SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 21, 1997
CNL INCOME FUND XVIII, LTD.
(Exact Name of Registrant as Specified in Charter)
Florida 33-90998-01 59-3295394
(State or other juris- (Commission File Number) (IRS Employer
diction of incorporation) Identification No.)
400 East South Street, Suite 500 32801
Orlando, Florida (Zip Code)
(Address of principal executive offices)
Registrant's telephone number, including area code: (407) 422-1574
ITEM 1. CHANGES IN CONTROL OF REGISTRANT.
Not applicable.
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS.
STATUS OF THE OFFERING
Pursuant to a registration statement on Form S-11 under the
Securities Act of 1933, as amended, effective August 11, 1995 (the
"Registration Statement"), CNL Income Fund XVII, Ltd. ("CNL XVII") and CNL
Income Fund XVIII, Ltd. ("CNL XVIII"), limited partnerships with the same
general partners and investment objectives, registered for sale an aggregate
of $65,000,000 of units of limited partnership interest (the "Units")
(6,500,000 Units at $10 per Unit). The first 3,000,000 Units ($30,000,000)
were for CNL XVII, and the remaining Units are for CNL XVIII. The offering of
Units of CNL XVII terminated on September 19, 1996, at which time
subscriptions for an aggregate 3,000,000 Units ($30,000,000), including Units
sold pursuant to the Reinvestment Plan, had been received and 1,602
subscribers had been admitted as Limited Partners in accordance with the
Partnership Agreement of CNL XVII. Pursuant to the registration statement,
CNL XVIII's offering of Units could not commence until the offering of Units
of CNL XVII was terminated. CNL XVIII's offering commenced on September 20,
1996. As of May 22, 1997, CNL XVIII had received subscription proceeds of
$19,654,664 (1,965,466 Units) from 950 Limited Partners.
As stated in the Registration Statement, including the Prospectus
which constitutes a part thereof, as supplemented and amended, the proceeds of
the offering of Units are to be used to acquire restaurant properties to be
leased primarily to operators of national and regional fast-food, family-
style, and casual dining restaurant chains (the "Properties"), to pay expenses
in connection with the offering of Units and to pay partnership organizational
costs.
ACQUISITION OF PROPERTIES
From May 13, 1997 through May 22, 1997, CNL XVIII acquired two
Properties. The Properties are a Golden Corral Property (in Elizabethtown,
Kentucky) and an IHOP Property (in Santa Rosa, California).
In connection with the purchase of each of these two Properties, CNL
XVIII, as lessor, entered into a long-term lease agreement with an
unaffiliated lessee. The leases are on a triple-net basis, with the lessee
responsible for all repairs and maintenance, property taxes, insurance and
utilities. The lessee also is required to pay for special assessments, sales
and use taxes, and the cost of any renovations permitted under the lease.
Upon termination of the lease, the lessee will surrender possession of the
Property to CNL XVIII, together with any improvements made to the Property
during the term of the lease. In addition, in connection with the purchase of
the Property which is to be constructed, CNL XVIII has entered into
development and indemnification and put agreements with the lessee.
The following table sets forth the location of the two Properties
consisting of land and building, acquired by CNL XVIII from May 13, 1997
through May 22, 1997, a description of the competition, and a summary of the
principal terms of the acquisition and lease of each Property.
-1-
<TABLE>
PROPERTY ACQUISITIONS
From May 13, 1997 through May 22, 1997
<CAPTION>
Lease Expira-
Property Location and Purchase Date tion and Minimum Option
Competition Price (1) Acquired Renewal Options Annual Rent (2) Percentage Rent To Purchase
- --------------------- ------------ -------- --------------- --------------- --------------- -----------
<S> <C> <C> <C> <C> <C> <C>
GOLDEN CORRAL $446,180 05/21/97 05/2012; four 10.75% of Total for each lease during the
(the "Elizabethtown (excluding five-year Cost (4) year, 5% of the first
Property") closing and renewal options amount by which through
Restaurant to be development annual gross seventh
constructed costs) (3) sales exceed lease years
$2,697,649 (5) and the
The Elizabethtown Property tenth
is located on the east side through
of North Dixie Avenue, in fifteenth
Elizabethtown, Hardin lease years
County, Kentucky, in an only
area of mixed retail,
commercial, and residential
development. Other fast-
food and family-style
restaurants located in
proximity to the
Elizabethtown Property
include a Steak N Shake, a
Dairy Queen, an Arby's, a
Bob Evans, a Captain D's, a
Fazoli's, a Hardee's, a
McDonald's, a Taco Bell,
and a Lee's Famous Recipe
Country Chicken.
IHOP $1,286,364 05/21/97 05/2017; three $130,244; for each lease during the
(the "Santa Rosa Property") five-year increases by year, (i) 4% of eleventh
Existing restaurant renewal options 10% after the annual gross lease year
fifth lease sales minus (ii) and at the
The Santa Rosa Property is year and after the minimum end of the
located on the northwest every five annual rent for initial
quadrant of Fulton Road and years such lease year lease term
Guerneville Road, in Santa thereafter
Rosa, Sonoma County, during the
California, in an area of lease term
mixed retail, commercial,
and residential
development. Other fast-
food and family-style
restaurants located in
proximity to the Santa Rosa
Property include a Taco
Bell, a McDonald's, and
several local restaurants.
-2-
</TABLE>
FOOTNOTES:
(1) The estimated federal income tax basis of the depreciable portion (the
building portion) of each of the Properties acquired, and for the
construction Property, once the building is constructed, is set forth
below:
Property Federal Tax Basis
-------- -----------------
Elizabethtown Property $1,077,000
Santa Rosa Property 854,000
(2) Minimum annual rent for each of the Properties became payable on the
effective date of the lease, except as indicated below. For the
Elizabethtown Property, minimum annual rent will become due and payable
on the earlier of (i) 180 days after execution of the lease, (ii) the
date the certificate of occupancy for the restaurant is issued, or (iii)
the date the restaurant opens for business to the public. During the
period commencing with the effective date of the lease to the date
minimum annual rent becomes payable for the Elizabethtown Property, as
described above, interim rent equal to 10 percent per annum of the
amount funded by CNL XVIII in connection with the purchase and
construction of the Property shall accrue and be payable in a single
lump sum at the time of final funding of the construction costs.
(3) 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. The maximum cost to CNL XVIII (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:
Estimated Final
Property Estimated Maximum Cost Completion Date
-------- ---------------------- ---------------
Elizabethtown Property $1,572,176 November 17, 1997
(4) 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.
(5) Percentage rent shall be calculated on a calendar year basis (January 1
to December 31).
-3-
STATEMENT OF ESTIMATED TAXABLE OPERATING RESULTS
CNL INCOME FUND XVIII, LTD.
PROPERTIES ACQUIRED FROM INCEPTION
THROUGH MAY 22, 1997
FOR THE PERIOD OCTOBER 12, 1996 (THE DATE OPERATIONS COMMENCED)
THROUGH DECEMBER 31, 1996 (UNAUDITED)
The following statement presents unaudited estimated taxable operating
results of each Property acquired by CNL XVIII from inception through May 22,
1997. The statement presents estimated taxable operating results for each
Property that was operational as if the Property had been acquired and
operational on October 12, 1996 (the date CNL XVIII commenced operations)
through December 31, 1996. The statement should be read in light of the
accompanying footnotes.
These estimates do not purport to present actual or expected operations
of CNL XVIII 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 with an aggregate purchase price in excess of 20% of the expected
total net offering proceeds of CNL XVIII.
<TABLE>
<CAPTION>
Burger King Golden Corral Jack in the Box Jack in the Box
Kinston, NC Houston #1, TX (7) Echo Park, CA (6) Henderson, NV (6)
----------- ------------------ ----------------- -----------------
<S> <C> <C> <C> <C>
Estimated Taxable Operating
Results:
Base Rent (1) $ 19,862 (5) (5) (5)
Management Fees (2) (199) (5) (5) (5)
General and Administrative
Expenses (3) (993) (5) (5) (5)
--------
Estimated Cash Available from
Operations 18,670 (5) (5) (5)
Depreciation Expense (4) (3,660) (5) (5) (5)
--------
Estimated Taxable Operating
Results $ 15,010 (5) (5) (5)
========
See Footnotes
-4-
<CAPTION>
Jack in the Box Golden Corral Boston Market Black-eyed Pea
Centerville, TX (6) Galveston, TX (7) Raleigh, NC Atlanta, GA
------------------- ----------------- ------------- --------------
<S> <C> <C> <C> <C>
Estimated Taxable Operating
Results:
Base Rent (1) (5) (5) $ 27,144 $ 15,358
Management Fees (2) (5) (5) (271) (154)
General and Administrative
Expenses (3) (5) (5) (1,357) (768)
-------- --------
Estimated Cash Available from
Operations (5) (5) 25,516 14,436
Depreciation Expense (4) (5) (5) (2,672) (3,596)
-------- --------
Estimated Taxable Operating
Results (5) (5) $ 22,844 $ 10,840
======== ========
See Footnotes
-5-
<CAPTION>
Golden Corral Boston Market On The Border Boston Market
Stow, OH San Antonio, TX San Antonio, TX Minnetonka, MN
------------- --------------- --------------- --------------
<S> <C> <C> <C> <C>
Estimated Taxable Operating
Results:
Base Rent (1) $42,009 (5) (5) (5)
Management Fees (2) (420) (5) (5) (5)
General and Administrative Expenses (3) (2,100) (5) (5) (5)
--------
Estimated Cash Available from Operations 39,489 (5) (5) (5)
Depreciation Expense (4) (7,047) (5) (5) (5)
--------
Estimate Taxable Operating
Results $ 32,442 (5) (5) (5)
========
See Footnotes
-6-
<CAPTION>
Wendy's Boston Market Jack in the Box Golden Corral
Sparta, TN Timonium, MD Houston #2, TX (6) Elizabethtown, KY (7)
---------- ------------- ------------------ ---------------------
<S> <C> <C> <C> <C>
Estimated Taxable Operating
Results:
Base Rent (1) (5) (5) (5) (5)
Management Fees (2) (5) (5) (5) (5)
General and Administrative
Expenses (3) (5) (5) (5) (5)
Estimated Cash Available from
Operations (5) (5) (5) (5)
Depreciation Expense (4) (5) (5) (5) (5)
Estimate Taxable Operating
Results (5) (5) (5) (5)
See Footnotes
-7-
<CAPTION>
IHOP
Santa Rosa, CA Total
-------------- ---------
<S> <C> <C>
Estimated Taxable Operating
Results:
Base Rent (1) $ 28,547 $132,920
Management Fees (2) (285) (1,329)
General and Administrative
Expenses (3) (1,427) (6,645)
-------- --------
Estimated Cash Available from
Operations 26,835 124,946
Depreciation Expense (4) (4,678) (21,653)
-------- --------
Estimate Taxable Operating
Results $ 22,157 $103,293
======== ========
</TABLE>
FOOTNOTES:
(1) Represents rental income from leases for five of the 17 Properties
acquired from inception through May 22, 1997, which were operational at
the time acquired by CNL XVIII, for the period commencing October 12,
1996 (the date CNL XVIII commenced operations) through December 31,
1996. The 12 Properties acquired by CNL XVIII that are under
construction are not presented due to the fact that they were not
operational for the period presented.
(2) The Properties are managed pursuant to a management agreement between
CNL XVIII and an Affiliate of the General Partners, pursuant to which
the Affiliate receives an annual management fee in an amount equal to
one percent of the gross revenues that CNL XVIII earns from its
Properties.
(3) Estimated at five percent of gross rental income based on the previous
experience of Affiliates of the General Partners with 17 public limited
partnerships which own properties similar to that owned by CNL XVIII.
(4) The estimated federal tax basis of the depreciable portion (the building
portion) of the Properties has been depreciated on the straight-line
method over 40 years.
-8-
(5) This Property is under construction and therefore was not operational
for the period presented. The development agreements for the Properties
which are to be constructed, provide that construction must be completed
no later than the dates set forth below:
Property Estimated Final Completion Date
-------- -------------------------------
Houston #1 Property June 25, 1997
Echo Park Property July 6, 1997
Henderson Property July 6, 1997
Centerville Property July 7, 1997
Galveston Property July 21, 1997
San Antonio #1 Property October 13, 1997
San Antonio #2 Property October 14, 1997
Minnetonka Property October 26, 1997
Sparta Property August 28, 1997
Timonium Property November 4, 1997
Houston #2 Property November 5, 1997
Elizabethtown Property November 17, 1997
(6) The lessee of the Echo Park, Henderson, Centerville and Houston #2
Properties is the same unaffiliated lessee.
(7) The lessee of the Houston #1, Galveston and Elizabethtown Properties is
the same unaffiliated lessee.
-9-
ITEM 3. BANKRUPTCY OR RECEIVERSHIP.
Not applicable.
ITEM 4. CHANGES IN REGISTRANT'S CERTIFYING ACCOUNTANT.
Not applicable.
ITEM 5. OTHER EVENTS.
Not applicable.
ITEM 6. RESIGNATION OF REGISTRANT'S GENERAL PARTNERS.
Not applicable.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND
EXHIBITS.
-10-
INDEX TO PRO FORMA FINANCIAL STATEMENTS
Page
CNL INCOME FUND XVIII, LTD.
(A FLORIDA LIMITED PARTNERSHIP)
Pro Forma Financial Information (unaudited):
Pro Forma Balance Sheet as of March 31, 1997 13
Pro Forma Statement of Income for the year ended
March 31, 1997 14
Pro Forma Statement of Income for the year ended
December 31, 1996 15
Notes to Pro Forma Financial Statements for the
quarter ended March 31, 1997 and the year ended
December 31, 1996 16
-11-
PRO FORMA FINANCIAL INFORMATION
The following Pro Forma Balance Sheet of CNL Income Fund XVIII, Ltd.
("CNL XVIII") gives effect to (i) property acquisition transactions from
inception through March 31, 1997, including the receipt of $16,736,878 in
gross offering proceeds from the sale of 1,673,688 units of limited
partnership interest (the "Units") pursuant to a registration statement on
Form S-11 under the Securities Act of 1933, as amended, effective August 11,
1995, and the application of such funds to acquire eight properties, five of
which were under construction at March 31, 1997, and to pay organizational and
offering expenses, acquisition fees, and miscellaneous acquisition expenses,
(ii) the receipt of $2,917,786 in gross offering proceeds from the sale of
291,778 additional Units during the period April 1, 1997 through May 22, 1997,
and (iii) the application of such funds and $6,079,177 of cash and cash
equivalents at March 31, 1997, to purchase nine additional properties during
the period April 1, 1997 through May 22, 1997, (six of which are under
construction and consist of land and building, one property which is under
construction and consists of building only and two properties which consist of
land and building), to pay additional construction costs for the five
properties under construction at March 31, 1997, and to pay offering expenses,
acquisition fees, and miscellaneous acquisition expenses, all as reflected in
the pro forma adjustments described in the related notes. The Pro Forma
Balance Sheet as of March 31, 1997, includes the transactions described in (i)
above, from its historical balance sheet, adjusted to give effect to the
transactions in (ii) and (iii) above, as if they had occurred on March 31,
1997.
The Pro Forma Statements of Income for the quarter ended March 31, 1997
and the year ended December 31, 1996, include the historical operating results
of the properties described in (i) above from the dates of their acquisitions.
No pro forma adjustments have been made to the Pro Forma Statements of Income
for the properties owned by CNL XVIII as of May 22, 1997, due to the fact that
these properties did not have a previous rental history.
This pro forma financial information is presented for informational
purposes only and does not purport to be indicative of CNL XVIII's financial
results or condition if the various events and transactions reflected therein
had occurred on the dates, or been in effect during the periods, indicated.
This pro forma financial information should not be viewed as predictive of CNL
XVIII's financial results or conditions in the future.
-12-
CNL INCOME FUND XVIII, LTD.
(A FLORIDA LIMITED PARTNERSHIP)
UNAUDITED PRO FORMA BALANCE SHEET
MARCH 31, 1997
Pro Forma
ASSETS Historical Adjustments Pro Forma
----------- --------------- -----------
Land and buildings on operating
leases, less accumulated
depreciation $ 8,231,628 $ 7,206,057 (a) $15,437,685
Net investment in direct
financing leases (c) 651,984 3,999,263 (a) 4,651,247
Cash and cash equivalents 6,079,177 (6,079,177)(a) -
Receivables 78,257 78,257
Prepaid expenses 900 900
Organization costs, less
accumulated amortization 9,089 9,089
Accrued rental income 6,504 6,504
Other assets 363,240 (444,973)(a)
148,065 (b) 66,332
----------- ----------- -----------
$15,420,779 $ 4,829,235 $20,250,014
=========== =========== ===========
LIABILITIES AND
PARTNERS' CAPITAL
Accounts payable $ 70,480 $ 70,480
Accrued construction costs
payable 686,342 $ 2,159,797 (a)
(2,846,139)(b) -
Distributions payable 154,476 154,476
Due to related parties 141,104 (133,812)(a) 7,292
Rents paid in advance 118,189 118,189
----------- ----------- -----------
Total liabilities 1,170,591 (820,154) 350,437
Partners' capital 14,250,188 2,655,185 (a)
2,994,204 (b) 19,899,577
----------- ----------- -----------
$15,420,779 $ 4,829,235 $20,250,014
=========== =========== ===========
See accompanying notes to unaudited pro forma
financial statements.
-13-
CNL INCOME FUND XVIII, LTD.
(A FLORIDA LIMITED PARTNERSHIP)
UNAUDITED PRO FORMA STATEMENT OF INCOME
QUARTER ENDED MARCH 31, 1997
Pro Forma
Historical Adjustments Pro Forma
---------- ----------- ---------
Revenues:
Rental income from operating
leases $ 52,230 $ - $ 52,230
Earned income from direct
financing leases 1,113 - 1,113
Interest income 42,871 - 42,871
--------- --------- ---------
96,214 - 96,214
--------- --------- ---------
Expenses:
General operating and
administrative 16,685 - 16,685
Professional services 5,896 - 5,896
Management fees to related party 1,212 - 1,212
State and other taxes 416 - 416
Depreciation and amortization 9,828 - 9,828
--------- --------- ---------
34,037 - 34,037
--------- --------- ---------
Net Income $ 62,177 $ - $ 62,177
========= ========= =========
Net Income Per Limited Partner
Unit (1) $ 0.05 $ 0.04
========= =========
Weighted Average Number of Units
Outstanding (1) 1,252,970 1,582,003
========= =========
See accompanying notes to unaudited pro forma
financial statements.
-14-
CNL INCOME FUND XVIII, LTD.
(A FLORIDA LIMITED PARTNERSHIP)
UNAUDITED PRO FORMA STATEMENT OF INCOME
YEAR ENDED DECEMBER 31, 1996
Pro Forma
Historical Adjustments Pro Forma
---------- ----------- ---------
Revenues:
Rental income from operating lease $ 1,373 $ - $ 1,373
Interest income 30,241 - 30,241
------- ------- -------
31,614 - 31,614
------- ------- -------
Expenses:
General operating and administrative 3,980 - 3,980
Management fee to related party 12 - 12
Depreciation and amortization 712 - 712
------- ------- -------
4,704 - 4,704
------- ------- -------
Net Income $26,910 $ - $26,910
======= ======= =======
Net Income Per Limited Partner
Unit (1) $ 0.05 $ 0.03
======= =======
Weighted Average Number of Units
Outstanding (1) 503,436 832,469
======= =======
See accompanying notes to unaudited pro forma
financial statements.
-15-
CNL INCOME FUND XVIII, LTD.
(A FLORIDA LIMITED PARTNERSHIP)
NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS
FOR THE QUARTER ENDED MARCH 31, 1997 AND THE
YEAR ENDED DECEMBER 31, 1996
Pro Forma Balance Sheet:
(a) Represents gross proceeds of $2,917,786 from the sale of 291,778 Units
during the period April 1, 1997 through May 22, 1997, and $6,079,177 of
cash and cash equivalents at March 31, 1997, used (i) to acquire nine
properties and to fund estimated construction costs relating to the five
properties under construction at March 31, 1997, totalling $10,629,047
(of which $2,159,797 were accrued as construction costs payable as of
May 22, 1997), (ii) to pay acquisition fees and other costs of $180,917
($49,617 of which was accrued as due to related parties at March 31,
1997) and reclassify from other assets $444,973 of acquisition fees and
other costs previously incurred relating to the acquired properties, and
(iv) to pay selling commissions and offering expenses (syndication
costs) of $346,796 ($84,195 of which was accrued as due to related
parties at March 31, 1997), which have been netted against partners'
capital.
The pro forma adjustments to land and buildings on operating leases as a
result of the above transactions were as follows:
<TABLE>
<CAPTION>
Estimated purchase
price (including
construction and Acquisition
closing costs) and fees
additional con- allocated
struction costs to property Total
------------------ ----------- -----------
<S> <C> <C> <C>
Golden Corral in Stow, OH $ 1,668,863 $ 90,480 $ 1,759,343
Boston Market in San Antonio, TX 851,302 46,154 897,456
On The Border in San Antonio, TX 1,186,744 64,342 1,251,086
Boston Market in Minnetonka, MN 815,065 44,190 859,255
Wendy's in Sparta, TN 633,967 34,372 668,339
Boston Market in Timonium, MD 1,129,934 61,261 1,191,195
Jack in the Box in Houston, TX 1,289,000 69,886 1,358,886
Golden Corral in Elizabethtown, KY 1,453,059 78,780 1,531,839
IHOP in Santa Rosa, CA 1,282,215 69,518 1,351,733
Five properties under construction at
March 31, 1997 318,898 17,290 336,188
----------- ----------- -----------
$10,629,047 $ 576,273 $11,205,320
=========== =========== ===========
Adjustment classified as follows:
Land and buildings on operating leases $ 7,206,057
Net investment in direct financing leases 3,999,263
-----------
$11,205,320
===========
</TABLE>
(b) Represents the assumed receipt of additional gross proceeds of
$3,290,334 from the sale of 329,033 Units on October 12, 1996 (the date
following when CNL XVIII received the minimum offering proceeds and
funds were released from escrow) used (i) to pay construction costs of
$2,846,139, (ii) to pay acquisition fees of $148,065 which were
classified as other assets and will be allocated to future properties)
and (iii) to pay selling commissions and offering expenses (syndication
costs) of $296,130, which have been netted partners' capital.
(c) In accordance with generally accepted accounting principles, leases in
which the present value of future minimum lease payments equals or
exceeds 90 percent of the value of the related properties are treated as
direct financing leases rather than as land and buildings. The
categorization of the leases has no effect on rental revenues received.
-16-
CNL INCOME FUND XVIII, LTD.
(A FLORIDA LIMITED PARTNERSHIP)
NOTES TO UNAUDITED PRO FORMA FINANCIAL STATEMENTS - CONTINUED
FOR THE QUARTER ENDED MARCH 31, 1997 AND THE
YEAR ENDED DECEMBER 31, 1996
Pro Forma Statement of Income:
(1) Historical net income per limited partner unit was calculated based upon
the weighted average number of limited partner units outstanding during
the period that CNL XVIII was operational, October 12, 1996 (the date
following when CNL XVIII received the minimum offering proceeds and
funds were released from escrow) through December 31, 1996, and for the
quarter ended March 31, 1997.
CNL XVIII assumed approximately 329,033 Units were sold, and the net
offering proceeds were available for investment, on October 12, 1996.
Pro forma net income per limited partner unit was calculated based upon
the weighted average number of limited partner units outstanding, as
adjusted, during the period CNL XVIII was operational, October 12, 1996
through December 31, 1996, and for the quarter ended March 31, 1997.
-17-
ITEM 8. CHANGE IN FISCAL YEAR.
Not applicable.
EXHIBITS
None.
-18-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be filed on its behalf
by the undersigned thereunto duly authorized.
CNL INCOME FUND XVIII, LTD.
Dated: June 4, 1997 By: /s/ Robert A. Bourne
---------------------------------
ROBERT A. BOURNE, General Partner
