Rule 424(b)(3)
No. 333-15411
CNL AMERICAN PROPERTIES FUND, INC.
This Supplement is part of, and should be read in conjunction with, the
Prospectus dated January 31, 1997 and the Prospectus Supplement dated March 17,
1997. This Supplement replaces the Supplement dated March 25, 1997. CAPITALIZED
TERMS USED IN THIS SUPPLEMENT HAVE THE SAME MEANING AS IN THE PROSPECTUS UNLESS
OTHERWISE STATED HEREIN.
Information as to proposed properties for which the Company has
received initial commitments and as to the number and types of Properties
acquired by the Company is presented as of March 27, 1997, and all references to
commitments or Property acquisitions should be read in that context. Proposed
properties for which the Company receives initial commitments, as well as
property acquisitions that occur after March 27, 1997, will be reported in a
subsequent Supplement.
THE OFFERING
Following the completion of its Initial Offering on February 6, 1997,
the Company commenced this offering of up to 27,500,000 Shares. As of March 27,
1997, the Company had received aggregate subscription proceeds of $24,323,095
(2,432,310 Shares) from 1,087 stockholders. Net Offering Proceeds to the Company
after deduction of Selling Commissions, Marketing Support and Due Diligence
Expense Reimbursement Fees and Offering Expenses totalled approximately
$21,900,000. As of March 27, 1997, $1,094,539 of such amount had been incurred
in Acquisition Fees to the Advisor and the balance was available for investment
in Properties and Mortgage Loans.
As of the completion of its Initial Offering, the Company had received
subscription proceeds of $150,591,765 (15,059,177 shares), including $591,765
(59,177 shares) issued pursuant to the Reinvestment Plan and after deduction of
selling commissions, marketing support and due diligence expense reimbursement
fees and offering expenses, net proceeds to the Company from its Initial
Offering totalled approximately $134,000,000. As of March 27, 1997, the Company
had invested or committed for investment approximately $120,500,000 of net
proceeds from the Initial Offering in 123 Properties, in providing mortgage
financing to the tenants of the 43 Properties consisting of land only through
Mortgage Loans, and in paying acquisition fees to the Advisor totalling
$6,776,629 and certain acquisition expenses, leaving approximately $13,500,000
in net offering proceeds from the Initial Offering available for investment in
Properties and Mortgage Loans. The Company expects to use such amount and Net
Offering Proceeds from this offering to invest in additional Properties and
Mortgage Loans.
BUSINESS
PROPERTY ACQUISITIONS
Between March 7, 1997 and March 27, 1997, the Company acquired 13
Properties, including one Property consisting of land and building, four
Properties consisting of building only and eight Properties consisting of land
only. These Properties are a Jack in the Box Property (in Houston, Texas), four
Black-eyed Pea Properties (one in each of Bedford, Dallas and Fort Worth, Texas;
and Oklahoma City, Oklahoma) and eight Pizza Hut Properties (one in each of
Wellsburg, West Virginia; Bolivar, Carrollton, Millersburg, Steubenville and
Uhrichsville, and two in New Philadelphia, Ohio) (hereinafter referred to as the
"Eight Pizza Hut Properties"). For information regarding the 110 Properties
acquired by the Company prior to March 7, 1997, see the Prospectus dated January
31, 1997 and the Prospectus Supplement dated March 17, 1997.
APRIL 2, 1997 PROSPECTUS DATED JANUARY 31, 1997
<PAGE>
In connection with the purchase of the Jack in the Box Property, which
is land and building, the Company, as lessor, entered into a long-term lease
agreement with an unaffiliated lessee. The general terms of the lease agreement
are described in the section of the Prospectus entitled "Business - Description
of Property Leases." In addition, in connection with the purchase of this
Property, which is to be constructed, the Company has entered into development
and indemnification and put agreements with the lessee. The general terms of
these agreements are described in the section of the Prospectus entitled
"Business - Site Selection and Acquisition of Properties - Construction and
Renovation."
In connection with the Black-eyed Pea Properties in Bedford, Dallas and
Fort Worth, Texas; and Oklahoma City, Oklahoma, which are building only, the
Company, as lessor, entered into long-term lease agreements with unaffiliated
lessees. The general terms of the lease agreements are described in the section
of the Prospectus entitled "Business - Description of Property Leases." In
addition, the Company has entered into landlord estoppel agreements with the
landlords of the land and collateral assignments of the ground leases with the
lessees in order to provide the Company with certain rights with respect to the
land on which the buildings are located.
In connection with the Eight Pizza Hut Properties, which are land only,
the Company acquired the land and is leasing these eight parcels to the lessee,
Castle Hill Holdings VII, L.L.C. ("Castle Hill"), pursuant to a master lease
agreement (the "Master Lease Agreement"). Castle Hill has subleased the Eight
Pizza Hut Properties to one of its affiliates, Midland Food Services III,
L.L.C., which is the operator of the restaurants. The general terms of the
Master Lease Agreement are similar to those described in the section of the
Prospectus entitled "Business - Description of Property Leases." If the lessee
does not exercise its option to purchase the Properties upon termination of the
Master Lease Agreement, the sublessee and lessee will surrender possession of
the Properties to the Company, together with any improvements on such
Properties. The lessee owns the buildings located on the Eight Pizza Hut
Properties. In addition, the Company provided mortgage financing of $4,200,000
to the lessee of the Eight Pizza Hut Properties pursuant to a Mortgage Loan
evidenced by a master mortgage note (the "Master Mortgage Note") which is
collateralized by the building improvements on the Eight Pizza Hut Properties,
the Pizza Hut property in Dover, Ohio, not yet acquired by the Company, and two
additional Pizza Hut Properties in Wintersville, Ohio, and Weirton, West
Virginia, which will not be owned by the Company. The Master Mortgage Note bears
interest at a rate of 10.50% per annum and principal and interest are due in
equal monthly installments over 20 years starting May 1, 1997. The Master
Mortgage Note equals approximately 88 percent of the appraised value of the
related buildings. Management believes that, due to the fact that the Company
owns the underlying land relating to the Eight Pizza Hut Properties and
anticipates owning the land relating to the property in Dover, Ohio, and due to
other underwriting criteria, the Company has sufficient collateral for the
Master Mortgage Note.
The following table sets forth the location of the 13 Properties,
including one Property consisting of land and building, four Properties
consisting of building only and eight Properties consisting of land only,
acquired by the Company, from March 7, 1997 through March 27, 1997, a
description of the competition, and a summary of the principal terms of the
acquisition and lease of each Property.
- 2 -
<PAGE>
<TABLE>
<CAPTION>
Lease Expira-
Purchase Date tion and Minimum
Property Location and Competition Price (1) Acquired Renewal Options Annual Rent (2)
<S> <C>
Jack in the Box $905,945 03/18/97 03/2015; four $92,859 (5); increases
(the "Houston #4 Property") (3)(5) five-year renewal by 8% after the fifth
Restaurant to be constructed options lease year and after
every five years
The Houston #4 Property is located on
the thereafter during the annual rent
for such southeast corner of Hempstead
Highway and lease term lease year (4)
34th Street, in Houston, Harris County,
Texas, in an area of mixed commercial
and residential development.
Black-eyed Pea (6)(9) $620,336 03/26/97 06/2013 $79,560; increases to
(the "Bedford Property") $81,950 during the
Existing restaurant eleventh through
sixteenth lease years
The Bedford Property is located within
the northeast quadrant of State Highway
121 and Parkwood Drive, in Bedford,
Tarrant County, Texas, in an area of
mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the Bedford Property
include several local restaurants.
</TABLE>
<TABLE>
<CAPTION>
Option
Property Location and Competition Percentage Rent To Purchase
<S> <C>
Jack in the Box for each lease year, at any time after
(the "Houston #4 Property") (i) 5% of annual the seventh lease
Restaurant to be constructed gross sales minus year
(ii) the minimum
The Houston #4 Property is located on
the thereafter during the annual rent
for such southeast corner of Hempstead
Highway and lease term lease year (4)
34th Street, in Houston, Harris County,
Texas, in an area of mixed commercial
and residential development.
Black-eyed Pea (6)(9) None at any time after
(the "Bedford Property") the fifth lease
Existing restaurant year
The Bedford Property is located within
the northeast quadrant of State Highway
121 and Parkwood Drive, in Bedford,
Tarrant County, Texas, in an area of
mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the Bedford Property
include several local restaurants.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Lease Expira-
Purchase Date tion and Minimum
Property Location and Competition Price (1) Acquired Renewal Options Annual Rent (2)
<S> <C>
Black-eyed Pea (6)(9) $620,320 03/26/97 05/2016 $75,182; increases to
(the "Dallas Property") $78,294 during the
Existing restaurant eleventh through
nineteenth lease
years
The Dallas Property is located on the
south side of West Northwest Highway
between Loop 12 and Interstate Highway
35E, in Dallas, Dallas County, Texas, in
an area of mixed retail, commercial, and
residential development. Other
fast-food and family- style restaurants
located in proximity to the Dallas
Property include an Olive Garden, a Red
Lobster, a Chili's, a Tony Roma's, and
several local restaurants.
Black-eyed Pea (6)(9) $620,323 03/26/97 04/2011 $84,305; increases to
(the "Forth Worth Property") $86,048 during the
Existing restaurant eleventh through
fourteenth lease
years
The Fort Worth Property is located on the
south side of Camp Bowie Boulevard between
Hillsdale Road and Bernie Anderson Avenue,
in Fort Worth, Tarrant County, Texas, in a
area of mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the Fort Worth Property
include a McDonald's, a Boston Market, and
several local restaurants.
</TABLE>
<TABLE>
<CAPTION>
Option
Property Location and Competition Percentage Rent To Purchase
<S> <C>
Black-eyed Pea (6)(9) None at any time after
(the "Dallas Property") the fifth lease
Existing restaurant year
The Dallas Property is located on the
south side of West Northwest Highway
between Loop 12 and Interstate Highway
35E, in Dallas, Dallas County, Texas, in
an area of mixed retail, commercial, and
residential development. Other
fast-food and family- style restaurants
located in proximity to the Dallas
Property include an Olive Garden, a Red
Lobster, a Chili's, a Tony Roma's, and
several local restaurants.
Black-eyed Pea (6)(9) None at any time after
(the "Forth Worth Property") the fifth lease
Existing restaurant year
The Fort Worth Property is located on the
south side of Camp Bowie Boulevard between
Hillsdale Road and Bernie Anderson Avenue,
in Fort Worth, Tarrant County, Texas, in a
area of mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the Fort Worth Property
include a McDonald's, a Boston Market, and
several local restaurants.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Lease Expira-
Purchase Date tion and Minimum
Property Location and Competition Price (1) Acquired Renewal Options Annual Rent (2)
<S> <C>
Black-eyed Pea (6) $617,022 03/26/97 04/2012 $81,660; increases to
(the "Oklahoma City Property") $83,680 during the
Existing restaurant eleventh through
fifteenth lease years
The Oklahoma City Property is located on
the south side of Interstate Highway 240,
east of South Pennsylvania Avenue, in
Oklahoma City, Oklahoma County, Oklahoma,
in an area of mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the Oklahoma City Property
include a Hardee's, a Denny's, a Ryan's
Family Steak House, a Wendy's, a Western
Sizzlin, a Golden Corral, and several local
restaurants.
Eight Pizza Hut Properties - Land only - $1,575,622 03/27/97 03/2017; two ten- $165,440 (9) ;
(7)(8) located in Bolivar, Ohio (the year renewal increases by 10% after
"Bolivar Property"), Carrollton, Ohio (the options the fifth and tenth
"Carrollton Property"), Millersburg, Ohio lease years and 12%
(the "Millersburg Property"), New after the fifteenth
Philadelphia, Ohio (the "New Philadelphia lease year
#1 Property"), New Philadelphia, Ohio (the
"New Philadelphia #2 Property"),
Steubenville, Ohio (the "Steubenville
Property"), Uhrichsville, Ohio (the
"Uhrichsville Property") and Wellsburg,
West Virginia (the "Wellsburg Property")
</TABLE>
<TABLE>
<CAPTION>
Option
Property Location and Competition Percentage Rent To Purchase
<S> <C>
Black-eyed Pea (6) None at any time after
(the "Oklahoma City Property") the fifth lease
Existing restaurant year
The Oklahoma City Property is located on
the south side of Interstate Highway 240,
east of South Pennsylvania Avenue, in
Oklahoma City, Oklahoma County, Oklahoma,
in an area of mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the Oklahoma City Property
include a Hardee's, a Denny's, a Ryan's
Family Steak House, a Wendy's, a Western
Sizzlin, a Golden Corral, and several local
restaurants.
Eight Pizza Hut Properties - Land only - None at any time after
(7)(8) located in Bolivar, Ohio (the the seventh lease
"Bolivar Property"), Carrollton, Ohio (the year
"Carrollton Property"), Millersburg, Ohio
(the "Millersburg Property"), New
Philadelphia, Ohio (the "New Philadelphia
#1 Property"), New Philadelphia, Ohio (the
"New Philadelphia #2 Property"),
Steubenville, Ohio (the "Steubenville
Property"), Uhrichsville, Ohio (the
"Uhrichsville Property") and Wellsburg,
West Virginia (the "Wellsburg Property")
</TABLE>
- 5 -
<PAGE>
<TABLE>
<CAPTION>
Lease Expira-
Purchase Date tion and Minimum
Property Location and Competition Price (1) Acquired Renewal Options Annual Rent (2)
<S> <C>
The Bolivar Property is located on the
north side of Edgebrook Boulevard just west
of State Road 212 and east of Wilkshire
Boulevard, in Bolivar, Tuscarawas County,
Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family-style
restaurants located in proximity to the
Bolivar Property include a McDonald's, a
Wendy's, and several local restaurants.
The Carrollton Property is located on the
east side of Canton Road Northwest, in
Carrollton, Carroll County, Ohio, in an
area of mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the Carrollton Property
include a Dairy Queen, a McDonald's, a
Subway Sandwich Shop, and several local
restaurants.
The Millersburg Property is located on the
east side of State Road 83 just south of
Country Road 58, in Millersburg, Holmes
County, Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family-style
restaurants located in proximity to the
Millersburg Property include a McDonald's,
a Subway Sandwich Shop, and several local
restaurants.
</TABLE>
<TABLE>
<CAPTION>
Option
Percentage Rate To Purchase
Property Location and Competition
<S> <C>
The Bolivar Property is located on the
north side of Edgebrook Boulevard just west
of State Road 212 and east of Wilkshire
Boulevard, in Bolivar, Tuscarawas County,
Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family-style
restaurants located in proximity to the
Bolivar Property include a McDonald's, a
Wendy's, and several local restaurants.
The Carrollton Property is located on the
east side of Canton Road Northwest, in
Carrollton, Carroll County, Ohio, in an
area of mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the Carrollton Property
include a Dairy Queen, a McDonald's, a
Subway Sandwich Shop, and several local
restaurants.
The Millersburg Property is located on the
east side of State Road 83 just south of
Country Road 58, in Millersburg, Holmes
County, Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family-style
restaurants located in proximity to the
Millersburg Property include a McDonald's,
a Subway Sandwich Shop, and several local
restaurants.
</TABLE>
- 6 -
<PAGE>
<TABLE>
<CAPTION>
Lease Expira-
Purchase Date tion and Minimum
Property Location and Competition Price (1) Acquired Renewal Options Annual Rent (2)
<S> <C>
The New Philadelphia #1 Property is located
on the north side of West High Avenue east
of its intersection with 12th Street, in
New Philadelphia, Tuscarawas County, Ohio,
in an area of mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the New Philadelphia #1
Property include a Burger King, a Long John
Silver's, a Taco Bell, a Denny's, an Elby's
Big Boy, a Hardee's, McDonald's, and
several local restaurants.
The New Philadelphia #2 Property is located
on the east side of Fourth Street
Northwest, in New Philadelphia, Tuscarawas
County, Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family-style
restaurants located in proximity to the New
Philadelphia Property include a Burger
King, a McDonald's, an Arby's, a Wendy's,
and a Papa John's.
</TABLE>
<TABLE>
<CAPTION>
Option
Property Location and Competition Percentage Rent To Purchase
<S> <C>
The New Philadelphia #1 Property is located
on the north side of West High Avenue east
of its intersection with 12th Street, in
New Philadelphia, Tuscarawas County, Ohio,
in an area of mixed retail, commercial, and
residential development. Other fast-food
and family-style restaurants located in
proximity to the New Philadelphia #1
Property include a Burger King, a Long John
Silver's, a Taco Bell, a Denny's, an Elby's
Big Boy, a Hardee's, McDonald's, and
several local restaurants.
The New Philadelphia #2 Property is located
on the east side of Fourth Street
Northwest, in New Philadelphia, Tuscarawas
County, Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family-style
restaurants located in proximity to the New
Philadelphia Property include a Burger
King, a McDonald's, an Arby's, a Wendy's,
and a Papa John's.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Lease Expira-
Purchase Date tion and Minimum
Property Location and Competition Price (1) Acquired Renewal Options Annual Rent (2)
<S> <C>
The Steubenville Property is located on the
north side of Sunset Boulevard, west of
U.S. 22, in Steubenville, Jefferson County,
Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family-style
restaurants located in proximity to the
Steubenville Property include a McDonald's,
a Burger King, a Taco Bell, and a Bob
Evans.
The Uhrichsville Property is located on the
west side of Commerce Drive, and also has
frontage along the easterly right-of-way of
U.S. 250, in Uhrichsville, Tuscarawas
County, Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family- style
restaurants located in proximity to the
Uhrichsville Property include an Arby's, a
KFC, a McDonald's, and several local
restaurants.
The Wellsburg Property is located on the
west side of Commerce Street, in Wellsburg,
Brooke County, West Virginia, in an area of
mixed retail, commercial, and residential
development. Other fast-food and family-
style restaurants located in proximity to
the Wellsburg Property include a Dairy
Queen and a Wendy's.
</TABLE>
<TABLE>
<CAPTION>
Option
Property Location and Competition Percentage Rent To Purchase
<S> <C>
The Steubenville Property is located on the
north side of Sunset Boulevard, west of
U.S. 22, in Steubenville, Jefferson County,
Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family-style
restaurants located in proximity to the
Steubenville Property include a McDonald's,
a Burger King, a Taco Bell, and a Bob
Evans.
The Uhrichsville Property is located on the
west side of Commerce Drive, and also has
frontage along the easterly right-of-way of
U.S. 250, in Uhrichsville, Tuscarawas
County, Ohio, in an area of mixed retail,
commercial, and residential development.
Other fast-food and family- style
restaurants located in proximity to the
Uhrichsville Property include an Arby's, a
KFC, a McDonald's, and several local
restaurants.
The Wellsburg Property is located on the
west side of Commerce Street, in Wellsburg,
Brooke County, West Virginia, in an area of
mixed retail, commercial, and residential
development. Other fast-food and family-
style restaurants located in proximity to
the Wellsburg Property include a Dairy
Queen and a Wendy's.
</TABLE>
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<PAGE>
FOOTNOTES:
(1) The estimated federal income tax basis of the depreciable portion (the
building portion) of each of the Properties acquired, and for
construction Properties, once the buildings are constructed, is set
forth below:
Property Federal Tax Basis
Houston #4 Property $539,000
Bedford Property 653,000
Dallas Property 652,000
Fort Worth Property 653,000
Oklahoma City Property 649,000
(2) Minimum annual rent for each of the Properties became payable on the
effective date of the lease.
(3) The development agreement for the Houston #4 Property, which is to be
constructed, provides that construction must be completed no later than
the date set forth below. The maximum cost to the Company, (including
the purchase price of the land (if applicable), development costs (if
applicable), and closing and acquisition costs) is not expected to, but
may, exceed the amount set forth below:
<TABLE>
<CAPTION>
Property Estimated Maximum Cost Estimated Final Completion Date
<S> <C>
Houston #4 Property $ 905,945 September 14, 1997
</TABLE>
(4) Percentage rent shall be calculated on a calendar year basis (January 1
to December 31).
(5) The Company paid for all construction costs in advance at closing;
therefore, minimum annual rent was determined on the date acquired and
is not expected to change.
(6) The Company owns the building only for this Property. The Company does
not own the underlying land; although, the Company entered into a
landlord estoppel agreement with the landlord of the land and a
collateral assignment of the ground lease with the lessee in order to
provide the Company with certain rights with respect to the land on
which the building is located.
(7) The lease relating to this Property is a land lease only. The Company
entered into a Mortgage Loan evidenced by a Master Mortgage Note for
$4,200,000 collateralized by building improvements. The Master Mortgage
Note bears interest at a rate of 10.50% per annum and principal and
interest will be collected in equal monthly installments over 20 years
beginning in May 1997.
(8) The Company entered into a Master Lease Agreement for the Bolivar,
Carrollton, Millersburg, New Philadelphia #1, New Philadelphia #2,
Steubenville and Uhrichsville, Ohio, and Wellsburg, West Virginia
Properties.
(9) The lessee of the Bedford, Dallas, and Forth Worth Properties is the
same unaffiliated lessee.
- 9 -
<PAGE>
BORROWING AND SECURED EQUIPMENT LEASES
Between March 7, 1997 and March 27, 1997, the Company obtained one
advance totalling $313,072 under its $15,000,000 Loan. This advance was the
final advance relating to the acquisition of Equipment for the restaurant
property in Hopkinsville, Kentucky (the "Hopkinsville Secured Equipment Lease").
PENDING INVESTMENTS
As of March 27, 1997, the Company had initial commitments to acquire 19
properties, including 17 properties consisting of land and building, one
property consisting of building only and one property consisting of land only.
The acquisition of each of these properties is subject to the fulfillment of
certain conditions, including, but not limited to, a satisfactory environmental
survey and property appraisal. There can be no assurance that any or all of the
conditions will be satisfied or, if satisfied, that one or more of these
properties will be acquired by the Company. If acquired, the leases of all 19 of
these properties are expected to be entered into on substantially the same terms
described in the section of the Prospectus entitled "Business Description of
Property Leases," except as described below.
In connection with the one Pizza Hut property consisting of land only,
the Company anticipates acquiring the land and leasing it to the tenant, Castle
Hill, pursuant to the master lease agreement for the Eight Pizza Hut Properties
acquired on March 27, 1997.
In connection with the Black-eyed Pea property in Scottsdale, Arizona,
the Company anticipates owning only the building and not the underlying land.
However, the Company anticipates entering into a landlord estoppel agreement
with the landlord of the land and a collateral assignment of the ground lease
with the lessee in order to provide the Company with certain rights with respect
to the land on which the building is located.
Set forth below are summarized terms expected to apply to the leases
for each of the properties. More detailed information relating to a property and
its related lease will be provided at such time, if any, as the property is
acquired.
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<PAGE>
<TABLE>
<CAPTION>
Lease Term and
Property Renewal Options Minimum Annual Rent
<S> <C>
Bennigan's 15 years; three five-year renewal 10.375% of the Company's total
Arvada, CO options cost to purchase the property;
Existing restaurant increases by 10% after the
fifth lease year and after
every five years thereafter
during the lease term
Black-eyed Pea (3) 14 years 13.66% of Total Cost (1)
Scottsdale, AZ
Restaurant to be renovated
Boston Market 15 years; five five-year renewal 10.38% of Total Cost (1);
Arvada, CO options increases by 10% after the
Restaurant to be constructed fifth lease year and after
every five years thereafter
during the lease term
Boston Market 15 years; five five-year renewal 10.38% of Total Cost (1);
Cedar Park, TX options increases by 10% after the
Restaurant to be constructed fifth lease year and after
every five years thereafter
during the lease term
Boston Market 15 years; five five-year renewal 10.38% of Total Cost (1);
Collinsville, IL options increases by 10% after the
Restaurant to be constructed fifth lease year and after
every five years thereafter
during the lease term
Boston Market 15 years; five five-year renewal 10.38% of Total Cost (1);
Indianapolis, IN options increases by 10% after the
Restaurant to be constructed fifth lease year and after
every five years thereafter
during the lease term
</TABLE>
<TABLE>
<CAPTION>
Property Percentage Rent Option to Purchase
<S> <C>
Bennigan's for each lease year, (i) 6% at any time after the fifth
Arvada, CO of annual gross sales minus lease year
Existing restaurant (ii) the minimum annual rent
for such lease year
Black-eyed Pea (3) None (6)
Scottsdale, AZ
Restaurant to be renovated
Boston Market for each lease year after the at any time after the fifth
Arvada, CO fifth lease year, (i) 4% of lease year
Restaurant to be constructed annual gross sales minus (ii)
the minimum annual rent for
such lease year
Boston Market for each lease year after the at any time after the fifth
Cedar Park, TX fifth lease year, (i) 4% of lease year
Restaurant to be constructed annual gross sales minus (ii)
the minimum annual rent for
such lease year
Boston Market for each lease year after the at any time after the fifth
Collinsville, IL fifth lease year, (i) 5% of lease year
Restaurant to be constructed annual gross sales minus (ii)
the minimum annual rent for
such lease year
Boston Market for each lease year after the at any time after the fifth
Indianapolis, IN fifth lease year, (i) 4% of lease year
Restaurant to be constructed annual gross sales minus (ii)
the minimum annual rent for
such lease year
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
Lease Term and
Property Renewal Options Minimum Annual Rent
<S> <C>
Boston Market 15 years; five five-year renewal 10.38% of Total Cost (1);
Lansing, MI options increases by 10% after the
Restaurant to be constructed fifth lease year and after
every five years thereafter
during the lease term
Boston Market 15 years; five five-year renewal 10.38% of Total Cost (1);
Taylorsville, UT options increases by 10% after the
Restaurant to be constructed fifth lease year and after
every five years thereafter
during the lease term
Burger King 20 years; two five-year renewal 11% of Total Cost (1)
Ooltewah, TN options
Restaurant to be constructed
Golden Corral 15 years; four five-year renewal 10.75% of Total Cost (1)
Jacksonville, FL options
Restaurant to be constructed
IHOP 20 years; three five-year renewal 10.125% of the Company's total
Fairfax, VA options cost to purchase the property;
Existing restaurant increases by 10% after the
fifth lease year and after
every five years thereafter
during the lease term
IHOP 20 years; three five-year renewal 10.125% of the Company's total
Hollywood, CA options cost to purchase the property;
Existing restaurant increases by 10% after the
fifth lease year and after
every five years thereafter
during the lease term
</TABLE>
<TABLE>
<CAPTION>
Property Percentage Rent Option to Purchase
<S> <C>
Boston Market for each lease year after the at any time after the fifth
Lansing, MI fifth lease year, (i) 4% of lease year
Restaurant to be constructed annual gross sales minus (ii)
the minimum annual rent for
such lease year
Boston Market for each lease year after the at any time after the fifth
Taylorsville, UT fifth lease year, (i) 4% of lease year
Restaurant to be constructed annual gross sales minus (ii)
the minimum annual rent for
such lease year
Burger King for each lease year, (i) 8.5% None
Ooltewah, TN of annual gross sales minus
Restaurant to be constructed (ii) the minimum annual rent
for such lease year
Golden Corral for each lease year, 5% of during the first through
Jacksonville, FL the amount by which annual seventh lease years and the
Restaurant to be constructed gross sales exceed a to be tenth through fifteenth
determined breakpoint lease years only
IHOP for each lease year, (i) 4% during the eleventh lease
Fairfax, VA of annual gross sales minus year and at the end of the
Existing restaurant (ii) the minimum annual rent initial lease term
for such lease year
IHOP for each lease year, (i) 4% during the eleventh lease
Hollywood, CA of annual gross sales minus year and at the end of the
Existing restaurant (ii) the minimum annual rent initial lease term
for such lease year
</TABLE>
- 12 -
<PAGE>
<TABLE>
<CAPTION>
Lease Term and
Property Renewal Options Minimum Annual Rent
<S> <C>
IHOP 20 years; three five-year renewal 10.125% of the Company's total
Leesburg, VA options cost to purchase the property;
Existing restaurant increases by 10% after the
fifth lease year and after
every five years thereafter
during the lease term
Jack in the Box 18 years; four five-year renewal 10.25% of Total Cost (1);
Bacliff, TX options increases by 8% after the fifth
Restaurant to be constructed lease year and after every five
years thereafter during the
lease term
Jack in the Box 18 years; four five-year renewal 10.25% of Total Cost (1);
Enunclaw, WA options increases by 8% after the fifth
Restaurant to be constructed lease year and after every five
years thereafter during the
lease term
Jack in the Box 18 years; four five-year renewal 10.25% of Total Cost (1);
Fresno, CA options increases by 8% after the fifth
Restaurant to be constructed lease year and after every five
years thereafter during the
lease term
Jack in the Box 18 years; four five-year renewal 10.25% of Total Cost (1);
Oxnard, CA options increases by 8% after the fifth
Restaurant to be constructed lease year and after every five
years thereafter during the
lease term
Pizza Hut (3)(4) 20 years; two ten-year renewal 10.50% of the Company's total
Dover, OH options cost to purchase the land;
Land only increases by 10% after the
fifth and tenth lease years and
12% after the fifteenth lease
year
</TABLE>
<TABLE>
<CAPTION>
Property Percentage Rent Option to Purchase
<S> <C>
IHOP for each lease year, (i) 4% during the eleventh lease
Leesburg, VA of annual gross sales minus year and at the end of the
Existing restaurant (ii) the minimum annual rent initial lease term
for such lease year
Jack in the Box for each lease year, (i) 5% at any time after the
Bacliff, TX of annual gross sales minus seventh lease year (2)
Restaurant to be constructed (ii) the minimum annual rent
for such lease year
Jack in the Box for each lease year, (i) 5% at any time after the
Enunclaw, WA of annual gross sales minus seventh lease year (2)
Restaurant to be constructed (ii) the minimum annual rent
for such lease year
Jack in the Box for each lease year, (i) 5% at any time after the
Fresno, CA of annual gross sales minus seventh lease year (2)
Restaurant to be constructed (ii) the minimum annual rent
for such lease year
Jack in the Box for each lease year, (i) 5% at any time after the
Oxnard, CA of annual gross sales minus seventh lease year (2)
Restaurant to be constructed (ii) the minimum annual rent
for such lease year
Pizza Hut (3)(4) None at any time after the
Dover, OH seventh lease year
Land only
</TABLE>
- 13 -
<PAGE>
<TABLE>
<CAPTION>
Lease Term and
Property Renewal Options Minimum Annual Rent
<S> <C>
Shoney's 20 years; two five-year renewal 11% of Total Cost; increases by
Phoenix, AZ options 10% after the fifth lease year
Restaurant to be constructed and after every five years
thereafter during the lease
term (1)
</TABLE>
<TABLE>
<CAPTION>
Property Percentage Rent Option to Purchase
<S> <C>
Shoney's for each lease year, (i) 6% at any time after the
Phoenix, AZ of annual gross sales minus seventh lease year
Restaurant to be constructed (ii) the minimum annual rent
for such lease year
</TABLE>
FOOTNOTES:
(1) The "Total Cost" is equal to the sum of (i) the purchase price of the
property, (ii) closing costs, and (iii) actual development costs
incurred under the development agreement.
(2) In the event the Company purchases the property directly from the
lessee, the lessee will have no option to purchase the property.
(3) The lease relating to this property is a land lease only. The Company
has entered into a master mortgage note receivable collateralized by
the Dover building improvements and the building improvements of the
Eight Pizza Hut Properties acquired by the Company on March 27, 1997.
(4) The Company has entered into a master lease agreement for this property
and the Eight Pizza Hut Properties acquired by the Company on March 27,
1997.
- 14 -
<PAGE>
PRO FORMA ESTIMATE OF TAXABLE INCOME BEFORE DIVIDENDS PAID DEDUCTION OF
CNL AMERICAN PROPERTIES FUND, INC.
GENERATED FROM THE OPERATIONS OF PROPERTIES ACQUIRED FROM MARCH 7, 1997
THROUGH MARCH 27, 1997
FOR A 12-MONTH PERIOD (UNAUDITED)
The following schedule represents pro forma unaudited estimates of
taxable income before dividends paid deduction of each Property acquired by the
Company from March 7, 1997 through March 27, 1997, for the 12-month period
commencing on the date of the inception of the respective lease on such
Property. The schedule should be read in light of the accompanying footnotes.
These estimates do not purport to present actual or expected operations
of the Company for any period in the future. These estimates were prepared on
the basis described in the accompanying notes which should be read in
conjunction herewith. No single lessee or group of affiliated lessees lease
Properties or has borrowed funds from the Company with an aggregate purchase
price in excess of 20% of the expected total net offering proceeds of the
Company.
<TABLE>
<CAPTION>
Jack in the Box Black-eyed Pea Black-eyed Pea
Houston #4, TX (5) Bedford, TX (8) Dallas, TX (8)
------------------ --------------- --------------
<S> <C>
Pro Forma Estimate of Taxable
Income Before Dividends Paid
Deduction:
Base Rent (1) $ 92,859 $ 79,560 $ 75,182
Interest Income (2) - - -
-------- -------- -------
Total Revenues 92,859 79,560 75,182
-------- -------- --------
Asset Management Fees (3) (5,430) (3,716) (3,716)
Mortgage Management Fee (4) - - -
General and Administrative
Expenses (5) (5,757) (4,933) (4,661)
-------- -------- --------
Total Operating Expenses (11,187) (8,649) (8,377)
-------- -------- --------
Estimated Cash Available from
Operations 81,672 70,911 66,805
Depreciation and Amortization
Expense (6) (13,833) (16,731) (16,731)
-------- -------- --------
Pro Forma Estimate of Taxable
Income Before Dividends Paid
Deduction of the Company $ 67,839 $ 54,180 $ 50,074
======== ======== ========
</TABLE>
SEE FOOTNOTES
- 15 -
<PAGE>
<TABLE>
<CAPTION>
Black-eyed Pea Black-eyed Pea Eight Pizza Hut
Fort Worth, TX (8) Oklahoma City, OK Properties Total
------------------ ----------------- --------------- -----
<S> <C>
Pro Forma Estimate of Taxable
Income Before Dividends Paid
Deduction:
Base Rent (1) $ 84,305 $ 81,660 $165,440 $ 579,006
Interest Income (2) - - 437,918 437,918
-------- -------- -------- ---------
Total Revenues 84,305 81,660 603,358 1,016,924
-------- -------- -------- ---------
Asset Management Fees (3) (3,716) (3,696) (9,454) (29,728)
Mortgage Management Fee (4) - - (25,200) (25,200)
General and Administrative
Expenses (5) (5,227) (5,063) (37,408) (63,049)
-------- -------- -------- ---------
Total Operating Expenses (8,943) (8,759) (72,062) (117,977)
-------- -------- -------- ---------
Estimated Cash Available from
Operations 75,362 72,901 531,296 898,947
Depreciation and Amortization
Expense (6) (16,731) (16,642) (11,340) (92,008)
-------- -------- -------- ---------
Pro Forma Estimate of Taxable
Income Before Dividends Paid
Deduction of the Company $ 58,631 $ 56,259 $519,956 $ 806,939
======== ======== ======== =========
</TABLE>
- 16 -
<PAGE>
FOOTNOTES:
(1) Base rent does not include percentage rents which become due if
specified levels of gross receipts are achieved.
(2) The Company entered into a Master Mortgage Note agreement for
$4,200,000, collateralized by building improvements located on the
Eight Pizza Hut Properties, the Pizza Hut property in Dover, Ohio, and
two additional Pizza Hut Properties in Wintersville, Ohio, and Weirton,
West Virginia. The Master Mortgage Note bears interest at a rate of
10.50% per annum and principal and interest will be collected in equal
monthly installments over 20 years beginning in May 1997. Amount does
not include $21,000 of loan commitment fees and $21,000 in loan
origination fees collected by the Company at closing from the borrower.
(3) The Properties will be managed pursuant to an advisory agreement
between the Company and CNL Fund Advisors, Inc. (the "Advisor"),
pursuant to which the Advisor will receive monthly asset management
fees in an amount equal to one-twelfth of .60% of the Company's Real
Estate Asset Value as of the end of the preceding month as defined in
such agreement. See "Management Compensation."
(4) For managing the Mortgage Loans, the Advisor will be entitled to
receive a monthly mortgage management fee of one-twelfth of .60% of the
total principal amount of the Mortgage Loans as of the end of the
preceding month. See "Management Compensation."
(5) Estimated at 6.2% of gross rental and interest income based on the
previous experience of Affiliates of the Advisor with 17 public limited
partnerships which own properties similar to those owned by the
Company. Amount does not include soliciting dealer servicing fee due to
the fact that such fee will not be incurred until December 31 of the
year following the year in which the offering terminates.
(6) The estimated federal tax basis of the depreciable portion (the
building portion) of each Property has been depreciated on the
straight-line method over 39 years. In connection with the Eight Pizza
Hut Properties, the Pizza Hut property in Dover, Ohio, and the two
additional Pizza Hut Properties in Wintersville, Ohio, and Weirton,
West Virginia, acquisition fees allocated to the Master Mortgage Note
have been amortized on a straight-line basis over the life of the
agreement (20 years).
(7) The development agreement for the Property which is to be constructed,
provides that construction must be completed no later than the date
set forth below:
<TABLE>
<CAPTION>
Property Estimated Final Completion Date
<S> <C>
Houston #4 Property September 14, 1997
</TABLE>
(8) The lessee of the Bedford, Dallas, and Forth Worth Properties is the
same unaffiliated lessee.
- 17 -
