IR PASS-THROUGH CORP.
c/o Winthrop Management, LLC
Five Cambridge Center
Cambridge, MA 02142
(617) 234-3000
Integrated ARROs Fund I (the "Fund")
February, 2000
Dear Unitholder:
Enclosed for your review are the Fund's audited financial statements as of
December 31, 1999. As you are aware, the Funds' investments are passive in
nature and consist of interest-bearing payment obligations that originated from
a series of net lease real estate partnerships. As such, the primary source of
payment for these obligations is the lease payments received from the
partnerships' corporate tenants. We are pleased to report that all tenant
obligations continue to be met and, on an overall basis, the credit ratings of
these tenants have not materially changed since the initial offering of the
Units.
As previously reported, the Fund has made arrangements with Royal Alliance
Associates (212-551-5100) to act as a market maker and with DCC Securities Corp.
(800-945-0440) to facilitate trading, as a broker, between buyers and sellers of
Units. Please contact these firms directly if you have any questions regarding
such activities.
If you have any specific questions regarding your holdings in the Fund, please
call the Trustee, Bankers Trust Company at (800) 735-7777.
Sincerely,
Integrated ARROs Fund I
By: IR Pass-through Corp., Sponsor
<PAGE>
To the Unit-holders, Board of Directors of the Sponsor, and Trustee
of Integrated ARROS Fund I
INDEPENDENT AUDITOR'S REPORT
We have audited the accompanying statements of financial condition of Integrated
ARROS Fund I (the "Fund") as of December 31, 1999 and 1998, including the
schedule of portfolio investments as of December 31, 1999, and the related
statements of operations and changes in net assets for the years then ended and
the schedule of selected per unit operating performance, ratios and supplemental
data for each of the two years in the period ended December 31, 1999. These
financial statements and the selected per unit operating performance, ratios and
supplemental data are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and the
selected per unit operating performance, ratios and supplemental data based on
our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements and the selected per
unit operating performance, ratios and supplemental data are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation.
We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the financial statements and the selected per unit operating
performance, ratios and supplemental data referred to above present fairly, in
all material respects, the financial position of Integrated ARROS Fund I as of
December 31, 1999 and 1998, and the results of its operations and changes inits
net assets for the years then ended and the selected per unit operating
performance, ratios and supplemental data for each of the two years in the
period ended December 31, 1999, in conformity with generally accepted accounting
principles.
As explained in Note 2, the financial statements include investments in payment
obligations valued at $10,328,758 and $10,404,532 as of December 31, 1999 and
1998, whose values have been stated at the lower of fair market value, as
estimated by the Board of Directors of the Sponsor in the absence of readily
ascertainable market values, or Minimum Termination Amount. We have reviewed the
procedures used by the Board of Directors in arriving at its estimate of fair
market value of such investments and have inspected underlying documentation,
and, in the circumstances, we believe the procedures are reasonable and the
documentation appropriate. However, because of the inherent uncertainty of
valuation, those estimated values may differ significantly from the values that
would have been used had a ready market for the investments existed, and the
differences could be material.
/s/Hays & Company
- -----------------
Hays & Company
February 18, 2000
New York, New York
<PAGE>
<TABLE>
<CAPTION>
Integrated ARROs Fund I
Statements of Financial Condition
December 31,
---------------------------
Assets 1999 1998
----------- -----------
<S> <C> <C>
Cash and Cash Equivalents $ 427,744 $ 456,778
Investments in payment obligations, at minimum
termination value (cost $2,634,352) 10,328,758 10,404,532
----------- -----------
Total Assets 10,756,502 10,861,310
Liabilities
Distributions Payable 427,744 456,778
----------- -----------
Net Assets $10,328,758 $10,404,532
=========== ===========
Net Asset Value per unit (2,771 units outstanding) $ 3,727.45 $ 3,754.79
=========== ===========
</TABLE>
See notes to financial statements
<PAGE>
<TABLE>
<CAPTION>
Integrated ARROs Fund I
Statements of Operations
Year Ended December 31,
-------------------------
1999 1998
---------- ----------
<S> <C> <C>
Investment Income:
Interest and discount earned, net of fund expenses $1,412,220 $1,758,441
========== ==========
</TABLE>
See notes to financial statements.
<PAGE>
<TABLE>
<CAPTION>
Integrated ARROs Fund I
Statements of Changes in Net Assets
Year Ended December 31,
------------------------------
1999 1998
------------ ------------
<S> <C> <C>
Decrease in net assets from operations:
Net investment income 1,412,220 $1,758,441
------------ ------------
Net increase in net assets resulting from operations 1,412,220 1,758,441
Total declared as distributions to Unit Holders (1,487,994) (2,880,134)
------------ ------------
Net decrease in net assets (75,774) (1,121,693)
Net assets:
Beginning of period 10,404,532 11,526,225
------------ ------------
End of period $ 10,328,758 $10,404,532
============ ============
</TABLE>
See notes to financial statements.
<PAGE>
Integrated ARROs Fund I
Notes to Financial Statements
1. ORGANIZATION
Integrated ARROs Fund I (the "Fund") is a grantor trust created under
the laws of the State of New York and registered under the Investment
Company Act of 1940 as a closed-end, non-diversified management
investment company.
The Fund was formed in April 1987 for the purpose of realizing
appreciation in value and deferring the receipt of income through
investments in a portfolio consisting of seven contract rights for the
payment of money (the "Payment Obligations"). The Payments Obligations
were sold to the Fund by IR Pass-through Corporation (the "Sponsor"),
formerly a wholly-owned subsidiary of Integrated Resources, Inc.
("Integrated"). The Payment Obligations were entered into by seven
privately offered, single purpose limited partnerships (the
"Partnership(s)") previously sponsored by Integrated that had acquired
and net leased commercial real estate. Pursuant to the Consummation of
Integrated's Plan of Reorganization ("the Plan"), on November 3, 1994,
the Sponsor is a wholly-owned indirect subsidiary of Presidio Capital
Corp. ("Presidio") (See Footnote 3). All capitalized terms herein not
defined have the same meaning as defined in the Trust Indenture.
2. SIGNIFICANT ACCOUNTING POLICIES
Security Valuation
The Payment Obligations are valued at the lower of fair market value
(as determined by the Board of Directors of the Sponsor) or Minimum
Termination Amount (as defined in the Trust Indenture).
Federal Income Taxes
The Fund is classified as a grantor trust. As a consequence, the Fund
is not subject to Federal Income Taxation.
Cash and Cash Equivalents
Cash and cash equivalents represents payment obligations received by
the Fund and which were invested in U. S. Treasury bills with
maturities of three months or less.
Use of Estimates
The preparation of the financial statements in conformity with
Generally Accepted Accounting Principles requires management to make
estimates and assumptions that affect the reported amounts for
Investments in payment obligations and the reported amounts for Net
investment income. Actual results could differ from these estimates.
3. THE SPONSOR
IR Pass-through Corporation is the Sponsor of the Fund and was/is a
wholly owned subsidiary of Integrated Resources, Inc. ("Integrated")
and its post-bankruptcy successor, Presidio Capital Corp. ("Presidio").
Presidio is an indirect but wholly owned subsidiary of NorthStar
Capital Investment Corp., the majority shareholder of Presidio.
<PAGE>
Subject to the rights of the unitholders under the Trust Indenture,
Presidio is responsible for the administration of the Fund through its
indirect ownership of all of the shares of the Sponsor. NorthStar
Presidio Management Company, LLC ("NorthStar Presidio"), an affiliate
of NorthStar Capital, provided administrative services to Presidio
through October 25, 1999. Thereafter, administrative services were
provided to Presidio by AP-PCC III, L.P. ("AP-PCC"), an unaffiliated
third party. NorthStar Presidio and AP-PCC in turn provided services to
the Fund. The board of directors of Presidio is authorized to designate
the officers and directors of the Sponsor, whose names, titles,
principal occupations during the past five years and the date they
began office is set forth in Note 5, Commitments and Contingencies.
4. THE PAYMENT OBLIGATIONS
The seven Payment Obligations acquired by the Fund were issued from
1981 to 1982 for the sale to the Partnerships of rights to acquire
interests in properties or for services rendered.
Payments on the seven Payment Obligations are scheduled over a period
not in excess of 40 years from commencement of the initial terms
("Primary Terms"), ranging from 20 to 25 years, of the respective net
leases. Interest at simple interest rates ranging from 13% to 18.5%
accrues on the principal amount for each Payment Obligation. Payments
on the Payment Obligations are scheduled to commence approximately 15
years after commencement of the Primary Terms of each net lease.
If a net lease is not extended by the lessee beyond the Primary Term,
the Partnership's obligation to pay the balance of the principal of a
Payment Obligation and accrued interest does not accelerate. In such
event, the Partnership may either seek to re-lease or to sell the
property, but there can be no assurance that such a sale or new lease
would be made or that it would be made in a timely manner. If a sale is
made, the balance of the principal and accrued interest thereon may be
declared by the Fund, at its discretion, to be immediately due and
payable. Upon the disposition by a Partnership of its entire interest
in the property (or properties), the Partnership shall be obligated to
pay the Fund (after satisfaction of any obligations senior to that of
the Payment Obligation which are then due and payable) first, accrued
unpaid interest and then the unpaid principal balance of the payment
Obligation. The Fund does not have the right to accelerate the payment
of any Payment Obligation in the event that a Partnership does not sell
its property at the end of the Primary Term, so long as the Partnership
remains current on its payments under the Payment Obligation. As such,
it is possible that the Fund may not realize the entire outstanding
principal and interest thereon of the related Payment Obligation.
5. COMMITMENTS AND CONTINGENCIES
The Trust Indenture provides that the Sponsor will bear all costs of
administering the Fund through the period in which the Fund will be
receiving only primary term payments. However, when the Fund begins
receiving renewal term payments, the Fund shall bear a portion of such
costs equal to the percentage of the renewal term payments received by
the Fund in such year to all of the payments received by the Fund in
such year.
<PAGE>
The Trust Indenture provides that the above obligations of the Sponsor
were to be funded through the retention of a portion of the proceeds
from the sale of the Units. However, the Sponsor did not segregate from
the general assets of its then parent, Integrated, a portion of the
sale proceeds for this purpose. Integrated filed for bankruptcy on
February 13, 1990 under Chapter 11 of the United States Bankruptcy
code. While Integrated's bankruptcy did not directly affect the Fund,
and had no effect on the portfolio of the Fund, the bankruptcy did
affect the Sponsor, which had no source of revenues other than
Integrated. The Sponsor therefore filed a claim in Integrated's
bankruptcy proceedings for the amounts necessary to fund the Sponsor's
obligations to the Fund and to Integrated ARROs Fund II, an affiliate.
As Integrated's liabilities far exceeded its assets, and the Sponsor's
claim was that of an unsecured general creditor, it was unlikely that
amounts eventually paid on the Sponsor's claim would be sufficient to
fund the Sponsor's obligations. However, in 1994, in full settlement of
the Sponsor's claim, Integrated paid the Sponsor $450,000. The Sponsor
projected at that time (based on a present value estimate of legal,
accounting, trustee fees, and printing and mailing costs) that this
amount would enable the Sponsor to meet its obligations to the Fund,
and its similar obligations to Fund II, through approximately the year
2000. However, at that time there was no assurance that the $450,000
paid by Integrated, plus any interest accrued (the "Settlement Fund"),
would in fact be sufficient to fund the Sponsor's obligations through
the year 2000. As of December 31, 1997, approximately $61,000 remained
of the original Settlement Fund. However, the Settlement Fund was fully
depleted during the first half of 1998. The Trustee may establish a
reserve fund, set aside out of the proceeds of the Payment Obligations,
to pay future expenses of administering the Fund. Consequently, the
Trustee paid $33,558 and $14,145 in such expenses from the proceeds of
Payment Obligations received by the Fund in 1999 and 1998,
respectively.
<PAGE>
Set forth below is certain information with respect to the Sponsor's
directors and officers. The business address for each of them is c/o
Winthrop Management, LLC, Five Cambridge Center, Cambridge,
Massachusetts 02142
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATIONS
NAME POSITION WITH SPONSOR DIRECTOR/OFFICER SINCE DURING PAST 5 YEARS
---- --------------------- ---------------------- ---------------------------------
<S> <C> <C> <C>
Dallas E. Lucas Director, Vice President August 1998 Mr. Lucas joined NorthStar Capital
And Treasurer in August 1998. From 1994 until
then he was the Chief Financial
Officer of Crescent Real Estate
Equities Company. Prior to that
he was a financial consulting
and audit manager in the real
estate services group of Arthur
Andersen LLP
David King Director and President November 1997 Mr. King joined NorthStar Capital
in November 1997. From 1990 to
1997 Mr. King was associated with
Olympia & York Companies (USA)
where he held the position of
Senior Vice Priesident of Finance.
Prior to that Mr. King was
employed with Bankers Trust in
its real estate finance group.
Charles Humber Vice President and Secretary November 1997 Mr. Humber joined NorthStar
Capital in September 1997. From
1996 to 1997 Mr. Humber was
employed with Merrill Lynch in
its real estate investment-
banking group. Prior to that Mr.
Humber was a student at Brown
University.
Steven Kauff Director and Vice President July 1999 Mr. Kauff joined NorthStar
Capital in July 1999. From 1996
to 1999 Mr Kauff was a Manager in
the Real Estate and Hospitality
Services Group of Arthur Andersen
LLP. Prior to joining Arthur
Andersen LLP, Mr. Kauff was with
Price Waterhouse LLP in the Real
Estate Industry Services Group.
</TABLE>
<PAGE>
6. DISTRIBUTION PAYABLE
The Trustee declared a $427,744 ($154.36 per unit) distribution payable
to unitholders of record as of December 31, 1999. Such distribution was
paid on January 14, 2000.
7. SIGNIFICANT TRANSACTIONS
In May 1996, the tenant of the Huntsville, Texas property, one of five
properties owned by Elway Associates, exercised the economic
discontinuance clause contained in its lease. This clause generally
allows the tenant to purchase the property for a predetermined amount
set forth in the lease upon declaring that continued use and occupancy
of the property was economically unsuitable. As a result, Elway
Associates wire transferred sale proceeds of $1,149,699 to the Fund's
Trustee in partial satisfaction of the Elway payment obligation. The
amount received in this case was substantially in excess of the portion
of the Minimum Termination Amount allocable to the Huntsville, Texas
property. While the Trust Indenture provides for the acceptance of
involuntary sale (such as in an economic discontinuance) proceeds in
prepayment of a payment obligation in which the underlying partnership
has a single property (lease), it does not specifically provide for
acceptance of involuntary sale proceeds in partial prepayment of a
payment obligation where the underlying partnership has more than one
property (lease) comprising the payment obligation, as is the case
here. The Sponsor believes that the original intent of the Trust
Indenture was to allow for such partial prepayment. However, the
Trustee that received the Elway sale proceeds did not agree to allow
the Elway payment in partial satisfaction of the associated payment
obligation and placed the Elway sale proceeds in an interest-bearing
account separate from that of the Fund, pending resolution of this
issue. The Elway primary and renewal term payments were reduced on a
pro-rata basis to reflect the involuntary sale of the Huntsville, Texas
property.
Effective March 29, 1998, the Sponsor arranged for the replacement of
the Trustee with a new trustee (the "Successor Trustee") which had a
broader interpretation of the Trust Indenture with regard to partial
prepayments received from a multi-property partnership. On April 1,
1998, a supplemental agreement to the original Trust Indenture was
entered into between the Successor Trustee for the Fund, the Sponsor of
the Fund, and the Partnerships (including Elway) that have Payment
Obligations to the Fund. Such agreement allows for, among other things,
the partial prepayment of a multi-property Partnership's Payment
Obligation in the event of an involuntary sale of one of its
properties. As a result of such agreement, the payment of $1,149,699
made by Elway Associates in May of 1996 in connection with an
involuntary sale was accepted by the Successor Trustee as a partial
prepayment of Elway's Payment Obligation and was subsequently
distributed, together with interest earned since its receipt of
$103,526, on June 5, 1998.
<PAGE>
The payment made by Elway was insufficient to cover that portion of
Elway's Payment Obligation allocable to the Huntsville Property. In
accordance with the terms of the Supplemental Agreement, such
shortfall, amounting to $381,150 (including accrued interest), was
repaid during 1998 from cash flow generated by Elway after the payment
of the reduced payments to the Fund and was included in subsequent
distributions made for 1998.
<PAGE>
<TABLE>
<CAPTION>
Integrated ARROs Fund I
Schedule of Selected Per Unit Operating Performance, Ratios and Supplemental Data
YEAR ENDED DECEMBER 31,
--------------------------------------------------------------------------------------
1999 1998 1997 1996 1995
------------- -------------- -------------- ------------- -------------
<S> <C> <C> <C> <C> <C>
Per Unit Operating Performance
Net asset value, beginning of period $ 3,754.79 $ 4,159.59 $ 3,920.28 $ 3,295.59 $ 2,901.11
Net investment income 509.65 634.59 459.69 678.56 394.48
Distributions (536.99) (1,039.39) (220.38) (53.87) 0.00
Net asset value, end of period $ 3,727.45 $ 3,754.79 $ 4,159.59 $ 3,920.28 $ 3,295.59
Total investment return $ 509.65 $ 634.59 $ 459.69 $ 678.56 $ 394.48
Ratios/Supplemental Data
Net assets, end of period $ 10,328,758 $ 10,404,532 $ 11,526,225 $ 10,863,094 $ 9,132,093
Ratio of expenses to average net assets 0.32% 0.13% N/A N/A N/A
Ratio of net investment income to average
net assets 13.62% 16.04% 11.38% 18.81% 12.73%
Portfolio turnover rate N/A N/A N/A N/A N/A
</TABLE>
<PAGE>
Integrated ARROs Fund I
Schedule of Portfolio Investments
December 31, 1999
<TABLE>
<CAPTION>
Partnership /
Date Payment Original Simple
Obligation Property Type of Principal Interest
Incurred Lessee Location(s) Property Amount Rate
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
Walando Walgreen Orlando, FL Office/ $820,000 13.0%
03/18/81 Company Warehouse
Building
Santex (2) Albertson's Venice, FL Retail 570,000 17.0%
07/01/81 Inc. Livermore, CA Facilities
Lando Albertson's Portland, OR Retail 783,451 16.0%
10/21/81 Inc. Orlando, FL Facilities
(amended Huntsville, AL
04/15/82)
Denville Xerox Lewisville, TX Plant 963,048 15.0%
12/22/81 Corporation Facility
(amended
01/27/84)
Elway Safeway Billings, MT Retail 1,429,042 18.5%
03/18/82 Stores, Inc. Fort Worth, TX Facilities
Aurora, CO
Mamoth Lakes, CA
Walstaff Walgreen Flagstaff, AZ Warehouse/ 1,159,762 16.0%
04/15/82 Arizona Distribution
(amended Drug Co. Building
06/17/82) (3)
Walcreek Hercules Walnut Creek, Office 1,306,709 18.5%
08/01/82 Credit Inc. CA Building
(amended (4)
06/29/83,
12/3/84)
--------------
$7,032,012
==============
</TABLE>
(1) Primary Term of the applicable net lease.
(2) Two Payment Obligations, one for each property, treated as one.
(3) Guaranteed by Walgreen Company.
(4) Guaranteed by Hercules Incorporated
<PAGE>
Integrated ARROs Fund I
Schedule of Portfolio Investments
December 31, 1999
<TABLE>
<CAPTION>
Partnership/ Discount To
Date Payment Arrive at Minimum Periodic Minimum
Obligation Accrued Termination Payment During Termination
Incurred Interest Amount Primary Term (1) Amount
- ------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Walando $1,481,228 $ 1,324,137 5/1/96-4/1/06 $977,091
03/18/81 $11,883/mo
Santex (2) 1,260,165 845,290 9/1/96-8/1/06 984,875
07/01/81 $13,342/mo
Lando 1,968,816 1,798,814 7/1/97-1/1/07 953,453
10/21/81 $62,656/semi
(amended
04/15/82)
Denville 2,400,729 2,235,884 8/1/98-7/1/08 1,127,893
12/22/81 $12,038/mo
(amended
01/27/84)
Elway 4,020,399 3,409,328 7/1/97-6/1/07 2,040,113
03/18/82 $22,027/mo
Walstaff 2,818,579 2,105,680 12/1/98-6/1/03 1,872,661
04/15/82 $156,738/semi
(amended
06/17/82)
Walcreek 3,036,874 1,970,913 10/1/97-9/1/07 2,372,672
08/01/82 $30,155/mo
(amended
06/29/83,
12/3/84)
---------------------------------- -----------
16,986,790 $13,690,046 $10,328,758
================================== ===========
</TABLE>
(1) Primary Term of the applicable net lease.
(2) Two Payment Obligations, one for each property, treated as one.
(3) Guaranteed by Walgreen Company.
(4) Guaranteed by Hercules Incorporated
<PAGE>
INTEGRATED ARROS FUND I
SCHEDULE OF ACCRUED INTEREST ON OUTSTANDING PAYMENT OBLIGATIONS
JANUARY 1, 1999 THROUGH DECEMBER 31, 1999
<TABLE>
<CAPTION>
ACCRUED ACCRUED ACCRUED ACCRUED
DATE INTEREST DATE INTEREST DATE INTEREST DATE INTEREST
<S> <C> <C> <C> <C> <C> <C> <C>
01-Jan-99 17,185,021 23-Feb-99 17,264,739 17-Apr-99 17,255,011 09-Jun-99 17,088,546
02-Jan-99 17,188,213 24-Feb-99 17,267,930 18-Apr-99 17,258,203 10-Jun-99 17,091,737
03-Jan-99 17,191,405 25-Feb-99 17,271,122 19-Apr-99 17,261,395 11-Jun-99 17,094,929
04-Jan-99 17,194,596 26-Feb-99 17,274,314 20-Apr-99 17,264,586 12-Jun-99 17,098,121
05-Jan-99 17,197,788 27-Feb-99 17,277,506 21-Apr-99 17,267,778 13-Jun-99 17,101,313
06-Jan-99 17,200,980 28-Feb-99 17,280,697 22-Apr-99 17,270,970 14-Jun-99 17,104,504
07-Jan-99 17,204,172 01-Mar-99 17,194,444 23-Apr-99 17,274,162 15-Jun-99 17,107,696
08-Jan-99 17,207,363 02-Mar-99 17,197,636 24-Apr-99 17,277,353 16-Jun-99 17,110,888
09-Jan-99 17,210,555 03-Mar-99 17,200,828 25-Apr-99 17,280,545 17-Jun-99 17,114,080
10-Jan-99 17,213,747 04-Mar-99 17,204,019 26-Apr-99 17,283,737 18-Jun-99 17,117,271
11-Jan-99 17,216,939 05-Mar-99 17,207,211 27-Apr-99 17,286,929 19-Jun-99 17,120,463
12-Jan-99 17,220,130 06-Mar-99 17,210,403 28-Apr-99 17,290,120 20-Jun-99 17,123,655
13-Jan-99 17,223,322 07-Mar-99 17,213,595 29-Apr-99 17,293,312 21-Jun-99 17,126,847
14-Jan-99 17,226,514 08-Mar-99 17,216,786 30-Apr-99 17,296,504 22-Jun-99 17,130,038
15-Jan-99 17,229,706 09-Mar-99 17,219,978 01-May-99 17,210,251 23-Jun-99 17,133,230
16-Jan-99 17,232,897 10-Mar-99 17,223,170 02-May-99 17,213,442 24-Jun-99 17,136,422
17-Jan-99 17,236,089 11-Mar-99 17,226,362 03-May-99 17,216,634 25-Jun-99 17,139,613
18-Jan-99 17,239,281 12-Mar-99 17,229,553 04-May-99 17,219,826 26-Jun-99 17,142,805
19-Jan-99 17,242,473 13-Mar-99 17,232,745 05-May-99 17,223,018 27-Jun-99 17,145,997
20-Jan-99 17,245,664 14-Mar-99 17,235,937 06-May-99 17,226,209 28-Jun-99 17,149,189
21-Jan-99 17,248,856 15-Mar-99 17,239,129 07-May-99 17,229,401 29-Jun-99 17,152,380
22-Jan-99 17,252,048 16-Mar-99 17,242,320 08-May-99 17,232,593 30-Jun-99 17,155,572
23-Jan-99 17,255,240 17-Mar-99 17,245,512 09-May-99 17,235,785 01-Jul-99 17,006,663
24-Jan-99 17,258,431 18-Mar-99 17,248,704 10-May-99 17,238,976 02-Jul-99 17,009,855
25-Jan-99 17,261,623 19-Mar-99 17,251,896 11-May-99 17,242,168 03-Jul-99 17,013,046
26-Jan-99 17,264,815 20-Mar-99 17,255,087 12-May-99 17,245,360 04-Jul-99 17,016,238
27-Jan-99 17,268,007 21-Mar-99 17,258,279 13-May-99 17,248,551 05-Jul-99 17,019,430
28-Jan-99 17,271,198 22-Mar-99 17,261,471 14-May-99 17,251,743 06-Jul-99 17,022,622
29-Jan-99 17,274,390 23-Mar-99 17,264,663 15-May-99 17,254,935 07-Jul-99 17,025,813
30-Jan-99 17,277,582 24-Mar-99 17,267,854 16-May-99 17,258,127 08-Jul-99 17,029,005
31-Jan-99 17,280,774 25-Mar-99 17,271,046 17-May-99 17,261,318 09-Jul-99 17,032,197
01-Feb-99 17,194,520 26-Mar-99 17,274,238 18-May-99 17,264,510 10-Jul-99 17,035,389
02-Feb-99 17,197,712 27-Mar-99 17,277,430 19-May-99 17,267,702 11-Jul-99 17,038,580
03-Feb-99 17,200,904 28-Mar-99 17,280,621 20-May-99 17,270,894 12-Jul-99 17,041,772
04-Feb-99 17,204,096 29-Mar-99 17,283,813 21-May-99 17,274,085 13-Jul-99 17,044,964
05-Feb-99 17,207,287 30-Mar-99 17,287,005 22-May-99 17,277,277 14-Jul-99 17,048,156
06-Feb-99 17,210,479 31-Mar-99 17,290,196 23-May-99 17,280,469 15-Jul-99 17,051,347
07-Feb-99 17,213,671 01-Apr-99 17,203,943 24-May-99 17,283,661 16-Jul-99 17,054,539
08-Feb-99 17,216,863 02-Apr-99 17,207,135 25-May-99 17,286,852 17-Jul-99 17,057,731
09-Feb-99 17,220,054 03-Apr-99 17,210,327 26-May-99 17,290,044 18-Jul-99 17,060,923
10-Feb-99 17,223,246 04-Apr-99 17,213,518 27-May-99 17,293,236 19-Jul-99 17,064,114
11-Feb-99 17,226,438 05-Apr-99 17,216,710 28-May-99 17,296,428 20-Jul-99 17,067,306
12-Feb-99 17,229,629 06-Apr-99 17,219,902 29-May-99 17,299,619 21-Jul-99 17,070,498
13-Feb-99 17,232,821 07-Apr-99 17,223,094 30-May-99 17,302,811 22-Jul-99 17,073,690
14-Feb-99 17,236,013 08-Apr-99 17,226,285 31-May-99 17,306,003 23-Jul-99 17,076,881
15-Feb-99 17,239,205 09-Apr-99 17,229,477 01-Jun-99 17,063,012 24-Jul-99 17,080,073
16-Feb-99 17,242,396 10-Apr-99 17,232,669 02-Jun-99 17,066,203 25-Jul-99 17,083,265
17-Feb-99 17,245,588 11-Apr-99 17,235,861 03-Jun-99 17,069,395 26-Jul-99 17,086,457
18-Feb-99 17,248,780 12-Apr-99 17,239,052 04-Jun-99 17,072,587 27-Jul-99 17,089,648
19-Feb-99 17,251,972 13-Apr-99 17,242,244 05-Jun-99 17,075,779 28-Jul-99 17,092,840
20-Feb-99 17,255,163 14-Apr-99 17,245,436 06-Jun-99 17,078,970 29-Jul-99 17,096,032
21-Feb-99 17,258,355 15-Apr-99 17,248,628 07-Jun-99 17,082,162 30-Jul-99 17,099,224
22-Feb-99 17,261,547 16-Apr-99 17,251,819 08-Jun-99 17,085,354 31-Jul-99 17,102,415
</TABLE>
<PAGE>
INTEGRATED ARROS FUND I
SCHEDULE OF ACCRUED INTEREST ON OUTSTANDING PAYMENT OBLIGATIONS
JANUARY 1, 1999 THROUGH DECEMBER 31, 1999
<TABLE>
<CAPTION>
ACCRUED ACCRUED ACCRUED
DATE INTEREST DATE INTEREST DATE INTEREST
<S> <C> <C> <C> <C> <C>
01-Aug-99 17,016,162 23-Sep-99 17,095,879 15-Nov-99 17,086,152
02-Aug-99 17,019,354 24-Sep-99 17,099,071 16-Nov-99 17,089,344
03-Aug-99 17,022,546 25-Sep-99 17,102,263 17-Nov-99 17,092,535
04-Aug-99 17,025,737 26-Sep-99 17,105,455 18-Nov-99 17,095,727
05-Aug-99 17,028,929 27-Sep-99 17,108,646 19-Nov-99 17,098,919
06-Aug-99 17,032,121 28-Sep-99 17,111,838 20-Nov-99 17,102,111
07-Aug-99 17,035,312 29-Sep-99 17,115,030 21-Nov-99 17,105,302
08-Aug-99 17,038,504 30-Sep-99 17,118,222 22-Nov-99 17,108,494
09-Aug-99 17,041,696 01-Oct-99 17,031,968 23-Nov-99 17,111,686
10-Aug-99 17,044,888 02-Oct-99 17,035,160 24-Nov-99 17,114,878
11-Aug-99 17,048,079 03-Oct-99 17,038,352 25-Nov-99 17,118,069
12-Aug-99 17,051,271 04-Oct-99 17,041,544 26-Nov-99 17,121,261
13-Aug-99 17,054,463 05-Oct-99 17,044,735 27-Nov-99 17,124,453
14-Aug-99 17,057,655 06-Oct-99 17,047,927 28-Nov-99 17,127,645
15-Aug-99 17,060,846 07-Oct-99 17,051,119 29-Nov-99 17,130,836
16-Aug-99 17,064,038 08-Oct-99 17,054,311 30-Nov-99 17,134,028
17-Aug-99 17,067,230 09-Oct-99 17,057,502 01-Dec-99 16,891,037
18-Aug-99 17,070,422 10-Oct-99 17,060,694 02-Dec-99 16,894,229
19-Aug-99 17,073,613 11-Oct-99 17,063,886 03-Dec-99 16,897,420
20-Aug-99 17,076,805 12-Oct-99 17,067,078 04-Dec-99 16,900,612
21-Aug-99 17,079,997 13-Oct-99 17,070,269 05-Dec-99 16,903,804
22-Aug-99 17,083,189 14-Oct-99 17,073,461 06-Dec-99 16,906,996
23-Aug-99 17,086,380 15-Oct-99 17,076,653 07-Dec-99 16,910,187
24-Aug-99 17,089,572 16-Oct-99 17,079,845 08-Dec-99 16,913,379
25-Aug-99 17,092,764 17-Oct-99 17,083,036 09-Dec-99 16,916,571
26-Aug-99 17,095,956 18-Oct-99 17,086,228 10-Dec-99 16,919,763
27-Aug-99 17,099,147 19-Oct-99 17,089,420 11-Dec-99 16,922,954
28-Aug-99 17,102,339 20-Oct-99 17,092,612 12-Dec-99 16,926,146
29-Aug-99 17,105,531 21-Oct-99 17,095,803 13-Dec-99 16,929,338
30-Aug-99 17,108,723 22-Oct-99 17,098,995 14-Dec-99 16,932,529
31-Aug-99 17,111,914 23-Oct-99 17,102,187 15-Dec-99 16,935,721
01-Sep-99 17,025,661 24-Oct-99 17,105,379 16-Dec-99 16,938,913
02-Sep-99 17,028,853 25-Oct-99 17,108,570 17-Dec-99 16,942,105
03-Sep-99 17,032,045 26-Oct-99 17,111,762 18-Dec-99 16,945,296
04-Sep-99 17,035,236 27-Oct-99 17,114,954 19-Dec-99 16,948,488
05-Sep-99 17,038,428 28-Oct-99 17,118,146 20-Dec-99 16,951,680
06-Sep-99 17,041,620 29-Oct-99 17,121,337 21-Dec-99 16,954,872
07-Sep-99 17,044,812 30-Oct-99 17,124,529 22-Dec-99 16,958,063
08-Sep-99 17,048,003 31-Oct-99 17,127,721 23-Dec-99 16,961,255
09-Sep-99 17,051,195 01-Nov-99 17,041,467 24-Dec-99 16,964,447
10-Sep-99 17,054,387 02-Nov-99 17,044,659 25-Dec-99 16,967,639
11-Sep-99 17,057,579 03-Nov-99 17,047,851 26-Dec-99 16,970,830
12-Sep-99 17,060,770 04-Nov-99 17,051,043 27-Dec-99 16,974,022
13-Sep-99 17,063,962 05-Nov-99 17,054,234 28-Dec-99 16,977,214
14-Sep-99 17,067,154 06-Nov-99 17,057,426 29-Dec-99 16,980,406
15-Sep-99 17,070,346 07-Nov-99 17,060,618 30-Dec-99 16,983,597
16-Sep-99 17,073,537 08-Nov-99 17,063,810 31-Dec-99 16,986,789
17-Sep-99 17,076,729 09-Nov-99 17,067,001
18-Sep-99 17,079,921 10-Nov-99 17,070,193
19-Sep-99 17,083,112 11-Nov-99 17,073,385
20-Sep-99 17,086,304 12-Nov-99 17,076,577
21-Sep-99 17,089,496 13-Nov-99 17,079,768
22-Sep-99 17,092,688 14-Nov-99 17,082,960
</TABLE>
