424(b)(3)
No. 333-47411
CNL HEALTH CARE PROPERTIES, INC.
This Supplement is part of, and should be read in conjunction with, the
Prospectus dated May 24, 1999. This Supplement replaces all prior Supplements to
the Prospectus. Capitalized terms used in this Supplement have the same meaning
as in the Prospectus unless otherwise stated herein.
Information in this Supplement is provided as of November 9, 1999. As
of November 9, 1999, the Company had not entered into any initial commitments to
acquire properties. Proposed properties for which the Company receives initial
commitments, as well as property acquisitions that occur after November 9, 1999,
will be reported in a subsequent Supplement.
THE OFFERING
As of July 13, 1999, the Company had received aggregate subscription
proceeds of $2,751,052 from 121 investors, which exceeded the minimum offering
amount of $2,500,000, and $2,526,052 of the funds were released from escrow. The
remaining subscription proceeds of $225,000 (representing funds received from
Pennsylvania investors) will be held in escrow until aggregate subscription
proceeds total at least $7,775,000. As of November 9, 1999, the Company had
received aggregate subscription proceeds of $4,575,728 (457,573 Shares),
including $4,164 (416 Shares) issued pursuant to the Reinvestment Plan. As of
November 9, 1999, the Company had approximately $3,655,000 available to invest
in Properties, following deduction of Selling Commissions, marketing support and
due diligence expense reimbursement fees, Organizational and Offering Expenses
of approximately three percent and Acquisition Fees and Acquisition Expenses.
MANAGEMENT COMPENSATION
For information concerning compensation and fees paid to the Advisor
and its Affiliates since the date of inception of the Company, see "Certain
Relationships and Related Transactions."
BUSINESS
GENERAL
The following information updates and replaces the table at the bottom
of page 43 and the last two paragraphs on page 44 of the Prospectus.
In addition to the growth in the number of elderly people, life
expectancies are increasing. Those 85 and over are the most rapidly growing
elderly age group. Between 1960 and 1994, this group grew 274%. During this same
period of time, the entire population of the United States grew 45%.
November 23, 1999 Prospectus Dated May 24, 1999
<PAGE>
Life Expectancy Trends
at Age 65 (in years)
Year Male Female
---- ---- ------
1965 12.9 16.3
1980 14.0 18.4
1985 14.4 18.6
1990 15.0 19.0
1991 15.1 19.1
1992 15.2 19.2
1993 15.1 19.0
1994 15.3 19.0
1995 15.3 19.0
1996* 15.8 19.1
1997* 15.6 19.2
1998** 15.7 19.2
1999** 15.7 19.3
* preliminary data
** estimated
Source: Social Security Administration Office of Programs: Data from
the Office of the Actuary
In addition to an aging population, according to 1997 data from the
U.S. Department of Commerce, a significant segment of the elderly population has
the financial resources to afford seniors' housing facilities. The mean
household income for those age 65 and over is more than $32,000 per year. In
addition, according to June 30, 1999 data from the U.S. Census Bureau, the
average household wealth for those age 65 and over exceeds the national average
for all age groups by 54%, and 27% of those households have an annual income in
excess of $50,000. Management believes that other changes and trends in the
health care industry will create opportunities for growth of seniors' housing
facilities, including (i) the growth of operators serving specific health care
niches, (ii) the consolidation of providers and facilities through mergers,
integration of physician practices, and elimination of duplicative services,
(iii) the pressures to reduce the cost of providing quality health care, (iv)
more dual-income and single-parent households leaving fewer family members
available for in-home care of aging parents and necessitating more senior care
facilities, and (v) an anticipated increase in the number of insurance companies
and health care networks offering privately funded long-term care insurance.
According to the Health Care Financing Administration and the National
Health Statistics Group, the health care industry represents over 13.5% of the
United States' gross domestic product ("GDP") with at least $1.092 trillion in
annual expenditures. The U.S. Department of Health and Human Services expects
this figure to rise to over 16.2% of the GDP by 2008. According to the U.S.
Census Bureau, U.S. health care construction expenditures are estimated to be
$17.4 billion per year and growing. With regard to housing for seniors, there
are three major contributors to growth and the attraction of capital, according
to the National Investment Conference for the Senior Living and Long Term Care
Industries in 1996. They are (i) demographics, (ii) the limited supply of new
product, and (iii) the investment community's increased understanding of the
industry. Although the Company believes the growth in demand and facilities will
continue for at least 50 years due to the favorable demographics, the increase
in public awareness of the industry, the preference of seniors for obtaining
care in non-institutional settings and the cost savings realized in a
non-institutional environment.
<PAGE>
SELECTED FINANCIAL DATA
The following table sets forth certain financial information for the
Company, and should be read in conjunction with "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and the Financial
Statements included in this Prospectus Supplement and in Appendix B to the
Prospectus.
<TABLE>
<CAPTION>
<S> <C>
Nine Months Ended
September 30, 1999 September 30, 1998 Year Ended
(1) (1) December 31,
(Unaudited) (Unaudited) 1998 (1) 1997 (1) (2)
-------------------- -------------------- ----------- ---------------
Revenues $ 31,845 $ -- $ -- $ --
Net loss (3) (12,845) -- -- --
Cash distributions
declared 16,460 -- -- --
September 30, September 30,
1999 1998 December 31, December 31,
(Unaudited) (Unaudited) 1998 1997
----------------- ----------------- ---------------- ---------------
Total assets $3,880,105 $549,743 $976,579 $280,330
Total stockholders' equity 2,293,992 200,000 200,000 200,000
</TABLE>
(1) No operations commenced until the Company received minimum offering
proceeds and funds were released from escrow on July 13, 1999.
(2) Selected financial data for 1997 represents the period December 22, 1997
(date of inception) through December 31, 1997.
(3) Net loss for the nine months ended September 30, 1999 is the result of
a deduction of $20,000 in organizational costs.
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following information, including, without limitation, the Year 2000
Compliance disclosure, that are not historical facts may be forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Act of 1934. Although the Company believes that
the expectations reflected in such forward-looking statements are based upon
reasonable assumptions, the Company's actual results could differ materially
from those set forth in the forward-looking statements. Certain factors that
might cause such a difference include the following: changes in general economic
conditions, changes in local and national real estate conditions, continued
availability of proceeds from the Company's offering, the ability of the Company
to obtain permanent financing on satisfactory terms, the ability of the Company
to identify suitable investments, the ability of the Company to locate suitable
tenants for its Properties and borrowers for its Mortgage Loans and Secured
Equipment Leases, and the ability of such tenants and borrowers to make payments
under their respective leases, Mortgage Loans or Secured Equipment Leases. Given
these uncertainties, readers are cautioned not to place undue reliance on such
statements. The Company undertakes no obligation to update these forward-looking
statements to reflect any future events or circumstances.
<PAGE>
INTRODUCTION
The Company is a Maryland corporation that was organized on December
22, 1997, to acquire Properties related to health care and seniors' housing
facilities located across the United States. The Health Care Facilities may
include congregate living, assisted living and skilled nursing facilities,
continuing care retirement communities and life care communities, and medical
office buildings and walk-in clinics. The Properties will be leased on a
long-term, "triple-net" basis to operators of the Health Care Facilities. The
Company may also provide Mortgage Loans to operators of Health Care Facilities
in the aggregate principal amount of approximately 5% to 10% of the Company's
total assets. The Company also may offer Secured Equipment Leases to operators
of Health Care Facilities. The aggregate principal amount of Secured Equipment
Leases is not expected to exceed 10% of the Company's total assets.
The Company's primary investment objectives are to preserve, protect,
and enhance the Company's Assets while (i) making Distributions commencing in
the initial year of Company operations; (ii) obtaining fixed income through the
receipt of base rent, and increasing the Company's income (and Distributions)
and providing protection against inflation through automatic fixed increases in
base rent or increases in the base rent based on increases in consumer price
indices, over the terms of the leases, and obtaining fixed income through the
receipt of payments from Mortgage Loans and Secured Equipment Leases; (iii)
qualifying and remaining qualified as a REIT for federal income tax purposes;
and (iv) providing stockholders of the Company with liquidity of their
investment within five to ten years after commencement of the offering, either
in whole or in part, through (a) Listing, or (b) the commencement of the orderly
Sale of the Company's Assets, and distribution of the proceeds thereof (outside
the ordinary course of business and consistent with its objective of qualifying
as a REIT).
LIQUIDITY AND CAPITAL RESOURCES
In connection with this offering, the Company registered for sale an
aggregate of $155,000,000 of Shares (15,500,000 Shares at $10 per Share),
500,000 of such Shares available only to stockholders who elect to participate
in the Company's Reinvestment Plan. The Company has elected to extend the
offering of Shares until a date no later than September 18, 2000. The Board of
Directors may determine to engage in future offerings of Common Stock up to the
number of unissued authorized shares of Common Stock available.
As of July 13, 1999, the Company had received aggregate subscription
proceeds of $2,751,052 (275,105 Shares), which exceeded the minimum offering
amount of $2,500,000, and $2,526,052 of the funds were released from escrow. The
remaining subscription proceeds of $225,000 (representing funds received from
Pennsylvania investors) will be held in escrow until the Company receives
aggregate subscriptions of at least $7,775,000.
As of November 9, 1999, the Company had received aggregate subscription
proceeds of $4,575,728 (457,573 Shares), including $4,164 (416 Shares) through
the Reinvestment Plan and $225,000 from Pennsylvania investors. As of November
9, 1999, the Company had approximately $3,655,000 available to invest in
Properties and Mortgage Loans, following the deduction of Selling Commissions,
marketing support and due diligence expense reimbursement fees, Organizational
and Offering Expenses of approximately three percent, and Acquisition Fees.
The Company will use Net Offering Proceeds (Gross Proceeds less fees
and expenses of the offering) from this offering to purchase Properties and to
invest in Mortgage Loans. See the section of the Prospectus entitled "Investment
Objectives and Policies." In addition, the Company intends to borrow money to
acquire Assets and to pay certain related fees. The Company intends to encumber
Assets in connection with such borrowing. The Company plans to obtain a
revolving Line of Credit initially in an amount up to $45,000,000, and may, in
addition, also obtain Permanent Financing. The Line of Credit may be increased
at the discretion of the Board of Directors and may be repaid with offering
proceeds, working capital or Permanent Financing. Although the Board of
Directors anticipates that the Line of Credit initially may be in the amount of
$45,000,000 and the aggregate amount of any Permanent Financing shall not exceed
30% of the Company's total Assets, the maximum amount the Company may borrow is
300% of the Company's Net Assets. The Company has engaged in preliminary
discussions with potential lenders but has not yet received a commitment for the
Line of Credit or any Permanent Financing and there is no assurance that the
Company will obtain the Line of Credit or any Permanent Financing on
satisfactory terms.
Until Properties are acquired or Mortgage Loans are entered into, Net
Offering Proceeds are held in short-term, highly liquid investments which
management believes to have appropriate safety of principal. This investment
strategy provides high liquidity in order to facilitate the Company's use of
these funds to acquire Properties at such time as Properties suitable for
acquisition are located or to fund Mortgage Loans. At September 30, 1999, the
Company had $3,607,683 invested in such short-term investments as compared to
$92 at December 31, 1998. The increase in the amount invested in short-term
investments reflects subscription proceeds received from the sale of Shares
during the nine months ended September 30, 1999. These funds will be used
primarily to purchase Properties, to make Mortgage Loans, to pay Organizational
and Offering Expenses and Acquisition Expenses, to pay Distributions to
stockholders, to meet other Company expenses and, in management's discretion, to
create cash reserves.
During the nine months ended September 30, 1999 and 1998, Affiliates of
the Company incurred on behalf of the Company $363,682 and $316,203,
respectively, for certain Organizational and Offering Expenses. In addition,
during the nine months ended September 30, 1999, Affiliates of the Company
incurred on behalf of the Company $74,630 for certain Acquisition Expenses and
$18,642 for certain Operating Expenses. As of September 30, 1999, the Company
owed the Advisor $1,582,097 for such amounts, unpaid fees and administrative
expenses. The Advisor has agreed to pay or reimburse the Company all
Organizational and Offering Expenses in excess of three percent of Gross
Proceeds.
Since the commencement of the offering through September 30, 1999,
approximately $313,519 has been incurred by the Company in Selling Commissions
and marketing support and due diligence reimbursement fees to related parties,
the majority of which was subsequently paid to unrelated third parties. In
addition, since the commencement of the offering through September 30, 1999, the
Company has reimbursed Affiliates approximately $135,339 for certain
Organizational and Offering Expenses incurred on behalf of the Company and
administrative services related to the offering.
During the nine months ended September 30, 1999, the Company generated
cash from operations of $31,845. Based on cash from operations, the Company
declared and paid Distributions to its stockholders of $16,460 during the period
July 13, 1999 (the date the Company commenced operations) through September 30,
1999. No Distributions were paid or declared for the nine months ended September
30, 1998. On October 1 and November 1, 1999, the Company declared Distributions
to stockholders of record on October 1 and November 1, 1999, totalling $10,372
and $11,286, respectively (each representing $0.025 per share), payable in
December 1999.
For the nine months ended September 30, 1999, 100 percent of the
Distributions received by stockholders were considered to be ordinary income for
federal income tax purposes. No amounts distributed or to be distributed to the
stockholders as of September 30, 1999 were required to be or have been treated
by the Company as a return of capital for purposes of calculating the
Stockholders' 8% Return on their Invested Capital.
Due to anticipated low ongoing Operating Expenses, rental income
expected to be obtained from Properties after they are acquired, the fact that
the Line of Credit and Permanent Financing have not been obtained and that the
Company has not entered into Mortgage Loans or Secured Equipment Leases,
<PAGE>
management does not believe that working capital reserves will be necessary at
this time. Management has the right to cause the Company to maintain reserves
if, in their discretion, they determine such reserves are required to meet the
Company's working capital needs.
As of November 9, 1999, the Company had not entered into any
arrangements creating a reasonable probability that a Property would be acquired
by the Company or that a particular Mortgage Loan or Secured Equipment Lease
would be funded. The number of Properties to be acquired and the number of
Mortgage Loans to be invested in by the Company will depend upon the amount of
Net Offering Proceeds available and the amount of funds borrowed to acquire
Properties and make Mortgage Loans. The number of Secured Equipment Leases to be
offered is currently undetermined, but the Company will fund the Secured
Equipment Leases with the proceeds from the Line of Credit or Permanent
Financing.
Management is not aware of any material trends, favorable or
unfavorable, in either capital resources or the outlook for long-term cash
generation, nor does management expect any material changes in the availability
and relative cost of such capital resources, other than as referred to in the
Prospectus.
RESULTS OF OPERATIONS
No operations commenced until the Company received the minimum offering
proceeds of $2,500,000 on July 13, 1999. The Company did not acquire any
Properties or enter into any Mortgage Loans during the nine months ended
September 30, 1999.
During the nine months ended September 30, 1999, the Company earned
$31,845 in interest income from investments in money market accounts. Interest
income is expected to increase as the Company invests subscription proceeds
received in the future in highly liquid investments pending investment in
Properties and Mortgage Loans. However, as Net Offering Proceeds are invested in
Properties and used to make Mortgage Loans, the percentage of the Company's
total revenues from interest income from investments in money market accounts or
other short term, highly liquid investments is expected to decrease.
Operating Expenses were $44,690 for the nine months September 30, 1999.
Operating Expenses represent only a portion of Operating Expenses which the
Company is expected to incur during a full nine month period in which the
Company owns Properties or in which the Company is operational. The dollar
amount of Operating Expenses is expected to increase as the Company acquires
Properties and invests in Mortgage Loans. However, general and administrative
expenses as a percentage of total revenues is expected to decrease as the
Company acquires Properties and invests in Mortgage Loans.
The Company has incurred Operating Expenses which, in general, are those
expenses relating to administration of the Company on an ongoing basis. Pursuant
to the Advisory Agreement, the Advisor is required to reimburse the Company the
amount by which the total Operating Expenses paid or incurred by the Company
exceed in any four consecutive fiscal quarters (the "Expense Year"), the greater
of two percent of average invested assets or 25 percent of net income (the
"Expense Cap").
In April 1998, the American Institute of Certified Public Accountants
issued Statement of Position ("SOP") 98-5, "Reporting on the Costs of Start-Up
Activities," which became effective for the Company January 1, 1999. This SOP
requires start-up and organization costs to be expensed as incurred and also
requires previously deferred start-up costs to be recognized as a cumulative
effect adjustment in the statement of earnings. During the nine months ended
September 30, 1999, operating expenses include a charge of $20,000 for
organizational costs.
Management is not aware of any known trends or uncertainties, other
than national economic conditions, which may reasonably be expected to have a
material impact, favorable or unfavorable, on revenues or income from the
acquisition and operations of real properties, other than those Properties
referred to in the Prospectus.
There currently are no material changes being considered in the
objectives and policies of the Company as set forth in the Prospectus.
YEAR 2000 READINESS DISCLOSURE
OVERVIEW OF YEAR 2000 PROBLEM
The year 2000 problem concerns the inability of information and
non-information technology systems to properly recognize and process
date-sensitive information beyond January 1, 2000. The failure to accurately
recognize the year 2000 could result in a variety of problems from data
miscalculations to the failure of entire systems.
INFORMATION AND NON-INFORMATION TECHNOLOGY SYSTEMS
The Company does not have any information or non-information technology
systems. The Advisor and Affiliates of the Advisor provide all services
requiring the use of information and non-information technology systems pursuant
to the Advisory Agreement with the Company. The information technology system of
the Affiliates of the Advisor consists of a network of personal computers and
servers built using hardware and software from mainstream suppliers. The
non-information technology systems of Affiliates of the Advisor are primarily
facility related and include building security systems, elevators, fire
suppressions, HVAC, electrical systems and other utilities. The Affiliates of
the Advisor have no internally generated programmed software coding to correct,
because substantially all of the software utilized by the Affiliates is
purchased or licensed from external providers.
THE Y2K TEAM
In early 1998, the Affiliates of the Advisor formed a Year 2000
committee (the "Y2K Team") for the purpose of identifying, understanding and
addressing the various issues associated with the year 2000 problem. The Y2K
Team consists of members from the Advisor and its Affiliates, including
representatives from senior management, information systems, telecommunications,
legal, office management, accounting and property management.
ASSESSING YEAR 2000 READINESS
The Y2K Team's initial step in assessing year 2000 readiness consists
of identifying any systems that are date sensitive and, accordingly, could have
potential year 2000 problems. The Y2K Team has conducted inspections, interviews
and tests to identify which of systems used by the Company could have a
potential year 2000 problem.
The information system of the Affiliates of the Advisor is comprised of
hardware and software applications from mainstream suppliers. Accordingly, the
Y2K Team has contacted and is evaluating documentation from the respective
vendors and manufacturers to verify the year 2000 compliance of their products.
The Y2K Team has also requested and is evaluating documentation from the
non-information technology systems providers of the Affiliates.
<PAGE>
In addition, the Y2K Team has requested and is evaluating documentation
from other companies with which the Company has material third party
relationships. Such third parties, in addition to the providers of information
and non-information technology systems, consist of the Company's transfer agent
and financial institutions. The Company depends on its transfer agent to
maintain and track investor information and its financial institutions for
availability of cash.
As of September 30, 1999, the Y2K Team had received responses from
approximately 60% of the third parties. All of the responses were in writing. Of
the third parties responding, all indicated that they are currently year 2000
compliant or will be year 2000 compliant prior to the year 2000. Although the
Y2K Team continues to receive positive responses from the companies with which
the Company has third party relationships regarding their year 2000 compliance,
the Advisor cannot be assured that the third parties have adequately considered
the impact of the year 2000.
ACHIEVING YEAR 2000 COMPLIANCE
The Y2K Team has identified and completed upgrades of hardware
equipment that was not year 2000 compliant. In addition, the Y2K Team has
identified and completed upgrades of software applications that were not year
2000 compliant, although the Advisor cannot be assured that the upgrade
solutions provided by the vendors have addressed all possible year 2000 issues.
The cost for these upgrades and other remedial measures is the
responsibility of the Advisor and its Affiliates. The Advisor does not expect
that the Company will incur any costs in connection with year 2000 remedial
measures.
ASSESSING THE RISKS TO THE COMPANY OF NON-COMPLIANCE AND DEVELOPING CONTINGENCY
PLANS
RISK OF FAILURE OF INFORMATION AND NON-INFORMATION TECHNOLOGY SYSTEMS USED BY
THE COMPANY
The Advisor believes that the reasonably likely worst case scenario
with regard to the information and non-information technology systems used by
the Company is the failure of one or more of these systems as a result of year
2000 problems. Because the Company's major source of income will be rental
payments under long-term triple-net leases, any failure of information or
non-information technology systems used by the Company is not expected to have a
material impact on the results of operations of the Company. Even if such
systems failed, if the Company owned Properties, the payment of rent under the
Company's leases would not be affected. In addition, the Y2K Team is expected to
correct any Y2K problems within the control of the Advisor and its Affiliates
before the year 2000.
The Y2K Team has determined that a contingency plan to address this
risk is not necessary at this time. However, if the Y2K Team identifies
additional risks associated with the year 2000 compliance of the information or
non-information technology systems used by the Company, the Y2K Team will
develop a contingency plan if deemed necessary at that time.
RISK OF INABILITY OF TRANSFER AGENT TO ACCURATELY MAINTAIN COMPANY RECORDS
The Advisor believes that the reasonably likely worst case scenario
with regard to the Company's transfer agent is that the transfer agent will fail
to achieve year 2000 compliance of its systems and will not be able to
accurately maintain the records of the Company. This could result in the
inability of the Company to accurately identify its stockholders for purposes of
distributions, delivery of disclosure materials and transfer of units. The Y2K
Team has received certification from the Company's transfer agent of its year
2000 compliance. Despite the positive response from the transfer agent, the
Advisor cannot be assured that the transfer agent has addressed all possible
year 2000 issues.
The Y2K Team has developed a contingency plan pursuant to which the
Advisor and its Affiliates would maintain the records of the Company manually,
in the event that the systems of the transfer agent are not year 2000 compliant.
The Advisor and its Affiliates would have to allocate resources to internally
perform the functions of the transfer agent. The Advisor does not anticipate
that the additional cost of these resources would have a material impact on the
results of operations of the Company.
RISK OF LOSS OF SHORT-TERM LIQUIDITY FROM FAILURE OF FINANCIAL INSTITUTIONS TO
ACHIEVE YEAR 2000 COMPLIANCE
The Advisor believes that the reasonably likely worst case scenario
with regard to the Company's financial institutions is that some or all of its
funds on deposit with such financial institutions may be temporarily
unavailable. The Y2K Team has received responses from 93% of the Company's
financial institutions indicating that their systems are currently year 2000
compliant or are expected to be year 2000 compliant prior to the year 2000.
Despite the positive responses from the financial institutions, the Advisor
cannot be assured that the financial institutions have addressed all possible
year 2000 issues. The loss of short-term liquidity could affect the Company's
ability to pay its expenses on a current basis. The Advisor does not anticipate
that a loss of short-term liquidity would have a material impact on the results
of operations of the Company.
Based upon the responses received from the Company's financial
institutions and the inability of the Y2K Team to identify a suitable
alternative for the deposit of funds that is not subject to potential year 2000
problems, the Y2K Team has determined not to develop a contingency plan to
address this risk.
THE ADVISOR AND THE ADVISORY AGREEMENT
THE ADVISOR
CNL Health Care Corp. (formerly CNL Health Care Advisors, Inc.) is a
Florida corporation organized in July 1997 to provide management, advisory and
administrative services. The Company originally entered into the Advisory
Agreement with the Advisor effective September 15, 1998. CNL Health Care Corp.,
as Advisor, has a fiduciary responsibility to the Company and the stockholders.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Mr. Seneff is Chairman of the Board of Directors and Chief Executive
Officer, and Mr. Bourne is a director, President and Treasurer, of the Managing
Dealer. In addition, Mr. Seneff is Chairman of the Board of Directors and Chief
Executive Officer, and Mr. Bourne is a director and President, of the Advisor.
The Managing Dealer is entitled to receive Selling Commissions
amounting to 7.5% of the total amount raised from the sale of Shares for
services in connection with the offering of Shares, a substantial portion of
which will be paid as commissions to other broker-dealers. For the period
January 1, 1999 through November 9, 1999, and the year ended December 31, 1998,
the Company had incurred $341,268 and $1,912, respectively of such fees, of
which $311,361 and $1,785, respectively, has been or will be paid by CNL
Securities Corp. as commissions to other broker-dealers.
In addition, the Managing Dealer is entitled to receive a marketing
support and due diligence expense reimbursement fee equal to 0.5% of the total
amount raised from the sale of Shares, all or a portion of which may be
reallowed to other broker-dealers. For the period January 1, 1999 through
<PAGE>
November 9, 1999, and the year ended December 31, 1998, the Company had incurred
$22,751 and $128, respectively, of such fees, the majority of which has been or
will be reallowed to other broker-dealers and from which all bona fide due
diligence expenses will be paid.
In addition, the Company has agreed to issue and sell Soliciting Dealer
Warrants to the Managing Dealer. The price for each warrant will be $0.0008 and
one warrant will be issued for every 25 Shares sold by the Managing Dealer. All
or a portion of the Soliciting Dealer Warrants may be reallowed to Soliciting
Dealers with prior written approval from, and in the sole discretion of the
Managing Dealer, except where prohibited by either federal or state securities
laws. The holder of a Soliciting Dealer Warrant will be entitled to purchase one
Share from the Company at a price of $12.00 during the five-year period
commencing with the date the offering begins. No Soliciting Dealer Warrant,
however, will be exercisable until one year from the date of issuance. The
Company had not issued any Soliciting Dealer Warrants to the Managing Dealer as
of September 30, 1999.
The Advisor is entitled to receive Acquisition Fees for services in
identifying the Properties and structuring the terms of the acquisition and
leases of the Properties and structuring the terms of the Mortgage Loans equal
to 4.5% of Total Proceeds. During the period January 1, 1999 through November 9,
1999, and the year ended December 31, 1998, the Company incurred $204,760 and
$1,148, respectively, of such fees. Such fees are included in other assets.
The Advisor and its Affiliates provide various administrative services
to the Company, including services related to accounting; financial, tax and
regulatory compliance reporting; stockholder distributions and reporting; due
diligence and marketing; and investor relations (including administrative
services in connection with the offering of Shares) on a day-to-day basis. For
the nine months ended September 30, 1999, the year ended December 31, 1998 and
the period December 22, 1997 (date of inception) through December 31, 1997, the
Company incurred $266,603, $196,184 and $15,202, respectively, for these
services. For the nine months ended September 30, 1999, $256,795 of such costs
represent stock issuance costs and $9,808 represents general operating and
administrative expenses. For 1998 and 1997, such amounts are included in
deferred offering costs.
The Company believes that all amounts paid or payable by the Company to
Affiliates are fair and comparable to amounts that would be paid for similar
services provided by unaffiliated third parties.
PRIOR PERFORMANCE INFORMATION
The information presented in this section represents the historical
experience of certain real estate programs organized by certain officers and
directors of the Advisor. Prior public programs have invested only in restaurant
properties and hotel properties and have not invested in Health Care Facilities.
Investors in the Company should not assume that they will experience returns, if
any, comparable to those experienced by investors in such prior public real
estate programs. Investors who purchase Shares will not thereby acquire any
ownership interest in any partnerships or corporations to which the following
information relates.
Two Directors of the Company, Robert A. Bourne and James M. Seneff,
Jr., individually or with others have served as general partners of 88 and 89
real estate limited partnerships, respectively, including 18 publicly offered
CNL Income Fund partnerships, and as directors and officers of two unlisted
public REITs. None of these limited partnerships or unlisted REITs has been
audited by the IRS. Of course, there is no guarantee that the Company will not
be audited. Based on an analysis of the operating results of the prior programs,
Messrs. Bourne and Seneff believe that each of such programs has met or is
meeting its principal investment objectives in a timely manner.
CNL Realty Corporation, which was organized as a Florida corporation in
November 1985 and whose sole stockholders are Messrs. Bourne and Seneff,
currently serves as the corporate general partner with Messrs. Bourne and Seneff
as individual general partners of 18 CNL Income Fund limited partnerships, all
of which were organized to invest in fast-food, family-style, and in the case of
two of the partnerships, casual-dining restaurant properties. Messrs. Bourne and
Seneff also currently serve as directors of CNL American Properties Fund, Inc.,
an unlisted public REIT organized to invest in fast-food, family-style and
casual-dining restaurant properties, mortgage loans and secured equipment
leases; and as directors and officers of CNL Hospitality Properties Inc., an
unlisted public REIT organized to invest in hotel properties, mortgage loans and
secured equipment leases. Both REITs have investment objectives similar to those
of the Company. As of September 30, 1999, the 18 partnerships and the two
unlisted public REITs had raised a total of approximately $1.7 billion from a
total of approximately 90,000 investors, and had invested in approximately 1,400
fast-food, family-style and casual-dining restaurant properties, and nine
hotels. None of the 18 public partnerships or the two unlisted public REITs has
invested in Health Care Facilities. Certain additional information relating to
the offerings and investment history of the 18 public partnerships and the two
unlisted public REITs is set forth below.
<TABLE>
<CAPTION>
<S> <C>
Number of Date 90% of Net
Limited Proceeds Fully
Maximum Partnership Invested or
Name of Offering Units or Committed to
Entity Amount (1) Date Closed Shares Sold Investment (2)
- ------ ---------- ----------- ----------- --------------
CNL Income $15,000,000 December 31, 1986 30,000 December 1986
Fund, Ltd. (30,000 units)
CNL Income $25,000,000 August 21, 1987 50,000 November 1987
Fund II, Ltd. (50,000 units)
CNL Income $25,000,000 April 29, 1988 50,000 June 1988
Fund III, Ltd. (50,000 units)
CNL Income $30,000,000 December 6, 1988 60,000 February 1989
Fund IV, Ltd. (60,000 units)
CNL Income $25,000,000 June 7, 1989 50,000 December 1989
Fund V, Ltd. (50,000 units)
CNL Income $35,000,000 January 19, 1990 70,000 May 1990
Fund VI, Ltd. (70,000 units)
CNL Income $30,000,000 August 1, 1990 30,000,000 January 1991
Fund VII, Ltd. (30,000,000 units)
CNL Income $35,000,000 March 7, 1991 35,000,000 September 1991
Fund VIII, Ltd. (35,000,000 units)
CNL Income $35,000,000 September 6, 1991 3,500,000 November 1991
Fund IX, Ltd. (3,500,000 units)
CNL Income $40,000,000 April 22, 1992 4,000,000 June 1992
Fund X, Ltd. (4,000,000 units)
CNL Income $40,000,000 October 8, 1992 4,000,000 September 1992
Fund XI, Ltd. (4,000,000 units)
CNL Income $45,000,000 April 15, 1993 4,500,000 July 1993
Fund XII, Ltd. (4,500,000 units)
Number of Date 90% of Net
Limited Proceeds Fully
Maximum Partnership Invested or
Name of Offering Units or Committed to
Entity Amount (1) Date Closed Shares Sold Investment (2)
- ------ ---------- ----------- ----------- --------------
CNL Income $40,000,000 September 13, 1993 4,000,000 August 1993
Fund XIII, Ltd. (4,000,000 units)
CNL Income $45,000,000 March 23, 1994 4,500,000 May 1994
Fund XIV, Ltd. (4,500,000 units)
CNL Income $40,000,000 September 22, 1994 4,000,000 December 1994
Fund XV, Ltd. (4,000,000 units)
CNL Income $45,000,000 July 18, 1995 4,500,000 August 1995
Fund XVI, Ltd. (4,500,000 units)
CNL Income $30,000,000 October 10, 1996 3,000,000 December 1996
Fund XVII, Ltd. (3,000,000 units)
CNL Income $35,000,000 February 6, 1998 3,500,000 December 1997
Fund XVIII, Ltd. (3,500,000 units)
CNL American $747,464,413 January 20, 1999 (3) 74,746,441 (3) February 1999 (3)
Properties Fund, Inc. (74,746,441 shares)
CNL Hospitality $425,072,637 (4) (4) (4)
Properties, Inc. (42,507,264 shares)
</TABLE>
- ---------------------
(1) The amount stated includes the exercise by the general partners of each
partnership of their option to increase by $5,000,000 the maximum size of
the offering of CNL Income Fund, Ltd., CNL Income Fund II, Ltd., CNL
Income Fund III, Ltd., CNL Income Fund IV, Ltd., CNL Income Fund VI,
Ltd., CNL Income Fund VIII, Ltd., CNL Income Fund X, Ltd., CNL Income
Fund XII, Ltd., CNL Income Fund XIV, Ltd., CNL Income Fund XVI, Ltd. and
CNL Income Fund XVIII, Ltd. The number of shares of common stock for CNL
American Properties Fund, Inc. ("APF") represents the number of shares
prior to a one-for-two reverse stock split, which was effective on June
3, 1999.
(2) For a description of the property acquisitions by these programs, see the
table set forth on the following page.
(3) In April 1995, APF, commenced an offering of a maximum of 16,500,000
shares of common stock ($165,000,000). On February 6, 1997, the initial
offering closed upon receipt of subscriptions totalling $150,591,765
(15,059,177 shares), including $591,765 (59,177 shares) through the
reinvestment plan. Following completion of the initial offering on
February 6, 1997, APF commenced a subsequent offering (the "1997
Offering") of up to 27,500,000 shares ($275,000,000) of common stock. On
March 2, 1998, the 1997 Offering closed upon receipt of subscriptions
totalling $251,872,648 (25,187,265 shares), including $1,872,648 (187,265
shares) through the reinvestment plan. Following completion of the 1997
Offering on March 2, 1998, APF commenced a subsequent offering (the "1998
Offering") of up to 34,500,000 shares ($345,000,000) of common stock. As
of December 31, 1998, APF had received subscriptions totalling
$345,000,000 (34,500,000 shares), including $3,107,848 (310,785 shares)
through the reinvestment plan, from the 1998 Offering. The 1998 Offering
closed in January 1999, upon receipt of the proceeds from the last
subscriptions. As of March 31, 1999, net proceeds to APF from its three
offerings totalled $670,151,200 and all of such amount had been invested
or committed for investment in properties and mortgage loans.
(4) Effective July 9, 1997, CNL Hospitality Properties, Inc. (formerly CNL
American Realty Fund, Inc.) ("CHP") commenced an offering of up to
16,500,000 shares of common stock ($165,000,000). On June 17, 1999, the
initial offering closed upon receipt of subscriptions totalling
$150,072,637 (15,007,264 shares), including $72,637 (7,264 shares)
through the reinvestment plan. Following completion of the initial
offering on June 17, 1999, CHP commenced a subsequent offering (the "1999
Offering") of up to 27,500,000 shares ($275,000,000) of common stock. As
of September 30, 1999, CHP had received subscriptions totalling
$73,248,406 (7,324,841 shares), including $232,466 (23,246 shares)
through the reinvestment plan, from the 1999 Offering. As of such date,
CHP had purchased, directly or indirectly, nine properties.
<PAGE>
As of September 30, 1999, Mr. Seneff and Mr. Bourne, directly or
through affiliated entities, also had served as joint general partners of 69
nonpublic real estate limited partnerships. The offerings of all of these 69
nonpublic limited partnerships had terminated as of September 30, 1999. These 69
partnerships raised a total of $185,927,353 from approximately 4,519 investors,
and purchased, directly or through participation in a joint venture or limited
partnership, interests in a total of 216 projects as of September 30, 1999.
These 216 projects consist of 19 apartment projects (comprising 10% of the total
amount raised by all 69 partnerships), 13 office buildings (comprising 5% of the
total amount raised by all 69 partnerships), 169 fast-food, family-style, or
casual-dining restaurant property and business investments (comprising 69% of
the total amount raised by all 69 partnerships), one condominium development
(comprising 0.5% of the total amount raised by all 69 partnerships), four
hotels/motels (comprising 5% of the total amount raised by all 69 partnerships),
eight commercial/retail properties (comprising 10% of the total amount raised by
all 69 partnerships), and two tracts of undeveloped land (comprising 0.5% of the
total amount raised by all 69 partnerships).
Mr. Bourne also has served, without Mr. Seneff, as a general partner of
one additional nonpublic real estate limited partnership program which raised a
total of $600,000 from 13 investors and purchased, through participation in a
limited partnership, one apartment building located in Georgia with a purchase
price of $1,712,000.
Mr. Seneff also has served, without Mr. Bourne, as a general partner of
two additional nonpublic real estate limited partnerships which raised a total
of $240,000 from 12 investors and purchased two office buildings with an
aggregate purchase price of $928,390. Both of the office buildings are located
in Florida.
Of the 90 real estate limited partnerships whose offerings had closed
as of September 30, 1999 (including 18 CNL Income Fund limited partnerships) in
which Mr. Seneff and/or Mr. Bourne serve or have served as general partners in
the past, 39 invested in restaurant properties leased on a "triple-net" basis,
including eight which also invested in franchised restaurant businesses
(accounting for approximately 93% of the total amount raised by all 90 real
estate limited partnerships).
The following table sets forth summary information, as of September 30,
1999, regarding property acquisitions by the 18 limited partnerships and the two
unlisted REITs.
<TABLE>
<CAPTION>
<S> <C>
Name of Type of Method of Type of
Entity Property Location Financing Program
------ -------- -------- --------- -------
CNL Income Fund, 22 fast-food or AL, AZ, CA, FL, GA, All cash Public
Ltd. family-style LA, MD, OK, PA, TX,
restaurants VA, WA
CNL Income Fund II, 49 fast-food or AL, AZ, CO, FL, GA, All cash Public
Ltd. family-style IL, IN, KS, LA, MI,
restaurants MN, MO, NC, NM, OH,
TN, TX, WA, WY
CNL Income Fund 38 fast-food or AL, AZ, CA, CO, FL, All cash Public
III, Ltd. family-style GA, IA, IL, IN, KS,
restaurants KY, MD, MI, MN, MO,
NC, NE, OK, TX
<PAGE>
Name of Type of Method of Type of
Entity Property Location Financing Program
------ -------- -------- --------- -------
CNL Income Fund IV, 47 fast-food or AL, DC, FL, GA, IL, All cash Public
Ltd. family-style IN, KS, MA, MD, MI,
restaurants MS, NC, OH, PA, TN,
TX, VA
CNL Income Fund V, 35 fast-food or AZ, FL, GA, IL, IN, All cash Public
Ltd. family-style MI, NH, NY, OH, SC,
restaurants TN, TX, UT, WA
CNL Income Fund VI, 56 fast-food or AR, AZ, FL, GA, IL, All cash Public
Ltd. family-style IN, KS, MA, MI, MN,
restaurants NC, NE, NM, NY, OH,
OK, PA, TN, TX, VA,
WA, WY
CNL Income Fund 49 fast-food or AZ, CO, FL, GA, IN, All cash Public
VII, Ltd. family-style LA, MI, MN, NC, OH,
restaurants SC, TN, TX, UT, WA
CNL Income Fund 42 fast-food or AZ, FL, IN, LA, MI, All cash Public
VIII, Ltd. family-style MN, NC, NY, OH, TN,
restaurants TX, VA
CNL Income Fund IX, 44 fast-food or AL, CO, FL, GA, IL, All cash Public
Ltd. family-style IN, LA, MI, MN, MS,
restaurants NC, NH, NY, OH, SC,
TN, TX
CNL Income Fund X, 54 fast-food or AL, CA, CO, FL, ID, All cash Public
Ltd. family-style IL, LA, MI, MO, MT,
restaurants NC, NE, NH, NM, NY,
OH, PA, SC, TN, TX, WA
CNL Income Fund XI, 43 fast-food or AL, AZ, CA, CO, CT, All cash Public
Ltd. family-style FL, KS, LA, MA, MI,
restaurants MS, NC, NH, NM, OH,
OK, PA, SC, TX, VA, WA
CNL Income Fund 50 fast-food or AL, AZ, CA, FL, GA, All cash Public
XII, Ltd. family-style LA, MO, MS, NC, NM,
restaurants OH, SC, TN, TX, WA
CNL Income Fund 50 fast-food or AL, AR, AZ, CA, CO, All cash Public
XIII, Ltd. family-style FL, GA, IN, KS, LA,
restaurants MD, NC, OH, PA, SC,
TN, TX, VA
<PAGE>
Name of Type of Method of Type of
Entity Property Location Financing Program
------ -------- -------- --------- -------
CNL Income Fund 65 fast-food or AL, AZ, CO, FL, GA, All cash Public
XIV, Ltd. family-style KS, LA, MN, MO, MS,
restaurants NC, NJ, NV, OH, SC,
TN, TX, VA
CNL Income Fund XV, 55 fast-food or AL, CA, FL, GA, KS, All cash Public
Ltd. family-style KY, MN, MO, MS, NC,
restaurants NJ, NM, OH, OK, PA,
SC, TN, TX, VA
CNL Income Fund 48 fast-food or AZ, CA, CO, DC, FL, All cash Public
XVI, Ltd. family-style GA, ID, IN, KS, MN,
restaurants MO, NC, NM, NV, OH,
TN, TX, UT, WI
CNL Income Fund 31 fast-food, CA, FL, GA, IL, IN, All cash Public
XVII, Ltd. family-style or MI, NC, NV, OH, SC,
casual-dining TN, TX, WA
restaurants
CNL Income Fund 25 fast-food, AZ, CA, FL, GA, IL, All cash Public
XVIII, Ltd. family-style or KY, MD, MN, NC, NV,
casual-dining NY, OH, TN, TX, VA
restaurants
CNL American 616 fast-food, AL, AZ, CA, CO, CT, (1) Public REIT
Properties Fund, family-style or DE, FL, GA, IA, ID,
Inc. casual-dining IL, IN, KS, KY, LA,
restaurants MD, MI, MN, MO, MS,
NC, NE, NH, NJ, NM,
NV, NY, OH, OK, OR,
PA, RI, SC, TN, TX,
UT, VA, WA, WI, WV
CNL Hospitality 9 limited service, AZ, GA, NV, TX, WA (2) Public REIT
Properties, Inc. extended stay or
full service hotels
</TABLE>
(1) As of March 31, 1999, all of APF's net offering proceeds had been
invested or committed for investment in properties and mortgage loans.
Since April 1, 1999, APF has used proceeds from its line of credit to
acquire and develop properties and to fund mortgage loans and secured
equipment leases.
(2) In 1998, CHP used proceeds from its line of credit and net offering
proceeds to fund the acquisition of two of its properties. As of
September 30, 1999, CHP had repaid amounts borrowed on its line of credit
using additional net offering proceeds. In 1999, CHP acquired an interest
in seven additional properties through CNL Hotel Investors, Inc. ("CHI"),
a real estate investment trust jointly owned by CHP and Five Arrow Realty
Securities II L.L.C. ("Five Arrows"). In connection with the acquisition
of these seven properties, CHI used proceeds from permanent financing, in
addition to net offering proceeds from CHP and cash contributions from
Five Arrows.
<PAGE>
A more detailed description of the acquisitions by real estate limited
partnerships and the unlisted REITs sponsored by Messrs. Bourne and Seneff is
set forth in prior performance Table VI, included in Part II of the registration
statement filed with the Securities and Exchange Commission for this offering. A
copy of Table VI is available to stockholders from the Company upon request,
free of charge. In addition, upon request to the Company, the Company will
provide, without charge, a copy of the most recent Annual Report on Form 10-K
filed with the Securities and Exchange Commission for CNL Income Fund, Ltd., CNL
Income Fund II, Ltd., CNL Income Fund III, Ltd., CNL Income Fund IV, Ltd., CNL
Income Fund V, Ltd., CNL Income Fund VI, Ltd., CNL Income Fund VII, Ltd., CNL
Income Fund VIII, Ltd., CNL Income Fund IX, Ltd., CNL Income Fund X, Ltd., CNL
Income Fund XI, Ltd., CNL Income Fund XII, Ltd., CNL Income Fund XIII, Ltd., CNL
Income Fund XIV, Ltd., CNL Income Fund XV, Ltd., CNL Income Fund XVI, Ltd., CNL
Income Fund XVII, Ltd., CNL Income Fund XVIII, Ltd., CNL American Properties
Fund, Inc. and CNL Hospitality Properties, Inc. as well as a copy, for a
reasonable fee, of the exhibits filed with such reports.
In order to provide potential purchasers of Shares in the Company with
information to enable them to evaluate the prior experience of the Messrs.
Seneff and Bourne as general partners of real estate limited partnerships and as
directors and officers of the two unlisted REITs, including those set forth in
the foregoing table, certain financial and other information concerning those
limited partnerships and the two unlisted REITs with investment objectives
similar to one or more of the Company's investment objectives is provided in the
Prior Performance Tables included as Appendix C. Information about the previous
public partnerships, the offerings of which became fully subscribed between July
1994 and June 1999, is included therein. Potential stockholders are encouraged
to examine the Prior Performance Tables attached as Appendix C (in Table III),
which include information as to the operating results of these prior
partnerships, for more detailed information concerning the experience of Messrs.
Seneff and Bourne.
DISTRIBUTION POLICY
DISTRIBUTIONS
In August and September 1999, the Company declared distributions
totalling $7,422 and $9,038, respectively (each representing $0.02500 per
Share), which were paid in September 1999. In addition, in October and November
1999, the Company declared Distributions totalling $10,372 and $11,286,
respectively (each representing $0.02500 per Share), payable in December 1999.
The Company intends to continue to make regular Distributions to stockholders.
Distributions will be made to those stockholders who are stockholders as of the
record date selected by the Directors. Distributions will be declared monthly
during the offering period, declared monthly during any subsequent offering,
paid on a quarterly basis during an offering period, and declared and paid
quarterly thereafter. The Company is required to distribute annually at least
95% of its real estate investment trust taxable income to maintain its objective
of qualifying as a REIT. Generally, income distributed will not be taxable to
the Company under federal income tax laws if the Company complies with the
provisions relating to qualification as a REIT. If the cash available to the
Company is insufficient to pay such Distributions, the Company may obtain the
necessary funds by borrowing, issuing new securities, or selling Assets. These
methods of obtaining funds could affect future Distributions by increasing
operating costs. To the extent that Distributions to stockholders exceed
earnings and profits, such amounts constitute a return capital for federal
income tax purposes, although such Distributions will not reduce stockholders'
aggregate Invested Capital. Distributions in kind shall not be permitted, except
for distributions of readily marketable securities; distributions of beneficial
interests in a liquidating trust established for the dissolution of the Company
and the liquidation of its assets in accordance with the terms of the Articles
of Incorporation; or distributions of in-kind property as long as the Directors
(i) advise each stockholder of the risks associated with direct ownership of the
property; (ii) offer each stockholder the election of receiving in-kind property
distributions; and (iii) distribute in-kind property only to those stockholders
who accept the Directors' offer.
Distributions will be made at the discretion of the Directors,
depending primarily on net cash from operations (which includes cash received
from tenants except to the extent that such cash represents a return of
principal in regard to the lease of a Property consisting of building only,
distributions from joint ventures, and interest income from lessees of Equipment
and borrowers under Mortgage Loans, less expenses paid) and the general
financial condition of the Company, subject to the obligation of the Directors
to cause the Company to qualify and remain qualified as a REIT for federal
income tax purposes. The Company intends to increase Distributions in accordance
with increases in net cash from operations.
<PAGE>
APPENDIX B
FINANCIAL INFORMATION
-------------------------------------------------
| |
| THE UPDATED UNAUDITED FINANCIAL STATEMENTS OF |
| CNL HEALTH CARE PROPERTIES, INC. CONTAINED IN |
| THIS ADDENDUM SHOULD BE READ IN CONJUNCTION |
| WITH APPENDIX B TO THE PROSPECTUS, DATED MAY |
| 24, 1999. |
| |
-------------------------------------------------
<PAGE>
INDEX TO FINANCIAL STATEMENTS
CNL HEALTH CARE PROPERTIES, INC.
Page
----
Updated Unaudited Financial Statements:
Condensed Balance Sheets as of September 30, 1999 and
December 31, 1998 B-2
Condensed Statements of Operations for the quarters and nine
months ended September 30, 1999 and 1998 B-3
Condensed Statements of Stockholders' Equity for the nine months
ended September 30, 1999 and the year ended December 31, 1998 B-4
Condensed Statements of Cash Flows for the nine months ended
September 30, 1999 and 1998 B-5
Notes to Condensed Financial Statements for the quarters and nine
months ended September 30, 1999 and 1998 B-6
<PAGE>
CNL HEALTH CARE PROPERTIES, INC.
CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
<S> <C>
September 30, December 31,
1999 1998
---------------- ----------------
ASSETS
Cash and cash equivalents $3,607,683 $ 92
Deferred offering costs -- 975,339
Other assets 272,422 1,148
----------------- ----------------
$3,880,105 $976,579
================= ================
LIABILITIES AND STOCKHOLDERS' EQUITY
Liabilities:
Due to related parties $1,582,097 $685,372
Accounts payable and accrued expenses 4,016 91,207
----------------- ----------------
Total liabilities 1,586,113 776,579
----------------- ----------------
Stockholders' equity:
Preferred stock, without par value.
Authorized and unissued 3,000,000 shares -- --
Excess shares, $.01 par value per share.
Authorized and unissued 103,000,000 shares -- --
Common stock, $.01 par value per share.
Authorized 100,000,000 shares, issued and
outstanding 411,899 and 20,000 shares,
respectively 4,119 200
Capital in excess of par value 2,319,178 199,800
Accumulated deficit (29,305 ) --
----------------- ----------------
2,293,992 200,000
----------------- ----------------
$3,880,105 $976,579
================= ================
See accompanying notes to financial statements.
<PAGE>
CNL HEALTH CARE PROPERTIES, INC.
CONDENSED STATEMENTS OF OPERATIONS
Quarter and Nine Months
Ended September 30,
1999 1998
--------------- ----------------
Revenues:
Interest income $31,845 $ --
---------------- -----------------
Expenses:
General operating and administrative 24,690 --
Organizational costs 20,000 --
---------------- -----------------
44,690 --
---------------- -----------------
Net Loss $ (12,845 ) $ --
================ =================
Loss Per Share of Common Stock
(Basic and Diluted) $ (.04 ) $ --
================ =================
Weighted Average Number of Shares of
Common Stock Outstanding 342,929 --
================ =================
See accompanying notes to financial statements.
<PAGE>
CNL HEALTH CARE PROPERTIES, INC.
CONDENSED STATEMENTS OF STOCKHOLDERS' EQUITY
Nine Months Ended September 30, 1999 and
Year Ended December 31, 1998
Common stock Capital in
--------------------------
Number Par excess of Accumulated
of Shares value par value deficit Total
------------ ---------- ------------- ---------------- --------------
Balance at December 31, 1997 20,000 $ 200 $ 199,800 $ -- $ 200,000
Subscriptions received for common
stock through public offering 2,550 26 25,474 -- 25,500
Subscriptions held in escrow (2,550 ) (26 ) (25,474 ) -- (25,500 )
------------- ----------- -------------- ---------------- ----------------
Balance at December 31, 1998 20,000 200 199,800 -- 200,000
Subscriptions received for common
stock through public offering
and distribution reinvestment plan 414,399 4,144 4,139,847 -- 4,143,991
Subscriptions held in escrow (22,500 ) (225 ) (224,775 ) -- (225,000 )
Stock issuance costs -- -- (1,795,694 ) -- (1,795,694 )
Net loss -- -- -- (12,845 ) (12,845 )
Distributions declared and paid
($.050 per share) -- -- -- (16,460 ) (16,460 )
------------- ----------- -------------- ---------------- ----------------
Balance at September 30, 1999 411,899 $ 4,119 $ 2,319,178 $ (29,305 ) $ 2,293,992
============= =========== ============== ================ ================
See accompanying notes to financial statements.
<PAGE>
CNL HEALTH CARE PROPERTIES, INC.
CONDENSED STATEMENTS OF CASH FLOWS
Nine Months Ended
September 30,
1999 1998
-------------- ----------------
Increase (Decrease) in Cash and Cash Equivalents:
Cash Flows from Operating Activities $ 31,845 $ --
--------------- -----------------
Cash Flows from Financing Activities:
Subscriptions received from stockholders 3,918,991 --
Distributions to stockholders (16,460 ) --
Reimbursement of stock issuance costs paid by
related parties on behalf of the Company -- (135,339 )
Payment of stock issuance costs (326,785 ) (64,569 )
--------------- -----------------
Net cash provided by (used in) financing
activities 3,575,746 (199,908 )
--------------- -----------------
Net Increase (Decrease) in Cash and Cash Equivalents 3,607,591 (199,908 )
Cash and Cash Equivalents at Beginning of Period 92 200,000
--------------- -----------------
Cash and Cash Equivalents at End of Period $3,607,683 $ 92
=============== =================
Supplement Schedule of Non-Cash and Financing
Activities:
Related parties paid certain acquisition,
deferring offering and stock issuance
costs on behalf of the Company as follows:
Acquisition costs $ 74,630 $ --
Deferred offering costs -- 316,203
Stock issuance costs 363,682 --
=============== =================
$ 438,312 $ 316,203
=============== =================
</TABLE>
See accompanying notes to financial statements.
<PAGE>
CNL HEALTH CARE PROPERTIES, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
Quarters and Nine Months Ended September 30, 1999 and 1998
1. Significant Accounting Policies:
Basis of Presentation - The accompanying unaudited financial statements
have been prepared in accordance with the instructions to Form 10-Q and
do not include all of the information and note disclosures required by
generally accepted accounting principles. The financial statements
reflect all adjustments, consisting of normal recurring adjustments,
which are, in the opinion of the management, necessary to a fair
statement of the results for the interim period presented. Operating
results for the quarter and nine months ended September 30, 1999 may
not be indicative of the results that may be expected for the year
ending December 31, 1999. Amounts as of December 31, 1998, included in
the financial statements, have been derived from audited financial
statements as of that date.
New Accounting Standard - In April 1998, the American Institute of
Certified Public Accountants issued Statement of Position ("SOP") 98-5,
"Reporting on the Costs of Start-Up Activities," which became effective
for the Company January 1, 1999. This SOP requires start-up and
organization costs to be expensed as incurred and also requires
previously deferred start-up costs to be recognized as a cumulative
effect adjustment in the statement of earnings. During the nine months
ended September 30, 1999, the Company expensed $20,000 of organization
costs.
The Company was a development stage enterprise from December 22, 1997
through July 13, 1999. Since operations had not begun, activities
through July 13, 1999, were devoted to organization of the Company.
Earnings per share are calculated based upon the weighted average
number of shares of common stock outstanding during the period the
Company was operational. The weighted average number of shares of
common stock outstanding for the period July 14, 1999 through September
30, 1999, was 342,929.
These unaudited financial statements should be read in conjunction with
the financial statements and notes thereto included in Form 10-K of CNL
Health Care Properties, Inc. (the "Company") for the year ended
December 31, 1998.
2. Other Assets:
Other assets at September 30, 1999, consisted of acquisition fees and
miscellaneous acquisition expenses which will be allocated to future
properties and miscellaneous prepaid expenses.
<PAGE>
CNL HEALTH CARE PROPERTIES, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS
Quarters and Nine Months Ended September 30, 1999 and 1998
3. Stock Issuance Costs:
The Company has incurred certain expenses associated with its offerings
of shares, including commissions, marketing support and due diligence
expense reimbursement fees, filing fees, legal, accounting, printing
and escrow fees, which have been deducted from the gross proceeds of
the offerings. Preliminary costs incurred prior to raising capital were
advanced by the affiliates of the Company. CNL Health Care Advisors,
Inc. (the "Advisor") has agreed to pay all offering expenses (excluding
commissions and marketing support and due diligence expense
reimbursement fees) which exceed three percent of the gross offering
proceeds received from the sale of shares of the Company in connection
with the current offering.
During the nine months ended September 30, 1999 and the year ended
December 31, 1998, the Company incurred $838,355 and $875,009,
respectively in organizational and offering costs, including $329,479
and $2,040, respectively, in commissions and marketing support and due
diligence expense reimbursement fees (see Note 5). These amounts have
been treated as stock issuance costs and have been charged to
stockholders' equity subject to the three percent cap described above.
4. Distributions:
For the nine months ended September 30, 1999, 100 percent of the
distributions paid to stockholders were considered ordinary income for
federal income tax purposes. No amounts distributed to the stockholders
for the nine months ended September 30, 1999 are required to be or have
been treated by the Company as a return of capital for purposes of
calculating the stockholders' 8% return on their invested capital. The
characterization for tax purposes of distributions declared for the
nine months ended September 30, 1999 may not be indicative of the
results that may be expected for the year ending December 31, 1999.
5. Related Party Arrangements:
Certain affiliates of the Company will receive fees and compensation in
connection with the offering, and the acquisition, management and sale
of the assets of the Company.
CNL Securities Corp. is entitled to receive commissions amounting to
7.5% of the total amount raised from the sale of shares for services in
connection with the offering of the shares, a substantial portion of
which will be paid as commissions to other broker-dealers. During the
nine months ended September 30, 1999, the Company incurred $292,012 of
such fees, of which $281,140 were or will be paid by CNL Securities
Corp. as commissions to other broker-dealers.
<PAGE>
CNL HEALTH CARE PROPERTIES, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
Quarters and Nine Months Ended September 30, 1999 and 1998
5. Related Party Arrangements - Continued:
In addition, CNL Securities Corp. is entitled to receive a marketing
support and due diligence expense reimbursement fee equal to 0.5% of
the total amount raised from the sale of shares, all or a portion of
which may be reallowed to other broker-dealers. During the nine months
ended September 30, 1999, the Company incurred $19,467 of such fees,
the majority of which will be reallowed to other broker-dealers and
from which all bona fide due diligence expenses will be paid.
In addition, the Company has agreed to issue and sell soliciting dealer
warrants ("Soliciting Dealer Warrants") to CNL Securities Corp. The
price for each warrant will be $0.0008 and one warrant will be issued
for every 25 shares sold by the managing dealer. All or a portion of
the Soliciting Dealer Warrants may be reallowed to soliciting dealers
with prior written approval from, and in the sole discretion of, the
managing dealer, except where prohibited by either federal or state
securities laws. The holder of a Soliciting Dealer Warrant will be
entitled to purchase one share of common stock from the Company at a
price of $12.00 during the five-year period commencing with the date
the offering begins. No Soliciting Dealer Warrant, however, will be
exercisable until one year from the date of issuance.
The Advisor is entitled to receive acquisition fees for services in
connection with finding, negotiating the leases of and acquiring
properties on behalf of the Company equal to 4.5% of gross proceeds,
loan proceeds from permanent financing and amounts outstanding on the
line of credit, if any, at the time of listing of the shares on a
national securities exchange or over-the-counter market, but excluding
that portion of the permanent financing used to finance secured
equipment leases. During the nine months ended September 30, 1999, the
Company incurred $175,207 of such fees. Such fees are included in other
assets at September 30, 1999.
The Company has incurred operating expenses which, in general, are
those expenses relating to administration of the Company on an ongoing
basis. Pursuant to the advisory agreement, the Advisor is required to
reimbursed the Company the amount by which the total operating expenses
paid or incurred by the Company exceed in any four consecutive fiscal
quarters (the "Expense Year"), the greater of two percent of average
invested assets or 25 percent of net income (the "Expense Cap").
The Advisor and its affiliates provide various administrative services
to the Company, including services related to accounting; financial,
tax and regulatory compliance reporting; stockholder distributions and
reporting; due diligence and marketing; and investor relations
(including administrative services in connection with the offering), on
a day-to-day basis.
<PAGE>
CNL HEALTH CARE PROPERTIES, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
Quarters and Nine Months Ended September 30, 1999 and 1998
5. Related Party Arrangements - Continued:
The expenses incurred for these services were classified as follows for
the nine months ended September 30:
1999 1998
------------- ------------
Deferred offering costs $ -- $106,779
Stock issuance costs 256,795 --
General operating and administrative
expenses 9,808 --
------------- ------------
$266,603 $106,779
============= ============
Amounts due to related parties consisted of the following at:
<TABLE>
<CAPTION>
<S> <C>
September 30, December 31,
1999 1998
--------------- -----------------
Due to the Advisor:
Expenditures incurred on behalf of
the Company $ 853,122 $ 470,798
Accounting and administrative services 477,989 211,386
Acquisition fees and expenses 250,986 1,148
--------------- -----------------
1,582,097 683,332
--------------- -----------------
Due to CNL Securities Corp.:
Commissions -- 1,912
Marketing support and due diligence
expense reimbursement fee -- 128
--------------- -----------------
-- 2,040
--------------- -----------------
$1,582,097 $ 685,372
=============== =================
</TABLE>
<PAGE>
CNL HEALTH CARE PROPERTIES, INC.
NOTES TO CONDENSED FINANCIAL STATEMENTS - CONTINUED
Quarters and Nine Months Ended September 30, 1999 and 1998
6. Subsequent Event:
During the period October 1, 1999 through October 25, 1999, the Company
received subscription proceeds for an additional 32,060 shares
($320,605) of common stock. As of October 25, 1999, the Company had
received total subscription proceeds of $4,464,596, including $225,000
from Pennsylvania investors whose funds will be held in escrow until
aggregate subscription proceeds total at least $7,775,000.
On October 1, 1999, the Company declared distributions totalling
$10,372, or $0.025 per share of common stock, payable in December 1999,
to stockholders of record on October 1, 1999.
<PAGE>
ADDENDUM TO
APPENDIX C
PRIOR PERFORMANCE TABLES
-------------------------------------------
| |
| THE FOLLOWING INFORMATION UPDATES AND |
| REPLACES THE CORRESPONDING INFORMATION |
| IN APPENDIX C TO THE ATTACHED |
| PROSPECTUS, DATED MAY 24, 1999. |
| |
-------------------------------------------
<PAGE>
APPENDIX C
PRIOR PERFORMANCE TABLES
The information in this Appendix C contains certain relevant summary
information concerning certain prior public programs sponsored by two of the
Company's principals (who also serve as the Chairman of the Board and President
of the Company) and their Affiliates (the "Prior Public Programs") which were
formed to invest in restaurant properties leased on a triple-net basis to
operators of national and regional fast-food and family-style restaurant chains,
or in the case of CNL Hospitality Properties, Inc., to invest in hotel
properties. No Prior Public Programs sponsored by the Company's Affiliates have
invested in health care facilities leased on a triple-net basis to operators of
health care facilities.
A more detailed description of the acquisitions by the Prior Public
Programs is set forth in Part II of the registration statement filed with the
Securities and Exchange Commission for this Offering and is available from the
Company upon request, without charge. In addition, upon request to the Company,
the Company will provide, without charge, a copy of the most recent Annual
Report on Form 10-K filed with the Securities and Exchange Commission for CNL
Income Fund, Ltd., CNL Income Fund II, Ltd., CNL Income Fund III, Ltd., CNL
Income Fund IV, Ltd., CNL Income Fund V, Ltd., CNL Income Fund VI, Ltd., CNL
Income Fund VII, Ltd., CNL Income Fund VIII, Ltd., CNL Income Fund IX, Ltd., CNL
Income Fund X, Ltd., CNL Income Fund XI, Ltd., CNL Income Fund XII, Ltd., CNL
Income Fund XIII, Ltd., CNL Income Fund XIV, Ltd., CNL Income Fund XV, Ltd., CNL
Income Fund XVI, Ltd., CNL Income Fund XVII, Ltd., CNL Income Fund XVIII, Ltd.,
CNL American Properties Fund, Inc., and CNL Hospitality Properties, Inc. as well
as a copy, for a reasonable fee, of the exhibits filed with such reports.
The investment objectives of the Prior Public Programs generally
include preservation and protection of capital, the potential for increased
income and protection against inflation, and potential for capital appreciation,
all through investment in restaurant properties, or in the case of CNL
Hospitality Properties, Inc., through investment in hotel properties. In
addition, the investment objectives of the Prior Public Programs included making
partially tax-sheltered distributions.
Stockholders should not construe inclusion of the following tables as
implying that the Company will have results comparable to those reflected in
such tables. Distributable cash flow, federal income tax deductions, or other
factors could be substantially different. Stockholders should note that, by
acquiring shares in the Company, they will not be acquiring any interest in any
prior public programs.
Description of Tables
The following Tables are included herein:
Table I - Experience in Raising and Investing Funds
Table II - Compensation to Sponsor
Table III - Operating Results of Prior Programs
Table V - Sales or Disposal of Properties
Unless otherwise indicated in the Tables, all information contained in
the Tables is as of June 30, 1999. The following is a brief description of the
Tables:
Table I - Experience in Raising and Investing Funds
Table I presents information on a percentage basis showing the
experience of two of the principals of the Company and their Affiliates in
raising and investing funds for the Prior Public Programs, the offerings of
which became fully subscribed between July 1994 and June 1999.
<PAGE>
The Table sets forth information on the offering expenses incurred and
amounts available for investment expressed as a percentage of total dollars
raised. The Table also shows the percentage of property acquisition cost
leveraged, the date the offering commenced, and the time required to raise funds
for investment.
Table II - Compensation to Sponsor
Table II provides information, on a total dollar basis, regarding
amounts and types of compensation paid to the two of the Company's principals
and their Affiliates which sponsored the Prior Public Programs.
The Table indicates the total offering proceeds and the portion of such
offering proceeds paid or to be paid to two of the principals of the Company and
their Affiliates in connection with the Prior Public Programs, the offerings of
which became fully subscribed between July 1994 and June 1999. The Table also
shows the amounts paid to two of the principals of the Company and their
Affiliates from cash generated from operations and from cash generated from
sales or refinancing by each of the Prior Public Programs on a cumulative basis
commencing with inception and ending June 30, 1999.
Table III - Operating Results of Prior Programs
Table III presents a summary of operating results for the period from
inception through June 30, 1999, of the Prior Public Programs, the offerings of
which became fully subscribed between July 1994 and June 1999.
The Table includes a summary of income or loss of the Prior Public
Programs, which are presented on the basis of generally accepted accounting
principles ("GAAP"). The Table also shows cash generated from operations, which
represents the cash generated from operations of the properties of the Prior
Public Programs, as distinguished from cash generated from other sources
(special items). The section of the Table entitled "Special Items" provides
information relating to cash generated from or used by items which are not
directly related to the operations of the properties of the Prior Public
Programs, but rather are related to items of an investing or financing nature.
These items include proceeds from capital contributions of investors and
disbursements made from these sources of funds, such as syndication (or stock
issuance) and organizational costs, acquisition of the properties and other
costs which are related more to the organization of the entity and the
acquisition of properties than to the actual operations of the entities.
The Table also presents information pertaining to investment income,
returns of capital on a GAAP basis, cash distributions from operations, sales
and refinancing proceeds expressed in total dollar amounts as well as
distributions and tax results on a per $1,000 investment basis.
Table IV - Results of Completed Programs
Table IV is omitted from this Appendix C because none of the Prior
Public Programs have completed operations (meaning they no longer hold
properties).
Table V - Sales or Disposal of Properties
Table V provides information regarding the sale or disposal of
properties owned by the Prior Public Programs between July 1994 and June 1999.
The Table includes the selling price of the property, the cost of the
property, the date acquired and the date of sale.
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
TABLE I
EXPERIENCE IN RAISING AND INVESTING FUNDS
CNL Income CNL Income CNL American CNL Income
Fund XV, Fund XVI, Properties Fund XVII,
Ltd. Ltd. Fund, Ltd.
Inc.
------------- ------------- ---------------- -------------
(Note 1)
Dollar amount offered $40,000,000 $45,000,000 $745,000,000 $30,000,000
============= ============= ================ =============
Dollar amount raised 100.0 % 100.0 % 100.0 % 100.0 %
------------- ------------- ---------------- -------------
Less offering expenses:
Selling commissions and discounts (8.5 ) (8.5 ) (7.5 ) (8.5 )
Organizational expenses (3.0 ) (3.0 ) (2.2 ) (3.0 )
Marketing support and due diligence
expense reimbursement fees
(includes amounts reallowed to
unaffiliated entities) (0.5 ) (0.5 ) (0.5 ) (0.5 )
------------- ------------- --------------- -------------
(12.0 ) (12.0 ) (10.2 ) (12.0 )
------------- ------------- ---------------- -------------
------------- ------------- ---------------- -------------
Reserve for operations -- -- -- --
------------- ------------- ---------------- -------------
Percent available for investment 88.0 % 88.0 % 89.8 % 88.0 %
============= ============= ================ =============
Acquisition costs:
Cash down payment 82.5 % 82.5 % 85.3 % 83.5 %
Acquisition fees paid to affiliates 5.5 5.5 4.5 4.5
Loan costs -- -- -- --
------------- ------------- ---------------- -------------
Total acquisition costs 88.0 % 88.0 % 89.8 % 88.0 %
============= ============= ================ =============
Percent leveraged (mortgage financing
divided by total acquisition costs) -- -- -- --
Date offering began 2/23/94 9/02/94 4/19/95, 9/02/95
2/06/97
and 3/02/98
Length of offering (in months) 6 9 22, 13 and 9, 12
respectively
Months to invest 90% of amount
available for investment measured
from date of offering 10 11 23, 16 and 11, 15
respectively
Note 1: Pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933, as amended, effective March 29, 1995, CNL
American Properties Fund, Inc. ("APF") registered for sale
$165,000,000 of shares of common stock (the "Initial Offering"),
including $15,000,000 available only to stockholders participating
in the company's reinvestment plan. The Initial Offering of APF
commenced April 19, 1995, and upon completion of the Initial
Offering on February 6, 1997, had received subscription proceeds
of $150,591,765 (15,059,177 shares), including $591,765 (59,177
shares) issued pursuant to the reinvestment plan. Pursuant to a
Registration Statement on Form S-11 under the Securities Act of
1933, as amended, effective January 31, 1997, APF registered for
sale $275,000,000 of shares of common stock (the "1997 Offering"),
including $25,000,000 available only to stockholders participating
in the company's reinvestment plan. The 1997 Offering of APF
commenced following the completion of the Initial Offering on
February 6, 1997, and upon completion of the 1997 Offering on
March 2, 1998, had received subscription proceeds of $251,872,648
(25,187,265 shares), including $1,872,648 (187,265 shares) issued
pursuant to the reinvestment plan. Pursuant to a Registration
Statement on Form S-11 under the Securities Act of 1933, as
amended, effective May 12, 1998, APF registered for sale
$345,000,000 of shares of common stock (the "1998 Offering"). The
1998 Offering of APF commenced following the completion of the
1997 Offering on March 2, 1998. As of January 31, 1999, APF had
received subscriptions totalling approximately $345,000,000 from
the 1998 Offering, including $3,107,848 issued pursuant to the
company's reinvestment plan. The 1998 Offering became fully
subscribed in December 1998 and proceeds from the last
subscriptions were received in January 1999.
<PAGE>
CNL Income CNL Hospitality
Fund XVIII, Properties,
Ltd. Inc.
- ---------------- ------------------
(Note 2)
$35,000,000 $150,072,637
================ ==================
100.0 % 100.0 %
- ---------------- ------------------
(8.5 ) (7.5 )
(3.0 ) (3.0 )
(0.5 ) (0.5 )
- ---------------- ------------------
(12.0 ) (11.0 )
- ---------------- ------------------
--
- ---------------- ------------------
88.0 % 89.0 %
================ ==================
83.5 % 84.5 %
4.5 4.5
-- --
- ---------------- ------------------
88.0 % 89.0 %
================ ==================
-- --
9/20/96 07/09/97
17 23
17 Note 2
Note 2: Pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933, as amended, effective July 9, 1997, CNL
Hospitality Properties, Inc. ("CHP") registered for sale
$165,000,000 of shares of common stock (the "Initial Offering"),
including $15,000,000 available only to stockholders participating
in the company's reinvestment plan. The Initial Offering of CHP
commenced September 11, 1997, and upon completion of the Initial
Offering on June 17, 1999 had received $150,072,637 (15,007,264
shares), including $72,637 (7,264 shares) issued pursuant to the
reinvestment plan. Pursuant to a Registration Statement on Form
S-11 under the Securities Act of 1933, as amended, effective June
17, 1999, CHP registered for sale $275,000,000 of shares of common
stock (the "1999 Offering"), including $25,000,000 available only
to stockholders participating in the Company's reinvestment plan.
The 1999 Offering of CHP commenced following the completion of the
Initial Offering on June 17, 1999. As of June 30, 1999, CHP had
received subscription proceeds of $7,657,757 (765,776 shares) from
its 1999 Offering, including $88,403 (8,840 shares) issued
pursuant to the reinvestment plan. As of June 30, 1999, CHP had
invested approximately $61,600,000 in nine properties,
representing 49% of the amount available from its Initial
Offering.
<PAGE>
TABLE II
COMPENSATION TO SPONSOR
CNL Income CNL Income CNL American CNL Income
Fund XV, Fund XVI, Properties Fund, Fund XVII,
Ltd. Ltd. Inc. Ltd.
------------- -------------- ----------------- --------------
(Note 1)
Date offering commenced 2/23/94 9/02/94 4/19/95, 2/06/97 9/02/95
and 3/02/98
Dollar amount raised $40,000,000 $45,000,000 $747,464,420 $30,000,000
============= ============== ================= ==============
Amount paid to sponsor from proceeds
of offering:
Selling commissions and discounts 3,400,000 3,825,000 56,059,832 2,550,000
Real estate commissions -- -- -- --
Acquisition fees 2,200,000 2,475,000 33,604,618 1,350,000
(Note 5)
Marketing support and due diligence
expense reimbursement fees
(includes amounts reallowed to
unaffiliated entities) 200,000 225,000 3,737,322 150,000
------------- -------------- ----------------- --------------
Total amount paid to sponsor 5,800,000 6,525,000 93,401,772 4,050,000
============= ============== ================= ==============
Dollar amount of cash generated from
operations before deducting payments
to sponsor:
1999 (6 months) 1,545,029 1,681,308 30,646,055 1,280,674
1998 3,343,292 3,765,104 42,216,874 2,638,733
1997 3,419,967 3,909,781 18,514,122 2,611,191
1996 3,557,073 3,911,609 6,096,045 1,340,159
1995 3,361,477 2,619,840 594,425 11,671
1994 1,154,454 212,171 -- --
Amount paid to sponsor from operations
(administrative, accounting and
management fees):
1999 (6 months) 76,270 80,719 2,389,763 50,370
1998 126,564 141,410 3,100,599 117,814
1997 113,372 129,357 1,437,908 116,077
1996 122,391 157,883 613,505 107,211
1995 122,107 138,445 95,966 2,659
1994 37,620 7,023 -- --
Dollar amount of property sales and
refinancing before deducting payments
to sponsor:
Cash (Note 3) 3,312,297 1,385,384 11,233,372 --
Notes -- -- -- --
Amount paid to sponsors from property
sales and refinancing:
Real estate commissions -- -- -- --
Incentive fees -- -- -- --
Other (Note 2) -- -- -- --
Note 1: Pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933, as amended, effective March 29, 1995, CNL
American Properties Fund, Inc. ("APF") registered for sale
$165,000,000 of shares of common stock (the "Initial Offering"),
including $15,000,000 available only to stockholders participating
in the company's reinvestment plan. The Initial Offering of APF
commenced April 19, 1995, and upon completion of the Initial
Offering on February 6, 1997, had received subscription proceeds
of $150,591,765 (15,059,177 shares), including $591,765 (59,177
shares) issued pursuant to the reinvestment plan. Pursuant to a
Registration Statement on Form S-11 under the Securities Act of
1933, as amended, effective January 31, 1997, APF registered for
sale $275,000,000 of shares of common stock (the "1997 Offering"),
including $25,000,000 available only to stockholders participating
in the company's reinvestment plan. The 1997 Offering of APF
commenced following the completion of the Initial Offering on
February 6, 1997, and upon completion of the 1997 Offering on
March 2, 1998, had received subscription proceeds of $251,872,648
(25,187,265 shares), including $1,872,648 (187,265 shares) issued
pursuant to the reinvestment plan. Pursuant to a Registration
Statement on Form S-11 under the Securities Act of 1933, as
amended, effective May 12, 1998, APF registered for sale
$345,000,000 of shares of common stock (the "1998 Offering"). The
1998 Offering of APF commenced following the completion of the
1997 Offering on March 2, 1998. As of January 31, 1999, APF had
received subscriptions totalling approximately $345,000,000 from
the 1998 Offering, including $3,107,848 issued pursuant to the
company's reinvestment plan. The 1998 Offering became fully
subscribed in December 1998 and proceeds from the last
subscriptions were received in January 1999. The amounts shown
represent the combined results of the Initial Offering, the 1997
Offering and the 1998 Offering as of January 31, 1999, including
shares issued pursuant to the company's reinvestment plans.
<PAGE>
CNL Income CNL Hospitality
Fund XVIII, Properties,
Ltd. Inc.
- ---------------- -------------------
(Note 4)
9/20/96 7/9/97 and 6/17/99
$35,000,000 $157,730,394
================ ===================
2,975,000 10,704,809
-- --
1,575,000 6,992,871
175,000 713,654
- ---------------- ------------------
4,725,000 18,411,334
================ ===================
1,502,770 2,251,573
2,964,628 2,985,455
1,459,963 29,358
30,126 --
-- --
-- --
52,883 217,816
132,890 208,490
98,207 6,889
2,980 --
-- --
-- --
-- --
-- --
-- --
-- --
-- --
Note 2: For negotiating secured equipment leases and supervising the
secured equipment lease program, APF is entitled to receive a
one-time secured equipment lease servicing fee of two percent of
the purchase price of the equipment that is the subject of a
secured equipment lease. During the six months ended June 30, 1999
and the years ended December 31, 1998, 1997 and 1996, APF incurred
$67,967, $54,998, $87,665 and $70,070, respectively, in secured
equipment lease servicing fees.
Note 3: Excludes properties sold and substituted with replacement
properties, as permitted under the terms of the lease agreements.
Note 4: Pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933, as amended, effective July 9, 1997, CNL
Hospitality Properties, Inc. registered for sale $165,000,000 of
shares of common stock (the "Initial Offering"), including
$15,000,000 available only to stockholders participating in the
company's reinvestment plan. The offering of shares of CNL
Hospitality Properties, Inc. commenced September 11, 1997, and
upon completion of the Initial Offering on June 17, 1999, had
received subscription proceeds of $150,072,637 (15,007,264
shares), including $72,637 (7,264 shares) issued pursuant to the
reinvestment plan. Pursuant to a Registration Statement on Form
S-11, as amended, effective June 17, 1999, CNL Hospitality
Properties, Inc. registered for sale $275,000,000 of shares of
common stock (the "1999 Offering"). The 1999 Offering of CNL
Hospitality Properties, Inc. commenced following the completion of
the Initial Offering on June 17, 1999. The amounts shown represent
the combined results of the Initial Offering and the 1999
Offering, including subscription proceeds issued pursuant to the
reinvestment plan as of June 30, 1999.
<PAGE>
TABLE II - COMPENSATION TO SPONSOR (continued)
Note 5: In addition to acquisition fees paid on gross proceeds from the
offerings, APF also incurred acquisition fees relating to proceeds
from its line of credit to the extent the proceeds were used to
acquire properties. Such fees were paid using proceeds from the
line of credit, and as of June 30, 1999, APF had incurred
$4,483,456 of such fees.
<PAGE>
TABLE III
Operating Results of Prior Programs CNL
INCOME FUND XV, LTD.
1993
(Note 1) 1994 1995 1996
-------------- ------------- ------------- -------------
Gross revenue $ 0 $ 1,143,586 $ 3,546,320 $ 3,632,699
Equity in earnings of joint ventures 0 8,372 280,606 392,862
Profit (Loss) from sale of properties
(Note 4) 0 0 (71,023 ) 0
Provision for loss on land and buildings
(Note 7 and 8) 0 0 0 0
Interest income 0 167,734 88,059 43,049
Less: Operating expenses 0 (62,926 ) (228,319 ) (235,319 )
Transaction costs 0 0 0 0
Interest expense 0 0 0 0
Depreciation and amortization 0 (70,848 ) (243,175 ) (248,232 )
-------------- ------------- ------------- -------------
Net income - GAAP basis 0 1,185,918 3,372,468 3,585,059
============== ============= ============= =============
Taxable income
- from operations 0 1,026,715 2,861,912 2,954,318
============== ============= ============= =============
- from gain on sale 0 0 0 0
============== ============= ============= =============
Cash generated from operations (Notes 2
and 3) 0 1,116,834 3,239,370 3,434,682
Cash generated from sales (Note 4) 0 0 811,706 0
Cash generated from refinancing 0 0 0 0
-------------- ------------- ------------- -------------
Cash generated from operations, sales and
refinancing 0 1,116,834 4,051,076 3,434,682
Less: Cash distributions to investors
(Notes 5, 6 and 10)
- from operating cash flow 0 (639,944 ) (2,650,003 ) (3,200,000 )
- from sale of properties 0 0 0 0
- from cash flow from prior period 0 0 0 0
-------------- ------------- ------------- -------------
Cash generated (deficiency) after cash
distributions 0 480,890 1,401,073 234,682
Special items (not including sales and
refinancing):
Limited partners' capital
contributions 0 40,000,000 0 0
General partners' capital
contributions 1,000 0 0 0
Syndication costs 0 (3,892,003 ) 0 0
Acquisition of land and buildings 0 (22,152,379 ) (1,625,601 ) 0
Investment in direct financing leases 0 (6,792,806 ) (2,412,973 ) 0
Investment in joint ventures 0 (1,564,762 ) (720,552 ) (129,939 )
Return of capital from joint venture 0 0 0 0
Reimbursement of organization,
syndication and acquisition costs
paid on behalf of CNL Income
Fund XV, Ltd. by related parties 0 (1,098,197 ) (23,507 ) 0
Increase in other assets 0 (187,757 ) 0 0
Other (38 ) (6,118 ) 25,150 0
-------------- ------------- ------------- -------------
Cash generated (deficiency) after cash
distributions and special items 962 4,786,868 (3,356,410 ) 104,743
============== ============= ============= =============
TAX AND DISTRIBUTION DATA PER
$1,000 INVESTED
Federal income tax results:
Ordinary income (loss)
- from operations 0 33 71 73
============== ============= ============= =============
- from recapture 0 0 0 0
============== ============= ============= =============
Capital gain (loss) (Note 4) 0 0 0 0
============== ============= ============= =============
<PAGE>
6 months
1997 1998 1999
- ---------------- -------------- -------------
$ 3,622,123 $ 3,179,911 $ 1,610,248
239,249 236,553 123,928
0 0 0
0 (280,907 ) (132,446 )
46,642 54,576 18,059
(224,761 ) (242,552 ) (160,072 )
0 (23,196 ) (107,297 )
0 0 0
(248,348 ) (281,888 ) (150,547 )
- ---------------- -------------- -------------
3,434,905 2,642,497 1,201,873
================ ============== =============
2,856,893 2,847,638 1,210,384
================ ============== =============
47,256 0 0
================ ============== =============
3,306,595 3,216,728 1,468,759
0 0 0
0 0 0
- ---------------- -------------- -------------
3,306,595 3,216,728 1,468,759
(3,280,000 ) (3,216,728 ) (1,468,759 )
0 0 0
0 (183,272 ) (131,241 )
- ---------------- -------------- -------------
26,595 (183,272 ) (131,241 )
0 0 0
0 0 0
0 0 0
0 0 0
0 0 0
0 (216,992 ) 0
51,950 0 0
0 0 0
0 0 0
0 0 0
- ---------------- -------------- -------------
78,545 (400,264 ) (131,241 )
================ ============== =============
71 70 30
================ ============== =============
0 0 0
================ ============== =============
1 0 0
================ ============== =============
<PAGE>
TABLE III - CNL INCOME FUND XV, LTD. (continued)
1993
(Note 1) 1994 1995 1996
-------------- ------------- ------------- -------------
Cash distributions to investors
Source (on GAAP basis)
- from investment income 0 21 66 80
- from capital gain 0 0 0 0
- from investment income from prior
period 0 0 0 0
-------------- ------------- ------------- -------------
Total distributions on GAAP basis (Note 5) 0 21 66 80
============== ============= ============= =============
Source (on cash basis)
- from sales 0 0 0 0
- from refinancing 0 0 0 0
- from operations 0 21 66 80
- from investment income from prior
period 0 0 0 0
-------------- ------------- ------------- -------------
Total distributions on cash basis (Note 5) 0 21 66 80
============== ============= ============= =============
Total cash distributions as a percentage of
original $1,000 investment (Notes 6, 9 and 10) 0.00 % 5.00 % 7.25 % 8.20 %
Total cumulative cash distributions per
$1,000 investment from inception 0 21 87 167
Amount (in percentage terms) remaining
invested in program properties at the end
of each year (period) presented (original
total acquisition cost of properties
retained, divided by original total
acquisition cost of all properties in
program) (Note 4) N/A 100 % 100 % 100 %
Note 1: The registration statement relating to this offering of Units of
CNL Income Fund XV, Ltd. became effective February 23, 1994.
Activities through March 23, 1994, were devoted to organization of
the partnership and operations had not begun.
Note 2: Cash generated from operations includes cash received from
tenants, plus distributions from joint venture, less cash paid for
expenses, plus interest received.
Note 3: Cash generated from operations per this table agrees to cash
generated from operations per the statement of cash flows included
in the financial statements of CNL Income Fund XV, Ltd.
Note 4: During 1995, the partnership sold three of its properties to a
tenant for its original purchase price, excluding acquisition fees
and miscellaneous acquisition expenses. The majority of the net
sales proceeds were used to acquire additional properties. As a
result of these transactions, the partnership recognized a loss
for financial reporting purposes of $71,023 primarily due to
acquisition fees and miscellaneous acquisition expenses the
partnership had allocated to the three properties and due to the
accrued rental income relating to future scheduled rent increases
that the partnership had recorded and reversed at the time of
sale. In addition, during 1996, Wood-Ridge Real Estate Joint
Venture, in which the partnership owns a 50% interest, sold its
two properties to the tenant and recognized a gain of
approximately $261,100 for financial reporting purposes. As a
result, the partnership's pro rata share of such gain of
approximately $130,550 is included in equity in earnings of
unconsolidated joint ventures for 1996.
Note 5: Distributions declared for the quarters ended December 31,
1994, 1995, 1996, 1997 and 1998 are reflected in the 1995, 1996,
1997, 1998 and 1999 columns, respectively, due to the payment of
such distributions in January 1995, 1996, 1997, 1998 and 1999,
respectively. As a result of distributions being presented on a
cash basis, distributions declared and unpaid as of December 31,
1994, 1995, 1996, 1997, 1998 and June 30, 1999 are not included in
the 1994, 1995, 1996, 1997, 1998 and 1999 totals, respectively.
Note 6: On December 31, 1996, CNL Income Fund XV, Ltd. declared a
special distribution of cumulative excess operating reserves equal
to .20% of the total invested capital. Accordingly, the total
yield for 1996 was 8.20%
Note 7: During the year ended December 31, 1998, the Partnership
established an allowance for loss on land and buildings of
$280,907 for financial reporting purposes relating to two of the
four Long John Silver's properties, one in each of Lancaster,
South Carolina and Lexington, North Carolina, whose leases were
rejected by the tenant. The tenant of these properties filed for
bankruptcy and ceased payment of rents under the terms of the
lease agreements. The loss represents the difference between the
carrying value of the Properties at December 31, 1998 and the
current estimated net realizable value for these Properties.
<PAGE>
6 months
1997 1998 1999
- ------------------ -------------- -------------
82 65 30
0 0 0
0 20 10
- ------------------ -------------- -------------
82 85 40
================== ============== =============
0 0 0
0 0 0
82 80 37
0 5 3
- ------------------ -------------- -------------
82 85 40
================== ============== =============
8.00 % 8.50 % 8.00 %
249 334 374
100 % 100 % 100 %
Note 8: At June 30, 1999, the Partnership recorded a provision for loss
on building in the amount of $132,446 for financial reporting
purposes relating to a Long John Silver's Property in Gastonia,
North Carolina, the lease for which was rejected by the tenant in
June 1998. The tenant of this Property filed for bankruptcy and
ceased payment of rents under the terms of its lease agreement.
The impairment represents the difference between the carrying
value of the Property at June 30, 1999 and the estimated net sales
proceeds from the sale of the Property based on a pending sales
contract with an unrelated third party.
Note 9: Total cash distributions as a percentage of original $1,000
investment are calculated based on actual distributions declared
for the period. (See Note 5 above)
Note 10: Cash distributions for 1998 include an additional amount equal
to 0.50% of invested capital which was earned in 1997 or prior
years, but declared payable in the first quarter of 1998.
Note 11: Certain data for columns representing less than 12 months have
been annualized.
<PAGE>
TABLE III
Operating Results of Prior Programs CNL
INCOME FUND XVI, LTD.
1993
(Note 1) 1994 1995 1996
-------------- -------------- -------------- -------------
Gross revenue $ 0 $ 186,257 $ 2,702,504 $ 4,343,390
Equity in earnings from joint venture 0 0 0 19,668
Profit from sale of properties (Notes 4
and 5) 0 0 0 124,305
Provision for loss on building (Notes 8 and 0 0 0 0
9)
Interest income 0 21,478 321,137 75,160
Less: Operating expenses 0 (10,700 ) (274,595 ) (261,878 )
Transaction costs 0 0 0 0
Interest expense 0 0 0 0
Depreciation and amortization 0 (9,458 ) (318,205 ) (552,447 )
============== ============== ============== =============
Net income - GAAP basis 0 187,577 2,430,841 3,748,198
============== ============== ============== =============
Taxable income
- from operations 0 189,864 2,139,382 3,239,830
============== ============== ============== =============
- from gain on sale (Notes 4 and 5) 0 0 0 0
============== ============== ============== =============
Cash generated from operations (Notes 2
and 3) 0 205,148 2,481,395 3,753,726
Cash generated from sales (Notes 4 and 5) 0 0 0 775,000
Cash generated from refinancing 0 0 0 0
-------------- -------------- -------------- -------------
Cash generated from operations, sales and
refinancing 0 205,148 2,481,395 4,528,726
Less: Cash distributions to investors
(Note 6)
- from operating cash flow 0 (2,845 ) (1,798,921 ) (3,431,251 )
- from sale of properties 0 0 0 0
-------------- -------------- -------------- -------------
Cash generated (deficiency) after cash
distributions 0 202,303 682,474 1,097,475
Special items (not including sales and
refinancing):
Limited partners' capital
contributions 0 20,174,172 24,825,828 0
General partners' capital
contributions 1,000 0 0 0
Syndication costs 0 (1,929,465 ) (2,452,743 ) 0
Acquisition of land and buildings 0 (13,170,132 ) (16,012,458 ) (2,355,627 )
Investment in direct financing leases 0 (975,853 ) (5,595,236 ) (405,937 )
Investment in joint ventures 0 0 0 (775,000 )
Reimbursement of organization,
syndication and acquisition costs
paid on behalf of CNL Income
Fund XVI, Ltd. by related parties 0 (854,154 ) (405,569 ) (2,494 )
Increase in other assets 0 (443,625 ) (58,720 ) 0
Increase (decrease) in restricted cash 0 0 0 0
Reimbursement from developer of
construction costs 0 0 0 0
Other (36 ) (20,714 ) 20,714 0
-------------- -------------- -------------- -------------
Cash generated (deficiency) after cash
distributions and special items 964 2,982,532 1,004,290 (2,441,583 )
============== ============== ============== =============
TAX AND DISTRIBUTION DATA PER
$1,000 INVESTED
Federal income tax results:
Ordinary income (loss)
- from operations 0 17 53 71
============== ============== ============== =============
- from recapture 0 0 0 0
============== ============== ============== =============
Capital gain (loss) (Notes 4 and 5) 0 0 0 0
============== ============== ============== =============
<PAGE>
6 months
1997 1998 1999
- ---------------- -------------- -------------
$ 4,308,853 $ 3,901,555 $ 1,874,675
73,507 132,002 79,712
41,148 0 0
0 (266,257 ) (84,478 )
73,634 60,199 28,862
(272,932 ) (270,489 ) (178,006 )
0 (24,652 ) (116,210 )
0 ) 0 0
(563,883 (555,360 ) (293,087 )
- ---------------- -------------- -------------
3,660,327 2,976,998 1,311,468
================ ============== =============
3,178,911 3,153,618 1,422,726
================ ============== =============
64,912 0 0
================ ============== =============
3,780,424 3,623,694 1,600,589
610,384 0 0
0 0 0
- ---------------- -------------- -------------
4,390,808 3,623,694 1,600,589
(3,600,000 ) (3,623,694 ) (1,600,589 )
0 (66,306 ) (199,411 )
- ---------------- -------------- -------------
790,808 (66,306 ) (199,411 )
0 0 0
0 0 0
0 0 0
(23,501 ) (3,545 ) 0
(29,257 ) (28,403 ) 0
0 (744,058 ) (158,512 )
0 0 0
0 0 0
(610,384 ) 610,384 0
0 161,648 0
0 0 (11,809 )
- ---------------- -------------- -------------
127,666 (70,280 ) (369,732 )
================ ============== =============
70 69 31
================ ============== =============
0 0 0
================ ============== =============
1 0 0
================ ============== =============
<PAGE>
TABLE III - CNL INCOME FUND XVI, LTD. (continued)
1993
(Note 1) 1994 1995 1996
-------------- ------------- ------------- -------------
Cash distributions to investors
Source (on GAAP basis)
- from investment income 0 1 45 76
- from capital gain 0 0 0 0
- from investment income from prior
period 0 0 0 0
-------------- ------------- ------------- -------------
Total distributions on GAAP basis (Note 6) 0 1 45 76
============== ============= ============= =============
Source (on cash basis)
- from sales 0 0 0 0
- from refinancing 0 0 0 0
- from operations 0 1 45 76
- from prior period 0 0 0 0
-------------- ------------- ------------- -------------
Total distributions on cash basis (Note 6) 0 1 45 76
============== ============= ============= =============
Total cash distributions as a percentage of
original $1,000 investment (Notes 7 and 10) 0.00 % 4.50 % 6.00 % 7.88 %
Total cumulative cash distributions per
$1,000 investment from inception 0 1 46 122
Amount (in percentage terms) remaining
invested in program properties at the end
of each year (period) presented (original
total acquisition cost of properties
retained, divided by original total N/A 100 % 100 % 100 %
acquisition cost of all properties in
program) (Notes 4 and 5)
Note 1: Pursuant to a registration statement on Form S-11 under the
Securities Act of 1933, as amended, CNL Income Fund XVI, Ltd.
("CNL XVI") and CNL Income Fund XV, Ltd. each registered for sale
$40,000,000 units of limited partnership interests ("Units"). The
offering of Units of CNL Income Fund XV, Ltd. commenced February
23, 1994. Pursuant to the registration statement, CNL XVI could
not commence until the offering of Units of CNL Income Fund XV,
Ltd. was terminated. CNL Income Fund XV, Ltd. terminated its
offering of Units on September 1, 1994, at which time the maximum
offering proceeds of $40,000,000 had been received. Upon the
termination of the offering of Units of CNL Income Fund XV, Ltd.,
CNL XVI commenced its offering of Units. Activities through
September 22, 1994, were devoted to organization of the
partnership and operations had not begun.
Note 2: Cash generated from operations includes cash received from
tenants, less cash paid for expenses, plus interest received.
Note 3: Cash generated from operations per this table agrees to cash
generated from operations per the statement of cash flows included
in the financial statements of CNL Income Fund XVI, Ltd.
Note 4: In April 1996, CNL Income Fund XVI, Ltd. sold one of its
properties and received net sales proceeds of $775,000, resulting
in a gain of $124,305 for financial reporting purposes. In October
1996, the partnership reinvested the net sales proceeds in an
additional property as tenants-in-common with an affiliate of the
general partners.
Note 5: In March 1997, CNL Income Fund XVI, Ltd. sold one of its
properties and received net sales proceeds of $610,384, resulting
in a gain of $41,148 for financial reporting purposes. In January
1998, the partnership reinvested the net sales proceeds in an
additional property as tenants-in-common with affiliates of the
general partners.
Note 6: Distributions declared for the quarters ended December 31,
1994, 1995, 1996, 1997 and 1998 are reflected in the 1995, 1996,
1997, 1998 and 1999 columns, respectively, due to the payment of
such distributions in January 1995, 1996, 1997, 1998 and 1999,
respectively. As a result of distributions being presented on a
cash basis, distributions declared and unpaid as of December 31,
1994, 1995, 1996, 1997, 1998 and June 30, 1999 are not included in
the 1994, 1995, 1996, 1997, 1998 and 1999 totals, respectively.
Note 7: Cash distributions for 1998 include an additional amount equal
to 0.20% of invested capital which was earned in 1997 but declared
payable in the first quarter of 1998.
Note 8: During the year ended December 31, 1998, the Partnership
recorded a provision for loss on building of $266,257 for
financial reporting purposes relating to a Long John Silver's
property in Celina, Ohio. The tenant of this property filed for
bankruptcy and ceased payment of rents under the terms of its
lease agreement. The allowance represents the difference between
the Property's carrying value at December 31, 1998 and the
estimated net realizable value for this Property.
<PAGE>
6 months
1997 1998 1999
- ------------------ -------------- ---------------
80 65 29
0 0 0
0 17 11
- ------------------ -------------- ---------------
80 82 40
================== ============== ===============
0 0 0
0 0 0
80 81 36
0 1 4
- ------------------ -------------- ---------------
80 82 40
================== ============== ===============
8.00 % 8.20 % 8.00 %
202 284 324
100 % 100 % 100 %
Note 9: At June 30, 1999, the Partnership recorded a provision for loss
on building in the amount of $84,478 for financial reporting
purposes relating to a Boston Market Property in Lawrence, Kansas,
the lease for which was rejected by the tenant. The tenant of this
property filed for bankruptcy and ceased payments of rents under
the terms of its lease agreement. The allowance represents the
difference between the carrying value of the Property at June 30,
1999 and the estimated net realizable value for the Property.
Note 10: Total cash distributions as a percentage of original $1,000
investment are calculated based on actual distributions declared
for the period. (See Note 6 above)
Note 11: Certain data for columns representing less than 12 months have
been annualized.
<PAGE>
TABLE III
Operating Results of Prior Programs
CNL AMERICAN PROPERTIES FUND, INC.
1994 1997
(Note 1) 1995 1996 (Note 2)
-------------- -------------- ------------- --------------
Gross revenue $ 0 $ 539,776 $ 4,363,456 $ 15,516,102
Equity in earnings of joint venture 0 0 0 0
Loss on Sale of Properties (Note 7) 0 0 0 0
Provision for loss on land and buildings (Notes
12 0 0 0 0
and 14)
Interest income 0 119,355 1,843,228 3,941,831
Less: Operating expenses 0 (186,145 ) (908,924 ) (2,066,962 )
Transaction costs 0 0 0 0
Interest expense 0 0 0 0
Depreciation and amortization 0 (104,131 ) (521,871 ) (1,795,062 )
Minority interest in income of
consolidated joint venture 0 (76 ) (29,927 ) (31,453 )
-------------- -------------- ------------- --------------
Net income - GAAP basis 0 368,779 4,745,962 15,564,456
============== ============== ============= ==============
Taxable income
- from operations (Note 8) 0 379,935 4,894,262 15,727,311
============== ============== ============= ==============
- from gain (loss) on sale 0 0 0 (41,115 )
============== ============== ============= ==============
Cash generated from operations (Notes 4 and 5) 0 498,459 5,482,540 17,076,214
Cash generated from sales (Note 7) 0 0 0 6,289,236
Cash generated from refinancing 0 0 0 0
-------------- -------------- ------------- --------------
Cash generated from operations, sales and
refinancing 0 498,459 5,482,540 23,365,450
Less: Cash distributions to investors (Note 9)
- from operating cash flow 0 (498,459 ) (5,439,404 ) (16,854,297 )
- from sale of properties 0 0 0 0
- from cash flow from prior period 0 0 0 0
- from return of capital (Note 10) 0 (136,827 ) 0 0
-------------- -------------- ------------- --------------
Cash generated (deficiency) after cash 0 (136,827 ) 43,136 6,511,153
distributions
Special items (not including sales of real estate
and refinancing):
Subscriptions received from stockholders 0 38,454,158 100,792,991 222,482,560
Sale of common stock to CNL Fund
Advisors, Inc. 200,000 0 0 0
Retirement of shares of common stock
(Note 13) 0 0 0 0
Contributions from minority interest 0 200,000 97,419 0
Distributions to holder of minority interest 0 0 (39,121 ) (34,020 )
Stock issuance costs (19 ) (3,680,704 ) (8,486,188 ) (19,542,862 )
Acquisition of land and buildings 0 (18,835,969 ) (36,104,148 ) (143,542,667 )
Investment in direct financing leases 0 (1,364,960 ) (13,372,621 ) (39,155,974 )
Proceeds from sales of equipment direct
financing leases 0 0 0 962,274
Investment in joint venture 0 0 0 0
Purchase of other investments 0 0 0 0
Investment in mortgage notes receivable 0 0 (13,547,264 ) (4,401,982 )
Collections on mortgage notes receivable 0 0 133,850 250,732
Investment in equipment and other notes
receivable 0 0 0 (12,521,401 )
Collections on equipment and other notes
receivable 0 0 0 0
Investment in certificates of deposit 0 0 0 (2,000,000 )
Proceeds of borrowing on line of credit 0 0 3,666,896 19,721,804
Payment on line of credit 0 0 (145,080 ) (20,784,577 )
Reimbursement of organization, acquisition,
and deferred offering and stock issuance
costs paid on behalf of CNL American (199,036 ) (2,500,056 ) (939,798 ) (2,857,352 )
Properties Fund, Inc. by related parties
Increase in intangibles and other assets 0 (628,142 ) (1,103,896 ) 0
Payment of loan costs 0 0 0 0
Other 0 0 (54,533 ) 49,001
-------------- -------------- ------------- --------------
Cash generated (deficiency) after cash
distributions and special items 945 11,507,500 30,941,643 5,136,689
============== ============== ============= ==============
TAX AND DISTRIBUTION DATA PER
$1,000 INVESTED (Note 6)
Federal income tax results:
Ordinary income (loss) (Note 11)
- from operations (Note 8) 0 20 61 67
============== ============== ============= ==============
- from recapture 0 0 0 0
============== ============== ============= ==============
Capital gain (loss) (Note 7) 0 0 0 0
============== ============== ============= ==============
<PAGE>
6 months
1998 1999
(Note 3) (Note 3)
- --------------- ---------------
$33,202,491 27,958,975
16,018 48,851
0 (201,843 )
(611,534 ) (540,522 )
8,984,546 4,191,380
(5,354,859 ) (4,391,244 )
0 (483,005 )
0 0
(4,054,098 ) (3,711,674 )
(30,156 ) (17,610 )
- --------------- ---------------
32,152,408 22,853,308
=============== ===============
33,553,390 24,450,902
=============== ===============
(149,948 ) (208,871 )
=============== ===============
39,116,275 28,256,292
2,385,941 2,186,720
0 0
- --------------- ---------------
41,502,216 30,443,012
(39,116,275 ) (28,256,292 )
0 0
(265,053 ) 0
(67,821 ) (219,858 )
- --------------- ---------------
2,053,067 1,966,862
385,523,966 210,736
0 0
(639,528 ) 0
0 366,289
(34,073 ) (21,105 )
(34,579,650 ) (735,785 )
(200,101,667 ) (170,153,724 )
(47,115,435 ) (44,186,644 )
0 1,487,187
(974,696 ) (117,663 )
(16,083,055 ) 0
(2,886,648 ) (2,596,244 )
291,990 224,373
(7,837,750 ) (22,358,869 )
1,263,633 626,959
0 0
7,692,040 151,437,245
(8,039 ) (12,580,289 )
(4,574,925 ) (1,258,062 )
(6,281,069 ) (3,198,326 )
0 (3,548,744 )
(95,101 ) 0
- --------------- --------------
75,613,060 (104,435,804 )
=============== ===============
63 33
=============== ===============
0 0
=============== ===============
0 0
=============== ===============
<PAGE>
TABLE III - CNL AMERICAN PROPERTIES FUND, INC. (continued)
1994 1997
(Note 1) 1995 1996 (Note 2)
-------------- ------------- -------------- -------------
Cash distributions to investors
Source (on GAAP basis)
- from investment income 0 19 59 66
- from capital gain 0 0 0 0
- from investment income from prior
period 0 0 0 0
- from return of capital (Note 10) 0 14 8 6
-------------- ------------- -------------- -------------
Total distributions on GAAP basis (Note 11) 0 33 67 72
============== ============= ============== =============
Source (on cash basis)
- from sales 0 0 0 0
- from refinancing 0 0 0 0
- from operations 0 26 67 72
- from cash flow from prior period 0 0 0 0
- from return of capital (Note 10) 0 7 0 0
-------------- ------------- -------------- -------------
Total distributions on cash basis (Note 11) 0 33 67 72
============== ============= ============== =============
Total cash distributions as a percentage of
original $1,000 investment (Note 6) 0.00 % 5.34 % 7.06 % 7.45 %
Total cumulative cash distributions per
$1,000 investment from inception 0 33 100 172
Amount (in percentage terms) remaining
invested in program properties at the end
of each year (period) presented
(original
total acquisition cost of properties
retained, divided by original total N/A 100 % 100 % 100 %
acquisition cost of all properties in
program) (Note 7)
Note 1: Pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933, as amended, effective March 29, 1995, CNL
American Properties Fund, Inc. ("APF") registered for sale
$165,000,000 of shares of common stock (the "Initial Offering"),
including $15,000,000 available only to stockholders participating
in the company's reinvestment plan. The Initial Offering of APF
commenced April 19, 1995, and upon completion of the Initial
Offering on February 6, 1997, had received subscription proceeds
of $150,591,765 (15,059,177 shares), including $591,765 (59,177
shares) issued pursuant to the reinvestment plan. Pursuant to a
Registration Statement on Form S-11 under the Securities Act of
1933, as amended, effective January 31, 1997, APF registered for
sale $275,000,000 of shares of common stock (the "1997 Offering"),
including $25,000,000 available only to stockholders participating
in the company's reinvestment plan. The 1997 Offering of APF
commenced following the completion of the Initial Offering on
February 6, 1997, and upon completion of the 1997 Offering on
March 2, 1998, had received subscription proceeds of $251,872,648
(25,187,265 shares), including $1,872,648 (187,265 shares) issued
pursuant to the reinvestment plan. Pursuant to a Registration
Statement on Form S-11 under the Securities Act of 1933, as
amended, effective May 12, 1998, APF registered for sale
$345,000,000 of shares of common stock (the "1998 Offering"). The
1998 Offering of APF commenced following the completion of the
1997 Offering on March 2, 1998. As of January 31, 1999, APF had
received subscriptions totalling approximately $345,000,000 from
the 1998 Offering, including $3,107,848 issued pursuant to the
company's reinvestment plan. The 1998 Offering became fully
subscribed in December 1998 and proceeds from the last
subscriptions were received in January 1999. Activities through
June 1, 1995, were devoted to organization of APF and operations
had not begun.
Note 2: The amounts shown represent the combined results of the Initial
Offering and the 1997 Offering.
Note 3: The amounts shown represent the combined results of the Initial
Offering, 1997 Offering and 1998 Offering.
Note 4: Cash generated from operations includes cash received from
tenants, less cash paid for expenses, plus interest received.
Note 5: Cash generated from operations per this table agrees to cash
generated from operations per the statement of cash flows included
in the financial statements of APF.
Note 6: Total cash distributions as a percentage of original $1,000
investment are calculated based on actual distributions declared
for the period.
Note 7: In May 1997 and July 1997, APF sold four properties and one
property, respectively, to a tenant for $5,254,083 and $1,035,153,
respectively, which was equal to the carrying value of the
properties at the time of sale. In May and July 1998, APF sold two
and one properties, respectively, to third parties for $1,605,154
and $1,152,262, respectively (and received net sales proceeds of
<PAGE>
6 months
1998 1999
(Note 3) (Note 3)
- ------------------ ---------------
60 31
0 0
0 0
14 7
- ------------------ ---------------
74 38
================== ===============
0 0
0 0
73 38
1 0
0 0
- ------------------ ---------------
74 38
================== ===============
7.625 % 7.625 %
246 284
100 % 100 %
Note 7
(continued): approximately $1,233,700 and $629,435, respectively, after
deduction of construction costs incurred but not paid by APF as
of the date of the sale), which approximated the carrying value
of the properties at the time of sale. As a result, no gain or
loss was recognized for financial reporting purposes. In each
of April and May 1999, APF sold one property for $822,824 and
$1,363,896, respectively, which resulted in a total loss of
$201,843 for financial reporting purposes. The company reinvested
the proceeds from the sale of properties in additional properties.
Note 8: Taxable income presented is before the dividends paid
deduction.
Note 9: For the six months ended June 30, 1999, and for the years ended
December 31, 1998, 1997, 1996 and 1995, 85.45%, 84.87%, 93.33%,
90.25% and 59.82%, respectively, of the distributions received by
stockholders were considered to be ordinary income and 14.55%,
15.13%, 6.67%, 9.75% and 40.18%, respectively, were considered a
return of capital for federal income tax purposes. No amounts
distributed to stockholders for the six months ended June 30, 1999
or for the years ended December 31, 1998, 1997, 1996 and 1995 are
required to be or have been treated by the company as a return of
capital for purposes of calculating the stockholders' return on
their invested capital.
Note 10: Cash distributions presented above as a return of capital on a
GAAP basis represent the amount of cash distributions in excess of
accumulated net income on a GAAP basis. Accumulated net income
includes deductions for depreciation and amortization expense and
income from certain non-cash items. In addition, cash
distributions presented as a return of capital on a cash basis
represents the amount of cash distributions in excess of cash
generated from operating cash flow and excess cash flows from
prior periods. These amounts have not been treated as a return of
capital by APF for purposes of calculating the amount of
stockholders' invested capital.
Note 11: Tax and distribution data and total distributions on GAAP
basis were computed based on the weighted average dollars
outstanding during each period presented.
Note 12: During the year ended December 31, 1998, APF recorded
provisions for losses on land and buildings in the amount of
$611,534 for financial reporting purposes relating to two Shoney's
Properties and two Boston Market Properties. The tenants of these
properties experienced financial difficulties and ceased payment
of rents under the terms of their lease agreements. The allowances
represent the difference between the carrying value of the
Properties at December 31, 1998 and the estimated net realizable
value for these Properties.
Note 13: In October 1998, the Board of Directors of APF elected to
implement APF's redemption plan. Under the redemption plan, APF
elected to redeem shares, subject to certain conditions and
limitations. During the year ended December 31, 1998, 69,514
shares were redeemed at $9.20 per share ($639,528) and retired
from shares outstanding of common stock.
<PAGE>
TABLE III - CNL AMERICAN PROPERTIES FUND, INC. (continued)
Note 14: During the six months ended June 30, 1999, APF recorded
provisions for losses on buildings in the amount of $540,522 for
financial reporting purposes relating to one Shoney's Property and
three Boston Market Properties. The tenants of these properties
experienced financial difficulties and ceased payment of rents
under the terms of their lease agreements. The allowances
represent the difference between the carrying value of the
Properties at June 30, 1999 and the estimated net realizable value
for these Properties.
Note 15: Certain data for columns representing less than 12 months have
been annualized.
<PAGE>
TABLE III
Operating Results of Prior Programs CNL
INCOME FUND XVII, LTD.
1995
(Note 1) 1996 1997 1998
-------------- -------------- ------------- --------------
Gross revenue $ 0 $ 1,195,263 $ 2,643,871 $ 2,816,845
Equity in earnings of unconsolidated joint 0 4,834 100,918 140,595
ventures
Interest income 12,153 244,406 69,779 51,240
Less: Operating expenses (3,493 ) (169,536 ) (181,865 ) (168,542 )
Transaction costs 0 0 0 (14,139 )
Interest expense 0 0 0 0
Depreciation and amortization (309 ) (179,208 ) (387,292 ) (369,209 )
Minority interest in income of
consolidated joint venture 0 0 (41,854 ) (62,632 )
-------------- -------------- ------------- --------------
Net income - GAAP basis 8,351 1,095,759 2,203,557 2,394,158
============== ============== ============= ==============
Taxable income
- from operations 12,153 1,114,964 2,058,601 2,114,039
============== ============== ============= ==============
- from gain on sale 0 0 0 0
============== ============== ============= ==============
Cash generated from operations (Notes
2 and 3) 9,012 1,232,948 2,495,114 2,520,919
Cash generated from sales 0 0 0 0
Cash generated from refinancing 0 0 0 0
-------------- -------------- ------------- --------------
Cash generated from operations, sales and
refinancing 9,012 1,232,948 2,495,114 2,520,919
Less: Cash distributions to investors (Note 4)
- from operating cash flow (1,199 ) (703,681 ) (2,177,584 ) (2,400,000 )
- from sale of properties 0 0 0 0
-------------- -------------- ------------- --------------
Cash generated (deficiency) after cash
distributions 7,813 529,267 317,530 120,919
Special items (not including sales and
refinancing):
Limited partners' capital contributions 5,696,921 24,303,079 0 0
General partners' capital contributions 1,000 0 0 0
Contributions from minority interest 0 140,676 278,170 0
Distribution to holder of minority interest 0 0 (41,507 ) (49,023 )
Syndication costs (604,348 ) (2,407,317 ) 0 0
Acquisition of land and buildings (332,928 ) (19,735,346 ) (1,740,491 ) 0
Investment in direct financing leases 0 (1,784,925 ) (1,130,497 ) 0
Investment in joint ventures 0 (201,501 ) (1,135,681 ) (124,452 )
Reimbursement of organization, syndication
and acquisition costs paid on behalf of
CNL Income Fund XVII, Ltd. by related
parties (347,907 ) (326,483 ) (25,444 ) 0
Increase in other assets (221,282 ) 0 0 0
Reimbursement from developer of
construction costs 0 0 0 306,100
Other (410 ) 410 0 0
-------------- -------------- ------------- --------------
Cash generated (deficiency) after cash
distributions and special items 4,198,859 517,860 (3,477,920 ) 253,544
============== ============== ============= ==============
TAX AND DISTRIBUTION DATA PER
$1,000 INVESTED
Federal income tax results:
Ordinary income (loss)
- from operations 36 37 69 70
============== ============== ============= ==============
- from recapture 0 0 0 0
============== ============== ============= ==============
Capital gain (loss) 0 0 0 0
============== ============== ============= ==============
<PAGE>
6 months
1999
- -----------------
$ 1,309,393
87,684
20,538
(101,142 )
0
0
(194,337 )
(31,436 )
- -----------------
1,090,700
=================
1,038,907
=================
0
=================
1,230,304
0
0
- -----------------
1,230,304
(1,200,000 )
0
- -----------------
30,304
0
0
0
(24,583 )
0
0
0
(527,864 )
0
0
0
0
- -----------------
(522,143 )
=================
34
=================
0
=================
0
=================
<PAGE>
TABLE III - CNL INCOME FUND XVII, LTD. (continued)
1995
(Note 1) 1996 1997 1998
-------------- ------------- -------------- -------------
Cash distributions to investors
Source (on GAAP basis)
- from investment income 4 23 73 79
- from capital gain 0 0 0 0
- from investment income from prior
period 0 0 0 1
-------------- ------------- -------------- -------------
Total distributions on GAAP basis (Note 4) 4 23 73 80
============== ============= ============== =============
Source (on cash basis)
- from sales 0 0 0 0
- from refinancing 0 0 0 0
- from operations 4 23 73 80
-------------- ------------- -------------- -------------
Total distributions on cash basis (Note 4) 4 23 73 80
============== ============= ============== =============
Total cash distributions as a percentage of
original $1,000 investment (Note 5) 5.00 % 5.50 % 7.625 % 8.00 %
Total cumulative cash distributions per
$1,000 investment from inception 4 27 100 180
Amount (in percentage terms) remaining
invested in program properties at the end
of each year (period) presented (original
total acquisition cost of properties
retained, divided by original total
acquisition cost of all properties in
program) (Note 6) N/A 100 % 100 % 100 %
Note 1: Pursuant to a registration statement on Form S-11 under the
Securities Act of 1933, as amended, effective August 11, 1995, CNL
Income Fund XVII, Ltd. ("CNL XVII") and CNL Income Fund XVIII,
Ltd. each registered for sale $30,000,000 units of limited
partnership interests ("Units"). The offering of Units of CNL
Income Fund XVII, Ltd. commenced September 2, 1995. Pursuant to
the registration statement, CNL XVIII could not commence until the
offering of Units of CNL Income Fund XVII, Ltd. was terminated.
CNL Income Fund XVII, Ltd. terminated its offering of Units on
September 19, 1996, at which time subscriptions for the maximum
offering proceeds of $30,000,000 had been received. Upon the
termination of the offering of Units of CNL Income Fund XVII,
Ltd., CNL XVIII commenced its offering of Units. Activities
through November 3, 1995, were devoted to organization of the
partnership and operations had not begun.
Note 2: Cash generated from operations includes cash received from
tenants, plus distributions from joint ventures, less cash paid
for expenses, plus interest received.
Note 3: Cash generated from operations per this table agrees to cash
generated from operations per the statement of cash flows included
in the financial statements of CNL XVII.
Note 4: Distributions declared for the quarters ended December 31,
1995, 1996, 1997 and 1998 are reflected in the 1996, 1997, 1998
and 1999 columns, respectively, due to the payment of such
distributions in January 1996, 1997, 1998 and 1999, respectively.
As a result of distributions being presented on a cash basis,
distributions declared and unpaid as of December 31, 1995, 1996,
1997, 1998 and June 30, 1999 are not included in the 1995, 1996,
1997, 1998 and 1999 totals, respectively.
Note 5: Total cash distributions as a percentage of original $1,000
investment are calculated based on actual distributions declared
for the period. (See Note 4 above)
Note 6: During 1998, CNL Income Fund XVII, Ltd. received approximately
$306,100 in reimbursements from the developer upon final
reconciliation of total construction costs relating to the
properties in Aiken, South Carolina and Weatherford, Texas, in
accordance with the related development agreements. During the six
months ended June 30, 1999, the Partnership had reinvested these
amounts, plus additional funds, in a property as tenants-in-common
with an affiliate of the general partners and in Ocean Shores
Joint Venture, with an affiliate of the Partnership which has the
same general partners.
Note 7: Certain data for columns representing less than 12 months have
been annualized.
<PAGE>
6 months
1999
- ------------------
36
0
4
- ------------------
40
==================
0
0
40
- ------------------
40
==================
8.00%
220
100 %
<PAGE>
TABLE III
Operating Results of Prior Programs CNL
INCOME FUND XVIII, LTD.
1995
(Note 1) 1996 1997 1998
-------------- -------------- ------------- --------------
Gross revenue $ 0 $ 1,373 $ 1,291,416 $ 2,956,349
Equity in earnings of joint venture 0 0 0 0
Provision for loss on land (Note 5) 0 0 0 (197,466 )
Interest income 0 30,241 161,826 141,408
Less: Operating expenses 0 (3,992 ) (156,403 ) (207,974 )
Transaction costs 0 0 0 (15,522 )
Interest expense 0 0 0 0
Depreciation and amortization 0 (712 ) (142,079 ) (374,473 )
-------------- -------------- ------------- --------------
Net income - GAAP basis 0 26,910 1,154,760 2,302,322
============== ============== ============= ==============
Taxable income
- from operations 0 30,223 1,318,750 2,324,746
============== ============== ============= ==============
- from gain on sale 0 0 0 0
============== ============== ============= ==============
Cash generated from operations (Notes
2 and 3) 0 27,146 1,361,756 2,831,738
Cash generated from sales 0 0 0 0
Cash generated from refinancing 0 0 0 0
-------------- -------------- ------------- --------------
Cash generated from operations, sales and
refinancing 0 27,146 1,361,756 2,831,738
Less: Cash distributions to investors (Note 4)
- from operating cash flow 0 (2,138 ) (855,957 ) (2,468,400 )
- from sale of properties 0 0 0 0
-------------- -------------- ------------- --------------
Cash generated (deficiency) after cash
distributions 0 25,008 505,799 363,338
Special items (not including sales and
refinancing):
Limited partners' capital contributions 0 8,498,815 25,723,944 854,241
General partners' capital contributions 1,000 0 0 0
Contributions from minority interest 0 0 0 0
Syndication costs 0 (845,657 ) (2,450,214 ) (161,142 )
Acquisition of land and buildings 0 (1,533,446 ) (18,581,999 ) (3,134,046 )
Investment in direct financing leases 0 0 (5,962,087 ) (12,945 )
Investment in joint venture 0 0 0 (166,025 )
Increase in restricted cash 0 0 0 0
Reimbursement of organization, syndication
and acquisition costs paid on behalf of CNL
Income Fund XVIII, Ltd. by related parties 0 (497,420 ) (396,548 ) (37,135 )
Increase in other assets 0 (276,848 ) 0 0
Other (20 ) (107 ) (66,893 ) (10,000 )
-------------- -------------- ------------- --------------
Cash generated (deficiency) after cash
distributions and special items 980 5,370,345 (1,227,998 ) (2,303,714 )
============== ============== ============= ==============
TAX AND DISTRIBUTION DATA PER
$1,000 INVESTED
Federal income tax results:
Ordinary income (loss)
- from operations 0 6 57 66
============== ============== ============= ==============
- from recapture 0 0 0 0
============== ============== ============= ==============
Capital gain (loss) 0 0 0 0
============== ============== ============= ==============
<PAGE>
6 months
1999
- --------------------
$ 1,570,899
28,767
0
26,835
(125,230 )
0
0
(199,121 )
- --------------------
1,302,150
====================
1,202,058
====================
0
====================
1,449,887
0
0
- --------------------
1,449,887
(1,400,000 )
0
- --------------------
49,887
0
0
0
0
(25,792 )
0
(526,138 )
0
(2,596 )
(117 )
0
- --------------------
(504,756 )
====================
34
====================
0
====================
0
====================
<PAGE>
TABLE III - CNL INCOME FUND XVIII, LTD. (continued)
1995
(Note 1) 1996 1997 1998
-------------- ------------- -------------- -------------
Cash distributions to investors
Source (on GAAP basis)
- from investment income 0 0 38 65
- from capital gain 0 0 0 0
- from investment income from prior
period 0 0 0 6
-------------- ------------- -------------- -------------
Total distributions on GAAP basis (Note 4) 0 0 38 71
============== ============= ============== =============
Source (on cash basis)
- from sales 0 0 0 0
- from refinancing 0 0 0 0
- from operations 0 0 38 71
-------------- ------------- -------------- -------------
Total distributions on cash basis (Note 4) 0 0 38 71
============== ============= ============== =============
Total cash distributions as a percentage of
original $1,000 investment from
inception 0.00 % 5.00 % 5.75 % 7.63 %
Total cumulative cash distributions per
$1,000 investment (Note 6) 0 0 38 109
Amount (in percentage terms) remaining
invested in program properties at the end
of each year (period) presented (original
total acquisition cost of properties
retained, divided by original total N/A 100 % 100 % 100 %
acquisition cost of all properties in
program)
Note 1: Pursuant to a registration statement on Form S-11 under the
Securities Act of 1933, as amended, effective August 11, 1995, CNL
Income Fund XVIII, Ltd ("CNL XVIII") and CNL Income Fund XVII,
Ltd. each registered for sale $30,000,000 units of limited
partnership interest ("Units"). The offering of Units of CNL
Income Fund XVII, Ltd. commenced September 2, 1995. Pursuant to
the registration statement, CNL XVIII could not commence until the
offering of Units of CNL Income Fund XVII, Ltd. was terminated.
CNL Income Fund XVII, Ltd. terminated its offering of Units on
September 19, 1996, at which time the maximum offering proceeds of
$30,000,000 had been received. Upon the termination of the
offering of Units of CNL Income Fund XVII, Ltd., CNL XVIII
commenced its offering of Units. Activities through October 11,
1996, were devoted to organization of the partnership and
operations had not begun.
Note 2: Cash generated from operations includes cash received from
tenants, less cash paid for expenses, plus interest received.
Note 3: Cash generated from operations per this table agrees to cash
generated from operations per the statement of cash flows included
in the financial statements of CNL XVIII.
Note 4: Distributions declared for the quarters ended December 1996,
1997 and 1998 are reflected in the 1997, 1998 and 1999 columns,
respectively, due to the payment of such distributions in January
1997, 1998 and 1999, respectively. As a result of distributions
being presented on a cash basis, distributions declared and unpaid
as of December 31, 1996, 1997, 1998 and June 30, 1999 are not
included in the 1996, 1997, 1998 and 1999 totals, respectively.
Note 5: During the year ended December 31, 1998, the partnership
established an allowance for loss on land of $197,466 for
financial reporting purposes relating to the property in
Minnetonka, Minnesota. The tenant of this Boston Market property
declared bankruptcy and rejected the lease relating to this
property. The loss represents the difference between the
Property's carrying value at December 31, 1998 and the current
estimate of net realizable value.
Note 6: Total cash distributions as a percentage of original $1,000
investment are calculated based on actual distributions declared
for the period. (See Note 4 above)
Note 7: Certain data for columns representing less than 12 months have
been annualized.
<PAGE>
6 months
1999
- -----------------------
37
0
3
- -----------------------
40
=======================
0
0
40
- -----------------------
40
=======================
8.00 %
149
100 %
<PAGE>
TABLE III
Operating Results of Prior Programs CNL
HOSPITALITY PROPERTIES, INC.
6 Months
1996 1997 1999
(Note 1) (Note 1) 1998 (Note 2)
------------- ------------- -------------- --------------
Gross revenue $ 0 $ 0 $ 1,316,599 $ 1,612,559
Dividend income (Note 10) 0 0 0 900,131
Interest and other income 0 46,071 638,862 907,739
Less: Operating expenses 0 (22,386 ) (257,646 ) (410,705 )
Interest expense 0 0 (350,322 ) (233,330 )
Depreciation and amortization 0 (833 ) (388,554 ) (493,415 )
Equity in loss of unconsolidated subsidiary
after deduction of preferred stock
dividends (Note 10) 0 0 0 (390,450 )
------------- ------------- -------------- --------------
Net income - GAAP basis 0 22,852 958,939 1,892,529
============= ============= ============== ==============
Taxable income
- from operations (Note 6) 0 46,071 886,556 1,708,248
============= ============= ============== ==============
- from gain (loss) on sale 0 0 0 0
============= ============= ============== ==============
Cash generated from operations (Notes 3 and 4) 0 22,469 2,776,965 2,033,757
Less: Cash distributions to investors (Note 7)
- from operating cash flow 0 (22,469 ) (1,168,145 ) (2,033,757 )
- from sale of properties 0 0 0 0
- from cash flow from prior period 0 0 0 (1,018,859 )
- from return of capital (Note 8) 0 (7,307 ) 0 0
------------- ------------- -------------- --------------
Cash generated (deficiency) after cash 0 (7,307 ) 1,608,820 (1,018,859 )
distributions
Special items (not including sales of real estate
and refinancing):
Subscriptions received from stockholders 0 11,325,402 31,693,678 114,711,315
Sale of common stock to CNL Hospitality
Corp. (formerly CNL Hospitality Advisors,
Inc.) 200,000 0 0 0
Stock issuance costs 0 (986,338 ) (3,086,630 ) (9,919,083 )
Acquisition of land, buildings and equipment 0 0 (28,216,757 ) 0
Investment in unconsolidated subsidiary 0 0 0 (37,172,643 )
Investment in certificate of deposit 0 0 (5,000,000 ) 0
Increase in restricted cash 0 0 (82,407 ) (121,725 )
Proceeds of borrowing on line of credit 0 0 9,600,000 0
Payment on line of credit 0 0 0 (9,600,000 )
Payment of loan costs 0 0 (91,262 ) (24,834 )
Reimbursement of organization, acquisition,
and deferred offering and stock issuance
costs paid on behalf of CNL Hospitality (197,916 ) (1,003,031 ) (862,068 ) (1,914,280 )
Properties, Inc. by related parties
Increase in intangibles and other assets 0 (463,470 ) (1,211,818 ) (4,509,931 )
Retirement of shares of common stock 0 0 0 (4,600 )
Other 0 2,498 7,529 14,971
------------- ------------- -------------- --------------
Cash generated (deficiency) after cash
distributions and special items 2,084 8,867,754 4,359,085 50,440,331
============= ============= ============== ==============
TAX AND DISTRIBUTION DATA PER
$1,000 INVESTED (Note 5)
Federal income tax results: Ordinary income (loss)
(Note 9)
- from operations (Note 6) 0 7 37 18
============= ============= ============== ==============
- from recapture 0 0 0 0
============= ============= ============== ==============
Capital gain (loss) (Note 7) 0 0 0 0
============= ============= ============== ==============
<PAGE>
TABLE III - CNL HOSPITALITY PROPERTIES, INC. (continued)
6 Months
1996 1997 1999
(Note 1) (Note 1) 1998 (Note 2)
-------------- -------------- ------------- -------------
Cash distributions to investors
Source (on GAAP basis)
- from investment income 0 3 40 20
- from capital gain 0 0 0 0
- from investment income from prior
period 0 0 0 0
- from return of capital (Note 8) 0 1 9 13
-------------- -------------- ------------- -------------
Total distributions on GAAP basis (Note 9) 0 4 49 33
============== ============== ============= =============
Source (on cash basis)
- from sales 0 0 0 0
- from refinancing 0 0 0 0
- from operations 0 3 49 22
- from cash flow from prior period 0 0 0 11
- from return of capital (Note 8) 0 1 0 0
-------------- -------------- ------------- -------------
Total distributions on cash basis (Note 9) 0 4 49 33
============== ============== ============= =============
Total cash distributions as a percentage of
original $1,000 investment (Note 5) N/A 3.00 % 4.67 % 7.12 %
Total cumulative cash distributions per
$1,000 investment from inception N/A 4 53 86
Amount (in percentage terms) remaining
invested in program properties at the end
of each year (period) presented (original
total acquisition cost of properties
retained, divided by original total N/A N/A 100 % 100 %
acquisition cost of all properties in
program)
Note 1: Pursuant to a Registration Statement on Form S-11 under the
Securities Act of 1933, as amended, effective July 9, 1997, CNL
Hospitality Properties, Inc. ("CHP") registered for sale
$165,000,000 of shares of common stock (the "Initial Offering"),
including $15,000,000 available only to stockholders participating
in the company's reinvestment plan. The Initial Offering of CHP
commenced September 11, 1997, and upon completion of the Initial
Offering on June 17, 1999, had received subscription proceeds of
$150,072,637 (15,007,264 shares), including $72,637 (7,264 shares)
issued pursuant to the reinvestment plan. Pursuant to a
Registration Statement on Form S-11 under the Securities Act of
1933, as amended, effective June 17, 1999, CHP registered for sale
$275,000,000 of shares of common stock (the "1999 Offering"),
including $25,000,000 available only to stockholders participating
in the company's reinvestment plan. The 1999 Offering of CHP
commenced following the completion of the Initial Offering on June
17, 1999. As of June 30, 1999, CHP had received subscription
proceeds totalling $7,657,757 from the 1999 Offering, including
$88,403 issued pursuant to the company's reinvestment plan.
Activities through October 15, 1997, were devoted to organization
of CHP and operations had not begun.
Note 2: The amounts shown represent the combined results of the Initial
Offering and the 1999 Offering.
Note 3: Cash generated from operations includes cash received from
tenants and dividend, interest and other income, less cash paid
for operating expenses. Cash generated from operations for the six
months ended June 30, 1999 does not include amounts received
subsequent to June 30, 1999 representing dividend income of
approximately $900,000.
Note 4: Cash generated from operations per this table agrees to cash
generated from operations per the statement of cash flows included
in the consolidated financial statements of CHP.
Note 5: Total cash distributions as a percentage of original $1,000
investment are calculated based on actual distributions declared
for the period.
Note 6: Taxable income presented is before the dividends paid deduction.
Note 7: For the six months ended June 30, 1999 and the years ended
December 31, 1998 and 1997, approximately 64%, 76% and 100%,
respectively, of the distributions received by stockholders were
considered to be ordinary income and approximately 36%, 24% and
0%, respectively, were considered a return of capital for federal
income tax purposes. No amounts distributed to stockholders for
the six months ended June 30, 1999 and the years ended December
31, 1998 and 1997 are required to be or have been treated by the
company as a return of capital for purposes of calculating the
stockholders' return on their invested capital.
<PAGE>
TABLE III - CNL HOSPITALITY PROPERTIES, INC. (continued)
Note 8: Cash distributions presented above as a return of capital on a
GAAP basis represent the amount of cash distributions in excess of
accumulated net income on a GAAP basis. Accumulated net income
includes deductions for depreciation and amortization expense and
income from certain non-cash items. In addition, cash
distributions presented as a return of capital on a cash basis
represents the amount of cash distributions in excess of cash
generated from operating cash flow and excess cash flows from
prior periods. These amounts have not been treated as a return of
capital for purposes of calculating the amount of stockholders'
invested capital.
Note 9: Tax and distribution data and total distributions on GAAP basis
were computed based on the weighted average shares outstanding
during each period presented.
Note 10: In February 1999, the company executed a series of agreements
with Five Arrows Realty Securities II, L.L.C. to jointly own a
real estate investment trust, CNL Hotel Investors, Inc., for the
purpose of acquiring eight hotels. During the six months ended
June 30, 1999, the company recorded $900,131 in dividend income
and $390,450 in an equity in loss after deduction of preferred
stock dividends, resulting in net earnings of $509,681
attributable to this investment.
<PAGE>
TABLE V
SALES OR DISPOSALS OF PROPERTIES
Selling Price, Net of
Closing Costs and GAAP Adjustments
---------------------------------------------------------------
Purchase
Cash Mortgage money Adjustments
received net balance mortgage resulting from
Date Date of of closing at time taken back application of
Property Acquired Sale costs of sale by program GAAP Total
==========================================================================================================================
CNL Income Fund, Ltd.:
Burger King -
San Dimas, CA (14) 02/05/87 06/12/92 $1,169,021 0 0 0 $1,169,021
Wendy's -
Fairfield, CA (14) 07/01/87 10/03/94 1,018,490 0 0 0 1,018,490
Wendy's -
Casa Grande, AZ 12/10/86 08/19/97 795,700 0 0 0 795,700
Wendy's -
North Miami, FL (9) 02/18/86 08/21/97 473,713 0 0 0 473,713
Popeye's -
Kissimmee, FL (14) 12/31/86 04/30/98 661,300 0 0 0 661,300
CNL Income Fund II, Ltd.:
Golden Corral -
Salisbury, NC 05/29/87 07/21/93 746,800 0 0 0 746,800
Pizza Hut -
Graham, TX 08/24/87 07/28/94 261,628 0 0 0 261,628
Golden Corral -
Medina, OH (11) 11/18/87 11/30/94 825,000 0 0 0 825,000
Denny's -
Show Low, AZ (8) 05/22/87 01/31/97 620,800 0 0 0 620,800
KFC -
Eagan, MN 06/01/87 06/02/97 623,882 0 42,000 0 665,882
KFC -
Jacksonville, FL 09/01/87 09/09/97 639,363 0 0 0 639,363
Wendy's -
Farmington Hills, MI 05/18/87 10/09/97 833,031 0 0 0 833,031
(12)
Wendy's -
Farmington Hills, MI 05/18/87 10/09/97 1,085,259 0 0 0 1,085,259
(13) (14)
Denny's -
Plant City, FL 11/23/87 10/24/97 910,061 0 0 0 910,061
Pizza Hut -
Mathis, TX 12/17/87 12/04/97 297,938 0 0 0 297,938
KFC -
Avon Park, FL (14) 09/02/87 12/10/97 501,975 0 0 0 501,975
Golden Corral -
Columbia, MO 11/17/87 03/23/99 678,888 0 0 0 678,888
CNL Income Fund III, Ltd.:
Wendy's -
Chicago, IL (14) 06/02/88 01/10/97 496,418 0 0 0 496,418
Perkins -
Bradenton, FL 06/30/88 03/14/97 1,310,001 0 0 0 1,310,001
Pizza Hut -
Kissimmee, FL 02/23/88 04/08/97 673,159 0 0 0 673,159
Burger King -
Roswell, GA 06/08/88 06/20/97 257,981 0 685,000 0 942,981
<PAGE>
Cost of Properties
Including Closing and
Soft Costs
-------------------------------------
Excess
Total (deficiency)
acquisition of property
cost, operating
capital cash
improvements receipts
Original closing and over
mortgage soft costs cash
Property financing (1) Total expenditures
=========================================================================================
CNL Income Fund, Ltd.:
Burger King -
San Dimas, CA (14) 0 $955,000 $955,000 $214,021
Wendy's -
Fairfield, CA (14) 0 861,500 861,500 156,990
Wendy's -
Casa Grande, AZ 0 667,255 667,255 128,445
Wendy's -
North Miami, FL (9) 0 385,000 385,000 88,713
Popeye's -
Kissimmee, FL (14) 0 475,360 475,360 185,940
CNL Income Fund II, Ltd.:
Golden Corral -
Salisbury, NC 0 642,800 642,800 104,000
Pizza Hut -
Graham, TX 0 205,500 205,500 56,128
Golden Corral -
Medina, OH (11) 0 743,000 743,000 82,000
Denny's -
Show Low, AZ (8) 0 484,185 484,185 136,615
KFC -
Eagan, MN 0 601,100 601,100 64,782
KFC -
Jacksonville, FL 0 405,000 405,000 234,363
Wendy's -
Farmington Hills, MI 0 679,000 679,000 154,031
(12)
Wendy's -
Farmington Hills, MI 0 887,000 887,000 198,259
(13) (14)
Denny's -
Plant City, FL 0 820,717 820,717 89,344
Pizza Hut -
Mathis, TX 0 202,100 202,100 95,838
KFC -
Avon Park, FL (14) 0 345,000 345,000 156,975
Golden Corral -
Columbia, MO 0 511,200 511,200 167,688
CNL Income Fund III, Ltd.:
Wendy's -
Chicago, IL (14) 0 591,362 591,362 (94,944 )
Perkins -
Bradenton, FL 0 1,080,500 1,080,500 229,501
Pizza Hut -
Kissimmee, FL 0 474,755 474,755 198,404
Burger King -
Roswell, GA 0 775,226 775,226 167,755
<PAGE>
TABLE V
SALES OR DISPOSALS OF PROPERTIES
Selling Price, Net of
Closing Costs and GAAP Adjustments
---------------------------------------------------------------
Purchase
Cash Mortgage money Adjustments
received net balance mortgage resulting from
Date Date of of closing at time taken back application of
Property Acquired Sale costs of sale by program GAAP Total
==========================================================================================================================
Wendy's -
Mason City, IA 02/29/88 10/24/97 217,040 0 0 0 217,040
Taco Bell -
Fernandina Beach, FL 04/09/88 01/15/98 721,655 0 0 0 721,655
(14)
Denny's -
Daytona Beach, FL (14) 07/12/88 01/23/98 1,008,976 0 0 0 1,008,976
Wendy's -
Punta Gorda, FL 02/03/88 02/20/98 665,973 0 0 0 665,973
Po Folks -
Hagerstown, MD 06/21/88 06/10/98 788,884 0 0 0 788,884
Denny's-
Hazard, KY 02/01/88 12/23/98 432,625 0 0 0 432,625
Perkins -
Flagstaff, AZ 09/30/88 04/30/99 1,091,193 0 0 0 1,091,193
Denny's -
Hagerstown, MD 08/14/88 06/09/99 700,977 0 0 0 700,977
CNL Income Fund IV, Ltd.:
Taco Bell -
York, PA 03/22/89 04/27/94 712,000 0 0 0 712,000
Burger King -
Hastings, MI 08/12/88 12/15/95 518,650 0 0 0 518,650
Wendy's -
Tampa, FL 12/30/88 09/20/96 1,049,550 0 0 0 1,049,550
Checkers -
Douglasville, GA 12/08/94 11/07/97 380,695 0 0 0 380,695
Taco Bell -
Fort Myers, FL (14) 12/22/88 03/02/98 794,690 0 0 0 794,690
Denny's -
Union Township, OH (14) 11/01/88 03/31/98 674,135 0 0 0 674,135
Perkins -
Leesburg, FL 01/11/89 07/09/98 529,288 0 0 0 529,288
Taco Bell -
Naples, FL 12/22/88 09/03/98 533,127 0 0 0 533,127
CNL Income Fund V, Ltd.:
Perkins -
Myrtle Beach, SC (2) 02/28/90 08/25/95 0 0 1,040,000 0 1,040,000
Ponderosa -
St. Cloud, FL (14) (22) 06/01/89 10/24/96 73,713 0 1,057,299 0 1,131,012
Franklin National Bank -
Franklin, TN 06/26/89 01/07/97 960,741 0 0 0 960,741
Shoney's -
Smyrna, TN 03/22/89 05/13/97 636,788 0 0 0 636,788
KFC -
Salem, NH 05/31/89 09/22/97 1,272,137 0 0 0 1,272,137
<PAGE>
Cost of Properties
Including Closing and
Soft Costs
-------------------------------------
Excess
Total (deficiency)
acquisition of property
cost, operating
capital cash
improvements receipts
Original closing and over
mortgage soft costs cash
Property financing (1) Total expenditures
=========================================================================================
Wendy's -
Mason City, IA 0 190,252 190,252 26,788
Taco Bell -
Fernandina Beach, FL 0 559,570 559,570 162,085
(14)
Denny's -
Daytona Beach, FL (14) 0 918,777 918,777 90,799
Wendy's -
Punta Gorda, FL 0 684,342 684,342 (18,369 )
Po Folks -
Hagerstown, MD 0 1,188,315 1,188,315 (399,431 )
Denny's-
Hazard, KY 0 647,622 647,622 (214,997 )
Perkins -
Flagstaff, AZ 0 993,508 993,508 97,685
Denny's -
Hagerstown, MD 0 861,454 861,454 (160,477 )
CNL Income Fund IV, Ltd.:
Taco Bell -
York, PA 0 616,501 616,501 95,499
Burger King -
Hastings, MI 0 419,936 419,936 98,714
Wendy's -
Tampa, FL 0 828,350 828,350 221,200
Checkers -
Douglasville, GA 0 363,768 363,768 16,927
Taco Bell -
Fort Myers, FL (14) 0 597,998 597,998 196,692
Denny's -
Union Township, OH (14) 0 872,850 872,850 (198,715 )
Perkins -
Leesburg, FL 0 737,260 737,260 (207,972 )
Taco Bell -
Naples, FL 0 410,546 410,546 122,581
CNL Income Fund V, Ltd.:
Perkins -
Myrtle Beach, SC (2) 0 986,418 986,418 53,582
Ponderosa -
St. Cloud, FL (14) (22) 0 996,769 996,769 134,243
Franklin National Bank -
Franklin, TN 0 1,138,164 1,138,164 (177,423 )
Shoney's -
Smyrna, TN 0 554,200 554,200 82,588
KFC -
Salem, NH 0 1,079,310 1,079,310 192,827
<PAGE>
TABLE V
SALES OR DISPOSALS OF PROPERTIES
Selling Price, Net of
Closing Costs and GAAP Adjustments
---------------------------------------------------------------
Purchase
Cash Mortgage money Adjustments
received net balance mortgage resulting from
Date Date of of closing at time taken back application of
Property Acquired Sale costs of sale by program GAAP Total
==========================================================================================================================
Perkins -
Port St. Lucie, FL 11/14/89 09/23/97 1,216,750 0 0 0 1,216,750
Hardee's -
Richmond, IN 02/17/89 11/07/97 397,785 0 0 0 397,785
Wendy's -
Tampa, FL (14) 02/16/89 12/29/97 805,175 0 0 0 805,175
Denny's -
Port Orange, FL (14) 07/10/89 01/23/98 1,283,096 0 0 0 1,283,096
Shoney's
Tyler, TX 03/20/89 02/17/98 844,229 0 0 0 894,229
Wendy's -
Ithaca, NY 12/07/89 03/29/99 471,248 0 0 0 471,248
Wendy's -
Endicott, NY 12/07/89 03/29/99 642,511 0 0 0 642,511
Burger King -
Halls, TN (20) 01/05/90 06/03/99 433,366 0 0 0 433,366
CNL Income Fund VI, Ltd.:
Hardee's -
Batesville, AR 11/02/89 05/24/94 791,211 0 0 0 791,211
Hardee's -
Heber Springs, AR 02/13/90 05/24/94 638,270 0 0 0 638,270
Hardee's -
Little Canada, MN 11/28/89 06/29/95 899,503 0 0 0 899,503
Jack in the Box -
Dallas, TX 06/28/94 12/09/96 982,980 0 0 0 982,980
Denny's -
Show Low, AZ (8) 05/22/87 01/31/97 349,200 0 0 0 349,200
KFC -
Whitehall Township, MI 02/26/90 07/09/97 629,888 0 0 0 629,888
Perkins -
Naples, FL 12/26/89 07/09/97 1,487,725 0 0 0 1,487,725
Burger King -
Plattsmouth, NE 01/19/90 07/18/97 699,400 0 0 0 699,400
Shoney's -
Venice, FL 08/03/89 09/17/97 1,206,696 0 0 0 1,206,696
Jack in the Box -
Yuma, AZ (10) 07/14/94 10/31/97 510,653 0 0 0 510,653
Denny's
Deland, FL 03/22/90 01/23/98 1,236,971 0 0 0 1,236,971
Wendy's -
Liverpool, NY 12/08/89 02/09/98 145,221 0 0 0 145,221
Perkin's -
Melbourne, FL 02/03/90 02/12/98 552,910 0 0 0 552,910
Hardee's -
Bellevue, NE 05/03/90 06/05/98 900,000 0 0 0 900,000
<PAGE>
Cost of Properties
Including Closing and
Soft Costs
-------------------------------------
Excess
Total (deficiency)
acquisition of property
cost, operating
capital cash
improvements receipts
Original closing and over
mortgage soft costs cash
Property financing (1) Total expenditures
=========================================================================================
Perkins -
Port St. Lucie, FL 0 1,203,207 1,203,207 13,543
Hardee's -
Richmond, IN 0 695,464 695,464 (297,679 )
Wendy's -
Tampa, FL (14) 0 657,800 657,800 147,375
Denny's -
Port Orange, FL (14) 0 1,021,000 1,021,000 262,096
Shoney's
Tyler, TX 0 770,300 770,300 73,929
Wendy's -
Ithaca, NY 0 471,297 471,297 (49 )
Wendy's -
Endicott, NY 0 471,255 471,255 171,256
Burger King -
Halls, TN (20) 0 329,231 329,231 104,135
CNL Income Fund VI, Ltd.:
Hardee's -
Batesville, AR 0 605,500 605,500 185,711
Hardee's -
Heber Springs, AR 0 532,893 532,893 105,377
Hardee's -
Little Canada, MN 0 821,692 821,692 77,811
Jack in the Box -
Dallas, TX 0 964,437 964,437 18,543
Denny's -
Show Low, AZ (8) 0 272,354 272,354 76,846
KFC -
Whitehall Township, MI 0 725,604 725,604 (95,716 )
Perkins -
Naples, FL 0 1,083,869 1,083,869 403,856
Burger King -
Plattsmouth, NE 0 561,000 561,000 138,400
Shoney's -
Venice, FL 0 1,032,435 1,032,435 174,261
Jack in the Box -
Yuma, AZ (10) 0 448,082 448,082 62,571
Denny's
Deland, FL 0 1,000,000 1,000,000 236,971
Wendy's -
Liverpool, NY 0 341,440 341,440 (196,219 )
Perkin's -
Melbourne, FL 0 692,850 692,850 (139,940 )
Hardee's -
Bellevue, NE 0 899,512 899,512 488
<PAGE>
TABLE V
SALES OR DISPOSALS OF PROPERTIES
Selling Price, Net of
Closing Costs and GAAP Adjustments
---------------------------------------------------------------
Purchase
Cash Mortgage money Adjustments
received net balance mortgage resulting from
Date Date of of closing at time taken back application of
Property Acquired Sale costs of sale by program GAAP Total
==========================================================================================================================
Burger King -
Greeneville, TN 01/05/90 06/03/99 1,059,373 0 0 0 1,059,373
Burger King -
Broadway, TN 01/05/90 06/03/99 1,059,200 0 0 0 1,059,200
Burger King -
Sevierville, TN 01/05/90 06/03/99 1,168,298 0 0 0 1,168,298
Burger King -
Walker Springs, TN 01/10/90 06/03/99 1,031,274 0 0 0 1,031,274
CNL Income Fund VII, Ltd.:
Taco Bell -
Kearns, UT 06/14/90 05/19/92 700,000 0 0 0 700,000
Hardee's -
St. Paul, MN 08/09/90 05/24/94 869,036 0 0 0 869,036
Perkins -
Florence, SC (3) 08/28/90 08/25/95 0 0 1,160,000 0 1,160,000
Church's Fried Chicken -
Jacksonville, FL (14) 04/30/90 12/01/95 0 0 240,000 0 240,000
(23)
Shoney's -
Colorado Springs, CO 07/03/90 07/24/96 1,044,909 0 0 0 1,044,909
Hardee's -
Hartland, MI 07/10/90 10/23/96 617,035 0 0 0 617,035
Hardee's -
Columbus, IN 09/04/90 05/30/97 223,590 0 0 0 223,590
KFC -
Dunnellon, FL 08/02/90 10/07/97 757,800 0 0 0 757,800
Jack in the Box -
Yuma, AZ (10) 07/14/94 10/31/97 471,372 0 0 0 471,372
Burger King -
Maryville, TN 05/04/90 06/03/99 1,059,954 0 0 0 1,059,954
Burger King -
Halls, TN (20) 01/05/90 06/03/99 451,054 0 0 0 451,054
CNL Income Fund VIII, Ltd.:
Denny's -
Ocoee, FL 03/16/91 07/31/95 1,184,865 0 0 0 1,184,865
Church's Fried Chicken -
Jacksonville, FL (4) 09/28/90 12/01/95 0 0 240,000 0 240,000
(14)
Church's Fried Chicken -
Jacksonville, FL (5) 09/28/90 12/01/95 0 0 220,000 0 220,000
(14)
Ponderosa -
Orlando, FL (6) (14) 12/17/90 10/24/96 0 0 1,353,775 0 1,353,775
<PAGE>
Cost of Properties
Including Closing and
Soft Costs
-------------------------------------
Excess
Total (deficiency)
acquisition of property
cost, operating
capital cash
improvements receipts
Original closing and over
mortgage soft costs cash
Property financing (1) Total expenditures
=========================================================================================
Burger King -
Greeneville, TN 0 890,240 890,240 169,133
Burger King -
Broadway, TN 0 890,036 890,036 169,164
Burger King -
Sevierville, TN 0 890,696 890,696 277,602
Burger King -
Walker Springs, TN 0 864,777 864,777 166,497
CNL Income Fund VII, Ltd.:
Taco Bell -
Kearns, UT 0 560,202 560,202 139,798
Hardee's -
St. Paul, MN 0 742,333 742,333 126,703
Perkins -
Florence, SC (3) 0 1,084,905 1,084,905 75,095
Church's Fried Chicken -
Jacksonville, FL (14) 0 233,728 233,728 6,272
(23)
Shoney's -
Colorado Springs, CO 0 893,739 893,739 151,170
Hardee's -
Hartland, MI 0 841,642 841,642 (224,607 )
Hardee's -
Columbus, IN 0 219,676 219,676 3,914
KFC -
Dunnellon, FL 0 546,333 546,333 211,467
Jack in the Box -
Yuma, AZ (10) 0 413,614 413,614 57,758
Burger King -
Maryville, TN 0 890,668 890,668 169,286
Burger King -
Halls, TN (20) 0 342,669 342,669 108,385
CNL Income Fund VIII, Ltd.:
Denny's -
Ocoee, FL 0 949,199 949,199 235,666
Church's Fried Chicken -
Jacksonville, FL (4) 0 238,153 238,153 1,847
(14)
Church's Fried Chicken -
Jacksonville, FL (5) 0 215,845 215,845 4,155
(14)
Ponderosa -
Orlando, FL (6) (14) 0 1,179,210 1,179,210 174,565
<PAGE>
TABLE V
SALES OR DISPOSALS OF PROPERTIES
Selling Price, Net of
Closing Costs and GAAP Adjustments
---------------------------------------------------------------
Purchase
Cash Mortgage money Adjustments
received net balance mortgage resulting from
Date Date of of closing at time taken back application of
Property Acquired Sale costs of sale by program GAAP Total
==========================================================================================================================
CNL Income Fund IX, Ltd.:
Burger King -
Woodmere, OH (15) 05/31/91 12/12/96 918,445 0 0 0 918,445
Burger King -
Alpharetta, GA 09/20/91 06/30/97 1,053,571 0 0 0 1,053,571
Shoney's -
Corpus Christi, TX 10/28/91 02/12/99 1,350,000 0 0 0 1,350,000
Perkins -
Rochester, NY 12/20/91 03/03/99 1,050,000 0 0 0 1,050,000
CNL Income Fund X, Ltd.:
Shoney's -
Denver, CO 03/04/92 08/11/95 1,050,186 0 0 0 1,050,186
Jack in the Box -
Freemont, CA 03/26/92 09/23/97 1,366,550 0 0 0 1,366,550
Jack in the Box -
Sacramento, CA 12/19/91 01/20/98 1,234,175 0 0 0 1,234,175
Pizza Hut -
Billings, MT 04/16/92 10/07/98 359,990 0 0 0 359,990
Perkins -
Amherst, NY 02/26/92 03/03/99 1,150,000 0 0 0 1,150,000
CNL Income Fund XI, Ltd.:
Burger King -
Philadelphia, PA 09/29/92 11/07/96 1,044,750 0 0 0 1,044,750
Burger King -
Columubus, OH (19) 06/29/92 09/30/98 795,264 0 0 0 795,264
Burger King -
Nashua, NH 06/29/92 10/07/98 1,630,296 0 0 0 1,630,296
CNL Income Fund XII, Ltd.:
Golden Corral -
Houston, TX 12/28/92 04/10/96 1,640,000 0 0 0 1,640,000
Long John Silver's -
Monroe, NC 06/30/93 12/31/98 483,550 0 0 0 483,550
Long John Silver's -
Morganton, NC (21) 07/02/93 05/17/99 467,300 0 55,000 0 522,300
CNL Income Fund XIII, Ltd.:
Checkers -
Houston, TX 03/31/94 04/24/95 286,411 0 0 0 286,411
Checkers -
Richmond, VA 03/31/94 11/21/96 550,000 0 0 0 550,000
Denny's -
Orlando, FL 09/01/93 10/24/97 932,849 0 0 0 932,849
<PAGE>
Cost of Properties
Including Closing and
Soft Costs
-------------------------------------
Excess
Total (deficiency)
acquisition of property
cost, operating
capital cash
improvements receipts
Original closing and over
mortgage soft costs cash
Property financing (1) Total expenditures
=========================================================================================
CNL Income Fund IX, Ltd.:
Burger King - 0 918,445 918,445 0
Woodmere, OH (15)
Burger King - 0 713,866 713,866 339,705
Alpharetta, GA
Shoney's - 0 1,224,020 1,224,020 125,980
Corpus Christi, TX
Perkins - 0 1,064,815 1,064,815 (14,815 )
Rochester, NY
CNL Income Fund X, Ltd.:
Shoney's - 0 987,679 987,679 62,507
Denver, CO
Jack in the Box - 0 1,102,766 1,102,766 263,784
Freemont, CA
Jack in the Box - 0 969,423 969,423 264,752
Sacramento, CA
Pizza Hut - 0 302,000 302,000 57,990
Billings, MT
Perkins - 0 1,141,444 1,141,444 8,556
Amherst, NY
CNL Income Fund XI, Ltd.:
Burger King - 0 818,850 818,850 225,900
Philadelphia, PA
Burger King - 0 795,264 795,264 0
Columubus, OH (19)
Burger King - 0 1,217,015 1,217,015 413,281
Nashua, NH
CNL Income Fund XII, Ltd.:
Golden Corral - 0 1,636,643 1,636,643 3,357
Houston, TX
Long John Silver's - 0 239,788 239,788 243,762
Monroe, NC
Long John Silver's - 0 304,002 304,002 218,298
Morganton, NC (21)
CNL Income Fund XIII, Ltd.:
Checkers - 0 286,411 286,411 0
Houston, TX
Checkers - 0 413,288 413,288 136,712
Richmond, VA
Denny's - 0 934,120 934,120 (1,271 )
Orlando, FL
<PAGE>
TABLE V
SALES OR DISPOSALS OF PROPERTIES
Selling Price, Net of
Closing Costs and GAAP Adjustments
---------------------------------------------------------------
Purchase
Cash Mortgage money Adjustments
received net balance mortgage resulting from
Date Date of of closing at time taken back application of
Property Acquired Sale costs of sale by program GAAP Total
==========================================================================================================================
CNL Income Fund XIV, Ltd.:
Checkers -
Knoxville, TN 03/31/94 03/01/95 339,031 0 0 0 339,031
Checkers -
Dallas, TX 03/31/94 03/01/95 356,981 0 0 0 356,981
TGI Friday's -
Woodridge, NJ (7) 01/01/95 09/27/96 1,753,533 0 0 0 1,753,533
Wendy's -
Woodridge, NJ (7) 11/28/94 09/27/96 747,058 0 0 0 747,058
Hardee's -
Madison, AL 12/14/93 01/08/98 700,950 0 0 0 700,950
Checkers -
Richmond, VA (#548) 03/31/94 01/29/98 512,462 0 0 0 512,462
Checkers -
Riviera Beach, FL 03/31/94 04/14/98 360,000 0 0 0 360,000
Checkers -
Richmond, VA (#486) 03/31/94 07/27/98 397,985 0 0 0 397,985
Long John Silver's -
Stockbridge, GA 03/31/94 05/25/99 696,300 0 0 0 696,300
CNL Income Fund XV, Ltd.:
Checkers -
Knoxville, TN 05/27/94 03/01/95 263,221 0 0 0 263,221
Checkers -
Leavenworth, KS 06/22/94 03/01/95 259,600 0 0 0 259,600
Checkers -
Knoxville, TN 07/08/94 03/01/95 288,885 0 0 0 288,885
TGI Friday's -
Woodridge, NJ (7) 01/01/95 09/27/96 1,753,533 0 0 0 1,753,533
Wendy's -
Woodridge, NJ (7) 11/28/94 09/27/96 747,058 0 0 0 747,058
CNL Income Fund XVI, Ltd.:
Long John Silver's -
Appleton, WI 06/24/95 04/24/96 775,000 0 0 0 775,000
Checker's -
Oviedo, FL 11/14/94 02/28/97 610,384 0 0 0 610,384
Boston Market -
Madison, TN (16) 05/05/95 05/08/98 774,851 0 0 0 774,851
Boston Market -
Chattanooga, TN (17) 05/05/95 06/16/98 713,386 0 0 0 713,386
<PAGE>
Cost of Properties
Including Closing and
Soft Costs
-------------------------------------
Excess
Total (deficiency)
acquisition of property
cost, operating
capital cash
improvements receipts
Original closing and over
mortgage soft costs cash
Property financing (1) Total expenditures
==========================================================================================
CNL Income Fund XIV, Ltd.:
Checkers -
Knoxville, TN 0 339,031 339,031 0
Checkers -
Dallas, TX 0 356,981 356,981 0
TGI Friday's -
Woodridge, NJ (7) 0 1,510,245 1,510,245 243,288
Wendy's -
Woodridge, NJ (7) 0 672,746 672,746 74,312
Hardee's -
Madison, AL 0 658,977 658,977 41,973
Checkers -
Richmond, VA (#548) 0 382,435 382,435 130,027
Checkers -
Riviera Beach, FL 0 276,409 276,409 83,591
Checkers -
Richmond, VA (#486) 0 352,034 352,034 45,951
Long John Silver's -
Stockbridge, GA 0 738,340 738,340 (42,040 )
CNL Income Fund XV, Ltd.:
Checkers -
Knoxville, TN 0 263,221 263,221 0
Checkers -
Leavenworth, KS 0 259,600 259,600 0
Checkers -
Knoxville, TN 0 288,885 288,885 0
TGI Friday's -
Woodridge, NJ (7) 0 1,510,245 1,510,245 243,288
Wendy's -
Woodridge, NJ (7) 0 672,746 672,746 74,312
CNL Income Fund XVI, Ltd.:
Long John Silver's -
Appleton, WI 0 613,838 613,838 161,162
Checker's -
Oviedo, FL 0 506,311 506,311 104,073
Boston Market -
Madison, TN (16) 0 774,851 774,851 0
Boston Market -
Chattanooga, TN (17) 0 713,386 713,386 0
<PAGE>
TABLE V
SALES OR DISPOSALS OF PROPERTIES
Selling Price, Net of
Closing Costs and GAAP Adjustments
---------------------------------------------------------------
Purchase
Cash Mortgage money Adjustments
received net balance mortgage resulting from
Date Date of of closing at time taken back application of
Property Acquired Sale costs of sale by program GAAP Total
==========================================================================================================================
CNL Income Fund XVII, Ltd.:
Boston Market -
Troy, OH (18) 07/24/96 06/16/98 857,487 0 0 0 857,487
CNL American Properties
Fund, Inc.:
TGI Friday's -
Orange, CT 10/30/95 05/08/97 1,312,799 0 0 0 1,312,799
TGI Friday's -
Hazlet, NJ 07/15/96 05/08/97 1,324,109 0 0 0 1,324,109
TGI Friday's -
Marlboro, NJ 08/01/96 05/08/97 1,372,075 0 0 0 1,372,075
TGI Friday's -
Hamden, CT 08/26/96 05/08/97 1,245,100 0 0 0 1,245,100
Boston Market -
Southlake, TX 07/02/97 07/21/97 1,035,153 0 0 0 1,035,135
Boston Market -
Franklin, TN (21) 08/18/95 04/14/98 950,361 0 0 0 950,361
Boston Market -
Grand Island, NE (22) 09/19/95 04/14/98 837,656 0 0 0 837,656
Burger King -
Indian Head Park, IL 04/03/96 05/05/98 674,320 0 0 0 674,320
Boston Market -
Dubuque, IA (26) 10/04/95 05/08/98 969,159 0 0 0 969,159
Boston Market -
Merced, CA (27) 10/06/96 05/08/98 930,834 0 0 0 930,834
Boston Market -
Arvada, CO (28) 07/21/97 07/28/98 1,152,262 0 0 0 1,152,262
Boston Market -
Ellisville, MO 09/03/96 04/28/99 822,824 0 0 0 822,824
Golden Corral -
Brooklyn, OH 08/23/96 05/18/99 1,363,896 0 0 0 1,363,896
<PAGE>
Cost of Properties
Including Closing and
Soft Costs
-------------------------------------
Excess
Total (deficiency)
acquisition of property
cost, operating
capital cash
improvements receipts
Original closing and over
mortgage soft costs cash
Property financing (1) Total expenditures
==========================================================================================
CNL Income Fund XVII, Ltd.:
Boston Market -
Troy, OH (18) 0 857,487 857,487 0
CNL American Properties
Fund, Inc.:
TGI Friday's -
Orange, CT 0 1,310,980 1,310,980 1,819
TGI Friday's -
Hazlet, NJ 0 1,294,237 1,294,237 29,872
TGI Friday's -
Marlboro, NJ 0 1,324,288 1,324,288 47,787
TGI Friday's -
Hamden, CT 0 1,203,136 1,203,136 41,964
Boston Market -
Southlake, TX 0 1,035,135 1,035,135 0
Boston Market -
Franklin, TN (21) 0 950,361 950,361 0
Boston Market -
Grand Island, NE (22) 0 837,656 837,656 0
Burger King -
Indian Head Park, IL 0 670,867 670,867 3,453
Boston Market -
Dubuque, IA (26) 0 969,159 969,159 0
Boston Market -
Merced, CA (27) 0 930,834 930,834 0
Boston Market -
Arvada, CO (28) 0 1,152,262 1,152,262 0
Boston Market -
Ellisville, MO 0 1,026,746 1,026,746 (203,922 )
Golden Corral -
Brooklyn, OH 0 997,296 997,296 366,600
</TABLE>
(1) Amounts shown do not include pro rata share of original offering costs
or acquisition fees.
(2) Amount shown is face value and does not represent discounted current
value. The mortgage note bears interest at a rate of 10.25% per annum
and provides for a balloon payment of $991,331 in July 2000.
(3) Amount shown is face value and does not represent discounted current
value. The mortgage note bears interest at a rate of 10.25% per annum
and provides for a balloon payment of $1,105,715 in July 2000.
(4) Amount shown is face value and does not represent discounted current
value. The mortgage note bears interest at a rate of 10.00% per annum
and provides for a balloon payment of $218,252 in December 2005.
(5) Amount shown is face value and does not represent discounted current
value. The mortgage note bears interest at a rate of 10.00% per annum
and provides for a balloon payment of $200,063 in December 2005.
(6) Amount shown is face value and does not represent discounted current
value. The mortgage note bears interest at a rate of 10.75% per annum
and provides for 12 monthly payments of interest only and thereafter, 24
equal monthly payments of principal and interest until November 1999,
when the remaining 144 equal monthly payments of principal and interest
will be reduced due to a lump sum payment received in advance from the
borrower in March 1999.
(7) CNL Income Fund XIV, Ltd. and CNL Income Fund XV, Ltd. each owned a 50
percent interest in Wood-Ridge Real Estate Joint Venture, which owned
two properties. The amounts presented for CNL Income Fund XIV, Ltd. and
CNL Income Fund XV, Ltd. represent each partnership's 50 percent
interest in the properties owned by Wood-Ridge Real Estate Joint
Venture.
(8) CNL Income Fund II, Ltd. owns a 64 percent interest and CNL Income Fund
VI, Ltd. owns a 36 percent interest in this joint venture. The amounts
presented for CNL Income Fund II, Ltd. and CNL Income Fund VI, Ltd.
represent each partnership's percent interest in the property owned by
Show Low Joint Venture.
(9) CNL Income Fund, Ltd. owns a 50 percent interest in this joint venture.
The amounts presented represent the partnerships percent interest in the
property owned by Seventh Avenue Joint Venture. A third party owns the
remaining 50 percent interest in this joint venture.
(10) CNL Income Fund VI, Ltd. and CNL Income Fund VII, Ltd. own a 52 percent
and 48 percent interest, respectively, in the property in Yuma, Arizona.
The amounts presented for CNL Income Fund VI, Ltd. and CNL Income Fund
VII, Ltd. represent each partnership's respective interest in the
property.
(11) Cash received net of closing costs includes $198,000 received as a lease
termination fee.
(12) Cash received net of closing costs includes $93,885 received as a lease
termination fee.
(13) Cash received net of closing costs includes $120,115 received as a lease
termination fee.
(14) Closing costs deducted from net sales proceeds do not include deferred,
subordinated real estate disposition fees payable to CNL Fund Advisors,
Inc. or its affiliates.
(15) The Burger King property in Woodmere, Ohio was exchanged on December 12,
1996 for a Burger King property in Carrboro, NC at the option of the
tenant as permitted under the terms of the lease agreement. Due to the
exchange, the Burger King property in Carrboro, NC is being leased under
the same lease as the Burger King property in Woodmere, OH.
(16) The Boston Market property in Madison, TN was exchanged on May 8, 1998
for a Boston Market property in Lawrence, KS at the option of the tenant
as permitted under the terms of the lease agreement. Due to the
exchange, the Boston Market property in Lawrence, KS is being leased
under the same lease as the Boston Market property in Madison, TN.
(17) The Boston Market property in Chattanooga, TN was exchanged on June 16,
1998 for a Boston Market property in Indianapolis, IN at the option of
the tenant as permitted under the terms of the lease agreement. Due to
the exchange, the Boston Market property in Indianapolis, IN is being
leased under the same lease as the Boston Market property in
Chattanooga, TN.
(18) The Boston Market property in Troy, OH was exchanged on June 16, 1998
for a Boston Market property in Inglewood, CA at the option of the
tenant as permitted under the terms of the lease agreement. Due to the
exchange, the Boston Market property in Inglewood, CA is being leased
under the same lease as the Boston Market property in Troy, OH.
(19) The Burger King property in Columbus, OH was exchanged on September 30,
1998 for a Burger King property in Danbury, CT at the option of the
tenant as permitted under the terms of the lease agreement. Due to the
exchange, the Burger King property in Danbury, CT is being leased under
the same lease as the Burger King property in Columbus, OH.
(20) CNL Income Fund V, Ltd. owns a 49 percent interest and CNL Income Fund
VII, Ltd. owns a 51 percent interest in this joint venture. The amounts
presented for CNL Income Fund V, Ltd. and CNL Income Fund VII, Ltd.
represent each partnership's percent interest in the property owned by
Halls Joint Venture.
(21) Amount shown is face value and does not represent discounted current
value. The mortgage note bears interest at a rate of 10.25% per annum
and provides for 60 equal monthly payments of principal and interest.
(22) Amount shown is face value and does not represent discounted current
value. The mortgage note bore an interest rate of 10.75% per annum and
provided for 12 monthly payments of interest only and thereafter, 168
equal monthly payments of principal and interest. The borrower prepaid
the mortgage note in full in April 1999.
(23) Amount shown is face value and does not represent discounted current
value. The mortgage note bore an interest rate of 10.00% per annum and
was paid in full in July 1999.
(24) The Boston Market property in Franklin, TN was exchanged on April 14,
1998 for a Boston Market property in Glendale, AZ at the option of the
tenant as permitted under the terms of the lease agreement. Due to the
exchange, the Boston Market property in Glendale, AZ is being leased
under the same lease as the Boston Market property in Franklin, TN.
(25) The Boston Market property in Grand Island, NE was exchanged on April
14, 1998 for a Boston Market property in Warwick, RI at the option of
the tenant as permitted under the terms of the lease agreement. Due to
the exchange, the Boston Market property in Warwick, RI is being leased
under the same lease as the Boston Market property in Grand Island, NE.
(26) The Boston Market property in Dubuque, IA was exchanged on May 8, 1998
for a Boston Market property in Columbus, OH at the option of the tenant
as permitted under the terms of the lease agreement. Due to the
exchange, the Boston Market property in Columbus, OH is being leased
under the same lease as the Boston Market property in Dubuque, IA.
(27) Cash received net of closing costs includes $362,949 in construction
costs incurred but not paid by CNL American Properties Fund, Inc. as of
the closing date, which were deducted from the actual net sales proceeds
received by CNL American Properties Fund, Inc.
(28) Cash received net of closing costs includes $522,827 in construction
costs incurred but not paid by CNL American Properties Fund, Inc. as of
the closing date, which were deducted from the actual net sales proceeds
received by CNL American Properties Fund, Inc.
<PAGE>
