<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
For the quarterly period ended JUNE 30, 1999
of
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
CPA(R):10
A MARYLAND Corporation
IRS Employer Identification No. 13-3559213
SEC File Number 0-19156
50 ROCKEFELLER PLAZA,
NEW YORK, NEW YORK 10020
(212) 492-1100
CPA(R):10 has SHARES OF COMMON STOCK registered pursuant to
Section 12(g) of the Act.
CPA(R):10 is not registered on any exchanges.
CPA(R):10 does not have any Securities registered pursuant to
Section 12(b) of the Act.
CPA(R):10 is unaware of any delinquent filers pursuant to Item
405 of Regulation S-K.
CPA(R):10 (1) has filed all reports required by Section 13 or
15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for shorter period that the registrant
was required to file such reports), and (2) has been subject
to such filing requirements for the past 90 days.
CPA(R):10 has no active market for common stock at August 9,
1999. 7,621,686 shares of common stock, $.001 Par Value
outstanding at August 9, 1999.
<PAGE> 2
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
INDEX
<TABLE>
<CAPTION>
Page No.
<S> <C>
PART I
Item 1. - Financial Information*
Condensed Consolidated Balance Sheets, as of December 31, 1998
and June 30, 1999 2
Condensed Consolidated Statements of Income for the three and
six months ended June 30, 1998 and 1999 3
Condensed Consolidated Statements of Comprehensive Income
for the three and six months ended June 30, 1998 and 1999 4
Condensed Consolidated Statements of Cash Flows for the six
months ended June 30, 1998 and 1999 5
Notes to Condensed Consolidated Financial Statements 6-7
Item 2. - Management's Discussion and Analysis of Financial
Condition and Results of Operations 8-10
PART II - Other Information
Item 3. - Quantitative and Qualitative Disclosures About Market Risk 11
Item 4. - Submission of Matters to a Vote of Security Holders 11
Item 6. - Exhibits and Reports on Form 8-K 11
Signatures 12
</TABLE>
*The summarized financial information contained herein is unaudited; however, in
the opinion of management, all adjustments necessary for a fair presentation of
such financial information have been included.
-1-
<PAGE> 3
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
PART I
Item 1. - FINANCIAL INFORMATION
CONDENSED CONSOLIDATED BALANCE SHEETS
<TABLE>
<CAPTION>
December 31, June 30,
1998 1999
------------ ------------
(Note) (Unaudited)
ASSETS:
<S> <C> <C>
Land and buildings,
net of accumulated depreciation of
$13,541,345 at December 31, 1998 and
$14,508,478 at June 30, 1999 $ 87,557,617 $ 85,292,063
Net investment in direct financing leases 16,758,447 16,758,447
Equity investment 12,382,287 12,780,836
Assets held for sale 751,750
Cash and cash equivalents 1,770,478 1,937,654
Other assets 787,077 1,166,256
------------ ------------
Total assets $119,255,906 $118,687,006
============ ============
LIABILITIES:
Mortgage notes payable $ 58,748,585 $ 58,056,685
Accrued interest 472,220 473,754
Accounts payable and accrued expenses 479,388 407,697
Accounts payable to affiliates 1,912,233 2,341,364
Dividends payable 1,348,268 1,351,321
Prepaid rental income 27,365 41,762
------------ ------------
Total liabilities 62,988,059 62,672,583
------------ ------------
Minority interest 3,665,708 3,579,989
------------ ------------
Commitments and contingencies
SHAREHOLDERS' EQUITY:
Common stock, $.001 par value; 40,000,000
shares authorized; 7,633,588 shares, issued and
outstanding at December 31, 1998 and June 30, 1999 7,633 7,633
Additional paid-in capital 66,530,408 66,530,408
Dividends in excess of accumulated earnings (13,993,711) (14,589,284)
Accumulated other comprehensive income 155,589 583,457
------------ ------------
52,699,919 52,532,214
Less, common stock in treasury, at cost, 11,902
shares at December 31, 1998 and June 30, 1999 (97,780) (97,780)
------------ ------------
Total shareholders' equity 52,602,139 52,434,434
------------ ------------
Total liabilities and shareholders' equity $119,255,906 $118,687,006
============ ============
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
Note: The condensed consolidated balance sheet at December 31, 1998 has been
derived from the audited financial statements at that date.
-2-
<PAGE> 4
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1998 June 30, 1999 June 30, 1998 June 30, 1999
------------- ------------- ------------- -------------
Revenues:
<S> <C> <C> <C> <C>
Rental income $2,895,837 $2,898,537 $6,248,516 $6,256,984
Interest from direct
financing leases 549,291 547,258 1,098,768 1,094,778
Other interest and
miscellaneous income 31,975 35,429 61,917 57,921
---------- ---------- ---------- ----------
3,477,103 3,481,224 7,409,201 7,409,683
---------- ---------- ---------- ----------
Expenses:
Interest 1,537,397 1,447,975 3,076,190 2,901,468
Depreciation and amortization 522,914 519,341 1,044,226 1,041,453
General and administrative 369,649 416,127 632,597 791,850
Property expenses 611,594 558,305 1,085,880 1,115,380
Writedown to fair value 146,249 494,965
---------- ---------- ---------- ----------
3,041,554 3,087,997 5,838,893 6,345,116
---------- ---------- ---------- ----------
Income before minority
interest, income from
equity investments and
gain on sale 435,549 393,227 1,570,308 1,064,567
Minority interest in income (158,753) (161,937) (316,484) (324,267)
---------- ---------- ---------- ----------
Income before income from
equity investments and
gain on sale 276,796 231,290 1,253,824 740,300
Income from equity investment 398,388 446,088 1,060,304 1,138,347
---------- ---------- ---------- ----------
Income before gain on sale 675,184 677,378 2,314,128 1,878,647
Gain on sale of securities 223,272 223,272
---------- ---------- --------- ----------
Net income $ 675,184 $ 900,650 $2,314,128 $2,101,919
========== ========== ========== ==========
Basic earnings per common share $.09 $.12 $.32 $.28
==== ==== ==== ====
Weighted average shares outstanding
- basic and diluted 7,302,497 7,621,686 7,254,833 7,621,686
========= ========= ========= =========
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
-3-
<PAGE> 5
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(UNAUDITED)
<TABLE>
<CAPTION>
Three Months Ended Six Months Ended
June 30, 1998 June 30, 1999 June 30, 1998 June 30, 1999
------------- ------------- ------------- -------------
<S> <C> <C> <C> <C>
Net income $ 675,184 $ 900,650 $2,314,128 $2,101,919
Other comprehensive income:
Change in unrealized gains on
securities during the period 189,624 457,041 189,624 427,868
---------- ---------- ---------- ----------
Comprehensive income $ 864,808 $1,357,691 $2,503,752 $2,529,787
========== ========== ========== ==========
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
-4-
<PAGE> 6
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
<TABLE>
<CAPTION>
Six months Ended June 30,
1998 1999
---- ----
Cash flows from operating activities:
<S> <C> <C>
Net income $ 2,314,128 $ 2,101,919
Adjustments to reconcile net income
to net cash provided by operating activities:
Depreciation and amortization 1,044,226 1,041,453
Income from equity investment
in excess of dividends received (343,933) (398,549)
Minority interest in income 316,484 324,267
Straight-line rent adjustments 5,683 2,619
Writedown to fair value 494,965
Provision for uncollected rents 55,105 55,138
Gain on sale of securities (223,272)
Net change in operating assets and liabilities 436,026 341,689
----------- -----------
Net cash provided by operating activities 3,827,719 3,740,229
----------- -----------
Cash flows from investing activities:
Proceeds from sale of securities 223,272
Purchase of marketable securities (285,110)
----------- -----------
Net cash (used in) provided by investing activities (285,110) 223,272
----------- -----------
Cash flows from financing activities:
Dividends paid (2,539,623) (2,694,439)
Proceeds from note payable
Purchase of treasury stock (9,688)
Distributions paid to minority partner (430,280) (409,986)
Payments of mortgage principal (626,805) (691,900)
----------- -----------
Net cash used in financing activities (3,606,396) (3,796,325)
----------- -----------
Net (decrease) increase in cash and cash equivalents (63,787) 167,176
Cash and cash equivalents, beginning of period 2,608,523 1,770,478
----------- -----------
Cash and cash equivalents, end of period $ 2,544,736 $ 1,937,654
=========== ===========
Supplemental disclosure of cash flows information:
Interest paid $ 2,967,930 $ 2,899,934
=========== ===========
</TABLE>
The accompanying notes are an integral part of the condensed consolidated
financial statements.
-5-
<PAGE> 7
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
Note 1. Basis of Presentation:
The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Article 10 of
Regulation S-X of the Securities and Exchange Commission. Accordingly, they do
not include all of the information and footnotes required by generally accepted
accounting principles for complete financial statements. All significant
intercompany balances and transactions have been eliminated. In the opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair presentation of the results of the interim periods
presented have been included. The results of operations for the interim periods
are not necessarily indicative of results for the full year. For further
information, refer to the financial statements and footnotes thereto included in
the Company's Annual Report on Form 10-K for the year ended December 31, 1998.
Assets held for sale are accounted for at the lower of carrying value or fair
value, less costs to dispose.
Note 2. Transactions with Related Parties:
The Company incurred asset management fees of $208,823 and $200,562 for the
three-months ended June 30, 1998 and 1999, respectively, and $403,525 and
$401,125 for the six months ended June 30, 1998 and 1999, respectively, with
performance fees in like amount. General and administrative expense
reimbursements were $139,290 and $172,608 for the three months ended June 30,
1998 and 1999, respectively, and $246,500 and $317,357 for the six months ended
June 30, 1998 and 1999, respectively.
Note 3. Lease Revenues:
The Company's operations consist of the direct and indirect investment in and
leasing of industrial and commercial real estate. The financial reporting
sources of leasing revenues for the six-month periods ended June 30, 1998 and
1999 are as follows:
<TABLE>
<CAPTION>
1998 1999
---- ----
Per Statements of Income:
<S> <C> <C>
Rental income from operating leases $6,248,516 $6,256,984
Interest from direct financing leases 1,098,768 1,094,778
Adjustments:
Rental income attributable to
minority interests (971,436) (971,436)
Share of interest income from equity
investment's direct financing lease 2,341,490 2,368,914
---------- ----------
$8,717,338 $8,749,240
========== ==========
</TABLE>
For the six-month periods ended June 30, 1998 and 1999, the Company earned its
proportionate net lease revenues from its investments as follows:
<TABLE>
<CAPTION>
1998 % 1999 %
---- ---- ---- ----
<S> <C> <C> <C> <C>
Marriott International, Inc. (a) $2,341,490 27% $2,368,914 27%
Information Resources Incorporated (b) 1,458,007 17 1,458,007 17
The Titan Corporation (b) 1,065,668 12 1,065,668 12
EnviroWorks, Inc. 708,511 8 723,145 8
New WAI, L.P./Warehouse Associates 726,620 8 722,630 8
Wal-Mart Stores, Inc. 633,946 7 690,789 8
Kmart Corporation 537,303 6 624,659 7
Childtime Childcare Inc. 402,727 5 402,727 5
Neodata Corporation 293,864 3 294,866 3
CalComp Technology, Inc. 219,917 3
Other 329,285 4 397,835 5
---------- ---- ---------- ----
$8,717,338 100% $8,749,240 100%
========== ==== ========== ====
</TABLE>
(a) Represents the Company's proportionate share of lease revenues from an
equity investment.
(b) Net of Corporate Property Associates 9's minority interest.
-6-
<PAGE> 8
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) - (CONTINUED)
Note 4. Equity Investment:
The Company owns an approximate 23.7% interest in Marcourt Investments
Incorporated ("Marcourt") which net leases 13 Courtyard by Marriott hotels to a
wholly-owned subsidiary of Marriott International, Inc. Summarized financial
information of Marcourt is as follows:
(in thousands)
<TABLE>
<CAPTION>
December 31, 1998 June 30, 1999
----------------- -------------
<S> <C> <C>
Assets (primarily real estate) $149,150 $149,018
Liabilities (primarily mortgage notes payable) 99,315 97,408
Shareholders' equity 49,835 51,610
</TABLE>
<TABLE>
<CAPTION>
Six Months Ended
June 30, 1998 June 30, 1999
------------- -------------
<S> <C> <C>
Revenue (primarily interest from
direct financing lease) $ 9,892 $ 10,006
Expenses (5,320) (5,105)
-------- --------
Net income $ 4,572 $ 4,901
======== ========
</TABLE>
Note 5. Writedown to Fair Value:
The Company and Carey Institutional Properties Incorporated ("CIP(R)"), an
affiliate, are owners as tenants-in-common of properties in Ruston, Louisiana
and Jonesboro, Arkansas. In April 1999, the Company and CIP(R) entered into an
agreement to sell the Ruston property for $450,000. The sale of the Ruston
property was completed on July 27, 1999. In addition, the Company and CIP(R)
have reached an agreement in principle to sell the Jonesboro property for
$1,100,000. The properties had been vacant since the termination of the Harvest
Foods, Inc. lease in March 1997. Based on the proposed sales prices less
estimated transaction costs, the Company's 50% interest in the properties has
been written down to $751,750, and an impairment loss of $494,965 has been
recognized. The Jonesboro property is subject to a ground lease and the ground
rental obligation, currently $113,447 per year, will be assumed by the
purchaser, if the sale is completed.
Note 6. Gain on Sale of Securities:
In March 1995, the Company entered into a net lease with Enviroworks, Inc.
("Enviroworks") at which time Enviroworks granted the Company warrants to
purchase 577,000 shares of common stock at an exercise price of $1.50. In
connection with consenting to the acquisition of Enviroworks' parent company in
December 1997, the Company exercised the warrants and sold the shares. A gain of
$285,987 was realized at that time with the additional funds deposited in an
escrow account. In May 1999, $223,272 was released to the Company from the
escrow account and has been recognized as a realized gain on sale in the
accompanying financial statements.
-7-
<PAGE> 9
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
Item 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following information should be read in conjunction with the
Company's condensed consolidated financial statements and notes thereto as of
June 30, 1999 included in this quarterly report and the Company's Annual Report
on Form 10-K for the year ended December 31, 1998. This quarterly report
contains forward looking statements. Such statements involve known and unknown
risks, uncertainties and other factors that may cause the actual results,
performance or achievement of the Company to be materially different from the
results of operations or plan expressed or implied by such forward looking
statements. Accordingly, such information should not be regarded as
representations by the Company that the results or conditions described in such
statements or the objectives and plans of the Company will be achieved.
RESULTS OF OPERATIONS:
Net income for three-month period ended June 30, 1999 reflected an
increase of $225,000 as compared with the three-month period ended June 30,
1998, however net income for the comparable six-month periods reflected a
decrease of $212,000. Excluding the effects of noncash writedowns on properties
held for sale and a gain on the sale of securities, income for the comparable
three-month and six-month periods would have reflected increases of $148,000 and
$60,000, respectively.
The increase in income, as adjusted, was due to a decrease in interest
expense and an increase in equity income from the Company's investment in
thirteen Courtyard Marriott hotels. The three-month period also benefited from a
moderate decrease in property expenses. The decrease in interest expense was due
to the satisfaction of a $1,500,000 mortgage loan in December 1998 as well as
the continuing principal amortization of the Company's limited recourse mortgage
loans. The increase in equity income from the investment in the Courtyard by
Marriott was also due to decreasing interest expense on the limited recourse
mortgage loans collateralized by hotel properties and an increase in percentage
rents. Lease revenues (rental income and interest from direct financing leases)
were stable. The Company has not recognized rental income in 1999 from its lease
with CalComp Technology, Inc. because CalComp is in the process of liquidating
and has vacated its leased property. The Company is continuing its efforts to
negotiate a settlement with CalComp and will pursue its legal remedies to
collect unpaid rents plus associated costs if a settlement cannot be reached.
The decrease in lease revenues as a result of not recognizing CalComp rents in
1999 (approximately $220,000 of rental income from CalComp was recognized by the
Company for the six-month period ended June 30, 1998) was offset by increased
percentage rents from the Company's leases with Kmart Corporation and Wal-Mart
Stores, Inc. and rent from a lease with Affiliated Foods Southwest, Inc. that
was entered into in 1998 for a property formerly leased to Harvest Foods, Inc.
The writedowns to fair value totaling $495,000 are the result of
adjusting the carrying value of properties in Jonesboro, Arkansas and Ruston,
Louisiana to their proposed sales prices, net of costs to sell. Both properties
were formerly leased to Harvest Foods and have been vacant since the termination
of the Harvest lease in March 1997. The Jonesboro property is subject to a
ground lease, which currently obligates the Company to an annual ground rental
commitment of approximately $57,000. The Company is evaluating its options for
each of the remaining four former Harvest properties including re-leasing,
redeveloping or selling each property.
The realized gain of $223,000 represents funds that were held in escrow
from the sale of warrants of common stock in a tenant company, EnviroWorks, Inc.
The Company sold the interest in the warrants in 1997 in connection with the
sale of EnviroWorks' parent company to Fiskars, Inc. The aggregate gain from the
sale of the warrants was $509,000.
-8-
<PAGE> 10
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
Item 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS, CONTINUED
FINANCIAL CONDITION:
There has been no material change in the Company's financial condition
since December 31, 1998. Cash flow from operations of $3,740,000 was slightly
less than the amounts needed to pay quarterly dividends of $2,694,000, pay
mortgage principal installments of $692,000 and distribute $410,000 to an
affiliate which owns the minority interests in the Information Resources, Inc.
and Titan Company net lease investments. Including the $223,000 received in
connection with sales proceeds released from escrow, the Company's cash balances
have increased by $167,000.
The limited recourse mortgage loan collateralized by the CalComp
property was originally scheduled to mature on August 1, 1999 with a balloon
payment of $1,574,000. The Company is evaluating an offer from the lender to
extend the maturity for up to six months in consideration for a partial
prepayment to reduce the principal balance to $1,500,000 and meeting certain
other conditions. The ability to pay the balloon payment at maturity may depend
on the amount of any termination settlement received from CalComp, the ability
to releverage other of the Company's properties or using cash from property
sales (as described below) and the possible sale of the Company's marketable
securities. A mortgage loan on the Company's portfolio of six Wal-Mart retail
properties that had been scheduled to mature on January 1, 1999 has been
extended through October 1, 1999. The Company is in discussions with the lender
to extend or refinance the Wal-Mart loan, and management believes that it is
probable that an extension or refinancing can be completed. As of June 30, 1999
the Wal-Mart loan had an outstanding balance of $6,844,000.
The Company has an agreement in principle to sell a property in
Jonesboro, Arkansas. The Company anticipates that it will realize cash proceeds
of approximately $540,000 if the sale is completed. In addition, the Company
realized $210,000 of cash proceeds on the sale of a property in Ruston,
Louisiana in July 1999. The Company owns 81,460 shares of common stock of a
tenant company, Titan Corporation. Titan's common stock is publicly traded and
the Company's holdings currently have a market value of approximately $850,000.
The company exercised warrants to purchase these shares in 1998 for $285,000.
The Company was formed in 1990 with the expectation that shareholders'
interests would be liquidated beginning eight to twelve years after the net
proceeds of the Company's offering were substantially invested. The Advisor is
beginning to evaluate liquidity alternatives.
YEAR 2000 ISSUES:
The "Year 2000 issue" refers to the series of problems that have
resulted or may result from the inability of certain computer software and
embedded processes to properly process dates. This shortcoming could result in
the failure of major systems or miscalculations causing major disruptions to
business operations. The Company has no information technology systems of its
own, but is dependent upon systems maintained by an affiliate of its Advisor,
and certain other third parties including banks and its transfer agent.
The Company and its affiliates have been evaluating their readiness
relating to Year 2000 issues since 1998. The affiliates' core information
technology systems used in administering the Company's business operations have
been upgraded or replaced, as needed, to become Year 2000 compliant. These
systems include desktop computers, network servers, operating systems and
applications software. A new, compliant, integrated accounting and asset
management system is currently being installed and is expected to be functional
in the fourth quarter of this year. Compliance of these systems with Year 2000
requirements has been determined through a combination of internal testing,
where feasible, and vendor representations. Non-core information technology
systems are currently being reviewed for compliance with Year 2000 requirements.
Such systems, although not critical to the Company's business operations, are
expected to be substantially upgraded or replaced before the end of 1999.
-9-
<PAGE> 11
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
Item 2. - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS, Continued
The Company has contacted and is evaluating documentation from its
critical third party vendors and suppliers including banks, transfer agents and
telecommunications service providers regarding their Year 2000 compliance. The
responses received have generally been positive although the Company cannot be
assured that such providers have adequately considered the impact of Year 2000
issues on their systems.
The Company has contacted its tenants regarding Year 2000 readiness and
emphasized the need to address Year 2000 issues. Generally, tenants are
contractually required to maintain their leased properties in good working order
and to make necessary alterations, foreseen or unforeseen, to meet their
contractual obligations. Because of those obligations, the Company believes that
the risks and costs of upgrading systems related to operations of the buildings
and that contain technology affected by Year 2000 issues will generally be
absorbed by tenants rather than the Company. The major risk is that Year 2000
issues have such an adverse effect on the financial condition of a tenant that
its ability to meet its lease obligations, including the timely payment of rent,
is impaired. In such an event, the Company may ultimately incur the costs for
Year 2000 readiness at the affected properties. The potential materiality of any
impact is not known at this time.
The Company will continue to monitor critical third party vendors and
suppliers to determine its vulnerability to potential disruptions caused by year
2000 issues. Limited scope contingency plans are currently being developed to
address potential disruptions of a temporary nature that may affect the Company.
Because it is not possible to anticipate all of the possible disruptions that
may be caused by Year 2000 events, there can be no assurance that the Company
will not be adversely affected if such disruptions occur.
-10-
<PAGE> 12
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
PART II
Item 3. - Quantitative and Qualitative Disclosures about Market Risk
Approximately $55,605,000 of the Company's long-term debt bears
interest at fixed rates, and therefore the fair value of these instruments is
affected by changes in the market interest rates. The following table presents
principal cash flows based upon expected maturity dates of the debt obligations
and the related weighted-average interest rates by expected maturity dates for
the fixed rate debt. The interest rate on the variable rate debt as of June 30,
1999 ranged from the lender's prime rate plus 1% to LIBOR plus 4%. There has
been no material change since December 31, 1998.
(in thousands)
<TABLE>
<CAPTION>
1999 2000 2001 2002 2003 Thereafter Total Fair Value
------- ------- ------- ------ --------- --------- ------- -------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Fixed rate $ 7,450 $22,847 $ 7,356 $ 996 $ 8,829 $ 8,127 $55,605 $58,977
Weighted average
interest rate 9.46% 10,65% 8.89% 9.89% 9.77% 9.94%
Variable rate 1,603 44 805 -- -- -- 2,452 2,452
</TABLE>
As of June 30, 1999, the Company had no other material
exposure to market risk.
Item 4. - SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
An annual Shareholders meeting was held on June 7, 1999, at which time
a vote was taken to elect the Company's directors through the solicitation of
proxies. The following directors were elected for a one-year term:
<TABLE>
<CAPTION>
Total Shares Shares
Name Of Director Shares Voting Voting Yes Voting No
---------------- ------------- ---------- ---------
<S> <C> <C> <C>
William P. Carey 4,021,030 3,935,810 85,220
Ralph G. Coburn 4,021,030 3,902,858 118,172
George E. Stoddard 4,021,030 3,930,513 90,517
William Ruder 4,021,030 3,936,233 84,797
Warren G. Wintrub 4,021,030 3,945,830 75,200
</TABLE>
Item 6. - EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits:
None.
(b) Reports on Form 8-K:
During the quarter ended June 30, 1999 the Company
was not required to file any reports on Form 8-K.
-11-
<PAGE> 13
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the Company has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CORPORATE PROPERTY ASSOCIATES 10 INCORPORATED
08/09/99 By: /s/ John J. Park
Date John J. Park
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
08/09/99 By: /s/ Claude Fernandez
Date Claude Fernandez
Executive Vice President and
Chief Administrative Officer
(Principal Accounting Officer)
-12-
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM 10-Q FOR
THE SIX MONTHS ENDED JUNE 30, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE
TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<CASH> 1,937,654
<SECURITIES> 0
<RECEIVABLES> 0
<ALLOWANCES> 0
<INVENTORY> 751,750
<CURRENT-ASSETS> 1,166,256
<PP&E> 116,589,988
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0
0
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