be effective, unless in writing and signed by each Lender affected thereby, to the extent it (A) changes the amount of such Lender’s Commitment, (B) reduces the principal of or the rate of interest on such Lender’s Loans or Notes or the fees payable to such Lender hereunder, (C) postpones any date fixed (otherwise than as a result of a prepayment) for any payment of principal of or interest on such Lender’s Loans or Notes or (D) amends this Section 8.06 or any other provision of this Agreement requiring the consent or other action of all of the Lenders. Unless otherwise specified in such waiver, a waiver of any right under the Loan Documents shall be effective only in the specific instance and for the specific purpose for which given. No election not to exercise, failure to exercise or delay in exercising any right, nor any course of dealing or performance, shall oper ate as a waiver of any right of the Administrative Agent or any Lender under the Loan Documents or Applicable Law, nor shall any single or partial exercise of any such right preclude any other or further exercise thereof or the exercise of any other right of the Administrative Agent or any Lender under the Loan Documents or Applicable Law.

Section 8.07Set-Off; Suspension of Payment and Performance.The Administrative Agent and each Lender is hereby authorized by the Borrower, at any time and from time to time, without notice, (a) during any Event of Default, to set off against, and to appropriate and apply to the payment of, the Liabilities of the Borrower under the Loan Documents (whether owing to such Person or to any other Person that is the Administrative Agent or a Lender and whether matured or unmatured, fixed or contingent or liquidated or unliquidated) any and all Liabilities owing by such Person or any of its Affiliates to the Borrower (whether payable in Dollars or any other currency, whether matured or unmatured and, in the case of Liabi lities that are deposits, whether general or special, time or demand and however evidenced and whether maintained at a branch or office located within or without the United States) and (b) during any Default, to suspend the payment and performance of such Liabilities owing by such Person or its Affiliates in an amount of the Loans plus interest accrued thereon and other amounts then due and payable under the Loan Documents and, in the case of Liabilities that are deposits, to the extent necessary, to return as unpaid for insufficient funds any and all checks and other items drawn against such deposits.

Section 8.08Sharing of Recoveries.  (a) Each Lender agrees that, if, for any reason, including as a result of (i) the exercise of any right of counterclaim, set-off, banker’s lien or similar right, (ii) its claim in any applicable bankruptcy, insolvency or other similar law being deemed secured by a debt owed by it to the Borrower, including a claim deemed secured under Section 506 of the Bankruptcy Code, or (iii) the allocation of payments by the Administrative Agent or the Borrower in a manner contrary to the provisions of Section 1.14, such Lender shall receive payment of a proportion of the aggreg ate amount due and payable to it hereunder as principal of or interest on the Loans that is greater than the proportion received by any other Lender in respect of the aggregate of such amounts due and payable to such other Lender hereunder, then the Lender receiving such proportionately greater payment shall purchase participations (which it shall be deemed to have done simultaneously upon the receipt of such payment) in the rights of the other Lenders hereunder so that all such recoveries with respect to such amounts due and payable hereunder (net of costs of collection) shall be pro rata among the Lenders; provided that if all or part of such proportionately greater payment received by the purchasing Lender is thereafter recovered by or on behalf of such Lender, such purchases shall be rescinded and the purchase prices paid for such participations shall be returned to such Lender to the extent of such recovery, but without interest (unless the purchasing Lender is required to pay interest on the amount rec overed to the Person recovering such amount, in which case the selling Lender shall be required to pay interest at a like rate). The Borrower expressly consents to the foregoing arrangements and agrees that any holder of a participation in any rights hereunder so purchased or acquired pursuant to this Section 8.08(a) shall, with respect to such participation, be entitled to all of the rights of a Lender under Sections 1.08, 1.09, 1.10, 8.02 and 8.07 (subject to any condition imposed on a Lender hereunder with respect thereto) and may exercise any and all rights of set-off with respect to such participation as fully as though the Borrower were directly indebted to the holder of such participation for Loans in the amount of such participation.

(b)Each Lender agrees that, in the event it exercises any right of counterclaim, set-off, banker’s lien or similar right that it may have in respect of the Borrower in a manner so as to apportion the amount subject to such exercise, on a pro rata basis, between (i) obligations of the Borrower for amounts subject to the sharing provisions of Section 8.08(a) and (ii) other obligations of the Borrower owing to such Lender in its individual capacity and not as an agent or similar capacity, provided that nothing contained in this Section 8.08 shall require any Lender to exercise any such right or shall affect the right of any Lender to exercise, and retain the benefit of, any such right with respect to any other indebtedness or other obligation of the Bo rrower to such Lender.

Section 8.09Assignments and Participations.  (a)Assignments.(i) The Borrower may not assign any of its rights or obligations under the Loan Documents without the prior written consent of (A) in the case of the Loan Documents referred to in Section 7.07(a), the Administrative Agent and (B) in the case of any of the other Loan Documents, each Lender, and no assignment of any such obligation shall release the Borrower therefrom unless the Administrative Agent or each Lender, as applicable, shall have c onsented to such release in a writing specifically referring to the obligation from which the Borrower is to be released.

(ii)Each Lender may from time to time assign any or all of its rights and obligations under the Loan Documents to one or more Persons, without the consent of the Borrower; provided that, no such assignment shall be effective unless (A) the assignment is consented to by the Administrative Agent and, so long as no Event of Default has occurred and is continuing, the Borrower, which consents shall not be unreasonably withheld or delayed, (B) a Notice of Note Assignment with respect to the assignment, duly executed by the assignor and the assignee, shall have been given to the Borrower and the Administrative Agent, (C) in the case of an assignment of a Registered Note, such Registered Note shall have been surrendered for registration of assignment duly endorsed by (or accompanied by a written instrument of assignment duly executed by) the Registered Holder and such assignment shall have been recorded on the Register and (D) except in the case of an assignment by the Lender that is the Administrative Agent, the Administrative Agent shall have been paid an assignment fee of $2,500. Upon any effective assignment, the assignee shall have all of the rights and shall be obligated to perform all of the obligations of a Lender; provided, however, that no assignee shall be entitled to any amounts that would otherwise be payable to it with respect to its assignment under Section 1.06, 1.09 or Section 1.10 unless (x) such amounts are payable in respect of a Regulatory Change Enacted after the date the applicable assignment agreement was executed or (y) such amounts would have been payable to the Lender that made such assignment if such assignment had not been made. In the event of a ny effective assignment by a Lender, the Borrower shall, against (except in the case of a partial assignment) receipt of the existing Note of the assignor Lender, issue a new Note to the assignee Lender.

(b)Participations.Each Lender may from time to time sell or otherwise grant participations in any or all of its rights and obligations under the Loan Documents without the consent of the Borrower, the Administrative Agent or any other Lender; provided, however, that for so long as no Event of Default or Default occurs, in no event shall any Lender sell a participation to any Person who is an operating lessor of Rolling Stock and a competitor of the Borrower without the written consent of the Borrower (as the circumstances may require). Each Lender undertakes to request the prior written consent of the Borrower be fore selling any participation to an operating lessor of Rolling Stock, provided that any refusal by the Borrower to consent to any such transfer shall be accompanied by a certification, in form and substance reasonably satisfactory to the Lender, that such prospective participant is a competitor of the Borrower and shall be delivered to the Lender within twenty-five (25) days of the date the Lender requests Borrower’s consent. In the event of any such grant by a Lender of a participation, such Lender’s obligations under the Loan Documents to the other parties thereto shall remain unchanged, such Lender shall remain solely responsible for the performance thereof, and the Borrower, the Administrative Agent and the other Lenders may continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations thereunder. A Lender may not grant to any holder of a participation the right to require such Lender to take or omit to take any action under the Loan Docume nts, except that a Lender may grant to any such holder the right to require such holder’s consent to (i) reduce the principal of or the rate of interest on such Lender’s Loans or the fees payable to such Lender hereunder, (ii) postpone any date fixed for any payment of principal of or interest on such Lender’s Loans or the fees payable to such Lender hereunder, (iii) permit any Loan Party to assign any of its obligations under the Loan Documents to any other Person, or (iv) release any Collateral from the Security Interest except as required or contemplated by the Loan Documents. Each holder of a participation in any rights under the Loan Documents, if and to the extent the applicable participation agreement so provides, shall, with respect to such participation, be entitled to all of the rights of a Lender as fully as though it were a Lender and may exercise any and all rights of set-off with respect to such participation as fully as though the Borrower were directly indebted to the holder of such participation for Loans in the amount of such participation; provided, however, that no holder of a participation shall be entitled to any amounts that would otherwise be payable to it with respect to its participation under Section 1.06, 1.09 or Section 1.10 unless (x) such amounts are payable in respect of a Regulatory Change Enacted after the date the applicable participation agreement was executed or (y) such amounts would have been payable to the Lender that granted such participation if such participation had not been granted. Each Lender selling or granting a participation, including a participation sold pursuant to Section 8.09 shall indemnify the Borrower and the Administrative Agent for any Taxes and Liabilities that they may sustain as a result of such Lender’s failure to withhold and pay any Taxes applicable to payments by such Lender to its participant in respect of such participation.

(c)Federal Reserve Bank. Notwithstanding any other provision set forth in this Agreement, any Lender may at any time assign and pledge all or any portion of its Loans to any Federal Reserve Bank as collateral security pursuant to Regulation A and any operating circular issued by such Federal Reserve Bank. No such assignment shall release the assigning Lender from its obligations hereunder.

Section 8.10Governing Law.The rights and duties of the Borrower, the Administrative Agent and the Lenders under this Agreement and the Notes (including matters relating to the Maximum Permissible Rate) shall, pursuant to New York General Obligations Law Section 5-1401, be governed by the law of the State of New York.

Section 8.11Submission to Jurisdiction. (a) Each of the Borrower, the Administrative Agent and the Lenders hereby irrevocably submits to the nonexclusive jurisdiction of the Supreme Court of the State of New York, New York County, and to the jurisdiction of the United States District Court for the Southern District of New York, for the purposes of any suit, action or other proceeding arising out of this Agreement or the subject matter hereof brought by any party or its successors or assigns, and each of the parties hereto hereby irrevocably agrees that all claims in respect of such ac tion or proceeding may be heard and determined in such New York State court or, to the fullest extent permitted by law, in such Federal court, and each of the parties hereto hereby agrees not to assert, by way of motions as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of the above-named courts, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such courts. The Borrower hereby waives personal service of process and consents that service of process upon it may be made by certified or registered mail, return receipt requested, at its address specified or determined in accordance with the provisions of Section 8.01(a)(ii), and service so made shall be deemed completed on the third Business Day after such service is deposited in the mail. Nothing herein shall affect th e right of the Administrative Agent, any Lender or any other Indemnified Person to serve process in any other manner permitted by law or shall limit the right of the Administrative Agent, any Lender or any other Indemnified Person to bring proceedings against the Borrower in the courts of any other jurisdiction.

(b)The due payment and performance of the obligations of the Borrower under the Loan Documents shall be without regard to any counterclaim or right of offset or any other claim which the Borrower may have against any Lender or the Administrative Agent, and no such counterclaim (other than a compulsory counterclaim) or offset shall be asserted by the Borrower in any action, suit or proceeding instituted by any Lender or the Administrative Agent for the payment or performance of such obligations; provided, however, that if the Borrower refrains from asserting any counterclaim or offset pursuant to this Section 8.11(b), in opposing such counterclaim or offset each Lender or the Administrative Agent, as the case may be, agrees not to assert the failure of the Borrower to assert such counterclaim or offset in any such action. Nothing herein shall prevent the Borrower from commencing a separate action against any Lender or the Administrative Agent.

Section 8.12LIMITATION OF LIABILITY.NEITHER THE ADMINISTRATIVE AGENT NOR THE LENDERS NOR ANY OTHER INDEMNIFIED PERSON SHALL HAVE ANY LIABILITY WITH RESPECT TO, AND THE BORROWER HEREBY WAIVES, RELEASES AND AGREES NOT TO SUE FOR, ANY SPECIAL, INDIRECT OR CONSEQUENTIAL, AND, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, PUNITIVE, DAMAGES SUFFERED BY THE BORROWER IN CONNECTION WITH ANY LOAN DOCUMENT RELATED CLAIM.

Section 8.13Severability of Provisions.Any provision of the Loan Documents that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions thereof or affecting the validity or enforceability of such provision in any other jurisdiction. To the extent permitted by Applicable Law, the Borrower hereby waives any provision of Applicable Law that renders any provision of the Loan Documents prohibited or unenforceable in any respect.

Section 8.14Counterparts.This Agreement may be executed in any number of counterparts, each executed counterpart constituting an original but all together only one Agreement.

Section 8.15Survival of Obligations.Except as otherwise expressly provided therein, the rights and obligations of the Borrower, the Administrative Agent, the Lenders and the other Indemnified Persons under the Loan Documents shall survive the Maturity Date and the termination of the Security Interest.

Section 8.16Entire Agreement.Agreement, together with the other Loan Documents, the schedules, the annexes and the exhibits and the other agreements referred to herein or therein, constitute the entire understanding between the parties with respect to the subject matter hereof. All prior agreements, understandings, representations, warranties and negotiations, if any, are merged into this Agreement, and this Agreement is the entire agreement between the parties hereto relating to the subject matter hereto.

Section 8.17Successors and Assigns.All of the provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.

Section 8.18WAIVER OF JURY TRIAL.BY ITS SIGNATURE BELOW WRITTEN EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS HEREIN DESCRIBED OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

ARTICLE 9

DEFINITIONS

Section 9.01Definitions.For the purpose of this Agreement.

“AAR” shall have the meaning specified in Section 1.01 of the Security Agreement.

“Accumulated Funding Deficiency” shall have the meaning ascribed to that term in Section 302 of ERISA.

“Accumulated Proceeds” shall have the meaning assigned to it in Section 1.05(a).

“Additional Collateral” shall mean the Additional Equipment and the related Equipment Leases.

“Additional Commitment” shall mean a commitment established in accordance with Section 1.16 hereof and pursuant to an Additional Commitment Addendum.

“Additional Commitment Addendum” shall mean an addendum to this Agreement entered into by, and in form and substance satisfactory to, the Borrower, the Administrative Agent and each Lender establishing an Additional Commitment pursuant thereto.

“Additional Equipment” shall mean any Equipment acquired by or contributed to the Borrower to comply with the requirements of the Sections 1.05(c) or 1.16 of this Agreement.

“Additional Loan” shall mean a Loan made pursuant to an Additional Commitment.

“Adjusted Operating Revenues” shall have the meaning assigned to it in Section 6.01 of the Management Agreement.

“Administrative Agent” shall have the meaning specified in the preamble of this Agreement.

“Affiliate” shall mean in respect to any Person any individual, corporation, partnership, limited liability company, limited liability partnership, joint venture, association or other entity that directly, or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with such Person; provided that, with respect to the Borrower, any Loan Party shall be deemed to be an Affiliate of the Borrower for purposes of this Agreement and of any other Loan Documents. For purposes of this definition, “control,” when used with respect to any Person, means the power to direct the management or policies of such Person, directly or indirectly, whether through the ownership of Voting Stock or equity interests, by contract or otherwise; the terms “controlling” and “controlled” have the meanings correlative to the forego ing.

“Agreement” shall mean this $25,314,750 Loan Agreement as the same may be amended, supplemented or modified, from time to time.

“Agreement Date” shall mean June 30, 2004.

“Applicable Law” shall mean, anything in Section 8.10 to the contrary notwithstanding, (a) all applicable common law and principles of equity and (b) all applicable provisions of all (i) constitutions, statutes, rules, regulations and orders of governmental bodies or transnational authorities, (ii) Governmental Approvals and Governmental Registrations, (iii) orders, decisions, judgments and decrees and (iv) treaties.

“Appraisal” shall mean, as the context may require, a Desktop Appraisal or a Physical Appraisal.

“Appraiser” shall mean RailSolutions, Inc. or any other qualified independent appraiser approved by the Administrative Agent and the Borrower.

“Approved Lessee” shall mean any Equipment Lessee, or the parent company of such Equipment Lessee, which has a rating of “BBB-“ or “Baa3” long term or better or “A-1” or “P-1” short term or better, by Standard & Poor’s and Moody’s Investor Services, respectively, or that are otherwise approved in writing by the Administrative Agent in its sole and absolute discretion. The list of Approved Lessees as approved by Administrative Agent in its sole and absolute discretion as stated above is contained in Schedule B hereto, as the same may be modified from time to time by the Administrative Agent.

“Asset Transfer Agreement” shall mean each of the Asset Transfer Agreements dated as of the date hereof between the Borrower and each of the PLM Growth Funds, in the form of Annex B hereto, and any future asset transfer agreements entered into by the Borrower in respect of any Additional Equipment.

“Assignment” shall mean each of the Assignment and Assumption Agreements dated as of the date hereof between the Borrower and each of the PLM Growth Funds, in the form of Annex C hereto and any future assignment and assumption agreements entered into by the Borrower in respect of any Additional Equipment.

“Availability Period” shall mean the period from the date hereof to and including July 9, 2004.

“Available Amount” shall have the meaning assigned to it in Section 1.01 of the Security Agreement.

“Benefit Plan” of any Person, shall mean, at any time, any employee benefit plan (including a Multiemployer Benefit Plan), the funding requirements of which (under Section 302 of ERISA or Section 412 of the Code) are, or at any time within six years immediately preceding the time in question were, in whole or in part, the responsibility of such Person.

“Bills of Sale” means the bills of sale delivered by the PLM Growth Funds to the Borrower with respect to each Item of Equipment.

“Blocked Account” shall have the meaning assigned to it in the Security Agreement.

“Board” means the Board of Governors of the Federal Reserve System of the United States of America.

“Borrower” shall have the meaning specified in the preamble of this Agreement.

“Borrower Collateral” shall mean “Collateral” as defined in the Security Agreement.

“Business Day” means any day of the year other than a Saturday, Sunday or a holiday on which banks are required or authorized by law to close in New York, New York and, if applicable, a day on which dealings in Dollar deposits are also carried on in the London interbank Eurodollar market and banks are open for business in London.

“Casualty Loss” shall have the meaning assigned to it in Section 5.02 of the Security Agreement.

“Closing Date” shall have the meaning assigned to it in Section 1.01(a) hereto.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, and rulings and regulations issued thereunder.

“Collateral” shall mean the Borrower Collateral and the Pledgors Collateral.

“Commitment” of any Lender means the amount set forth opposite such Lender’s name under, in the case of a Tranche A Lender, the heading “Tranche A Commitment” on Annex A hereto, in the case of a Tranche B Lender, the heading “Tranche B Commitment” on Annex A hereto and, in the case of a Lender party to an Additional Commitment Addendum, under the heading “Additional Commitment” on such Additional Commitment Addendum, or, in the case of a Lender that becomes a Lender pursuant to an assignment, the amount of the assignor’s Commitment assigned to such Lender.

“Concentration Limits” shall have the meaning assigned to it in Section 1.05(b).

“Concentration Ratios” shall have the meaning assigned to it in Section 4.01(x).

“Contract” means (a) any agreement (whether bi-lateral or unilateral or executory or non-executory and whether a Person entitled to rights thereunder is so entitled directly or as a third-party beneficiary), including an indenture, lease or license, (b) any deed or other instrument of conveyance, (c) any certificate of incorporation or charter and (d) any by-law.

“Default” means any condition or event that constitutes an Event of Default or that with the giving of notice or lapse of time or both would, unless cured or waived, become an Event of Default.

“Default Rate” shall have the meaning assigned to it in Section 1.03(c) hereof.

“Desktop Appraisal” shall mean a written desktop appraisal by an Appraiser, undertaken at the sole expense of the Borrower, and in form and substance satisfactory to the Administrative Agent as to the fair market value of the Equipment being so appraised.

“Determination Date” shall have the meaning specified in Section 1.01 of the Security Agreement.

“Dollars” and “$” mean the lawful and freely transferable currency of the United States of America.

“Eligible Assignee” means (i) a commercial bank, savings and loan institution, insurance company or financial institution organized under the laws of the United States of America, or any State thereof, (ii) a commercial bank organized under the laws of any other country, or a political subdivision of any such country, provided that such bank is acting through a branch or agency located in the United States of America, or (iii) a finance company, insurance company or other financial institution or a fund which is engaged in making, purchasing or otherwise investing in commercial loans in the ordinary course of its business and is doing business in the United States of America, and is organized under the laws of the United States of America, or any State thereof.

“Enacted”, as applied to a Regulatory Change, shall mean the date such Regulatory Change first becomes effective or is implemented or first required or expected to be complied with, whether the same is (a) the result of an enactment by a government or any agency or political subdivision thereof, a determination of a court or regulatory authority, a request or directive of a regulatory authority, or otherwise or (b) enacted, adopted, issued or proposed before or after the Agreement Date.

“Equipment” shall have the meaning assigned to it in Section 2.02 of the Security Agreement.

“Equipment Leases” shall have the meaning assigned to it in Section 2.03 of the Security Agreement.

“Equipment Lessees” shall mean the Persons identified in Schedule A to this Agreement (as such schedule may be amended, supplemented or modified from time to time), as Equipment Lessees under the Equipment Leases, and any Persons that become Equipment Lessees pursuant to such Equipment Leases (including Replacement Leases).

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, or any successor federal statute.

“ERISA Affiliate” shall mean, with respect to any Person, any other Person, including a Subsidiary or other Affiliate of such first Person, that is a member of any group of organizations within the meaning of Sections 414(b), (c), (m) or (o) of the Code of which such first Person is a member.

“Escrow Account” shall have the meaning assigned to it in the Security Agreement.

“Escrow Agreement” shall have the meaning assigned to it in the Security Agreement.

“Escrow Bankruptcy Event” shall have the meaning assigned to it in the Security Agreement.

“Event of Default” shall have the meaning provided in Article 5 of this Agreement.

“Expired Lease” shall have the meaning assigned to it in Section 4.03 of the Security Agreement.

“Fair Market Value” shall mean (i) in respect of the Closing Date, the fair market value of the Equipment set forth in the Initial Appraisal to be delivered in connection with such Closing Date, and (ii) thereafter, the fair market value of the Equipment set forth in the most recent Appraisal.

“Federal Funds Rate” means, for any day, the weighted average of the rates on overnight Federal funds transactions with members of the Federal Reserve System arranged by Federal funds brokers, as published for such day (or, if such day is not a Business Day, for the next preceding Business Day) by the Federal Reserve Bank of New York or, if such rate is not so published for any day that is a Business Day, the average of quotations for such day on such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by the Administrative Agent.

“Filing Lessee” shall have the meaning assigned to it in Section 1.05(b) hereof.

“Funding Loss Amount” shall mean those amounts required to compensate each Lender for any losses, additional costs or expenses, that such Lender may reasonably incur as a result of a prepayment of the Loans on a day other than the last day of the then applicable Interest Period, for any reason whatsoever, whether as a result of an Event of Default or otherwise, including, without limitation, any loss, cost or expense incurred by reason of the liquidation or reemployment of deposits or other funds acquired by such Lender to fund or maintain its portion of the Loans. Each Lender shall furnish the Borrower a certificate of an officer of such Lender setting forth in reasonable detail the computation of such amount and such determination shall be binding, absolute and conclusive, absent manifest error in computation.

“GAAP” means at any time the generally accepted United States of America accounting principles, as promulgated by the American Institute of Certified Public Accountants at such time.

“Governmental Approval” shall mean any authority, consent, approval, license (or the like) or exemption (or the like) of any governmental unit.

“Governmental Registration” shall mean any registration or filing (or the like) with, or report or notice (or the like) to, any governmental unit.

“Indemnified Person” means any Person that is, or at any time was, the Administrative Agent, a Lender, a Swap Counterparty, an Affiliate of the Administrative Agent, a Lender or a Swap Counterparty or a director, officer, employee or agent of any such Person.

“Initial Appraisal” shall mean a Desktop Appraisal, undertaken at Borrower’s sole expense, as to the fair market value of the Equipment owned by the Borrower on the Closing Date.

“Installment Payment Date” shall mean any or all, as the context may require, of each (a) Tranche A Installment Payment Date and (b) Tranche B Installment Payment Date.

“Interest Excess” shall have the meaning assigned to it on Section 1.03(e) hereof.

“Interest Payment Date” shall mean the last day of each Interest Period commencing on the first such date next succeeding the Closing Date and continuing thereafter to and including the applicable Maturity Date.

“Interest Pe

riod” shall mean a period commencing, in the case of the first Interest Period with respect to each Loan, on the Closing Date on which such Loan is disbursed, and, in the case of each subsequent, successive Interest Period applicable thereto, on the last day of the immediately preceding Interest Period, and ending on the same day in the third month thereafter, except that (a) any Interest Period that would otherwise end on a day that is not a Business Day shall be extended to the next succeeding Business Day unless such Business Day falls in another calendar month, in which case such Interest Period shall end on the next preceding Business Day and (b) any Interest Period that begins on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the calendar month in which such Interest Period ends) shall end on the last Business D ay of a calendar month.

“Interest Rate” shall mean the Tranche A Interest Rate or Tranche B Interest Rate, as applicable.

“Item of Equipment” shall mean each of the railcars described in Schedule A to the Security Agreement together with any Additional Equipment.

“Lenders” means (a) any Person listed on Annex A hereto and (b) any Person that has been assigned any or all of the rights or obligations of a Lender pursuant to Section 8.09 of this Agreement.

“Lending Office” of any Lender means (a) the branch or office of such Lender set forth below such Lender’s name under the heading “Lending Office” on Annex A or, in the case of a Lender that becomes a Lender pursuant to an assignment, the branch or office of such Lender set forth under the heading “Lending Office” in the Notice of Note Assignment given to the Borrower and the Administrative Agent with respect to such assignment or (b) such other branch or office of such Lender designated by such Lender from time to time as the branch or office at which its Loans are to be made or maintained.

“Liability” of any Person means (in each case, whether with full or limited recourse) any indebtedness, liability, obligation, covenant or duty of or binding upon, or any term or condition to be observed by or binding upon, such Person or any of its assets, of any kind, nature or description, direct or indirect, absolute or contingent, due or not due, contractual or tortious, liquidated or unliquidated, whether arising under Contract, Applicable Law, or otherwise, whether now existing or hereafter arising, and whether for the payment of money or the performance or non-performance of any act.

“LIBOR Rate” shall mean with respect to any Loan for any each Interest Period, the rate per annum determined by the Administrative Agent at approximately 11:00 a.m. (London time) on the second Business Day prior to the first day of such Interest Period by reference to the British Bankers' Association Interest Settlement Rates for deposits in Dollars (as set forth by any service selected by the Administrative Agent that has been nominated by the British Bankers' Association as an authorized information vendor for the purpose of displaying such rates) for a period equal to the relevant Interest Period (rounded upward to the nearest whole multiple of one-sixteenth of one percent (0.0625%)), provided that to the extent that an interest rate is not ascertainable pursuant to the foregoing provisions of this definition, "LIBOR Rate" shall be the interest rate per annum determined b y the Administrative Agent to be the rate (rounded upward to the nearest whole multiple of one-sixteenth of one percent (0.0625%) per annum, if such rate is not a multiple) at which deposits in Dollars are offered to major banks in the London interbank market in London, England by the Administrative Agent at approximately 11:00 a.m. (London time) on the second Business Day prior to the first day of such Interest Period.

“Liens” shall have the meaning assigned to it in Section 3.03 of the Security Agreement.

“Limited Liability Company Agreement” means the Limited Liability Company Agreement of the Borrower dated on or about the date hereof.

“Liquidity Reserve Account” shall have the meaning assigned to it in Section 1.01 of the Security Agreement.

“Liquidity Reserve Account Required Amount” shall have the meaning assigned to it in Section 1.01 of the Security Agreement.

“LLC Membership Interest” shall have the meaning assigned to it in Section 6.01 of the Pledge Agreement.

“Loans” shall mean any and all, as the context may require, of each (a) Tranche A Loans and (b) Tranche B Loans and (c), if any, Additional Loans.

“Loan Documents” shall mean this Agreement, the Security Agreement, any Additional Commitment Addendum, the Bills of Sale, the Escrow Agreement, the Notes, the Assignments, the Asset Transfer Agreements, the Management Agreement, the Notices of Assignment, the Pledge Agreement, the Limited Liability Company Agreement, the irrevocable powers of attorney delivered by the Borrower pursuant to Section 2.01(c)(ix), and any certificates or documents executed in connection herewith or therewith.

“Loan Document Related Claim” means any claim or dispute (whether arising under Applicable Law, including any “environmental” or similar law, under Contract or otherwise and, in the case of any proceeding relating to any such claim or dispute, whether civil, criminal, administrative or otherwise) in any way arising out of, related to, or connected with, the Loan Documents, the relationships established thereunder or any actions or conduct thereunder or with respect thereto, whether such claim or dispute arises or is asserted before or after the Agreement Date or before or after the final Maturity Date.

“Loan Document Representation and Warranty” means any “Representation and Warranty” as defined in any Loan Document and any other representation or warranty made or deemed made under any Loan Document.

“Loan Party” means any of the Borrower, Manager or any Pledgor.

“LTV Ratio” shall mean at any time the ratio of the aggregate principal balance of the Loans outstanding at such time to the aggregate Fair Market Value of the Equipment at such time.

“Majority Lenders” means, at any time, Lenders having more than 66 2/3% of the aggregate principal amount of the Loans outstanding.

“Majority Pledgor” shall mean a Pledgor that owns, directly or indirectly, more than 50% of the LLC Membership Interest.

“Management Agreement” shall mean the Railcar Management Agreement dated on or about the date hereof between Borrower and Manager.

“Manager” shall mean PLM, unless a new manager has been appointed by the Lenders following an Event of Default under the Management Agreement.

“Materially Adverse Effect” means, (a) with respect to any Person, any materially adverse effect on such Person’s business, assets, Liabilities, financial condition, results of operations or business prospects, (b) with respect to a group of Persons “taken as a whole”, any materially adverse effect on such Persons’ business, assets, Liabilities, financial conditions, results of operations or business prospects taken as a whole on, where appropriate, a consolidated basis in accordance with GAAP, (c) with respect to any Loan Document, any adverse effect, WHETHER OR NOT MATERIAL, on the binding nature, validity or enforceability thereof as an obligation of any Loan Party that is a party thereto and (d) with respect to any Collateral, or any category of Collateral, pledged by any Loan Party, a materially adverse effect on its value as Collateral or its utilit y in such Loan Party’s business or an adverse effect, WHETHER OR NOT MATERIAL, on the validity, perfection, priority or enforceability of the security interest therein.

“Maturity Date” shall mean (i) in respect of Tranche A Loans, the earlier of (A) the sixth anniversary of the Closing Date or (B) the Tranche A Installment Payment Date on which all Tranche A Loans shall have been repaid in full together with any accrued and unpaid interest thereon and (ii) in respect of Tranche B Loans, the earlier of (A) the second anniversary of the Maturity Date of the Tranche A Loans or (B) the Tranche B Installment Payment Date on which all Tranche B Loans shall have been repaid in full together with any accrued and unpaid interest thereon.

“Maximum Permissible Rate” shall mean, with respect to interest payable on any amount, the rate of interest on such amount that, if exceeded, could, under Applicable Law, result in (a) civil or criminal penalties being imposed on the payee or (b) the payee’s being unable to enforce payment of (or, if collected, to retain) all or any part of such amount or the interest payable.

“MILPI” shall mean MILPI Holdings, LLC, a Delaware limited liability company.

“Multiemployer Benefit Plan” shall mean any Benefit Plan that is a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

“Note” shall mean a Tranche A Note or Tranche B Note, as applicable.

“Notice of Borrowing” shall have the meaning assigned to it in Section 1.02(a) hereof.

“Notices of Assignment” shall mean the notices of assignment in substantially the form of Exhibit C hereto.

“Notice of Default” shall have the meaning assigned to it in Section 7.03 hereof.

“Notice of Note Assignment” shall mean any notice to the Borrower and the Administrative Agent with respect to an assignment pursuant to Section 8.09 in the form of Exhibit D hereto.

“Operating Expenses” means the aggregate amount of all reasonable direct or indirect out-of-pocket expenses and costs paid by the Borrower or the Manager to persons not constituting an Affiliate of the Borrower or Manager (unless such payment to an Affiliate constitutes a reimbursement to such Affiliate for payments it made to an unaffiliated third party) incurred in connection with the ownership of the Equipment, including, without limitation, all expenses and costs relating to the following: any maintenance activity including amounts paid to American Railcar Industries; all premiums and other expenses related to insurance on, and licenses for, the Equipment; all taxes imposed upon or against the Equipment including property taxes, ad valorem taxes, and gross receipts taxes; delivery, switching, repositioning, and storage charges; any audits inspections or appraisals reques ted by the Administrative Agent; and such other costs as the Manager and Administrative Agent may agree.

“Payment Date” shall mean any or all, as the context may require, of each (a) Interest Payment Date and (b) Installment Payment Date.

“Pay Proceeds Letter” shall have the meaning assigned to it in Section 1.02(d) hereof.

“PBGC” shall mean the Pension Benefit Guaranty Corporation.

“Permitted Investments” means at any time:

(a)any evidence of indebtedness, maturing no later than the next Interest Payment Date, issued or guaranteed by the Government of the United States of America;

(b)commercial paper, maturing no later than the next Interest Payment Date, which is issued by

(i)a corporation (other than an Affiliate of Borrower) organized under the laws of any state of the United States of America or of the District of Columbia and rated A-1 by Standard & Poor’s Corporation (or any successor to its rating business) or P-1 by Moody’s Investors Service, Inc. (or any successor to its rating business), or

(ii)the Administrative Agent (or its holding company);

(c)any deposit (whether or not interest bearing), certificate of deposit or bankers acceptance, maturing no later than the next Interest Payment Date, which is issued by either

(i)a commercial banking institution that is a member of the Federal Reserve System and has a combined capital and surplus and undivided profits of not less than $500,000,000, or

(ii)the Administrative Agent;

(d)such other investments as the Administrative Agent may approve from time to time.

“Permitted Liens” shall have the meaning assigned to it in Section 3.03 of the Security Agreement.

“Person” shall mean and include any individual, business trust, partnership, limited liability company, limited liability partnership, joint venture, firm, corporation, association, joint stock company, trust or other enterprise or any government or political sub-division or agency, department or instrumentality thereof.

“Physical Appraisal” shall mean an appraisal of the fair market value of the Equipment based on the physical inspection of five percent (5%) of the Items of Equipment conducted by an Appraiser, in form and substance satisfactory to the Administrative Agent and undertaken at the sole expense of the Borrower to the extent that such expense is reasonable in light of usual market standards for such an appraisal.

“Pledge Agreement” shall mean the Pledge Agreement dated on or about the date hereof, between the PLM Growth Funds and the Administrative Agent.

“Pledgors” shall have the meaning assigned to it in the Pledge Agreement.

“Pledgors Collateral” means “Collateral” as defined in the Pledge Agreement.

“PLM” shall mean Transportation Equipment – PLM, LLC, a Delawarelimited liability company.

“PLM Growth Funds” shall mean PLM Equipment Growth Fund V, PLM Equipment Growth Fund VI, and PLM Equipment Growth & Income Fund VII, each a limited partnership organized under the laws of the State of California.

“Prohibited Transaction” shall mean any transaction that is prohibited under Code Section 4975 or ERISA Section 406 and not exempt under Code Section 4975 or ERISA Section 408.

“Reference Rate” shall mean the higher of (i) the sum of the Federal Funds Rate in effect on such day plus 2.50% and (ii) the publicly announced prime rate of the Administrative Agent. The Administrative Agent may lend to its customers at rates that are at, above or below the Reference Rate.

“Register” shall have the meaning assigned to it in Section 6.01 hereof.

“Registered Holder” means the Person in whose name a Registered Note is registered.

“Registered Note” shall mean a Note the name of the holder of which has been recorded on the Register. The registration of a Note shall constitute the registration of the Loan evidenced thereby.

“Regulatory Change” shall mean any Applicable Law, interpretation, directive, determination, request or guideline (whether or not having the force of law), or any change therein or in the administration or enforcement thereof, that is Enacted after the Agreement Date, including any such that imposes, increases or modifies any Tax, reserve requirement, insurance charge, special deposit requirement, assessment or capital adequacy requirement.

“Replacement Lease” shall have the meaning assigned to it in Section 1.01 of the Security Agreement.

“Reportable Event” shall mean, with respect to any Benefit Plan of any Person, (a) the occurrence of any of the events set forth in ERISA Sections 4043(c), other than an event as to which the requirement of 30 days’ notice, or the penalty for failure to provide such notice, has been waived by the PBGC, (b) the existence of conditions sufficient to require advance notice to the PBGC pursuant to ERISA Section 4043(b), (c) the occurrence of any of the events set forth in ERISA Sections 4062(e) or 4063(a) or the regulations thereunder, (d) any event requiring such Person or any of its ERISA Affiliates to provide security to such Benefit Plan under Code Section 401(a)(29) or (e) any failure to make a payment required by Code Section 412(m) with respect to such Benefit Plan.

“Representation and Warranty” means any representation or warranty made pursuant to or under (a) Article 3 or any other provision of this Agreement or (b) any amendment to, or waiver of rights under, this Agreement, WHETHER OR NOT, IN THE CASE OF ANY REPRESENTATION OR WARRANTY REFERRED TO IN CLAUSE (a) OR (b) OF THIS DEFINITION (EXCEPT, IN EACH CASE, TO THE EXTENT OTHERWISE EXPRESSLY PROVIDED), THE INFORMATION THAT IS THE SUBJECT MATTER THEREOF IS WITHIN THE KNOWLEDGE OF THE BORROWER.

“Responsible Officer” shall mean (a) with respect to the Borrower, any manager of the Borrower or any Person instructed by the Borrower to have responsibility for and to administer this transaction and (b) with respect to any other Loan Party, the President, the Vice President, Finance, the Treasurer, the Assistant Treasurer or any Person instructed by such Loan Party to have responsibility for and to administer this transaction.

“Rolling Stock” shall mean standard gauge railroad rolling stock, other than passenger equipment or work equipment, used or intended for use in connection with interstate commerce; excluding, however, railroad rolling stock scrapped or intended to be scrapped.

“Secured Party” has the meaning ascribed to such term in the respective Security Documents.

“Securities Act” shall mean the Securities Act of 1933, as amended.

“Security Agreement” shall mean the Security Agreement - Chattel Mortgage dated on or about the date hereof between the Borrower, as Debtor and the Administrative Agent, as Secured Party, as the same may be amended, supplemented or modified from time to time.

“Security Document” shall mean and include the Security Agreement and the Pledge Agreement.

“Security Interest” means the Liens created, or purported to be created by the Loan Documents.

“STB” shall mean the Surface Transportation Board of the United States of America.

“Subsidiary” shall mean, with respect to any Person at any time, (a) any other Person the accounts of which would be consolidated with those of such first Person in its consolidated financial statements as of such time, and (b) any other Person (i) that is, at such time, controlled by, or (ii) securities of which having ordinary voting power to elect a majority of the board of directors (or other persons having similar functions), or other ownership interests of which ordinarily constituting a majority voting interest, are at such time, directly or indirectly, owned or controlled by such first Person, or by such first Person and one or more of its Subsidiaries.

“Swap Agreement” shall have the meaning assigned to it in Section 1.03(f).

“Swap Counterparty” means any of HSH Nordbank AG, New York Branch in its individual capacity (“HSH”), any Lender or an affiliate of HSH or such Lender or Lenders (and their respective successors and assigns) that is participating in any Swap Agreement with the Borrower.

“Tax” means any Federal, State or foreign tax, assessment or other governmental charge (including any withholding tax) upon a Person or upon its assets, revenues, income or profits.

“Termination Event” shall mean, with respect to any Benefit Plan, (a) any Reportable Event with respect to such Benefit Plan, (b) the termination of such Benefit Plan, or the filing of a notice of intent to terminate such Benefit Plan, or the treatment of any amendment to such Benefit Plan as a termination under ERISA Section 4041(c), (c) the institution of proceedings to terminate such Benefit Plan under ERISA Section 4042 or (d) the appointment of a trustee to administer such Benefit Plan under ERISA Section 4042.

“Tranche A Installment Payment Date” shall mean, with respect to each Tranche A Loan, the last day of each Interest Period commencing on the first such date next succeeding the Closing Date and continuing thereafter to and including the Maturity Date of the Tranche A Loans, or such other date as provided for in Section 1.05 hereof.

“Tranche A Installment Payment Schedule” shall mean the payment schedule with respect to the Tranche A Loans set forth in Schedule 1-B to the Tranche A Note, as the same may be amended in accordance with the terms hereof.

“Tranche A Interest Rate” means, for each Interest Period, a rate of interest equal to LIBOR Rate for such Interest Period plus 1.75% per annum (computed on the basis of a 360-day year consisting of twelve 30-day months).

“Tranche A Lender” means any Person listed as a Tranche A Lender on Annex A hereto and each successor, permitted assignee or transferee thereof as holder of a Tranche A Note.

“Tranche A Loans” shall mean the Loans made by the Tranche A Lenders to the Borrower pursuant to Section 1.01(a) hereof.

“Tranche A Note” means each promissory note, substantially in the form of Exhibit A-1 hereto, delivered by Borrower to a Tranche A Lender pursuant to Section 1.03.

“Tranche B Installment Payment Date” shall mean, with respect to each Tranche B Loan, the last day of each Interest Period commencing on the Maturity Date of the Tranche A Loans and continuing thereafter to and including the Maturity Date of the Tranche B Loans, or such other date as provided for in Section 1.05 hereof.

“Tranche B Installment Payment Schedule” shall mean a payment schedule with respect to the Tranche B Loans set forth in Schedule 1-B to the Tranche B Note, as the same may be amended in accordance with the terms hereof.

“Tranche B Interest Rate” means, for each Interest Period, a rate of interest equal to LIBOR Rate for such Interest Period plus 2.50% per annum (computed on the basis of a 360-day year consisting of twelve 30-day months).

“Tranche B Lender” means any Person listed as a Tranche B Lender on Annex A hereto and each successor, permitted assignee or transferee thereof as holder of a Tranche B Note.

“Tranche B Loans” shall mean the Loans made by the Tranche B Lenders to the Borrower pursuant to Section 1.01(b).

“Tranche B Note” mean a promissory note, substantially in the form of Exhibit A-2 hereto, delivered by the Borrower to the Tranche B Lender pursuant to Section 1.03.

“UCC” or “Uniform Commercial Code” shall mean the Uniform Commercial Code in effect in the State of New York, unless otherwise specified, as amended from time to time.

“Voting Stock” as applied to the stock of any corporation, shall mean stock of any class or classes (however designated) having ordinary voting power for the election of a majority of the directors of such corporation, other than stock having such power only by reason of the happening of a contingency.

Section 9.02Other Interpretive Provisions. (a) Except as otherwise specified herein, all references herein (i) to any Person shall be deemed to include such Person’s successors and assigns, (ii) to any Applicable Law defined or referred to herein shall be deemed references to such Applicable Law or any successor Applicable Law as the same may have been or may be amended or supplemented from time to time and (iii) to any Loan Document or Contract defined or referred to herein shall be deemed references to such Loan Document or Contract (and, in the case of any Note or any other instrument, any instrument issued in substitution therefor) as the terms thereof may have been or may be am ended, supplemented, waived or otherwise modified from time to time.

(b)When used in this Agreement, the words “herein”, “hereof” and “hereunder” and words of similar import shall refer to this Agreement as a whole and not to any provision of this Agreement, and the words “Article”, “Section”, “Annex”, “Schedule” and “Exhibit” shall refer to Articles and Sections of, and Annexes, Schedules and Exhibits to, this Agreement unless otherwise specified.

(c)Whenever the context so requires, the neuter gender includes the masculine or feminine, the masculine gender includes the feminine, and the singular number includes the plural, and vice versa.

(d)Any item or list of items set forth following the word “including”, “include” or “includes” is set forth only for the purpose of indicating that, regardless of whatever other items are in the category in which such item or items are “included”, such item or items are in such category, and shall not be construed as indicating that the items in the category in which such item or items are “included” are limited to such items or to items similar to such items.

(e)Each authorization in favor of the Administrative Agent, the Lenders or any other Person granted by or pursuant to this Agreement shall be deemed to be irrevocable and coupled with an interest.

(f)Except as otherwise specified herein, all references herein to the Administrative Agent, any Lender or any Loan Party shall be deemed to refer to such Person however designated in the Loan Documents, so that (i) a reference to rights or duties of the Administrative Agent under the Loan Documents shall be deemed to include the rights or duties of such Person as the Secured Party under the Security Agreement, and (ii) a reference to the obligations of the Borrower under the Loan Documents shall be deemed to include the obligations of such Person as the Debtor under the Security Agreement.

(g)Except as otherwise specified herein, all references to the time of day shall be deemed to be to New York City time as then in effect.

(h)Except where the context clearly indicates a different meaning, all terms defined in Article 1, 8 or 9 of the UCC, as in effect on the Agreement Date, are used herein with the meanings therein ascribed to them.

(i)Except as otherwise specified herein, all references to the knowledge of the Borrower shall be deemed to include the knowledge of the Borrower and of any other Loan Party or any member of the Manager Management Team at such date, or any other Responsible Officer of any Loan Party.

Section 9.03Accounting Matters.Unless otherwise specified herein, all accounting determinations hereunder and all computations utilized by the Borrower in complying with the covenants contained herein shall be made, all accounting terms used herein shall be interpreted, and all financial statements required to be delivered hereunder shall be prepared, in accordance with Generally Accepted Accounting Principles, except, in the case of such financial statements, for departures from GAAP that may from time to time be approved in writing by the independent certified public accountants who are at the time, in accordance with Section 4.01(a), reporting on the Borrower’s financial stateme nts.

Section 9.04Representations and Warranties.All Representations and Warranties shall be deemed made (a) in the case of any Representation and Warranty contained in this Agreement at the time of its initial execution and delivery, at and as of the Agreement Date, (b) in the case of any Representation and Warranty contained in this Agreement or any other document at the time any Loan is made, at and as of such time and (c) in the case of any particular Representation and Warranty, wherever contained, at such other time or times as such Representation and Warranty is made or deemed made in accordance with the provisions of this Agreement or the document pursuant to, under or in connection w ith which such Representation and Warranty is made or deemed made.

Section 9.05Captions.Captions to Articles, Sections and subsections of, and Annexes, Schedules and Exhibits to, this Agreement are included for convenience of reference only and shall not constitute a part of this Agreement for any other purpose or in any way affect the meaning or construction of any provision of this Agreement.

Section 9.06Interpretation of Related Documents.Except as otherwise specified therein, terms that are defined herein that are used in Notes, certificates, opinions and other documents delivered in connection herewith shall have the meanings ascribed to them herein and such documents shall be otherwise interpreted in accordance with the provisions of this Article 9.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective officer thereunto duly authorized as of the date first above written.

PLM RAIL PARTNERS, LLC, a Delaware limited liability company, as Borrower

By: Transportation Equipment-PLM, LLC, a Delaware limited liability company, its manager

By _______________________________________

Its_____________________________________

HSH NORDBANK AG, NEW YORK BRANCH,

as Administrative Agent

By:________________________________________

Name:

Title:

By:________________________________________

Name:

Title:

THE BANKS:

HSH NORDBANK AG, NEW YORK BRANCH

By:_______________________________________

Name:

Title:

By:________________________________________

Name:

Title:

Annex A

COMMITMENTS

TRANCHE A COMMITMENT:TRANCHE A LENDERS:

Amount

$15,710,054                                                                                                                        HSH NORDBANK AG, NEW YORK BRANCH

                                                                                                                                            Lending Office for Loans:

                                                                                                                                            HSH Nordbank AG,

                                                                                                                                            New York Branch

                                                                                                                                            590 Madison Avenue, 28th Floor

                                                                                                                                            New York, NY 10022

                                                                                                                                            Address for Notices:

                                                                                                                                            HSH Nordbank AG,

                                                                                                                                            New York Branch

                                                                                                                                            590 Madison Avenue, 28th Floor

                                                                                                                                            New York, NY 10022

                                                                                                                                            Attention: Kristie Li   

                                                                                                                                            Telephone: 212-407-6057   

                                                                                                                                            Telecopier: 212-407-6033

TRANCHE B COMMITMENT:                                                                                         TRANCHE B LENDERS:

Amount

$9,604,696                                                                                                                          HSH NORDBANK AG, NEW YORK BRANCH

                                                                                                                                            Lending Office for Loans:

                                                                                                                                            HSH Nordbank AG,

                                                                                                                                            New York Branch

                                                                                                                                            590 Madison Avenue, 28th Floor

                                                                                                                                            New York, NY 10022

                                                                                                                                            Address for Notices:

                                                                                                                                            HSH Nordbank AG,

                                                                                                                                            New York Branch

                                                                                                                                            590 Madison Avenue, 28th Floor

                                                                                                                                            New York, NY 10022

                                                                                                                                            Attention: Kristie Li   

                                                                                                                                            Telephone: 212-407-6057   

                                                                                                                                            Telecopier: 212-407-6033

Annex B

FORM OF TRANSFER AGREEMENTS

Annex C

FORM OF ASSIGNMENTS

Schedule A

EQUIPMENT LEASES

TO BE PROVIDED BY BORROWER AND AGREED BY ADMINISTRATIVE AGENT ON OR PRIOR TO THE CLOSING DATE.

Schedule B

APPROVED LESSEES

Exhibit A-1

FORM OF TRANCHE A PROMISSORY NOTE

Exhibit A-2

FORM OF TRANCHE B PROMISSORY NOTE

Exhibit B

FORM OF EQUIPMENT LEASE

Exhibit C

NOTICE OF ASSIGNMENT

Exhibit D

FORM OF NOTICE OF NOTE ASSIGNMENT

Exhibit E

FORM OF ASSIGNMENT AND ACCEPTANCE

Exhibit F

FORM OF IRREVOCABLE POWER OF ATTORNEY

EX-10.2

Asset Transfer Agreement

Between

PLM Equipment Growth Fund VI

And

PLM Rail Partners, LLC

Dated as of July 1, 2004

TableofContents

SECTION		HEADING	PAGE
SECTION 1.		DEFINITIONS	1
SECTION 2.		CONTRIBUTION; DELIVERY	3
	Section 2.1.	Contribution; Delivery and Acceptance	3
	Section 2.2.	Delivery of Administration Agreement Notice	3
SECTION 3.		REPRESENTATIONS, WARRANTIES AND COVENANTS	4
SECTION 4.		INFORMATION; FURTHER ASSURANCES, ETC.	8
SECTION 5.		INELIGIBLE RAILCARS	9
SECTION 6.		COSTS AND EXPENSES	11
SECTION 7.		INDEMNIFICATION; LIMITATION ON LIABILITY	11
	Section 7.1.	Obligation of Seller To Indemnify	11
	Section 7.2.	Obligation of Buyer To Indemnify	11
SECTION 8.		CONTEST RIGHTS	11
	Section 8.1.	Notice and Opportunity To Defend	11
	Section 8.2.	Limitations on Liability; Payments	12
SECTION 9.		NOTICES	12
SECTION 10.		AMENDMENT	13
SECTION 11.		SUCCESSORS AND ASSIGNS	13
SECTION 12.		COUNTERPARTS	14
SECTION 13.		GOVERNING LAW	14
SECTION 14.		SEVERABILITY	14
SECTION 15.		NO PETITION IN BANKRUPTCY	14
SCHEDULE
	1.	Description of Seller Equipment and Seller Leases
EXHIBITS
	A.	Form of Seller Assignment and Assumption Agreement
	B.	Form of Seller Bill of Sale
ANNEXES
	A.	Seller Equipment Description
	B.	Seller Leases

Asset Transfer Agreement

Asset Transfer Agreement (the “Agreement”) dated as of July 1, 2004 between PLM Equipment Growth Fund VI, a California limited partnership (“Seller”), and PLM Rail Partners, LLC, a Delaware limited liability company (“Buyer”).

Seller and Buyer hereby agree as follows:

Section 1.   Definitions

Section 1.1.In this Agreement:

“AAR Value” shall mean, with respect to any railcar included in the Seller Equipment or Replacement Equipment, the settlement value of such railcar as determined in accordance with Rule 107—Damaged and/or Destroyed Cars (or a successor rule) of the Association of American Railcars as published in the most recent edition of the Field Manual of the A.A.R. Interchange Rules (or a successor publication).

“Administrative Agent” means HSH Norbank AG, New York Branch.

“Administrative Agent Liens” means the lien created by Buyer on the Seller Equipment and Seller Leases under the Security Agreement.

“Asserted Liability” shall have the meaning set forth in Section 8.1(a).

“Business Day” shall mean each day which is neither a Saturday, Sunday nor other day on which banking institutions or trust companies in The City of New York are legally authorized or required to close.

“Claims Notice” shall have the meaning set forth in Section 8.1(a).

“Contract Month” shall mean the calendar month during which the date of this Agreement falls.

“Cure Notification” shall have the meaning set forth in Section 5.1.

“Governmental Authority” means any federal, state, local or foreign government of any court, agency, authority, instrumentality or regulatory body thereof.

“Indemnifying Party” shall have the meaning set forth in Section 8.1(a).

“Indemnitee” shall have the meaning set forth in Section 8.1(a).

“Ineligible Car Closing Date” shall have the meaning set forth in Section 5.2.

“Ineligible Car Representations” shall have the meaning set forth in Section 5.1.

“Ineligible Car Value Statement” shall have the meaning set forth in Section 5.3.

“Ineligible Car Value” shall have the meaning set forth in Section 5.2.

“Ineligible Car” shall have the meaning set forth in Section 5.1.

“Lien” means, with respect to any asset, (i) any mortgage, deed of trust, lien, pledge, claim, equity interest, participation interest, security interest or other interest charge or encumbrance of any kind in or on such asset and (ii) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement relating to such asset; it being understood, however, that the leasehold interests under the Seller Leases shall not constitute “Liens” hereunder.

“Loan Agreement” means the Loan Agreement, dated as of June 30, 2004, among Buyer, as Borrower, the Lenders set forth therein and HSH Norbank AG, New York Branch, as Administrative Agent, as amended and supplemented to date and as may be further amended or supplemented from time to time, pursuant to which the Lender has provided financing to Buyer.

“Losses” shall have the meaning set forth in Section 7.1.

“Management Agreement” means the railcar Management Agreement, dated as of July 1, 2004, between Buyer and Transportation Equipment—PLM, LLC (including all amendments, modifications and supplements thereto).

“Replacement Car Representations” shall have the meaning set forth in Section 5.4.

“Replacement Car Value Statement” shall have the meaning set forth in Section 5.3.

“Replacement Cars” shall have the meaning set forth in Section 5.2.

“Representation Termination Date” shall have the meaning set forth in Section 3.4.

“Required Consents” shall have the meaning set forth in Section 3.1(j).

“Security Agreement” shall mean the Security Agreement - Chattel Mortgage dated as of July 8, 2004, between Buyer, as Debtor and HSH Norbank AG, New York Branch, as Secured Party.

“Seller Assignment and Assumption Agreement” means an assignment and assumption agreement executed by Seller and Buyer substantially in the form of Exhibit A.

“Seller Bill of Sale” means a bill of sale executed by Seller substantially in the form of Exhibit B.

“Seller Equipment” means railcars more specifically described on Schedule 1, and for purposes of Section 5, any Replacement Cars.

“Seller Leases” means all current leases of any Seller Equipment and all other contracts for use of any Seller Equipment more specifically described on Schedule 1, including, without limitation, all extensions, renewals, supplements and modifications of any of the foregoing. If any of the Seller Leases (including, without limitation, any master lease) shall include both Seller Equipment and railcars not part of the Seller Equipment, then such Seller Leases shall be subject to this Agreement only to the extent they cover Seller Equipment; and, for purposes of this Agreement, the term Seller Lease shall mean a lease (including without limitation, the provisions of any master lease) only insofar as such lease applies to Seller Equipment subject to this Agreement.

“Seller Rent Portion” shall have the meaning set forth in Section 3.5.

Section 1.2.The headings or subheadings of Sections and the Table of Contents are inserted for convenience of reference only and shall not in any way affect the interpretation or construction of this Agreement. The Schedules, Exhibits and Annexes to this Agreement shall form an integral part hereof. References herein to any agreement or other instrument shall be deemed to include references to such agreement or other instrument as varied, amended, supplemented or replaced from time to time pursuant to the applicable provisions thereof. Where the context permits, words importing the plural shall include the singular and vice versa, and references to a person shall be construed as references to an individual, firm, company, corporation or unincorporated body of persons.

Section 2.   Contribution; Delivery

Section 2.1.Contribution; Delivery and Acceptance. Seller hereby sells, transfers, assigns, sets over and otherwise conveys to the Buyer, without recourse (except for the obligations specifically set forth herein) on the date hereof all of Seller’s right, title and interest in and to the Seller Equipment (subject to the Seller Leases) and all proceeds of the foregoing, and Buyer hereby accepts all such right, title and interest upon and subject to the terms and conditions of this Agreement. To evidence such transfer, Seller has executed and delivered to Buyer on the date hereof the Seller Bill of Sale. Seller hereby assigns to Buyer and Buyer hereby assumes from Seller, on the date hereof pursuant to a Seller Assignment and Assumption Agreement, the Seller Leases insofar as they relate to the Seller Equipment.

Section 2.2.Delivery of Seller Leases; Delivery of Administration Agreement Notice. Seller shall deliver to Buyer original copies of the Seller Leases covering such Seller Equipment or, if a Seller Lease relates both to Seller Equipment transferred to Buyer on the date hereof and railcars to be owned by any person or persons other than Buyer after the date hereof, an original copy of the lease schedule or rider relating to such Seller Equipment of the related master lease provided, that if any such master lease or lease schedule or rider relates to both railcars to be owned by Buyer after the date hereof and railcars to be owned by any person or persons other than Buyer after the date hereof, Seller may retain the original copies of such Seller Leases and deliver copies to Buyer so long as on or prior to the date hereof, Seller shall affix or stamp the following legend on the original copies of each Seller Lease (including the related master leases and any lease schedules or riders relating to any Seller Equipment):

The rights and interests of PLM Equipment Growth Fund VI or PLM Rail Partners, LLC under this Lease (and all amendments and riders hereto relating to certain railcars listed herein) and in such railcars, have been assigned to HSH Norbank AG, New York Branch and/or one or more financial institutions and are subject to a first priority perfected security interest in favor of such financial institutions or banks. To the extent that this Lease constitutes chattel paper, no security interest in this Lease may be created or perfected through the transfer or possession of this original.

Section 3.   Representations, Warranties and Covenants

Section 3.1.Seller represents and warrants to Buyer that:

(a)Organization; Powers. Seller (i) is a limited partnership duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (ii) has all requisite limited partnership power and authority to own its property and assets and to carry on its business as now conducted and as proposed to be conducted, (iii) is qualified to do business in every jurisdiction where such qualification is required, except where the failure so to qualify would not have a material adverse effect on the performance by Seller of its obligations under this Agreement, the Seller Bill of Sale and the Seller Assignment and Assumption Agreement and (iv) has the limited partnership power and authority to execute, deliver and perform its obligations un der this Agreement, the Seller Bill of Sale and the Seller Assignment and Assumption Agreement.

(b)Authorization; Conflicts. The execution, delivery and performance by Seller of each of this Agreement, the Seller Bill of Sale and the Seller Assignment and Assumption Agreement and the performance of the transactions contemplated hereby and thereby (i) have been duly authorized by all requisite limited partnership action and (ii) will not (A) violate (1) any provision of law, statute, rule or regulation the effect of which would be to cause or be reasonably expected to have a material adverse effect on the ability of Seller to perform any of its obligations under this Agreement, the Seller Bill of Sale and the Seller Assignment and Assumption Agreement, (2) any order of any Governmental Authority having proper jurisdiction over the Seller Equipment, ( 3) any provision of the certificate of limited partnership or limited partnership agreement of Seller, or (4) any provision of any indenture, loan agreement or other material agreement to which Seller is a party or by which it or any of its property is or may be bound, except for those releases that will be obtained on the date hereof, (B) be in conflict with, result in a breach of or constitute (alone or with notice or lapse of time or both) a default under any such indenture, loan agreement or other material agreement, or (C) result in the creation or imposition of any Lien upon or with respect to the Seller Equipment and the Seller Leases other than the Administrative Agent Liens and the Permitted Liens (as defined in the Loan Agreement).

(c)Enforceability. Each of this Agreement, the Seller Bill of Sale and the Seller Assignment and Assumption Agreement has been duly authorized, executed and delivered by Seller and constitutes a legal, valid and binding obligation of Seller enforceable against Seller in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and subject to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).

(d)Title and Ownership. Seller is the sole legal and beneficial owner of the Seller Equipment and the Seller Leases and has full power and lawful authority to sell, transfer, convey and assign all of Seller’s right, title and interest in and to the Seller Equipment and the Seller Leases to Buyer in the manner contemplated hereby. The provisions of this Agreement, the Seller Bill of Sale and the Seller Assignment and Assumption Agreement will be effective to convey to, and vest in, Buyer ownership of the Seller Equipment and all of Seller’s rights under the Seller Leases, and after giving effect to the transactions contemplated hereby Buyer shall be entitled to exercise all rights of the lessor under such Seller Lease (including the right of enforcement).

(e)Absence of Liens. Upon the execution of the Seller Bill of Sale and the Seller Assignment and Assumption Agreement, the Seller Equipment and the Seller Leases will be free from all Liens other than the Administrative Agent Liens and the Permitted Liens. Thereupon, legal title to the Seller Equipment, subject to the Seller Leases, and all rights and benefits under the Seller Leases shall pass to Buyer.

(f)Condition of the Railcars. Each item of Seller Equipment is free from all material defects in materials (except as to articles and materials incorporated therein by lessees under the Seller Leases) and workmanship under usual use and service. Each such item of Seller Equipment is in good operating order and condition in accordance with the rules and regulations of the Association of American Railroads and any Governmental Authority having proper jurisdiction over the Seller Equipment except for (A) any such item of Seller Equipment undergoing maintenance in the ordinary course of Seller’s business for railcars of a similar type and age and (B) as to any such item of Seller Equipment, such conditions which do not have, and are reasonably expected not to have, a m aterial adverse effect on the value of such item of Seller Equipment.

(g)Schedule Information. All of the information relating to the Seller Equipment and the Seller Leases set forth on Schedule 1 is true and correct in all material respects.

(h)Seller Lease Defaults. Seller is not in violation or breach of, or in default with respect to, any provision of any Seller Lease, except for such defaults which do not have, and are reasonably expected not to have, a material adverse effect on the value of the Seller Leases. To the knowledge of the Seller, none of the lessees under the Seller Leases are in violation or breach of, or are in default with respect to, any provision of any of the Seller Leases, except for such defaults which do not have, and are reasonably expected not to have, a material adverse effect on the value of the Seller Leases. Each Seller Lease has been duly authorized, executed and delivered by Seller and assuming the due authorization, execution a nd delivery by the related lessee, constitutes a legal, valid and binding obligation of Seller and such lessee enforceable against Seller and such lessee in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and subject to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).

(i)No Violation; Litigation. To Seller’s knowledge, no action has been taken, and no order, statute, rule, regulation, executive order, stay, decree, judgment or injunction shall have been enacted, promulgated, entered or enforced by any government, governmental agency or instrumentality or court, domestic or foreign, that prohibits or makes illegal or materially restricts the consummation of the transactions contemplated hereby or the use of the Equipment. There are no actions, suits, claims or legal, administrative or arbitral proceedings or investigations pending, or, to the knowledge of Seller, threatened against or involving Seller or any of the Seller Equipment or the Seller Leases, before any government, governmental agency or instrumentality or court, domestic or for eign, to prohibit, make illegal, or restrain the consummation of the transactions contemplated hereby or which, individually or in the aggregate, could reasonably be expected on the date hereof to have a material adverse effect upon the consummation of the transactions contemplated hereby or upon the value of the Seller Equipment or the Seller Leases.

(j)Government Approvals. Except for such consents, approvals, authorizations, filings, or declarations that have been made and that are in full force and effect (the “Required Consents”), no consent, approval or authorization from, or filing or declaration with, any Governmental Authority or any industry regulatory authority (including the Association of American Railroads) is required to be made by Seller to give Buyer a perfected ownership interest in the Seller Equipment and the Seller Leases or for the consummation of the transactions contemplated hereby.

(k)Marking of Seller Equipment. The marking or remarking of any of the railcars included in the Seller Equipment is not required by law to protect properly Buyer’s interest therein.

Section 3.2.Buyer represents and warrants to Seller that:

(a)Organization; Powers. Buyer (i) is a limited liability company duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization, (ii) has all requisite limited liability company power and authority to own its property and assets and to carry on its business as now conducted and as proposed to be conducted, (iii) is qualified to do business in every jurisdiction where such qualification is required, except where the failure so to qualify would not have a material adverse effect on the performance by Buyer of its obligations under this Agreement and the Seller Assignment and Assumption Agreement, and (iv) has the power and authority to execute, deliver and perform its obligations under this Agreement and the Seller Assignment and Assumption Agreement.

(b)Authorization; Conflicts. The execution, delivery and performance by Buyer of each of this Agreement and the Seller Assignment and Assumption Agreement and the performance of the transactions contemplated hereby and thereby (i) have been duly authorized by all requisite limited liability company action and (ii) will not (A) violate (1) any provision of law, statute, rule or regulation the effect of which would be to cause or be reasonably expected to have a material adverse effect on the ability of Buyer to perform any of its obligations under this Agreement and the Seller Assignment and Assumption Agreement, (2) any order of any Governmental Authority having proper jurisdiction over the Seller Equipment, (3) any provision of the certificate or ar ticles of formation or other organizational documents or operating agreement or limited liability company agreement of Buyer, or (4) any provision of any indenture, loan agreement or other material agreement to which Buyer is a party or by which it or any of its property is or may be bound or (B) be in conflict with, result in a breach of or constitute (alone or with notice or lapse of time or both) a default under any such indenture, loan agreement or other material agreement.

(c)Enforceability. Each of this Agreement and the Seller Assignment and Assumption Agreement has been duly authorized, executed and delivered by Buyer and constitutes a legal, valid and binding obligation of Buyer enforceable against Buyer in accordance with its terms, subject to bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and subject to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law).

(d)Organizational Documents. Buyer has heretofore delivered to Seller true and complete copies of its certificate of formation and its operating agreement as in effect on the date hereof.

Section 3.3.Buyer and Seller hereby agree that the transfer herein constitutes, for bankruptcy purposes, a true sale of the Seller Equipment and Seller Leases from Seller to Buyer such that Seller retains no interest in, or any risk with respect to, the Seller Equipment and Seller Leases except with respect to the representations, warranties and covenants made herein and such that none of the Seller Equipment or Seller’s interest in and title to the Seller Equipment and Seller Leases will be part of Seller’s estate prior to or in the event of the filing of a bankruptcy petition by or against Seller under any bankruptcy law. Seller will make appropriate entries in its financial statements to evidence such sale.

Section 3.4.All representations, warranties, covenants and agreements of the parties contained herein and in the Seller Bill of Sale and the Seller Assignment and Assumption Agreement shall survive the execution and delivery of this Agreement. With respect to each railcar included in the Seller Equipment, all representations and warranties contained in Section 3.1(f) with respect to such railcar and Seller Lease covering such railcar shall thereafter terminate and expire no later than six (6) months from the date hereof (the “Representation Termination Date”) with respect to any claim based upon, arising out of or otherwise in respect of any inaccuracy in or any breach of any such representation or warranty (a “Claim”) unless the party asserting a Claim shall have given written notice to the other party hereto of such Claim on or prior to such date.

Section 3.5.(a) On the date hereof, Seller shall pay to Buyer, in immediately available funds, the amount of Seller Rent Portion (as hereinafter defined). “Seller Rent Portion” shall mean the product of (1) all amounts of rent collected pursuant to the Seller Leases by or on behalf of Seller for the Seller Equipment with respect to the Contract Month and (2) a fraction, the numerator of which is the number of days from and including the date hereof until and including the last day of the Contract Month, and the denominator of which is the number of days in the Contract Month. Notwithstanding the foregoing, to the extent that on the Business Day prior to the date hereof, information is not available to Sell er regarding certain rent payments collected pursuant to such Seller Leases with respect to the Contract Month, Seller shall pay to Buyer, in immediately available funds, the Seller Rent Portion with respect to such rent payments promptly after such information becomes available.

(b)It is the intent of the parties hereto that (i) Seller receive all amounts due in respect of the Seller Equipment and the Seller Leases prior to the date hereof and all amounts due in respect of all other railcars owned by Seller at all times, including the period from and after the date hereof, (ii) Buyer receive all amounts due in respect of the Seller Equipment and the Seller Leases from and after the date hereof, and (iii) Seller be charged with all credits given to lessees for mileage compensation payments from railroads or the Association of American Railroads and other credits allowed to lessees or other parties on account of any time period prior to the date hereof.

Section 3.6.If it shall be determined that (a) Buyer or Seller received any amount to which the other was entitled or (b) Buyer or Seller was charged with any credit which should have been charged to the other, the party (Seller or Buyer) receiving such amount or to whom such credit should have been charged shall promptly notify the other (Buyer or Seller) of the discrepancy and pay over an amount equal thereto to the other (Buyer or Seller).

Section 4.   Information; Further Assurances, etc.

Section 4.1.Seller agrees that at any time and from time to time, at Buyer’s expense, Seller shall promptly and duly execute, deliver, file, register and record any and all such further instruments and documents and take such further actions as required by law or as Buyer may reasonably request in writing in order (i) to protect the title and ownership of Buyer to the Seller Equipment, the Seller Leases and the proceeds therefrom (including, but not limited to, the filing of applicable continuation statements under the Uniform Commercial Code to continue the perfection of Buyer’s interest in the Seller Leases) and (ii) to permit Buyer to obtain the full benefits of this Agreement and the rights and powers herein granted.

Section 4.2.Seller hereby covenants and agrees that at any time after the date hereof, at Buyer’s expense, Seller shall take any action reasonably requested by Buyer to allow Buyer to effectuate the assignment of the Seller Leases contemplated by the Seller Assignment and Assumption Agreement or to perform the obligations of, or enforce all of the rights, title and interest of, the lessor under the Seller Leases, insofar as they relate to the Seller Equipment, including, without limitation, the performance and enforcement of all rights of Buyer as lessor under the Seller Leases and submission to the jurisdiction of any court in which Buyer seeks to enforce its rights, title and interest in such Seller Leases.

Section 4.3.Any action or proceeding brought relating to this Agreement or the transactions contemplated hereby, may be brought and enforced in the courts of the State of New York or of the United States for the Southern District of New York. Buyer and Seller hereby irrevocably consent to the jurisdiction of each such court in respect of any such action or proceeding. Buyer and Seller further irrevocably consent to the service of process in any such action or proceeding by the mailing of copies thereof by registered or certified mail, postage prepaid, return receipt requested, to their respective addresses as provided for notices hereunder. The foregoing shall not limit the right to serve process in any other manner permitted by law or to bring any action or proceeding, or to obtain execution of any judgment, in any other jurisdiction.

Section 5.   Ineligible Railcars

Section 5.1.With respect to any one or more railcars included in the Seller Equipment prior to the Representation Termination Date (or in the case of any one or more Replacement Cars (as defined below) prior to the date which is six months from the date of delivery of such Replacement Cars), if either party to this Agreement determines in good faith that any of the representations and warranties set forth in Section 3.1(f), or the Seller Bill of Sale (the “Ineligible Car Representations”), were inaccurate (with respect to any railcars or the related leases sold by Seller), as of the date hereof or as of the date of delivery (with respect to Replacement Cars or the related leases) (the “Ineligible Cars”), then such party shall notify the other party to this Agreement in writing of such inaccuracy. Such notice shall generally describe the relevant Ineligible Car Representations, the inaccuracy of such Ineligible Car Representations, and the related equipment or leases. Within 30 days of the earlier of the discovery of any inaccuracy in the Ineligible Car Representations by Seller or after receipt of notification from Buyer, Seller, at its expense, may take any actions (including, without limitation, entering into a new user lease or repairing such railcar) to cure any such inaccuracy. Upon the expiration of the 30-day cure period described in the preceding sentence, Seller shall notify Buyer in writing either that it has cured such inaccuracy and, giving effect to the actions taken by it to cure under this Section 5.1, such Ineligible Car Representations would have been true and correct on the date hereof or as of the date of delivery (with respect to Replacement Cars or the related leases) or that such inaccuracy continues to exist (the “Cure Notification”). In the event that the Cure Notification indicates that Seller has cured the inaccurate Ineligible Car Representations, it shall provide evidence reasonably satisfactory to Buyer of the actions taken to accomplish the same.

Section 5.2.If the Ineligible Car Representations continue to be inaccurate on the expiration of the 30-day cure period referred to in Section 5.1, then, on a Business Day selected by Seller that is within 10 days after the expiration date of such 30-day cure period (the “Ineligible Car Closing Date”), at it’s option, Seller shall either (i) repurchase such Ineligible Cars for a cash purchase price equal to the purchase price allocated to such Ineligible Cars as of the delivery date of such Ineligible Cars (assuming that the Ineligible Car Representations as they relate to the Ineligible Cars and any related Seller Leases were accurate in all respects) (the “I neligible Car Value”), (ii) deliver replacement railcars (the “Replacement Cars”) to Buyer of similar age and utility as the Ineligible Cars and having an AAR Value as of the Ineligible Car Closing Date at least equal to the Ineligible Car Value and which otherwise satisfy the requirement set forth in the Loan Agreement and the Security Agreement in exchange for such Ineligible Cars and (iii) with respect to any inaccuracy in Section 3.1(e) arising because of the existence of any Lien on any of the railcars included in the Seller Equipment or on any Seller Lease, agree to indemnify the other party under Section 7.1 for any Losses based upon, arising out of, or otherwise in respect of such inaccuracy; provided that Seller may not elect the option under clause (iii) above if Seller shall have previously agreed to indemnify Buyer under clause (iii) for inaccuracies related to railcars included in the Seller Equipment with an aggregate AAR Value in excess of $100,000 and subject to Liens representing indebtedness and other amounts in excess of $100,000. It is understood that with respect to any group of two or more Ineligible Cars that are required to be replaced, indemnified for, or repurchased simultaneously under this Section 5.2, Seller may elect to repurchase and/or provide indemnification for one or more of such Ineligible Cars and replace the remainder of such Ineligible Cars. The purchase price shall be paid on the Ineligible Car Closing Date in immediately available funds without set-off.

Section 5.3.At least 5 Business Days prior to the Ineligible Car Closing Date, Seller shall deliver to Buyer and Administrative Agent a written statement selecting the Ineligible Car Closing Date, stating whether such party is electing to repurchase or replace the Ineligible Cars and setting forth in reasonable detail its calculation of the Ineligible Car Value (the “Ineligible Car Value Statement”). If Seller shall elect to deliver Replacement Cars to Buyer pursuant to Section 5.2, at the same time that Seller delivers the Ineligible Car Value Statement, Seller shall also deliver to Buyer a statement setting forth in reasonable detail the calculation of the AAR Value of the Re placement Cars (the “Replacement Car Value Statement”). The Replacement Car Value Statement shall also include a general description of the Replacement Cars (including the age, remaining service life, function and condition of each Replacement Car).

Section 5.4.Buyer and Seller shall execute and deliver such agreements and documents as are customary and appropriate for acquisitions of railcars (it being understood that if Seller delivers Replacement Cars to Buyer, then Seller shall make written representations and warranties concerning the Replacement Cars to Buyer which are substantially similar to the Ineligible Car Representations (the “Replacement Car Representations”)). Seller further agrees to promptly and duly execute, deliver, file, register and record any and all instruments and documents and take such action as required by law or as the other party may reasonably request in order to protect the title of the other party to the Replacement Car, any leases to which the Replacement Cars are or become subject, and the proceeds therefrom.

Section 5.5.Any Replacement Cars delivered pursuant to this Section 5 shall be deemed to be part of the Seller Equipment and shall be entitled to the benefits under this Section 5 to the extent that any Replacement Car Representations are inaccurate.

Section 6.   Costs and Expenses

Whether or not any item of Seller Equipment is delivered to Buyer pursuant to this Agreement, each party shall (except as set forth in Section 4 and in the Seller Assignment and Assumption Agreement) bear its own costs and expenses incurred in connection with this transaction (including any fees and disbursements of any legal, tax or accounting advisor); except that (a) if Seller is required to repurchase or replace any Ineligible Cars pursuant to Section 5, then Seller shall bear all of the costs and expenses of Buyer incurred in connection with the repurchase or replacement of such Ineligible Cars and (b) Seller shall be responsible for the payment of any transfer tax payable in connection with the transfer of the Seller Equipment, Seller Leases and the Replacement Cars (and any leases related thereto) contemplated hereby.

Section 7.   Indemnification; Limitation on Liability

Section 7.1.Obligation of Seller To Indemnify. Seller agrees to indemnify, defend and hold harmless Buyer (and its directors, officers, employees, affiliates, successors and assigns) from and against all losses, liabilities, damages, deficiencies, demands, claims, actions, judgments or causes of action, assessments, costs or expenses (including, without limitation, interest, penalties and reasonable attorneys’ fees and disbursements) (“Losses”) based upon, arising out of, or otherwise in respect of (i) any inaccuracy in or any breach of any representation, warranty, covenant, agreement of Seller contained in this Agreement, the Seller Bill of Sale or the Seller Assi gnment and Assumption Agreement (including the representations and warranties provided under Section 5.4, if any); provided that Seller’s indemnification obligations hereunder shall be subject to the express limitations of Section 3.4 and Section 5 and (ii) the ownership, rental, maintenance, use or operation of (a) each item of Seller Equipment and the Seller Leases prior to the date hereof and (b) any Replacement Cars and any related leases prior to the date of delivery thereof. Buyer’s sole remedy for any breach of any representation or warranty of Seller expressly set forth in this Agreement shall be for indemnification pursuant to this Section 7 or for repurchase or replacement of railcars pursuant to Section 5.

Section 7.2.Obligation of Buyer To Indemnify. Buyer agrees to indemnify, defend and hold harmless Seller (and its directors, officers, employees, affiliates, successors and assigns) from and against all Losses based upon, arising out of, or otherwise in respect of any inaccuracy in or any breach of any representation, warranty, covenant or agreement of Buyer contained in this Agreement or the Seller Assignment and Assumption Agreement. Seller’s sole remedy for any breach of any representation or warranty of Buyer expressly set forth in this Agreement shall be for indemnification pursuant to this Section 7.

Section 8.   Contest Rights

Section 8.1.Notice and Opportunity To Defend.

(a)Notice of Asserted Liability. Promptly after receipt by any party hereto (the “Indemnitee”) of notice of any demand, claim or circumstances, which, with a lapse of time, would or might give rise to a claim or the commencement (or threatened commencement) of any action, proceeding or investigation (the “Asserted Liability”) that may result in a Loss, the Indemnitee shall give notice thereof (the “Claims Notice”) to any other party obligated to provide indemnification pursuant to Section 7.1 or 7.2 (the “Indemnifying Party”). The Claims Notice shall describe the Asserted Liability in reasonable detail and shall indicate the amount (estimated if necessary and to the extent feasible) of the Loss that has been or may be suffered by the Indemnitee.

(b)Opportunity To Defend. The Indemnifying Party may elect to compromise or defend, at its own expense and by its own counsel, any Asserted Liability. If the Indemnifying Party elects to compromise or defend such Asserted Liability, it shall within 30 days (or sooner, if the nature of the Asserted Liability so requires) notify the Indemnitee of its intent to do so, and the Indemnitee shall cooperate, at the expense of the Indemnifying Party, in the compromise of, or defense against, such Asserted Liability. If the Indemnifying Party elects not to compromise or defend the Asserted Liability, fails to notify the Indemnitee of its election as herein provided or contests its obligation to pay an indemnity under this Agreement, the Indemnitee may pay, compromise or defend such Asserted Liability. Notwithstanding the foregoing, neither the Indemnifying Party nor the Indemnitee may settle or compromise any claim over the objection of the other; provided, however, that consent to settlement or compromise shall not be unreasonably withheld or delayed. In any event, the Indemnitee and the Indemnifying Party may participate, at their own expense, in the defense of any such Asserted Liability. If the Indemnifying Party chooses to defend any claim, the Indemnitee shall make available to the Indemnifying Party any books, records or other documents within its control that are necessary or appropriate for such defense.

Section 8.2.Limitations on Liability; Payments. The aggregate liability of Seller for repurchases of Ineligible Railcars pursuant to Section 5, for indemnification under Section 7 (other than clause (ii) of Section 7.1) and for all breaches of its representations or warranties expressly set forth herein and in the Seller Assignment and Assumption Agreement and the Seller Bill of Sale, shall be limited to an amount not in excess of the purchase price of the Seller Equipment contributed hereunder. All indemnification payments shall be made by the Indemnifying Party in immediately available funds, without set-off.

Section 9.   Notices

Any notice or communication under this Agreement shall be sufficiently given if in writing and mailed by first-class mail, postage prepaid, or delivered in person or by telex, telecopier or overnight air courier guaranteeing next day delivery, addressed as follows:

If to Seller:

235 Third Street South
Suite 200
St. Petersburg, FL 33701

If to Buyer:

PLM Rail Partners, LLC
1 North LaSalle Street
Suite 2700
Chicago, Illinois 60602
Attention: Michael Clayton

with a copy to Administrative Agent:

HSH Nordbank AG, New York Branch
590 Madison Avenue, 28^th Floor
New York, New York 10022
Attention: Kristie Li

with a copy to:

Pillsbury Winthrop LLP

1540 Broadway
New York, New York 10036
Attention: Jonathan B. Whitney, Esq.

Either of the above parties by notice to the other party may designate additional or different addresses for subsequent notices or communications. All notices and communications shall be deemed to have been duly given: at the time of delivery by hand, if personally delivered; five business days after being deposited in the mail, postage prepaid, if mailed; when answered back, if telexed; when receipt acknowledged, if sent by telecopier; and the next Business Day after timely delivery to the courier, if sent by overnight air courier guaranteeing next day delivery. If a notice or communication is given in the manner provided above within the time prescribed, it is duly given, whether or not such party receives it.

Section 10.   Amendment

Neither this Agreement nor any of the terms hereof may be terminated, amended, supplemented, waived or modified, except by an instrument in writing signed by Buyer and Seller.

Section 11.   Successors and Assigns

Neither party may assign any of its rights or obligations under this Agreement without the prior written consent of the other party; provided, however, that it is agreed and understood that Buyer may assign its rights with respect to any railcars included in the Seller Equipment to Administrative Agent and any purchaser of, or other lender in respect of, such railcars. Administrative Agent or any such other lender may only take action as Buyer is entitled to hereunder from and after the time an Event of Default (as defined in the Loan Agreement) or an event of default as defined in the loan documentation with such other lender shall have occurred and be continuing; provided that Administrative Ag ent, the Lender (as defined in the Loan Agreement), or such other lender may at any time give the notice of an inaccuracy in any of the Ineligible Car Representations pursuant to Section 5.1. All covenants and agreements in this Agreement made by or on behalf of the parties hereto shall bind and inure to the benefit of the respective successors and assigns of the parties hereto whether so expressed or not.

Section 12.   Counterparts

This Agreement may be executed in any number of counterparts, each of which when so executed shall be deemed to be an original; such counterparts together shall constitute but one Agreement.

Section 13.   Governing Law

This agreement shall be governed by and construed in accordance with the law of the State of New York.

Section 14.   Severability

Any provision of this Agreement that may be prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof so long as the economic or legal substance for the transactions contemplated thereby is not affected in any manner adverse to any party. Such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

Section 15.   No Petition in Bankruptcy

Prior to the date that is one year and one day after the later to occur of (i) the payment in full of the loans made by the Lender under the Loan Agreement or (ii) the payment in full of any indebtedness incurred by Buyer to refinance the loan made by Administrative Agent under the Loan Agreement, Seller covenants and agrees that it will not institute against, or join any other person in instituting against, Buyer an action in bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or any other similar proceeding under the laws of the United States or any state of the United States.

[Signature Page Follows]

In Witness Whereof, the parties hereto have entered into this Asset Transfer Agreement as of the date first written above.

PLM Equipment Growth Fund VI, a California limited partnership

By: PLM Financial Services, Inc., a Delaware corporation, its sole general partner

By____________________________________________________

                Name:_______________________________________________

                Title:________________________________________________

PLM Rail Partners, LLC, a Delaware limited liability company

By: Transportation Equipment-PLM, LLC, a Delaware limited liability company, its manager

By____________________________________________________

                Name:_______________________________________________

                Title:_________________________________________________

Schedule 1

Description of Seller Equipment

Each of the railcars with the reporting marks and road numbers and Association of American Railroads designation numbers set forth on Annex A hereto.

Description of Seller Leases

Each of the user leases or lease schedules or riders with the contract rider number and the named lessee set forth in Annex B hereto insofar as it relates to the railcars with the car numbers set forth on Annex B hereto.

Exhibit A

Seller Assignment and Assumption Agreement

Exhibit B

Seller Bill of Sale

Annex A

Seller Equipment Description

Annex B

Seller Leases

EX-10.3

Limited Liability Company Agreement

of

PLM Rail Partners, LLC

Table of Contents

SECTION	HEADING	PAGE
ARTICLE I	DEFINED TERMS	1
ARTICLE II	FORMATION AND TERM	8
Section 2.1.	Formation	8
Section 2.2.	Name of the Company	8
Section 2.3.	Existence	8
Section 2.4.	Registered Agent and Office	8
Section 2.5.	Principal Place of Business	8
ARTICLE III	PURPOSE AND POWERS OF THE COMPANY	9
Section 3.1.	Purpose	9
Section 3.2.	Powers of the Company	9
ARTICLE IV	CAPITAL CONTRIBUTIONS AND CAPITAL ACCOUNTS	9
Section 4.1.	Capital Contributions	9
Section 4.2.	Member's LLC Interest	9
Section 4.3.	Certificates	10
Section 4.4.	Lost Certificates	10
Section 4.5.	Status of Capital Contributions	10
Section 4.6.	Capital Accounts	10
Section 4.7.	Advances	11
Section 4.8.	Tax Treatment	11
ARTICLE V	MEMBERS	11
Section 5.1.	Powers of Members	11
Section 5.2.	Reimbursements	12
Section 5.3.	Restrictions on Transfers; Right of First Refusal	12
Section 5.4.	Additional Restrictions	14
Section 5.5.	Right of First Refusal Concerning Equipment	14
ARTICLE VI	MANAGEMENT	15
Section 6.1.	Manager	15
Section 6.2.	General Powers of the Manager	16
Section 6.3.	Removal, Resignation and Replacement of the Manager	16
Section 6.4.	Devotion of Time	16
Section 6.5.	No Management by Other Members	16
Section 6.6.	Matters Requiring Independent Manager Approval	16
ARTICLE VII	MEETINGS AND VOTING BY MEMBERS	17
Section 7.1.	Meetings	17
Section 7.2.	Telephonic Meetings	18
Section 7.3.	Member Approval	18
Section 7.4.	Written Consent	18
ARTICLE VIII	AMENDMENTS	18
ARTICLE IX	ALLOCATIONS AND DISTRIBUTIONS	18
Section 9.1.	Manager's Determination	18
Section 9.2.	Distributions	19
Section 9.3.	No Violation	19
Section 9.4.	Withholding	19
Section 9.5.	Property Distributions and Installment Sales	19
Section 9.6.	Allocations of Net Profit or Net Loss	19
Section 9.7.	Special Allocations	20
Section 9.8.	Loss Limitation	21
Section 9.9.	Curative Allocations	21
Section 9.10.	Other Allocation Rules	22
Section 9.11.	Tax Allocations: Code Section 704(c)	22
Section 9.12.	Interpretation	22
ARTICLE X	ACCOUNTING	23
ARTICLE XI	TAX MATTERS PARTNER	23
ARTICLE XII	LIABILITY, EXCULPATION AND INDEMNIFICATION	23
Section 12.1.	Liability	23
Section 12.2.	Exculpation	24
Section 12.3.	Indemnification	24
Section 12.4.	Expenses	24
Section 12.5.	Outstanding Businesses	25
ARTICLE XIII	DISSOLUTION, LIQUIDATION AND TERMINATION	25
Section 13.1.	Dissolution	25
Section 13.2.	Notice of Dissolution	25
Section 13.3.	Liquidation	25
Section 13.4.	Termination	25
Section 13.5.	Claims of the Members	26
ARTICLE XIV	MISCELLANEOUS	26
Section 14.1.	Notices	26
Section 14.2.	Entire Agreement	26
Section 14.3.	Governing Law	26
Section 14.4.	Headings	26
Section 14.5.	Assigns	26
Section 14.6.	No Implied Rights or Remedies	26
Section 14.7.	Counterparts	26
Section 14.8.	Severability	27
Section 14.9.	Agreement Drafted by Counsel for the Company	27

Limited Liability Company Agreement
of

PLM Rail Partners, LLC

This Limited Liability Company Agreement of PLM Rail Partners, LLC, a Delaware limited liability company (the “Company”), is made and entered into as of June 29, 2004 (as amended and in effect from time to time, this “Agreement”), by and among the signatories hereto.

Recitals

Whereas, the Company was formed pursuant to the Delaware Limited Liability Company Act, 6 Del. C. §18-101,et seq. (as amended and in effect from time to time the “Delaware Act”), by filing the Certificate of Formation of the Company with the office of the Secretary of State of the State of Delaware and entering into this Agreement; and

Whereas, the parties have agreed to operate a limited liability company in accordance with the terms and subject to the conditions set forth in this Agreement;

Now, Therefore, in consideration of the agreements and obligations set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Members (as hereinafter defined) hereby agree as follows:

Article I

Defined Terms

Unless the context otherwise requires, the terms defined in this Article I shall, for the purposes of this Agreement, have the meanings herein specified.

“Adjusted Capital Account Deficit” shall mean, with respect to any Member, the deficit balance, if any, in such Member’s Capital Account as of the end of the relevant Fiscal Year, after giving effect to the following adjustments:

(a)credit to such Capital Account any amounts which such Member is obligated to restore pursuant to any provision of this Agreement or is deemed to be obligated to restore pursuant to the next to the last sentences of the Regulations Sections 1.704-2(g)(1) and 1.704-2(i)(5) after taking into account any changes during such year in Company minimum gain and Member minimum gain (as determined under such Regulations); and

(b)debit to such Capital Account the items described in Section 1.704-1(b)(2)(ii)(d)(4), (5) and (6) of the Regulations.

“Administrative Agent” shall have the meaning assigned to it in the Loan Agreement.

“Affiliate” shall mean, with respect to any Member, any other Person controlling, controlled by or under common control with, such Person. As used in this definition, “control,” “controlled by” and “under common control with” mean the possession, directly or indirectly, of power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise.

“Agreement” shall mean this Agreement, including all Exhibits hereto, as the same may be amended or supplemented from time to time in accordance with the terms hereof.

“Asset Transfer Agreements” shall have the meaning assigned to it in the Loan Agreement.

“Assignments” shall have the meaning assigned to it in the Loan Agreement.

“Bills of Sale” shall have the meaning assigned to it in the Loan Agreement.

“Bona Fide Offer” has the meaning set forth in Section 5.3(b).

“Book Gain” or “Book Loss” shall mean the gain or loss recognized by the Company for Code Section 704(b) book purposes in any Fiscal Year or other period by reason of the sale, exchange or other disposition of any Company asset. Such Book Gain or Book Loss shall be computed by reference to the Book Value of such asset as of the date of such sale, exchange or other disposition, rather than by reference to the tax basis of such asset as of such date, and each and every reference herein to “gain” or “loss” shall be deemed to refer to Book Gain or Book Loss, rather than to tax gain or tax loss, unless otherwise expressly provided herein.

“Book Value” means with respect to any asset, the asset’s adjusted basis for federal income tax purposes, except as follows:

(i)the initial Book Value of any asset contributed by a Member to the Company shall be the gross fair market value of such asset, as determined by the Manager; provided that the initial Book Values of the asset to be contributed to the Company pursuant to Section 4.1 hereof shall be as set forth on Exhibit A dated June 29, 2004 attached hereto and Exhibit A dated July 1, 2004 attached hereto;

(ii)the Book Values of all Company assets shall be adjusted to equal their respective gross fair market values (taking Code Section 7701(g) into account), as determined by the Manager as of the following times: (A) the acquisition of an additional interest in the Company by any new or existing Member in exchange for more than a de minimis Capital Contribution; (B) the distribution by the Company to a Member of more than a de minimis amount of Company property as consideration for an interest in the Company; (C) to the extent permitted under proposed or final Regulations, the grant of an interest in the Company (other than a de minimis interest) as consideration for the provision of services to or for the benefit of the Company by an existing Member of the Company acting in a Member capacity, or by a new member of the Company acting in a Member capacity or in anticipation of being a Member; and (D) the liquidation of the Company within the meaning of Regulations Section 1.704-l(b)(2)(ii)(g); provided that an adjustment described in clauses (A), (B) and (C) of this paragraph shall be made only if the Manager reasonably determines that such adjustment is necessary to reflect the relative economic interests of the Members in the Company;

(iii)the Book Value of any item of Company assets distributed to any Member shall be adjusted to equal the gross fair market value (taking Code Section 7701(g) into account) of such asset on the date of distribution as determined by the Manager; and

(iv)the Book Values of Company assets shall be increased (or decreased) to reflect any adjustments to the adjusted basis of such assets pursuant to Code Section 734(b) or Code Section 743(b), but only to the extent that such adjustments are taken into account in determining Capital Accounts pursuant to Regulations Section 1.704-1(b)(2)(iv)(m) and subparagraph (iv) of the definition of “Net Profit” and “Net Loss.”

If the Book Value of an asset has been determined or adjusted pursuant to subparagraph (i), (ii) or (iv), such Book Value shall thereafter be adjusted by the Depreciation taken into account with respect to such asset for purposes of computing Profits and Losses.

“Capital Account” shall mean, with respect to any Member, the account maintained for such Member in accordance with the provisions of Section 4.6 hereof.

“Capital Contribution” shall mean with respect to any Member, the total amount of cash, plus the fair market value of any other property (net of liabilities assumed or to which the property is subject) or assets contributed or deemed to be contributed to the Company with respect to the LLC Interest held by such Member pursuant to the terms of this Agreement.

“Certificate” shall mean the Certificate of Formation of the Company and any and all amendments thereto and restatements thereof filed on behalf of the Company with the Secretary pursuant to the Delaware Act.

“Closing Date” shall have the meaning assigned to it in the Loan Agreement.

“Code” shall mean the Internal Revenue Code of 1986, as amended from time to time, or any corresponding federal tax statute enacted after the date of this Agreement. A reference to a specific section of the Code refers not only to such specific section but also to any corresponding provision of any federal tax statute enacted after the date of this Agreement, as such specific section or corresponding provision is in effect on the date of application of the provisions of this Agreement containing such reference.

“Company” has the meaning set forth in the Recitals hereto.

“Company Minimum Gain” shall have the meaning set forth in Section 1.704-2(b)(2) and 1.704-2(d) of the Regulations for “partnership minimum gain.”

“Covered Person” shall mean any Member, any Affiliate of a Member or any officer, director, member, manager, partner, employee, representative or agent of the Company, any Member or any of their respective Affiliates.

“Delaware Act” has the meaning set forth in the Recitals hereto.

“Depreciation” shall mean for each Fiscal Year or other period, an amount equal to the depreciation, amortization or other cost recovery deduction allowable with respect to an asset for such year or other period for federal income tax purposes, except if the Book Value of an asset differs from its adjusted basis for federal income tax purposes at the beginning of any such year or other period, Depreciation shall be an amount that bears the same relationship to the Book Value of such asset as the depreciation, amortization or other cost recovery deduction computed for tax purposes with respect to such asset for the applicable period bears to the adjusted tax basis of such asset at the beginning of such period, or if such asset has a zero adjusted tax basis, Depreciation shall be an amount determined under any reasonable method selected by the Manager, with the advice of its independent accountants.

“Distribution” shall mean cash or property (net of liabilities assumed or to which the property is subject) distributed to a Member or an assignee in respect of the Member’s LLC Interest in the Company.

“Equipment” shall have the meaning assigned to it in Section 2.02 of the Security Agreement.

“Equipment Closing” has the meaning set forth in Section 5.5(c).

“Equipment Leases” shall have the meaning assigned to it in the Security Agreement.

“Equipment Notice” has the meaning set forth in Section 5.5(b).

“Equipment Offer” has the meaning set forth in Section 5.5(b).

“Equipment Option” has the meaning set forth in Section 5.5(c).

“Equipment Option Exercise Period” has the meaning set forth in Section 5.5(c).

“Event of Default” shall have the meaning assigned to it in the Loan Agreement.

“Exercising Member” has the meaning set forth in Section 5.5(c).

“Fiscal Year” means (i) the period that commenced upon the formation of the Company and ending on December 31, 2004, (ii) any subsequent twelve (12) month period commencing on January 1 and ending on December 31, or (iii) any portion of the period described in clause (ii) of this sentence for which the Company is required to allocate Net Profits, Net Losses and other items of Company income, gain, loss or deduction pursuant to Article IX hereof.

“Identified Third Party” has the meaning set forth in Section 5.3(b).

“Independent Manager” shall mean, so long as any Obligation under the Loan Documents shall remain outstanding, a Person designated as such by the Administrative Agent.

“Interest Certificate” has the meaning set forth in Section 4.3.

“Lenders” shall have the meaning assigned to it in the Loan Agreement.

“LLC Interest” shall mean a Member’s share of Net Profits and Net Losses of the Company, the right to receive distributions from the Company, the right to inspect the Company’s books and records and the right to participate in the management of and vote on matters coming before the Company, as evidenced by an Interest Certificate.

“Loan Agreement” shall mean the Loan Agreement to be entered into, on or about the date hereof, by the Company, as Borrower, the Lenders party thereto, and HSH Nordbank AG, New York Branch, as Administrative Agent.

“Loan Documents” shall have the meaning assigned to it in the Loan Agreement.

“Management Agreement” has the meaning set forth in Section 6.1.

“Manager” shall mean each Person signing this Agreement and each Person who subsequently is admitted, as a Manager in accordance with the terms hereof.

“Member” shall mean each Person signing this Agreement and any Person, who subsequently is admitted as a Member in accordance with the terms hereof.

“Member Nonrecourse Debt” has the same meaning as the term “partner nonrecourse debt” in Section 1.704-2(b)(4) of the Regulations.

“Member Nonrecourse Debt Minimum Gain” means an amount, with respect to each Member Nonrecourse Debt, equal to the Company Minimum Gain that would result if such Member Nonrecourse Debt were treated as a Nonrecourse Liability, determined in accordance with Section 1.704-2(i)(3) of the Regulations.

“Member Nonrecourse Deductions” has the same meaning as the term “partner nonrecourse deductions” in Sections 1.704-2(i)(1) and 1.704-2(i)(2) of the Regulations.

“Nonrecourse Deductions” has the meaning set forth in Section 1.704-2(b)(1) of the Regulations.

“Nonrecourse Liability” has the meaning set forth in Section 1.704-2(b)(3) of the Regulations.

“Net Profit” and “Net Loss” shall mean, for each Fiscal Year or other period, an amount equal to the Company’s taxable income or loss, respectively, for such year or period, determined in accordance with Section 703(a) of the Code (taking into account all items of income, gain, loss or deduction required to be stated separately pursuant to Section 703(a)(1) of the Code), with the following adjustments:

(i)any income of the Company that is exempt from federal income tax and not otherwise taken into account in computing Net Profit or Net Loss pursuant to this provision shall be added to such taxable income or loss;

(ii)any expenditures of the Company described in Section 705(a)(2)(B) of the Code (relating to expenditures which are neither deductible nor properly chargeable to capital) or treated as Code Section 705(a)(2)(B) expenditures pursuant to Section 1.704-1(b)(2)(iv)(i) of the Regulations, and not otherwise taken into account in computing Net Profit or Net Loss pursuant to this provision, shall be subtracted from such taxable income or loss;

(iii)Book Gain or Book Loss from the sale or other disposition of any asset of the Company shall be taken into account in lieu of any tax gain or tax loss recognized by the Company by reason of such sale or other disposition; and

(iv)in lieu of the depreciation, amortization and other cost recovery deductions taken into account in computing such taxable income or loss, there shall be taken into account Depreciation for such fiscal year or other period, computed as provided in this Agreement.

“Nonrecourse Deductions” shall have the meaning set forth in Regulations Section 1.704-2(b)(1).

“Obligations” shall have the meaning assigned to it in the Security Agreement.

“Offered LLC Interests” has the meaning set forth in Section 5.3(b).

“Offeror” has the meaning set forth in Section 5.5(b).

“Option” has the meaning set forth in Section 5.3(c).

“Option Closing” has the meaning set forth in Section 5.3(c).

“Option Exercise Period” has the meaning set forth in Section 5.3(c).

“Option Holder” has the meaning set forth in Section 5.3(c).

“Original Member” shall mean each of PLM Equipment Growth Fund V, PLM Equipment Growth Fund VI and PLM Equipment Growth & Income Fund VII and their respective Affiliates as long as such Person is a Member.

“Other Member” shall mean each Member other than an Original Member.

“Percentage Interest” shall mean, with respect to any Member as of any date, the ratio (expressed as a percentage) of the aggregate amount of such Member’s Capital Contribution, represented by the LLC Interests as set forth on Exhibit A attached hereto, on such date to the aggregate amount of Capital Contributions represented by the LLC Interests of all of the Members set forth on Exhibit A attached hereto on such date.

“Permitted Distributions” has the meaning set forth in Section 9.1.

“Person” shall mean any individual, partnership, corporation, association, trust, limited liability company, joint venture, unincorporated organization and any government, governmental department or agency or political subdivision thereof.

“Pledge Agreement” shall mean the Pledge Agreement to be entered into, on or about the date hereof, by each Original Member and Transportation Equipment-PLM, LLC, as Pledgors, and HSH Nordbank AG, New York Branch, as Secured Party.

“Qualified Income Offset” shall have the meaning set forth in Regulations Section 1.704-1(b)(2)(ii)(d).

“Regulations” shall mean the income tax regulations, including temporary regulations, promulgated under the Code, as such regulations may be amended from time to time (including corresponding provisions of succeeding regulations).

“Secretary” shall mean the Office of the Secretary of State of the State of Delaware.

“Secured Creditors” shall have the meaning assigned to it in the Security Agreement or the Pledge Agreement.

“Secured Party” shall have the meaning assigned to it in the Security Agreement or the Pledge Agreement, as applicable.

“Security Agreement” shall mean the Security Agreement—Chattel Mortgage to be entered into, on or about the date hereof, by the Company, as Debtor and HSH Nordbank AG, New York Branch, as Secured Party.

“Security Interest” shall have the meaning assigned to it in the Loan Agreement.

“Tax Matters Partner” shall have the meaning set forth in Article XI.

“Transfer” shall mean any sale, hypothecation, pledge, assignment, attachment, encumbrance, abandonment, disposition or other transfer.

“Transfer Notice” has the meaning set forth in Section 5.3(b).

“Transferring Member” has the meaning set forth in Section 5.3(b).

“Two-Thirds Interest” shall mean sixty-six and two-thirds percent (66 2/3%) of the Percentage Interests.

Article II

Formation and Term

Section 2.1.Formation. (a) The Members have caused the formation of the Company as a Delaware limited liability company under and pursuant to the provisions of the Delaware Act and agree that the rights, duties and liabilities of the Members shall be as provided in the Delaware Act, except as otherwise provided herein.

(b)The name and business or mailing address of each Member, the Capital Contribution of each Member and each Member’s Percentage Interest shall be listed on Exhibit A attached hereto. The Manager shall update Exhibit A from time to time as necessary to accurately reflect the information therein. Any amendment or revision to Exhibit A made in accordance with this Agreement shall not be deemed an amendment to this Agreement. Any reference in this Agreement to Exhibit A shall be deemed to be a reference to Exhibit A as amended and in effect from time to time.

Section 2.2.Name of the Company. The name of the Company shall be “PLM Rail Partners, LLC.” As long as any Obligation under the Loan Documents shall remain outstanding, the business of the Company may not be conducted under any other name unless consented to in writing by the Administrative Agent.

Section 2.3.Existence. The existence of the Company commenced at the time of the filing of the Certificate with the Secretary and shall continue for a term ending April 21, 2019 unless dissolved before such date in accordance with the provisions of this Agreement.

Section 2.4.Registered Agent and Office. The Company’s registered agent and office in Delaware shall be Corporation Service Company at 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808. At any time, the Manager, in its sole discretion, may designate another registered agent and/or registered office.

Section 2.5.Principal Place of Business. The principal place of business of the Company shall be 1 North LaSalle Street, Suite 2700, Chicago, Illinois 60602. As long as any Obligation under the Loan Documents shall remain outstanding, the location of the Company’s principal place of business may not be changed unless consented to in writing by the Administrative Agent.

Article III

Purpose and Powers of the Company

Section 3.1.Purpose. As long as any Obligation under the Loan Documents shall remain outstanding, the Company’s sole object and purpose shall be (i) acquiring all of the rights, title and interests to and in the Equipment from the Original Members pursuant to the Asset Transfer Agreements and Bills of Sale, (ii) assuming all of the rights, title and interests in the Equipment Leases relating to the Equipment from the Original Members pursuant to the Assignments, (iii) borrowing funds from the Lenders related to its ownership of the Equipment pursuant to the Loan Agreement, (iv) granting the Security Interest to the Secured Party pursuant to the Security Agreement, (v) entering into a Management Agreement with the Manager for purposes of ma naging the Equipment, and (vi) engaging in any other activities contemplated and/or expressly permitted by the Loan Documents; provided, however, after all Obligations under the Loan Documents are satisfied, the Company may engage in any lawful act or activity which limited liability companies may engage in under the Delaware Act.

Section 3.2.Powers of the Company. (a) The Company shall have the power and authority to take any and all actions necessary, convenient or incidental to or for the furtherance of the purpose set forth in Section 3.1 hereof.

(b)The Manager may authorize any Person (including, without limitation, any other Member) to enter into and perform any document, instrument or agreement necessary, convenient or incidental to the accomplishment of the purpose set forth in Section 3.1 hereof on behalf of, and in the name of, the Company.

Article IV

Capital Contributions and Capital Accounts

Section 4.1.Capital Contributions. (a) Upon execution of this Agreement, each Member shall have contributed to the Company the Capital Contribution as set forth on Exhibit A dated June 29, 2004 attached hereto. On July 1, 2004, each Member shall have contributed to the Company the Capital Contribution as set forth on Exhibit A dated July 1, 2004 attached hereto.

(b)No Member shall be required to make any additional Capital Contributions to the Company. However, a Member may make additional Capital Contributions to the Company on terms and conditions satisfactory to, and only with the prior written consent of, the Manager.

Section 4.2.Member’s LLC Interest. A Member’s LLC Interest shall for all purposes be personal property. A Member has no interest in specific Company property. All LLC Interests shall be governed by and determined to be a “security” under Article 8 of the Uniform Commercial Code as adopted in the State of Delaware.

Section 4.3.Certificates. Each Member acquiring an LLC Interest in the Company shall be issued a certificate, in the form set forth in Exhibit C hereto, to evidence such LLC Interest (each, an “Interest Certificate”). All Interest Certificates shall be signed on behalf of the Company by the Manager. Moreover, an authorized partner, officer or manager of the relevant Member shall sign the Interest Certificate acknowledging receipt of such Interest Certificate. By accepting delivery of an Interest Certificate, each Member represents that it is not acquiring the Interest Certificate with a view to public distribution and the transfer of an Interest Certificate shall not be allow ed if it would require registration under the United States Securities Act of 1933, as amended (the “Securities Act”), any other federal securities laws or regulations or the securities law or regulations of any other applicable jurisdiction. All Interest Certificates that are issued by the Company shall be a security governed by Article 8 of the Uniform Commercial Code of the State of Delaware.

Section 4.4.Lost Certificates. Except as provided in this Section 4.4, no new Interest Certificate shall be issued in lieu of an old Interest Certificate unless the latter is surrendered to the Company and canceled at the same time. The Manager of the Company shall, in case any Interest Certificate is lost, stolen or destroyed, authorize the issuance of a new Interest Certificate in lieu thereof.

Section 4.5.Status of Capital Contributions. (a) No Member shall have the right to withdraw any part of its Capital Contribution or otherwise to voluntarily or involuntarily withdraw from the Company. Each of the Members waives any and all rights that it may have to maintain an action for partition of the Company’s property or other property or to otherwise be paid any amount in respect of a withdrawal from the Company.

(b)No Member shall receive any interest, salary or drawing with respect to its Capital Contributions or its Capital Account or for services rendered on behalf of the Company or otherwise in its capacity as a Member, except as otherwise specifically provided in this Agreement.

(c)Except as provided in Section 4.7 hereof,no Member shall be liable for any debts, liabilities, contracts or obligations of the Company or be required to lend any funds to the Company. No Member shall have any liability for the repayment of any Capital Contributions of any other Member.

Section 4.6.Capital Accounts. A separate account (each, a “Capital Account”) shall be established and maintained for each Member which shall be increased by (i) the amount of cash and the fair market value, as determined by the Manager, of any other property contributed by such Member to the Company as a Capital Contribution (net of liabilities secured by such property or that the Company is considered to assume or take the property subject to pursuant to Code Section 752) and (ii) such Member’s share of the Net Profit of the Company, and the Capital Account shall be reduced by (i) the amount of cash and the fair market value, as determined by the Man ager, of any other property distributed to such Member (net of liabilities secured by such property or that the Member is considered to assume or take the property subject to pursuant to Code Section 752) and (ii) such Member’s share of the Net Loss of the Company. It is the intention of the Members that the Capital Accounts of the Company be maintained in accordance with the provisions of Section 704(b) of the Code and the Regulations thereunder and that this Agreement be interpreted consistently therewith.

Section 4.7.Advances. If any Member shall advance any funds to the Company in excess of its Capital Contributions, the amount of such advance shall neither increase its Capital Account nor in any way affect such Member’s share of the Net Profits, Net Losses, credits and Distributions of the Company. The amount of any such advance shall be a debt obligation of the Company to such Member and shall be repaid to it by the Company upon such terms and conditions as shall be determined by the Manager; provided, however, as long as any Obligation under the Loan Documents shall remain outstanding, any such advance (i) shall be subordinated to the rights of the Secured Creditors under the Loan Documents in terms satisfactory to such Secured Creditors and (ii) shall only be repaid by the Company from funds available for Permitted Distributions. Any such advance shall be payable and collectible only out of Company assets, and the other Members shall not be obligated to repay any part thereof. No Person who makes any nonrecourse loan to the Company shall have or acquire, as a result of making such loan, any direct or indirect interest in the Net Profits or any other property of the Company, other than as a creditor. If for any reason the Company fails to pay Transportation Equipment-PLM, LLC any Management Fee (as defined in the Management Agreement), each Member agrees to pay a portion of such Management Fee to Transportation Equipment-PLM, LLC, in accordance with its Percentage Interest, and such advances by the Members shall be debt obligations of the Company and be promptly repaid to the Members by the Company; provided, however, as long as any Obligation under the Loan Documents shall remain outstanding, any such advance by any Member (i) shall be subordinated to the rights of the Secured Creditors under the Loan Documents in terms satisfactory to such Secured Creditors and(ii) shall only be repaid by the Company from funds available for Permitted Distributions. So long as any Obligation under the Loan Documents shall remain outstanding, in the event Transportation-Equipment-PLM, LLC’s Management Fee is paid by the Members pursuant to this Section 4.7, Transportation Equipment-PLM, LLC shall provide the Company with a written acknowledgement that such Management Fee has been paid by the Members within a reasonable period of time after receipt of such Management Fee.

Section 4.8.Tax Treatment. It is the intention of the Members that the Company be treated as a “partnership” for United States federal, state and local income tax purposes, and, except as otherwise required by law, no Member shall take any action inconsistent with the classification of the Company as a partnership for such income tax purposes. Consistent with such intention, the Company shall not make an election under Section 301.7701-3 of the Regulations to be treated as a corporation.

Article V

Members

Section 5.1.Powers of Members. The Members shall have the power to exercise any and all rights or powers granted to the Members pursuant to the express terms of this Agreement or as otherwise required by the Delaware Act. No Member shall have the power to act for or on behalf of, or to bind, the Company, and all Members shall constitute one class or group of Members of the Company for all purposes of the Delaware Act.

Section 5.2.Reimbursements. The Company shall reimburse the Members and the Manager for all ordinary and necessary out-of-pocket expenses incurred by the Members or Manager on behalf of the Company; provided, however, so long as any Obligation under the Loan Documents shall remain outstanding, any such reimbursement shall only be paid by the Company from funds available for Permitted Distributions. The Manager’s determination of which expenses may be reimbursed to a Member and the Manager and the amount of such expenses shall be conclusive. Such reimbursement shall be treated as an expense of the Company that shall not be deemed to constitute a distributive share of the Net Profit s or a distribution or return of capital to any Member.

Section 5.3.Restrictions on Transfers;Right of First Refusal Concerning LLC Interests. (a) Except for (i) Transfers among Members (ii) Transfers by any Original Member to one of its Affiliates and (iii) each Member’s pledge of its LLC Interest to HSH Nordbank AG, New York Branch pursuant to the Pledge Agreement, no Member shall have the right to Transfer all or any part of its LLC Interests unless the Member desiring to Transfer its LLC Interests (x) receives the prior written consent of the Manager to such Transfer, which consent may be withheld in the sole discretion of the Manager, and (y) such Member complies with paragrap hs (b) through (e) of this Section 5.3 and Section 5.4 hereof; provided that, so long as any Obligation under the Loan Documents shall remain outstanding, no Transfer by any Member of its LLC Interest shall be made unless expressly permitted by the terms of the Loan Documents.

(b)If a Member (a “Transferring Member”) receives from any Person (an “Identified Third Party”) a bona-fide, arm’s-length written offer (a “Bona Fide Offer”) with respect to the Transfer of its LLC Interests, or any portion thereof (the “Offered LLC Interests”), which the Transferring Member desires to accept, the Transferring Member shall give written notice (a “Transfer Notice”) of such Bona Fide Offer to the Company, the Original Members and the Other Members. Each Transfer Notice shall set forth the name and address of the Identified Third Party, the price and material terms and conditions of the Bona Fide Offer and the Transferring Member’s desire to Transfer its Offered LLC Interests on the terms and conditions set forth in the Bona Fide Offer, and be accompanied by a copy of the Bona Fide Offer if it is in writing.

(c)Upon receipt of a Transfer Notice, the Company, the Original Members and the Other Members (each an “Option Holder”) shall each, as a class, have an option in the priority in which they are named heretofore (each, an “Option”) to purchase all (but not less than all) of the Offered LLC Interests at the price and on the terms set forth in the Transfer Notice. If the Company exercises its Option within fifteen (15) days of its receipt of the Transfer Notice, the Original Members and the Other Members shall have no right to exercise their respective Options hereunder. If within fifteen (15) days of the Company’s receipt of the Transfer Notice it does not exercise its Option to purchase all (but not less than all) of the Offered LLC Interests, such Option shall expire with respect to such Offered LLC Interests and the Original Members may then exercise their Options, within thirty (30) days of their receipt of the Transfer Notice, to collectively purchase all (but not less than all) of the Offered LLC Interests on a pro rata basis. If within such thirty (30) day period any Original Member does not exercise its Option to purchase its pro rata amount of the Offered LLC Interests, the other Original Members may, within forty-five (45) days of their receipt of the Transfer Notice, elect to purchase all (but not less than all) of such Offered LLC Interests on a pro rata basis. If within forty f ive (45) days of the Original Members’ receipt of the Transfer Notice, the Original Members collectively do not exercise their Options to purchase all (but not less than all) of the Offered LLC Interests, such Option shall expire with respect to such Offered LLC Interests and the Other Members may then exercise their Options, within sixty (60) days of their receipt of the Transfer Notice, to purchase all (but not less than all) of the Offered LLC Interests on a pro rata basis. If within such sixty (60) day period any Other Member does not exercise its Option to purchase its pro rata amount of the Offered LLC Interest, the remaining Other Members may, within seventy five (75) days of their receipt of the Transfer Notice, elect to purchase all (but not less than all) of such Offered LLC Interests on a pro rata basis. Each Option shall be exercised by the Option Holder delivering an exercise notice (an “Exercise Notice”) to the Transferring Member within the applicable time period set forth above (each an “Option Exercise Period”). If the Bona Fide Offer provides, in whole or in part, for non-cash consideration, then the “price” offered by the Identified Third Party shall be deemed to be the amount of cash, if any provided in the Bona Fide Offer plus the fair market value of the non-cash consideration. If the Option Holder exercises its Option within the applicable Option Exercise Period, the Transfer of such LLC Interests will be consummated with such Option Holder at the Company’s principal place of business as soon as practicable, but in any event within sixty (60) days from the end of the applicable Option Exercise Period (the “Option Closing”). Contemporaneously therewith, the Transferring Member shall deliver to the Option Holder an assignment of the Transferring Member’s LLC Interests, a bill of sale, instruments of conveyance and all other instruments of transfer reasonably requested by the Option Holder, duly executed and in form and substance reasonably satisfactory to the Option Holder, as shall be necessary to Transfer to and vest in the Option Holder good and merchantable title to such LLC Interest free and clear of all liens, claims and encumbrances.

(d)If no Option Holder(s) exercises its Option within the Option Exercise Period to purchase all (but not less than all) of the Offered LLC Interests or an Option Closing is not consummated within sixty (60) days from the expiration of the applicable Option Exercise Period, then, subject to compliance by the Transferring Member with all of the provisions of this Agreement, the Transferring Member may Transfer all (but not less than all) of the LLC Interests specified in the Transfer Notice to the Identified Third Party at the price and on the terms contained in the Bona Fide Offer at any time within a period ninety (90) days after the date the last Option Exercise Period expires. If the Transferring Member has not so Transferred the LLC Interests to the Identified Third Party within said ninety (90) day period, then the LLC I nterests thereafter shall continue to be subject to all of the restrictions contained in this Agreement as though no Transfer Notice had ever been given.

(e)If, in any instance, the Option Holder elects not to exercise its rights hereunder or elects to waive such rights, such election or waiver shall not constitute a waiver of such rights to receive a Transfer Notice in the case of any such sale subsequently proposed.

Section 5.4.Additional Restrictions. Anything contained in the foregoing provisions of this Article V expressed or implied to the contrary notwithstanding:

(a)The Manager may, in addition to any other requirement that it may impose, require as a condition to the Transfer of any LLC Interests (or any portion thereof) that the Transferring Member furnish to the Company an opinion of counsel, satisfactory (both as to such opinion and as to such counsel) to counsel to the Company, that (i) such Transfer would not violate the Securities Act or any applicable state securities laws applicable to the Company or the LLC Interests to be transferred, (ii) such Transfer would not cause the Company to be considered a publicly traded partnership under Section 7704(b) of the Code, (iii) such Transfer would not require the Company or the Manager to register as an investment adviser under the Investment Advisers Act of 1940, as amended, or to register as an investment compan y under the Investment Company Act of 1940, as amended, (iv) such Transfer would not cause a termination of the Company for federal income tax purposes, and (v) the Transfer would not result in the termination of the Company pursuant to Section 708 of the Code.

(b)Each transferee of LLC Interests (or any portion thereof) shall execute and deliver an instrument satisfactory to the Manager whereby such transferee becomes a party to this Agreement.

(c)Any Transfer of LLC Interests (or any portion thereof) in contravention of any of the provisions of this Article V shall be void and ineffectual and shall not bind, or be recognized by, the Company.

Section 5.5.Right of First Refusal Concerning Equipment. (a) The Company shall not Transfer all or any part of the Equipment to any Person unless the Company complies with paragraphs (b) through (e) of this Section 5.5 and, so long as any Obligation under the Loan Documents shall remain outstanding, unless such Transfer is expressly permitted by the terms of the Loan Documents.

(b)If the Company receives from any Person (an “Offeror”) a bona-fide, arm’s length written offer (an “Equipment Offer”) with respect to the Transfer of any of the Equipment (the “Offered Equipment”) which the Company desires to accept, the Company shall give written notice (an “Equipment Notice”) of such Equipment Offer to each Original Member. Each Equipment Notice shall set forth the name and address of the Offeror, the price and material terms and conditions of the Equipment Offer and the Company’s desire to Transfer the Offered Equipment on the terms and conditions set forth in the Equipment Offer, and be accompanied by a copy of the Equipment Offer if it is in writing.

(c)Each Original Member shall have an option to purchase the Offered Equipment at the price and on the terms set forth in the Equipment Notice (each, an “Equipment Option”). If any Original Member desires to exercise its Equipment Option (an “Exercising Member”), such Exercising Member shall deliver an exercise notice to the Offeror within thirty (30) days of such Exercising Member’s receipt of the Equipment Notice (the “Equipment Option Exercise Period”). If there is more than one Exercising Member, then such Exercising Members shall mutual ly agree upon an equitable arrangement with respect to such Offered Equipment. If any Original Member does not exercise its Equipment Option, such Original Member’s Equipment Option shall expire with respect to such Offered Equipment. If the Equipment Offer provides, in whole or in part, for non-cash consideration, then the “price” offered by the Offeror shall be deemed to be the amount of cash, if any, provided in the Equipment Offer plus the fair market value of the non-cash consideration. If one or more Original Member exercises its Equipment Option within the Equipment Option Exercise Period, the Transfer of such Offered Equipment will be consummated at the Company’s principal place of business as soon as practicable, but in any event within sixty (60) days from the end of the Equipment Option Exercise Period (the “Equipment Closing”). At the Equipment Closing, each Exercising Member shall d eliver to the Company an amount equal to the purchase price set forth in the Equipment Offer or its pro rata amount thereof, as the case may be, by certified or cashier’s check or wire transfer in immediately available funds to an account or accounts designated by the Company. Contemporaneously therewith, the Company shall deliver to the Exercising Member or Members title to such Offered Equipment, bills of sale, assignments, instruments of conveyance and all other instruments of transfer, reasonably requested by the Exercising Member or Members, duly executed and in form and substance reasonably satisfactory to the Exercising Member or Members, as shall be necessary to Transfer to and vest in the Exercising Member or Members good and merchantable title to such Offered Equipment free and clear of all liens, claims and encumbrances.

(d)If no Original Member exercises its Equipment Option within the Equipment Option Exercise Period to purchase all (but not less than all) of the Offered Equipment or an Equipment Closing is not consummated within sixty (60) days from the expiration of the Equipment Option Exercise Period, then, subject to compliance by the Company with all of the provisions of this Agreement, the Company may Transfer all (but not less than all) of the Offered Equipment specified in the Equipment Notice to the Offeror at the price and on the terms contained in the Equipment Offer at any time within ninety (90) days after the date the Equipment Option Exercise Period expires. If the Company has not Transferred the Offered Equipment to the Offeror within said ninety (90) day period, then the Offered Equipment thereafter shall continue to be su bject to all of the restrictions contained in this Agreement as though no Equipment Notice had ever been given.

(e)If, in any instance, an Original Member elects not to exercise its rights hereunder or elects to waive such rights, such election or waiver shall not constitute a waiver of such rights to receive an Equipment Notice in the case of any such sale subsequently proposed.

Article VI

Management

Section 6.1.Manager. Unless otherwise required by Section 6.6 of this Agreement, the business and affairs of the Company shall be managed by one (1) Manager who may, but need not, be a Member. Transportation Equipment-PLM, LLC, a Delaware limited liability company, is hereby designated to serve as the initial Manager of the Company. The Company and Transportation-Equipment-PLM, LLC shall contemporaneously herewith enter into that certain Management Agreement attached hereto as Exhibit B and all of the Members hereby approve of such agreement (the “Management Agreement”).

Section 6.2.General Powers of the Manager. The Manager shall have full, exclusive, and complete discretion, power, and authority, subject in all cases to the other provisions of this Agreement and the requirements of applicable law, to manage, control, administer, and operate the business and affairs of the Company for the purpose set forth in Section 3.1, and to make all decisions affecting such business and affairs permitted hereunder, except those requiring the consent or vote of the Members or the Independent Manager as provided herein.

Section 6.3.Removal, Resignation and Replacement of the Manager. The Manager shall serve in such capacity until its resignation or removal. The Manager may be removed and replaced at any time, with or without cause, by the vote of the Members holding a Two-Thirds Interest. A Manager may resign at any time by giving written notice to the Company. Such resignation shall take effect at the time such Manager is replaced by the Company. Upon resignation or removal of a Manager, the Members holding a Two-Thirds Interest shall appoint a replacement Manager.

Section 6.4.Devotion of Time. The Manager shall devote such time to the affairs of the Company as it deems necessary for the proper performance of its duties.

Section 6.5.No Management by Other Members. Except as otherwise expressly provided herein, no Member shall take part in the day-to-day management or the operation or control of the business and affairs of the Company. Except and only to the extent expressly provided for in this Agreement and as delegated by the Manager, no Member or other Person shall be an agent of the Company or have any right, power or authority to transact any business in the name of the Company or to act for or on behalf of or to bind the Company.

Section 6.6.Matters Requiring Independent Manager Approval. Notwithstanding anything to the contrary contained in this Agreement or the Certificate, so long as any Obligation under the Loan Documents shall remain outstanding, the written consent or affirmative vote of one (1) Independent Manager shall be required to:

(a)enter into any transaction of merger or consolidation, or change the form of organization of its business, or transfer its properties and assets substantially as an entirety to any other Person; or

(b)(i) commence a voluntary case under the Federal bankruptcy laws (as now or hereafter in effect), (ii) file a petition seeking to take advantage of any other laws, domestic or foreign, relating to bankruptcy, insolvency, reorganization, winding up or composition or adjustment of debts, (iii) consent to or fail to contest in a timely and appropriate manner any petition filed against it in an involuntary case under such bankruptcy laws or other laws, (iv) apply for, or consent to, or fail to contest in a timely and appropriate manner, the appointment of, or the taking of possession by, a receiver, custodian, trustee, liquidator or the like of itself or of a substantial part of its assets, domestic or foreign, or (v) make a general assignment for the benefit of creditors; or

(c)authorize the amendment of the Company’s Certificate or this Agreement to: (i) provide for the removal and/or substitution of the Independent Manager provided for hereunder unless a new Independent Manager is designated by the Administrative Agent and is appointed and accepts such appointment; (ii) enlarge or alter the special purpose of the Company set forth in Section 3.1 hereof; (iii) remove the Independent Manager (even upon the insolvency or institution of bankruptcy proceedings involving the Company); or (iv) permit or cause the Company to dissolve or to liquidate.

So long as any Obligation under the Loan Documents shall remain outstanding, if the Company shall not have one (1) Independent Manager, the Company, or any of the Members or Manager on behalf of the Company, shall not (i) do, take or perform any of the actions set forth in clause (a), (b) or (c) above or (ii) vote upon any matter set forth in clause (a), (b) or (c) above. So long as any Obligation under the Loan Documents shall remain outstanding, any such action or vote taken by the Company, or any of the Members or Manager on behalf of the Company, without the written consent or affirmative vote of an Independent Manager designated by the Administrative Agent shall not be valid.

The Independent Manager shall have none of the rights or powers granted to the Manager pursuant to the express terms of this Agreement or as otherwise granted to the Manager by the Delaware Act. The sole rights and powers granted to the Independent Manager under this Agreement shall be to consent or not consent to or vote upon the matters set forth in Section 6.6 hereof, but only so long as any Obligation under the Loan Documents shall remain outstanding. After the satisfaction of all Obligations under the Loan Documents, all references in this Agreement to the Independent Manager shall have no further force or effect.

Article VII

Meetings and Voting by Members

Section 7.1.Meetings. Neither regular nor special meetings of the Members shall be required; however, a meeting of the Members may be called at any time by a Member holding at least ten percent (10%) of the Percentage Interests. Meetings of Members shall be held at the Company’s principal place of business or at such other place as determined by the Member calling the meeting. Not less than ten (10) days or more than sixty (60) days before each meeting, the Member calling the meeting shall give written notice of the meeting to each Member entitled to vote at the meeting. The notice shall state the time, place and purpose of the meeting. Notwithstanding the foregoing sentences, each Member who is entitled to notice waives notice if before or after the meeting, the Member signs a waiver of the notice which is filed with the records of Members’ meetings or is present at the meeting in person or by proxy. Unless this Agreement provides otherwise, at a meeting of the Members, the presence in person or by proxy of the Members holding a majority of the Percentage Interests then held by the Members constitutes a quorum. A Member may vote either in person or by written proxy signed by the Member or by its duly authorized attorney-in-fact.

Section 7.2.Telephonic Meetings. Any and all Members may participate in any Members’ meeting by, or through the use of, any means of communication by which all Members participating may simultaneously hear each other during the meeting. A Member so participating is deemed to be present in person at the meeting. If all the participants are participating by telephone conference or similar communications equipment, the meeting shall be deemed to be held at the principal place of business of the Company.

Section 7.3.Member Approval. Except as otherwise provided in this Agreement (including, without limitation, Section 6.6), the affirmative vote of the Members holding a majority of the Percentage Interests then held by the Members shall be required to approve any matter coming before the Members.

Section 7.4.Written Consent. In lieu of holding a meeting, the Members may vote or otherwise take action by a written instrument indicating the consent of the Members holding the required Percentage Interests then held by the Members to approve such action. Action taken under this Section 7.4 is effective when the Members holding the required Percentage Interests necessary to approve such action have signed the written instrument, unless the written instrument specifies a different effective date. Following the action by written instrument, the Company shall deliver notice of such action to those Members who have not consented in writing.

Article VIII

Amendments

This Agreement may not be amended, altered or modified except by a written instrument signed by (x) Members holding a Two-Thirds Interest or (y) Members holding at least a majority of the Percentage Interests and the Manager; provided, however, so long as any Obligation under the Loan Documents shall remain outstanding, no such amendment, alteration or modification shall be made unless expressly permitted by the terms of the Loan Documents and adopted in a manner consistent with Section 6.6 hereof, if applicable. Notwithstanding the foregoing sentence, the Manager, without such approval, may make any amendments, alterations or modifications from time to time required to comply with the then existing requirements of the Code and the Regulations, affecting the status of the Company as a partnership for federal income purposes, or to clarify or rectify any mistake or ambiguity in this Agreement.

Article IX

Allocations and Distributions

Section 9.1.Manager’s Determination. The Manager shall have the sole authority to determine the timing and amount of all Distributions to Members; provided, however, that all Distributions shall be allocated among the Members in accordance with Section 9.2 hereof; provided, further, as long as any Obligation under the Loan Documents shall remain outstanding, Distributions by the Company shall be limited to amounts received by the Company pursuant to (i) on the Closing Date, the disbursement of the Loans under the Loan Agreement, (ii) so long as no Event of Default has occurred and i s continuing, Clause Tenth of Section 1.15(a) of the Loan Agreement and (iii) if an Event of Default has occurred and is continuing, Clause Fifth of Section 1.15(b) of the Loan Agreement (collectively, the “Permitted Distributions”).

Section 9.2.Distributions. Subject to Section 9.1 hereof, Distributions, if any, from the Company to its Members shall be made to the Members according to their Percentage Interests as set forth on Exhibit A hereto, as such Exhibit may be amended from time to time in accordance with the terms hereof.

Section 9.3.No Violation. Notwithstanding any provision to the contrary contained in this Agreement, the Company and the Manager on behalf of the Company shall not be required to make a Distribution to any Member on account of its interest in the Company if such Distribution would violate Section 18-607 of the Delaware Act or other applicable law.

Section 9.4.Withholding. All amounts withheld pursuant to the Code or any provision of any state, local or foreign tax law with respect to any payment, distribution or allocation by the Company shall be treated as amounts paid by the Company. Such amounts shall in turn be allocated to and treated as distributed to the Members for all purposes under this Agreement. The Manager is authorized to withhold from Distributions or allocations to the Members and to pay over to the appropriate federal, state, local or foreign government any amounts required to be so withheld. The Manager shall allocate any such amounts to the Members in respect of whose Distribution or allocation the tax was withheld and shall treat such amounts as actually distributed to such Members.

Section 9.5.Property Distributions and Installment Sales. If any assets of the Company shall be distributed in kind pursuant to this Article IX, such assets shall be distributed to the Members entitled thereto in the same proportions as the Members would have been entitled to cash Distributions. The amount by which the fair market value, as determined by the Manager, of any property to be distributed in kind to the Members exceeds or is less than the Book Value of such property shall, to the extent not otherwise recognized by the Company, be taken into account in determining Net Profit and Net Loss and determining the Capital Accounts of the Members as if such property had been sold at its fair market value immediately prior to the Distribution. If any assets are sold in transactions in which, by reason of the provisions of Section 453 of the Code or any successor thereto, gain is realized but not recognized, such gain shall be taken into account when realized in computing gain or loss of the Company for purposes of allocation of Net Profit or Net Loss under this Article IX, and, if such sales shall involve substantially all the assets of the Company, the Company shall be deemed to have been dissolved and terminated notwithstanding any election by the Members to continue the Company for purposes of collecting the proceeds of such sales.

Section 9.6.Allocations of Net Profit or Net Loss. After giving effect to the special allocations provisions set forth in this Article IX for any taxable year of the Company, the Net Profit or Net Loss of the Company shall be allocated among the Members according to their Percentage Interests.

Section 9.7.Special Allocations. The following special allocations shall be made in the following order:

(a)Minimum Gain Chargeback. Except as otherwise provided in Section 1.704-2(f) of the Regulations, notwithstanding any other provision of this Article IX, if there is a net decrease in Company Minimum Gain during any taxable year, each Member shall be specially allocated items of Company income and gain for such taxable year (and, if necessary, subsequent taxable years) in an amount equal to such Member’s share of the net decrease in Company Minimum Gain, determined in accordance with Regulations Section 1.704-2(g). Allocations pursuant to the previous sentence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Sections 1.704-2(f)(6) and 1.704-2(j)(2) of the Regulations. Th is Section 9.7(a) is intended to comply with the minimum gain chargeback requirement in Section 1.704-2(f) of the Regulations and shall be interpreted consistently therewith.

(b)Member Minimum Gain Chargeback. Except as otherwise provided in Section 1.704-2(i)(4) of the Regulations, notwithstanding any other provision of this Article IX, if there is a net decrease in Member Nonrecourse Debt Minimum Gain attributable to a Member Nonrecourse Debt during any taxable year, each Member who has a share of the Member Nonrecourse Debt Minimum Gain attributable to such Member Nonrecourse Debt, determined in accordance with Section 1.704-2(i)(5) of the Regulations, shall be specially allocated items of Company income and gain for such taxable year (and, if necessary, subsequent taxable year) in an amount equal to such Member’s share of the net decrease in Member Nonrecourse Debt, determined in accordance with Regulations Section 1.704-2(i)(4). Allocations pursuant to the previous s entence shall be made in proportion to the respective amounts required to be allocated to each Member pursuant thereto. The items to be so allocated shall be determined in accordance with Sections 1.704-2(i)(4) and 1.704-2(j)(2) of the Regulations. This Section 9.7(b) is intended to comply with the minimum gain chargeback requirement in Section 1.704-2(i)(4) of the Regulations and shall be interpreted consistently therewith.

(c)Qualified Income Offset. In the event any Member unexpectedly receives any adjustments, allocations, or distributions described in Sections 1.704-l(b)(2)(ii)(d)(4), 1.704-1(b)(2)(ii)(d)(5), or 1.704-1(b)(2)(ii)(d)(6) of the Regulations, items of Company income and gain shall be specially allocated to such Member in an amount and manner sufficient to eliminate, to the extent required by the Regulations, the Adjusted Capital Account Deficit of the Member as quickly as possible, provided that an allocation pursuant to this Section 9.7(c) shall be made only if and to the extent that the Member would have an Adjusted Capital Account Deficit after all other allocations provided for in this Article IX have been tentatively made as if this Section 9.7(c) were not in the Agreement.

(d)Gross Income Allocation. In the event any Member has an Adjusted Capital Account Deficit at the end of any taxable year, each such Member shall be specially allocated items of Company income and gain in the amount of such excess as quickly as possible, provided that an allocation pursuant to this Section 9.7(d) shall be made only if and to the extent that such Member would have an Adjusted Capital Account Deficit in excess of such sum after all other allocations provided for in this Article IX have been made as if Section 9.7(c) and this Section 9.7(d) were not in the Agreement.

(e)Nonrecourse Deductions. Nonrecourse Deductions for any taxable year shall be specially allocated to the Members in proportion to their respective Percentage Interests.

(f)Member Nonrecourse Deductions. Any Member Nonrecourse Deductions for any taxable year shall be specially allocated to the Member who bears the economic risk of loss with respect to the Member Nonrecourse Debt to which such Member Nonrecourse Deductions are attributable in accordance with Regulations Section 1.704-2(i)(1).

Section 9.8.Loss Limitation. Losses allocated pursuant to Section 9.6 hereof shall, to the extent possible, not exceed the maximum amount of Losses that can be allocated without causing any Member to have an Adjusted Capital Account Deficit at the end of any taxable year. In the event some but not all of the Members would have Adjusted Capital Account Deficits as a consequence of an allocation of Losses pursuant to Section 9.6 hereof, the limitation set forth in this Section 9.8 shall be applied on a Member by Member basis and Losses not allocable to any Member as a result of such limitation shall be allocated to the other Members in accordance with the positive balances in such Member’s Capital Accounts so as to allocate the maximum permissible Los ses to each Member under Section 1.704-1(b)(2)(ii)(d) of the Regulations. Any remaining Losses shall be allocated first to the Members in proportion to the extent to which such Members bear the economic risk with respect to such Losses and then to the Members in proportion to their Percentage Interests.

Section 9.9.Curative Allocations. The allocations set forth in Sections 9.7 and 9.8 (the “Regulatory Allocations”) are intended to comply with certain requirements of the Regulations. It is the intent of the Members that, to the extent possible, all Regulatory Allocations shall be offset either with other Regulatory Allocations or with special allocations of other items of Company income, gain, loss or deduction pursuant to this Section 9.9. Therefore, notwithstanding any other provision of this Article IX (other than the Regulatory Allocations), to the extent permitted under the Regulations, the Manager shall make such offsetting special allocations of Company income, gain, loss or deduction in whatever manner it determines appropriate so that, after such offsetting allocations are made, each Member’s Capital Account balance is, to the extent possible, equal to the Capital Account balance such Member would have had if the Regulatory Allocations were not part of the Agreement and all Company items were allocated pursuant to Section 9.6.

Section 9.10.Other Allocation Rules. (a) For purposes of determining the Net Profits, Net Losses, or any other items allocable to any period, Net Profits, Net Losses, and any such other items shall be determined on a daily, monthly, or other basis, as determined by the Manager using any Percentage permissible method under Code Section 706 and the Regulations thereunder. To the extent Members’ Percentage Interests have changed during a period of allocation, the Manager shall determine, in its sole discretion, the method for allocating Net Profits, Net Losses and other items in accordance with the applicable general allocation rules set forth herein. Such method may involve (i) calculating the Members’ weighted average Percentage Interests for su ch period based on a daily, monthly or other basis, (ii) calculating Net Profit, Net Loss and other items during portions of such period that correspond to times when Members’ Percentage Interests are constant, or (iii) such other procedures as the Manager may determine.

(b)The Members are aware of the income tax consequences of the allocations made by this Article IX and hereby agree to be bound by the provisions of this Article IX in reporting their shares of Company income and loss for income tax purposes.

(c)Solely for purposes of determining a Member’s proportionate share of the “excess nonrecourse liabilities” of the Company within the meaning of Regulations Section 1.752-3(a) (3), the Members’ interests in Company Net Profit shall be equal to their respective Percentage Interests.

Section 9.11.Tax Allocations: Code Section 704(c). For tax purposes, all items of income, gain, loss, deduction, expense and credit, other than tax items corresponding to items allocated pursuant to Sections 9.7, 9.8 and 9.9, shall be allocated in the same manner as are Net Profits and Net Losses; provided, however, that in accordance with Code Section 704(c) and the Regulations thereunder, income, gain, loss and deductions with respect to any property contributed to the capital of the Company shall, solely for tax purposes, be allocated among the Members so as to take account of any variation between the adjusted basis of such property to the Company for federal income tax p urposes and its initial Book Value (computed in accordance with the definition of Book Value) using any method or methods permitted by the applicable Regulations that the Manager determines to apply.

In the event the Book Value of any Company asset is adjusted pursuant to subparagraph (ii) of the definition of Book Value, subsequent allocations of income, gain, loss and deductions with respect to such asset shall take account of any variation between the adjusted basis of such asset for federal income tax purposes and its Book Value in the same manner as under Code Section 704(c) and the Regulations thereunder using any method or methods permitted by the applicable Regulations that the Manager determines to apply.

Any elections or other decisions relating to such allocations shall be made by the Manager in any manner that reasonably reflects the purpose and intention of this Agreement.

Section 9.12.Interpretation. It is the intent of the Members that the provisions hereof relating to each Member’s distributive share of income, gain, loss, deduction and credit (and items thereof) shall comply with the provisions of Sections 704(b), 704(c), 706 and other relevant provisions of the Code and the applicable Regulations. In furtherance of the foregoing, the Manager is hereby directed to resolve any ambiguity in the provisions of this Agreement in a manner that will preserve and protect the allocations provided for in this Article IX for federal income tax purposes and, subject to the last sentence hereof, to adopt such curative provisions to this Article IX as the Manager may deem necessary or appropriate. In the event of any dispute, t he decision of the independent tax counsel employed by the Company shall be final. Notwithstanding the foregoing, no Member shall have the right to require or compel any distribution of cash or property not authorized or provided for by the provisions of this Agreement, and the Manager shall not have the right to alter any distribution of cash or property provided for by the provisions of this Agreement on the ground that such action is necessary to cause the provisions hereof to conform to the provisions of the Regulations.

Article X

Accounting

For both financial and tax reporting purposes and for purposes of determining Net Profits and Net Losses, the books and records of the Company shall be kept on the accrual method of accounting applied in a consistent manner and shall reflect all Company transactions and be appropriate for the Company’s business.

Article XI

Tax Matters Partner

PLM Equipment Growth & Income Fund VII is hereby specifically authorized as “Tax Matters Partner” of the Company for purposes of §6231(a)(7) of the Code and shall have the power to manage and control, on behalf of the Company, any administrative proceeding at the Company level with the Internal Revenue Service relating to the determination of any item of Company income, gain, loss, deduction or credit for federal income tax purposes.

Article XII

Liability, Exculpation and Indemnification

Section 12.1.Liability. (a) Except as otherwise provided by the Delaware Act, the debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and no Covered Personshall be obligated personally or otherwise for any such debt, obligation or liability of the Company solely by reason of being a Covered Person.

(b)Except as otherwise expressly required by law, a Member shall have no liability in excess of (i) the amount of its Capital Contributions, (ii) its share of any assets and undistributed Net Profits of the Company, (iii) its obligation to make other payments expressly provided for in this Agreement, and (iv) the amount of any distributions wrongfully distributed to it.

Section 12.2.Exculpation. (a) No Member or Manager shall be liable to the Company or any other person for any loss, damage or claim incurred by reason of any act or omission performed or omitted by such Member or Manager in good faith on behalf of the Company and in a manner reasonably believed to be within the scope of authority conferred on such Member or Manager by this Agreement, except that a Member or Manager shall be liable for any such loss, damage or claim incurred by reason of such Member or Manager’s gross negligence or willful misconduct.

(b)A Member or Manager shall be fully protected in relying in good faith upon the records of the Company and upon such information, opinions, reports or statements presented to the Company by any Person as to matters that the Member or Manager reasonably believes are within such Person’s professional or expert competence and who has been selected with reasonable care by or on behalf of the Company, including such information, opinions, reports or statements may include assessing the value and amount of the assets, liabilities, Net Profits, Net Losses, or may include any other facts pertinent to the existence and amount of assets from which distributions to Members might properly be paid.

Section 12.3.Indemnification. To the fullest extent permitted by applicable law, any Covered Person shall be entitled to indemnification from the Company for any loss, damage or claim incurred by such Covered Person by reason of any act or omission performed or omitted by such Covered Person in good faith on behalf of the Company and in a manner reasonably believed to be within the scope of authority conferred on such Covered Person by this Agreement, except that no Covered Person shall be entitled to be indemnified in respect of any loss, damage or claim incurred by such Covered Person by reason of gross negligence or willful misconduct with respect to such acts or omissions; provided, however, that any indemnity under this Section 12.3 (i) shall be provided out of and to the extent of Company assets only, and no Covered Person shall have any personal liability or otherwise on account thereof and (ii) so long as any Obligation under the Loan Documents shall remain outstanding, shall be subordinated to the rights of the Secured Creditors under the Loan Documents in terms satisfactory to such Secured Creditors and shall only be repaid by the Company from funds available for Permitted Distributions. The Company may, from time to time, enter into separate indemnity agreements with any of the Covered Persons or certain other parties.

Section 12.4.Expenses. To the fullest extent permitted by applicable law, expenses (including reasonable legal fees) incurred by a Covered Person in defending any claim, demand, action, suit or proceeding shall (i), from time to time, be advanced by the Company prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by the Company of an undertaking by or on behalf of the Covered Person to repay such amount if it shall be determined that the Covered Person is not entitled to be indemnified as authorized in Section 12.3 hereof and (ii) so long as any Obligation under the Loan Documents shall remain outstanding, be subordinated to the rights of the Secured Creditors under the Loan Documents in terms satisfactory to such Secu red Creditors and shall only be repaid by the Company from funds available for Permitted Distributions.

Section 12.5.Outstanding Businesses. Except as expressly set forth herein, any Manager, Member or Affiliate thereof may engage in or possess an interest in other business ventures of any nature or description, independently or with others, similar or dissimilar to the business of the Company, and the Company, the Manager and the Members shall have no rights by virtue of this Agreement in and to such independent ventures or the income or profits derived therefrom, and the pursuit of any such venture, even if competitive with the business of the Company, shall not be deemed wrongful or improper. Except as expressly set forth herein, no Manager, Member or Affiliate thereof shall be obligated to present any particular investment opportunity to the Company even if such oppo rtunity is of a character that if presented to the Company could be taken by the Company, and any Manager, Member or Affiliate thereof shall have the right to take for its own account (individually or as a partner, Member, fiduciary or otherwise) or to recommend to others any such particular investment opportunity.

Article XIII

Dissolution, Liquidation and Termination

Section 13.1.Dissolution. The Company shall be dissolved and its affairs shall be wound up upon the occurrence of any of the following events:

(a)the expiration of the term of the Company, as provided in Section 2.3 hereof;

(b)the entry of a decree of judicial dissolution under Section 18-802 of the Delaware Act; or

(c)upon the unanimous written agreement of all of the Members including, but only so long as any Obligation under the Loan Documents is outstanding, the Independent Manager in accordance with Section 6.6 hereof.

Section 13.2.Notice of Dissolution. Upon the dissolution of the Company, the Manager shall promptly notify the Members of such dissolution.

Section 13.3.Liquidation. Upon dissolution of the Company, the Manager shall immediately commence to wind up the Company’s affairs; provided, however, that a reasonable time shall be allowed for the orderly liquidation of the assets of the Company and the satisfaction of liabilities to creditors so as to enable the Members to minimize the normal losses attendant upon a liquidation. The Members shall continue to share in Distributions during liquidation in the same manner, as specified in Article IX hereof, as is applicable before liquidation. The proceeds of liquidation shall be distributed, as realized, in accordance with the provisions of Section 18-804 of the Delaware Act.

Section 13.4.Termination. The Company shall terminate when all of the assets of the Company have been distributed in the manner provided for in this Article XIII, and the Certificate shall have been canceled in the manner required by the Delaware Act.

Section 13.5.Claims of the Members. Members and former Members shall look solely to the Company’s assets for the return of their Capital Contributions, and if the assets of the Company remaining after payment of or due provision for all debts, liabilities and obligations of the Company are insufficient to return such Capital Contributions, the Members and former Members shall have no recourse against the Company or any other Member.

Article XIV

Miscellaneous

Section 14.1.Notices. All notices, demands and other communications hereunder shall be in writing and delivered by first class mail, personally, by facsimile or overnight courier directed to the address of such Member listed in the books and records of the Company or to the Company at the Company’s principal place of business. Notices, demands and other communications shall be conclusively deemed to have been received by the party to whom addressed three (3) business days after deposited with the United States mail or one (1) business day after deposited with the overnight courier, delivered personally or faxed.

Section 14.2.Entire Agreement. This Agreement (including the Exhibits hereto) contains the entire understanding of the parties hereto and thereto, supersedes all prior agreements and understandings relating to the subject matter hereof. Each of the parties hereto further acknowledge and agree that, in entering into this Agreement they have not in any way relied upon any oral or written agreements, statements, promises, information, arrangements, understandings, representations or warranties, express or implied, not specifically set forth in this Agreement.

Section 14.3.Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware without regard to its conflict of laws rules.

Section 14.4.Headings. The headings of sections and subsections are for reference only and shall not limit or control the meaning thereof.

Section 14.5.Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, successors and permitted assigns.

Section 14.6.No Implied Rights or Remedies. Except as otherwise expressly provided herein, nothing herein expressed or implied is intended or shall be construed to confer upon or to give any Person, except the parties hereto, any rights or remedies under or by reason of this Agreement.

Section 14.7.Counterparts. This Agreement may be executed in multiple counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.

Section 14.8.Severability. The invalidity or unenforceability of any particular provision of this Agreement shall not affect the other provisions hereof, and this Agreement shall be construed in all respects as if such invalid or unenforceable provision was omitted.

Section 14.9.Agreement Drafted by Counsel for the Company. This Agreement has been drafted by Chapman and Cutler LLP (“Chapman”) as counsel for the Company. Each party hereto has been advised that a conflict may exist between its interests and the interests of the other parties, and it has been advised to seek the advice of independent counsel and has had the opportunity to seek such advice. Each party has been advised that this Agreement has differing tax consequences and has received no representation from Chapman about the tax consequences of this Agreement. Each party acknowledges that Chapman has not represented and will not represent any party hereto with respect t o its purchase of LLC Interests.

In Witness Whereof, the parties hereto have executed this Agreement as of the date first above stated.

Manager:                                                                                                  Members:

Transportation Equipment-PLM, LLC                                                       PLM Equipment Growth Fund V

                                                                                                                 By: PLM Financial Services, Inc., a Delaware corporation, its sole general partner

By ______________________________________                                By__________________________________________________

     Its____________________________________                                     Its________________________________________________

                                                                                                                  PLM Equipment Growth Fund VI

                                                                                                                  By: PLM Financial Services, Inc., a Delaware corporation, its sole general partner

                                                                                                                  By_________________________________________________

                                                                                                                      Its_______________________________________________

                                                                                                                  PLM Equipment Growth & Income Fund VII

                                                                                                                  By: PLM Financial Services, Inc., a Delaware corporation, its sole general partner

                                                                                                                  By__________________________________________________

                                                                                                                      Its________________________________________________

Exhibit A
Dated
June 29, 2004

Name of Member And Address	Capital Contribution	Percentage Interest
PLM Equipment Growth Fund V 1 North LaSalle Street Suite 2700 Chicago, Illinois 60602 Attention: Michael Clayton	$229	22.9%
PLM Equipment Growth Fund VI 1 North LaSalle Street Suite 2700 Chicago, Illinois 60602 Attention: Michael Clayton	$433	43.3%
PLM Equipment Growth & Income Fund VII 1 North LaSalle Street Suite 2700 Chicago, Illinois 60602 Attention: Michael Clayton	$338	33.8%
Total	$1,000	100%

Exhibit A
Dated
July 1, 2004

Name of Member And Address	Capital Contribution	Percentage Interest
PLM Equipment Growth Fund V 1 North LaSalle Street Suite 2700 Chicago, Illinois 60602 Attention: Michael Clayton	$7,720,229	22.9%
PLM Equipment Growth Fund VI 1 North LaSalle Street Suite 2700 Chicago, Illinois 60602 Attention: Michael Clayton	$14,622,433	43.3%
PLM Equipment Growth & Income Fund VII 1 North LaSalle Street Suite 2700 Chicago, Illinois 60602 Attention: Michael Clayton	$11,411,338	33.8%
Total	$33,754,000	100%

Exhibit B

[Management Agreement]

Exhibit C

[Interest Certificate]

EX-31.1 5 plmgf610qsb063004ex311.htm PRESIDENT CERTIFICATE 302

Exhibit 31.1

CONTROL CERTIFICATION

I, James A. Coyne, certify that:

1.I have reviewed this quarterly report on Form 10-QSB of PLM Equipment Growth Fund VI.

2.Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report.

3.Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report.

4.The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

b)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation.

5.The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

6.The registrant’s other certifying officers and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: August 13, 2004By:      /s/ James A. Coyne

James A. Coyne

President

EX-31.2 6 plmgf610qsb063004ex312.htm CFO CERTIFICATE 302

Exhibit 31.2

CONTROL CERTIFICATION

I, Richard K Brock, certify that:

1.I have reviewed this quarterly report on Form 10-QSB of PLM Equipment Growth Fund VI.

2.Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report.

3.Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report.

4.The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

b)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation.

5.The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

6.The registrant’s other certifying officers and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: August 13, 2004By:/s/ Richard K. Brock

Richard K Brock

Chief Financial Officer

(Principal Financial Officer)

EX-32.1 7 plmgf610qsb063004ex321.htm PRESIDENT CERTIFICATE 906

Exhibit 32.1

Certification Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the

Sarbanes - Oxley Act of 2002

In connection with the Quarterly Report of PLM Equipment Growth Fund VI (the “Partnership”), on Form 10-QSB for the period ended June 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, the President of the General Partner and of the Partnership, hereby certifies pursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:

(1) the Report of the Partnership filed today fully complies with the requirements of Section 13(a) and 15 (d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ James A. Coyne

James A. Coyne

President of PLM Financial Services, Inc.

August 13, 2004

EX-32.2 8 plmgf610qsb063004ex322.htm CFO CERTIFICATE 906

Exhibit 32.2

Certification Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the

Sarbanes - Oxley Act of 2002

In connection with the Quarterly Report of PLM Equipment Growth Fund VI (the “Partnership”), on Form 10-QSB for the period ended June 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, the Chief Financial Officer of the General Partner and of the Partnership, hereby certifies pursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:

(1) the Report of the Partnership filed today fully complies with the requirements of Section 13(a) and 15 (d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ Richard K Brock

Richard K Brock

Chief Financial Officer of PLM Financial Services, Inc.

(Principal Financial Officer)

August 13, 2004

-----END PRIVACY-ENHANCED MESSAGE-----

EX-31.1

Exhibit 31.1

CONTROL CERTIFICATION

I, James A. Coyne, certify that:

1.I have reviewed this quarterly report on Form 10-QSB of PLM Equipment Growth Fund VI.

2.Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report.

3.Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report.

4.The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

b)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation.

5.The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

6.The registrant’s other certifying officers and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: August 13, 2004By:      /s/ James A. Coyne

James A. Coyne

President

EX-31.2

Exhibit 31.2

CONTROL CERTIFICATION

I, Richard K Brock, certify that:

1.I have reviewed this quarterly report on Form 10-QSB of PLM Equipment Growth Fund VI.

2.Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report.

3.Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report.

4.The registrant’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the registrant and have:

a)designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; and

b)evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures as of the end of the period covered by this report based on such evaluation.

5.The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal controls over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent functions):

a)all significant deficiencies and material weaknesses in the design or operation of internal controls over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b)any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

6.The registrant’s other certifying officers and I have indicated in this quarterly report whether there were significant changes in internal controls or in other factors that could significantly affect internal controls subsequent to the date of our most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

Date: August 13, 2004By:/s/ Richard K. Brock

Richard K Brock

Chief Financial Officer

(Principal Financial Officer)

EX-32.1

Exhibit 32.1

Certification Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the

Sarbanes - Oxley Act of 2002

In connection with the Quarterly Report of PLM Equipment Growth Fund VI (the “Partnership”), on Form 10-QSB for the period ended June 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, the President of the General Partner and of the Partnership, hereby certifies pursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:

(1) the Report of the Partnership filed today fully complies with the requirements of Section 13(a) and 15 (d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ James A. Coyne

James A. Coyne

President of PLM Financial Services, Inc.

August 13, 2004

EX-32.2

Exhibit 32.2

Certification Pursuant to 18 U.S.C. Section 1350,

As Adopted Pursuant to Section 906 of the

Sarbanes - Oxley Act of 2002

In connection with the Quarterly Report of PLM Equipment Growth Fund VI (the “Partnership”), on Form 10-QSB for the period ended June 30, 2004 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, the Chief Financial Officer of the General Partner and of the Partnership, hereby certifies pursuant to 18 U.S.C. §1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 that:

(1) the Report of the Partnership filed today fully complies with the requirements of Section 13(a) and 15 (d) of the Securities Exchange Act of 1934; and

(2)the information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Partnership.

/s/ Richard K Brock

Richard K Brock

Chief Financial Officer of PLM Financial Services, Inc.

(Principal Financial Officer)

August 13, 2004