1169083--3/30/2006--LEASE_EQUITY_APPRECIATION_FUND_I_LP

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{loan, real, estate}
{investment, property, distribution}
{tax, income, asset}
{competitive, industry, competition}
{loss, insurance, financial}
{system, service, information}
Our success will be subject to risks inherent in the equipment leasing business, any of which may affect our ability to operate profitably. Higher than expected equipment lease defaults may result in losses. Using "leverage" to build our portfolio subjects us to the risk that our revenues may not be sufficient to cover our operating costs plus debt service and, consequently, may result in losses. If we are unable to realize the residual value of our equipment, we may incur losses. Interest rate changes may reduce the value of our portfolio and our returns on it. Damage or disruptions to our General Partner's operating systems could make us less attractive as a source of equipment leases. We may be unable to obtain insurance for certain types of losses. If we are, or become, subject to usury laws, it could result in reduced revenues or, possibly, lags on our investment. Investments in joint ventures may be subject to risks that our co-venturer may have different business objectives than ours.

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