UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549

                                    FORM 10-K

(Mark One)

[x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
    ACT OF 1934

                   For the fiscal year ended December 31, 2001

                                       OR

[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
    EXCHANGE ACT OF 1934

                        For the transition period from to


                         Commission file number 0-20016

                             CNL INCOME FUND X, LTD.
             (Exact name of registrant as specified in its charter)

       Florida                                         59-3004139
(State or other jurisdiction of           (I.R.S. Employer Identification No.)
 incorporation or organization)

                             450 South Orange Avenue
                             Orlando, Florida 32801
          (Address of principal executive offices, including zip code)

       Registrant's telephone number, including area code: (407) 540-2000

           Securities registered pursuant to Section 12(b) of the Act:

    Title of each class:                 Name of exchange on which registered:
           None                                     Not Applicable

           Securities registered pursuant to Section 12(g) of the Act:

              Units of limited partnership interest ($10 per Unit)
                                (Title of class)

         Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the  Securities  Exchange  Act of
1934 during the preceding 12 months (or such 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: Yes X No

         Indicate by check mark if disclosure of delinquent  filers  pursuant to
Item 405 of Regulation S-K is not contained  herein,  and will not be contained,
to the best of  registrant's  knowledge,  in  definitive  proxy  or  information
statements  incorporated  by  reference  in Part  III of this  Form  10-K or any
amendment to this Form 10-K. [x]

         Aggregate market value of the voting stock held by nonaffiliates of the
registrant:  The registrant registered an offering of 4,000,000 units of limited
partnership  interest  (the  "Units") on Form S-11 under the  Securities  Act of
1933, as amended. Since no established market for such Units exists, there is no
market value for such Units. Each Unit was originally sold at $10 per Unit.

                      DOCUMENTS INCORPORATED BY REFERENCE:
                                      None

<page>
                                     PART I

Item 1.  Business

         CNL Income Fund X, Ltd. (the  "Registrant" or the  "Partnership")  is a
limited  partnership  which was  organized  pursuant to the laws of the State of
Florida on April 16, 1990. The general partners of the Partnership are Robert A.
Bourne,  James M. Seneff, Jr. and CNL Realty Corporation,  a Florida corporation
(the  "General  Partners").  Beginning  on September  9, 1991,  the  Partnership
offered  for  sale up to  $40,000,000  of  limited  partnership  interests  (the
"Units") (4,000,000 Units at $10 per Unit) pursuant to a registration  statement
on Form S-11 under the Securities Act of 1933, as amended,  effective  March 20,
1991.  The  offering  terminated  on March 18,  1992,  at which date the maximum
offering  proceeds of  $40,000,000  had been  received  from  investors who were
admitted to the Partnership as limited partners (the "Limited Partners").

         The  Partnership  was organized to acquire both newly  constructed  and
existing  restaurant  properties,  as well as properties upon which  restaurants
were to be  constructed  (the  "Properties"),  which  are  leased  primarily  to
operators of national and regional fast-food and family-style  restaurant chains
(the "Restaurant Chains").  Net proceeds to the Partnership from its offering of
Units,  after  deduction  of  organizational  and  offering  expenses,   totaled
$35,200,000, and were used to acquire 47 Properties, including interests in nine
Properties  owned by joint  ventures in which the  Partnership is a co-venturer,
and to establish a working capital reserve for Partnership purposes.

         During the year ended  December  31,  1995,  the  Partnership  sold its
Property  in Denver,  Colorado,  and  reinvested  the  majority of the net sales
proceeds  in a Shoney's  in Fort  Myers  Beach,  Florida.  During the year ended
December 31, 1996, the  Partnership  reinvested the remaining net sales proceeds
in a Golden Corral Property located in Clinton, North Carolina,  with affiliates
of the General Partners as tenants-in-common. During the year ended December 31,
1997, the Partnership sold its Property in Fremont,  California,  and reinvested
the majority of the net sales proceeds in a Boston Market in Homewood,  Alabama.
In addition,  during 1997, the Partnership used approximately  $130,400 that had
been  previously  reserved for working  capital  purposes to invest in a Chevy's
Fresh Mex Property  located in Miami,  Florida,  with  affiliates of the General
Partners as  tenants-in-common.  During the year ended  December 31,  1998,  the
Partnership sold its Properties in Sacramento, California and Billings, Montana.
During  1998,  the  Partnership  reinvested  the proceeds  from the  Sacramento,
California  sale in a  Property  in San  Marcos,  Texas.  During  the year ended
December 31, 1999, the Partnership sold its Properties in Amherst,  New York and
Fort Myers Beach, Florida.  During 1999, the Partnership reinvested the proceeds
from the  Amherst,  New York sale in a Property  in  Fremont,  Nebraska.  During
January 1999, the Partnership reinvested the net sales proceeds from the sale of
its Property in Billings,  Montana in a joint venture arrangement,  Ocean Shores
Joint Venture, to purchase and hold one Property. In addition,  during 1999, the
Partnership  reinvested  the  majority of the net sales  proceeds  from the Fort
Myers Beach, Florida sale in a joint venture arrangement,  Peoria Joint Venture,
with CNL Income Fund II, Ltd., an affiliate of the General  Partners to purchase
and hold one  Property.  During  2000,  the  Partnership  sold its  Property  in
Lancaster,  New York.  During 2001, the Partnership  reinvested a portion of the
net sales  proceeds  from the sale of its Property in  Lancaster,  New York in a
joint  venture  arrangement,  CNL VIII,  X, XII Kokomo Joint  Venture,  with CNL
Income Fund VIII, Ltd. and CNL Income Fund XII, Ltd.,  affiliates of the General
Partners,  to purchase  and hold one  Property.  In addition,  during 2001,  the
Partnership  and the joint venture partner  liquidated  Peoria Joint Venture and
the Partnership received its pro rata share of the liquidation proceeds.

         As a result of the above  transactions,  as of December 31,  2001,  the
Partnership owned 48 Properties.  The Partnership  owned 35 Properties  directly
and  held  interests  in 11  Properties  owned by joint  ventures  in which  the
Partnership  is a co-venturer  and two Properties  owned with  affiliates of the
General  Partners  as  tenants-in-common.   In  January  2002,  the  Partnership
reinvested the majority of the liquidation proceeds from Peoria Joint Venture in
a Property in Austin, Texas, as  tenants-in-common,  with CNL Income Fund XVIII,
Ltd., a Florida limited  partnership  and an affiliate of the General  Partners.
The Partnership  generally  leases the Properties on a triple-net basis with the
lessees responsible for all repairs and maintenance,  property taxes,  insurance
and utilities.

         The  Partnership  will hold its Properties  until the General  Partners
determine that the sale or other  disposition of the Properties is  advantageous
in view of the Partnership's investment objectives.  In deciding whether to sell
Properties, the General Partners will consider factors such as potential capital
appreciation,  net cash flow and  federal  income  tax  considerations.  Certain
lessees also have been granted options to purchase Properties,  generally at the
Property's  then fair market  value after a specified  portion of the lease term
has elapsed.  The  Partnership has no obligation to sell all or any portion of a
Property  at any  particular  time,  except as may be  required  under  property
purchase options granted to certain lessees.

         On March 11, 1999, the  Partnership  entered into an Agreement and Plan
of Merger with CNL American Properties Fund, Inc.("APF"),  pursuant to which the
Partnership  would be merged with and into a subsidiary  of APF (the  "Merger").
APF is a real estate investment trust whose primary business is the ownership of
restaurant properties leased on a long-term,  "triple net" basis to operators of
national and regional restaurant chains. Under the Agreement and Plan of Merger,
APF was to issue shares of its common stock as consideration  for the Merger. On
March 1, 2000,  the General  Partners and APF  announced  that they had mutually
agreed to terminate the Agreement and Plan of Merger entered into in March 1999.
The agreement to terminate the Agreement and Plan of Merger was based,  in large
part,  on the General  Partners'  concern  that,  in light of market  conditions
relating to publicly  traded real  estate  investment  trusts,  the value of the
transaction  had  diminished.  As a result  of such  diminishment,  the  General
Partners ability to unequivocally  recommend voting for the transaction,  in the
exercise  of their  fiduciary  duties,  had  become  questionable.  The  General
Partners are continuing to evaluate strategic  alternatives for the Partnership,
including alternatives to provide liquidity to the Limited Partners.

Leases

         Although there are variations in the specific terms of the leases,  the
following  is  a  summarized   description  of  the  general  structure  of  the
Partnership's  leases.  Generally,  the  leases of the  Properties  owned by the
Partnership,  the joint ventures in which the  Partnership is a co-venturer  and
the  Properties  owned  as  tenants-in-common  with  affiliates  of the  General
Partners  provide for initial  terms  ranging  from 10 to 20 years (the  average
being 17 years) and expire  between 2006 and 2019. The leases are generally on a
triple-net basis,  with the lessee  responsible for all repairs and maintenance,
property taxes,  insurance and utilities.  The leases of the Properties  provide
for  minimum  base annual  rental  payments  (payable  in monthly  installments)
ranging  from  approximately  $29,400 to  $225,800.  The  majority of the leases
provide for percentage rent, based on sales in excess of a specified  amount. In
addition,  a majority of the leases provide that,  commencing in specified lease
years  (ranging  from the second to the sixth lease year),  the annual base rent
required under the terms of the lease will increase.

         Generally,  the  leases  of the  Properties  provide  for  two to  five
five-year  renewal  options  subject  to the same  terms and  conditions  as the
initial lease.  Lessees of 36 of the  Partnership's 48 Properties also have been
granted options to purchase  Properties at the Property's then fair market value
after a specified portion of the lease term has elapsed.  Fair market value will
be determined  through an appraisal by an independent  appraisal firm. Under the
terms of certain leases,  the option purchase price may equal the  Partnership's
original cost to purchase the Property  (including  acquisition  costs),  plus a
specified percentage from the date of the lease or a specified percentage of the
Partnership's purchase price, if that amount is greater than the Property's fair
market value at the time the purchase option is exercised.

         The leases also  generally  provide that, in the event the  Partnership
wishes to sell the Property  subject to that lease,  the Partnership  first must
offer the  lessee  the right to  purchase  the  Property  on the same  terms and
conditions,  and for the same  price,  as any offer  which the  Partnership  has
received for the sale of the Property.

         In December 2000, the Partnership  sold its Property in Lancaster,  New
York and  during  2001  reinvested  the net sales  proceeds  in a joint  venture
arrangement,  CNL VIII,  X, XII Kokomo Joint  Venture with CNL Income Fund VIII,
Ltd. and CNL Income Fund XII, Ltd.,  each a Florida  limited  partnership and an
affiliate of the General Partners, to purchase and hold one restaurant Property.
The  lease  terms  for  this  Property  are   substantially   the  same  as  the
Partnership's other leases.

         In  August  1999,  the  leases  relating  to  the  Long  John  Silver's
Properties in Alamogordo and Las Cruces, New Mexico were amended to provide rent
deferrals.  All other lease terms remained unchanged.  As of March 15, 2002, the
Partnership  has  continued  to  receive  rental  payments   relating  to  these
Properties.  The General  Partners do not believe that the rent  deferrals  will
have a material adverse effect of the results of operations of the Partnership.

         In  January  2002,  the  Partnership  reinvested  the  majority  of the
liquidation  proceeds it received  from  Peoria  Joint  Venture in a Property in
Austin,  Texas,  with CNL Income  Fund XVIII,  Ltd.,  as  tenants-in-common,  as
described below in "Joint Venture and Tenancy in Common Arrangements." The lease
term for this  Property is  substantially  the same as the  Partnership's  other
leases.

Major Tenants

         During 2001,  three  lessees (or groups of  affiliated  tenants) of the
Partnership and its consolidated joint venture,  (i) Burger King Corporation and
BK  Acquisition,  Inc.  (which are  affiliated  entities under common control of
Diageo,  PLC)  (hereinafter  referred to as "Diageo,  PLC"),  (ii) Golden Corral
Corporation and (iii) Jack in the Box Inc. and Jack in the Box Eastern Division,
L.P.  (which are  affiliated  entities  under common  control of Jack in the Box
Inc.) (hereinafter referred to as "Jack in the Box Inc."), each contributed more
than 10% of the  Partnership's  total rental and earned income (including rental
and earned  income from the  Partnership's  consolidated  joint  venture and the
Partnership's  share of rental and earned  income from ten  Properties  owned by
unconsolidated  joint ventures and two Properties  owned with  affiliates of the
General Partners as tenants-in-common). As of December 31, 2001, Diageo, PLC was
the lessee under leases relating to seven restaurants, Golden Corral Corporation
was the lessee under leases relating to six restaurants and Jack in the Box Inc.
was the lessee under leases relating to six restaurants.  It is anticipated that
based on the minimum rental payments required by the leases, these three lessees
each will continue to contribute more than 10% of the Partnership's total rental
and earned income in 2002. In addition,  four Restaurant  Chains,  Golden Corral
Family Steakhouse Restaurants ("Golden Corral"), Hardee's, Burger King, and Jack
in the Box, each accounted for more than 10% of the  Partnership's  total rental
and earned  income  during  2001  (including  rental and earned  income from the
Partnership's  consolidated joint venture and the Partnership's  share of rental
and earned income from ten Properties owned by unconsolidated joint ventures and
two   Properties   owned   with   affiliates   of  the   General   Partners   as
tenants-in-common). In 2002, it is anticipated that these four Restaurant Chains
each will  continue to account for more than 10% of the total  rental and earned
income to which the  Partnership is entitled under the terms of the leases.  Any
failure of these  lessees or  Restaurant  Chains  could have a material  adverse
affect on the  Partnership's  income if the  Partnership is not able to re-lease
the  Properties  in a timely  manner.  No single  tenant or groups of affiliated
tenants lease  Properties  with an aggregate  carrying value in excess of 20% of
the total assets of the Partnership.

Joint Venture and Tenancy in Common Arrangements

         The Partnership has entered into a joint venture  arrangement,  Allegan
Real Estate Joint Venture,  with an unaffiliated entity to purchase and hold one
Property.  In addition,  the  Partnership  has entered into five separate  joint
venture arrangements:  CNL Restaurant  Investments III, with CNL Income Fund IX,
Ltd.,  to purchase and hold six  Properties;  Ashland  Joint  Venture,  with CNL
Income Fund IX,  Ltd.  and CNL Income Fund XI,  Ltd.,  to purchase  and hold one
Property;  Williston Real Estate Joint Venture,  with CNL Income Fund XII, Ltd.,
to purchase and hold one Property;  Ocean Shores Joint Venture,  with CNL Income
Fund XVII, Ltd., to purchase and hold one restaurant  Property.  Each of the CNL
Income  Funds  is  an  affiliate  of  the  General  Partners  and  is a  limited
partnership organized pursuant to the laws of the state of Florida.

         The joint  venture  arrangements  provide for the  Partnership  and its
joint venture  partners to share in all costs and benefits  associated  with the
joint ventures in accordance with their respective  percentage  interests in the
joint  ventures.  The  Partnership has an 88.26% interest in Allegan Real Estate
Joint  Venture,  a 50%  interest  in CNL  Restaurant  Investments  III, a 10.51%
interest in Ashland Joint  Venture,  a 40.95%  interest in Williston Real Estate
Joint  Venture,  and a  69.06%  interest  in Ocean  Shores  Joint  Venture.  The
Partnership and its joint venture partners are also jointly and severally liable
for all debts, obligations and other liabilities of the joint ventures.

         In  addition,  in April  2001,  the  Partnership  entered  into a joint
venture arrangement, CNL VIII, X, XII Kokomo Joint Venture, with CNL Income Fund
VIII, Ltd. and CNL Income Fund XII, Ltd., affiliates of the General Partners, to
purchase  and  hold one  restaurant  Property.  The  joint  venture  arrangement
provides  for the  Partnership  and its joint  venture  partners to share in all
costs and  benefits  associated  with the joint  venture in  proportion  to each
partner's  percentage  interest in the joint venture.  The  Partnership  and its
joint  venture  partners  are also jointly and  severally  liable for all debts,
obligations  and other  liabilities of the joint venture.  The Partnership has a
10%  interest  in the  profits  and  losses of this joint  venture.  Each of the
affiliates is a limited partnership  organized pursuant to the laws of the state
of Florida.

         In August 2001, Peoria Joint Venture,  in which the Partnership owned a
52% interest,  sold its Property to a third party. The Partnership and the joint
venture partner liquidated Peoria Joint Venture and the Partnership received its
pro rata share of the liquidation proceeds from the joint venture.

         CNL  Restaurant  Investments  III's joint  venture  agreement  does not
provide for a fixed term, but continues in existence until  terminated by either
of the joint  venturers.  Ashland Joint Venture has an initial term of 14 years,
CNL VIII,  X, XII Kokomo  Joint  Venture  has an initial  term of 30 years,  and
Allegan Real Estate Joint Venture and  Williston  Real Estate Joint Venture each
have an initial term of 20 years. After the expiration of the initial term, each
of the joint ventures continues in existence from year to year unless terminated
at the  option  of any of the  joint  venturers  or by an event of  dissolution.
Events of dissolution  include the bankruptcy,  insolvency or termination of any
joint  venturer,  sale of the  Property  owned by the joint  venture  and mutual
agreement  of the  Partnership  and its joint  venture  partners to dissolve the
joint venture.

         The  Partnership  has  management  control of Allegan Real Estate Joint
Venture and shares  management  control  equally with  affiliates of the General
Partners  for CNL  Restaurant  Investments  III,  Williston  Real  Estate  Joint
Venture,  Ashland Joint Venture, Ocean Shores Joint Venture and CNL VIII, X, XII
Kokomo Joint  Venture.  The joint venture  agreements  restrict each  venturer's
ability to sell,  transfer or assign its joint  venture  interest  without first
offering it for sale to its joint venture  partners,  either upon such terms and
conditions  as to which the  venturers  may agree or, in the event the venturers
cannot agree,  on the same terms and  conditions as any offer from a third party
to purchase such joint venture interest.

         Net cash  flow  from  operations  of CNL  Restaurant  Investments  III,
Allegan Real Estate Joint Venture, Ashland Joint Venture,  Williston Real Estate
Joint  Venture,  Ocean  Shores Joint  Venture and CNL VIII,  X, XII Kokomo Joint
Venture  is  distributed  50%,   88.26%,   10.51%,   40.95%,   69.06%  and  10%,
respectively,  to the  Partnership and the balance is distributed to each of the
other joint venture  partners in  accordance  with their  respective  percentage
interest in the joint  venture.  Any  liquidation  proceeds,  after paying joint
venture debts and liabilities and funding  reserves for contingent  liabilities,
will be distributed  first to the joint venture  partners with positive  capital
account  balances in proportion to such balances until such balances equal zero,
and thereafter in proportion to each joint venture partner's percentage interest
in the joint venture.

         In addition to the above joint venture  arrangements,  the  Partnership
entered  into an  agreement to hold a Property in Clinton,  North  Carolina,  as
tenants-in-common  with CNL Income Fund IV,  Ltd.,  CNL Income Fund VI, Ltd. and
CNL Income Fund XV, Ltd. In addition,  the Partnership entered into an agreement
to hold a Property in Miami, Florida, as tenants-in-common, with CNL Income Fund
III,  Ltd.,  CNL Income  Fund VII,  Ltd.,  and CNL Income  Fund XIII,  Ltd.  The
agreements  provide for the  Partnership  and the other  parties to share in the
profits and losses of the  Properties in  proportion to each party's  percentage
interest.  The Partnership owns a 13% and 6.69% interest,  respectively in these
Properties.  Each CNL Income Fund is an affiliate of the General Partners and is
a limited  partnership  organized  pursuant to the laws of the State of Florida.
The  tenancy  in  common  agreement  restricts  each  party's  ability  to sell,
transfer,  or assign its  interest in the tenancy in common's  Property  without
first offering it for sale to the remaining party.

         In addition,  in January 2002, the Partnership  reinvested the majority
of the liquidation  proceeds from Peoria Joint Venture, as described above, in a
Property in Austin,  Texas,  as  tenants-in-common,  with CNL Income Fund XVIII,
Ltd., a Florida limited  partnership  and an affiliate of the General  Partners.
The  Partnership   entered  into  a  long-term,   triple-net  lease  with  terms
substantially the same as its other leases.

         The use of joint venture and tenancy in common  arrangements allows the
Partnership  to fully invest its available  funds at times at which it would not
have  sufficient  funds to purchase an additional  property,  or at times when a
suitable  opportunity to purchase an additional  property is not available.  The
use of joint  venture  and  tenancy in common  arrangements  also  provides  the
Partnership  with  increased  diversification  of its portfolio  among a greater
number of properties. In addition,  tenancy in common arrangements may allow the
Partnership to defer the gain for federal income tax purposes upon the sale of a
Property if the proceeds are reinvested in an additional Property.


Certain Management Services

         CNL APF Partners,  LP, an affiliate of the General  Partners,  provides
certain  services  relating to management of the  Partnership and its Properties
pursuant to a management  agreement with the Partnership.  Under this agreement,
CNL APF  Partners,  LP (the  "Advisor") is  responsible  for  collecting  rental
payments,  inspecting  the  Properties  and  the  tenants'  books  and  records,
assisting the  Partnership  in  responding  to tenant  inquiries and notices and
providing  information to the Partnership about the status of the leases and the
Properties.  The Advisor also assists the General  Partners in  negotiating  the
leases.  For these  services,  the  Partnership has agreed to pay the Advisor an
annual fee of one percent of the sum of gross rental  revenues  from  Properties
wholly owned by the Partnership plus the Partnership's  allocable share of gross
revenues of joint ventures in which the Partnership is a co-venturer, but not in
excess  of  competitive  fees for  comparable  services.  Under  the  management
agreement, the management fee is subordinated to receipt by the Limited Partners
of an aggregate, 10%, cumulative,  noncompounded annual return on their adjusted
capital  contributions  (the "10% Preferred  Return"),  calculated in accordance
with  the  Partnership's   limited   partnership   agreement  (the  "Partnership
Agreement").

         During 2000,  CNL Fund Advisors,  Inc.  assigned its rights in, and its
obligations  under,  the management  agreement  with the  Partnership to CNL APF
Partners,  LP.  All of the terms and  conditions  of the  management  agreement,
including the payment of fees, as described above, remain unchanged.

         The management agreement continues until the Partnership no longer owns
an interest in any Properties unless terminated at an earlier date upon 60 days'
prior notice by either party.

Competition

         The fast-food and family-style  restaurant business is characterized by
intense  competition.  The restaurants on the Partnership's  Properties  compete
with  independently  owned  restaurants,  restaurants which are part of local or
regional chains, and restaurants in other well-known national chains,  including
those offering different types of food and service.

Employees

         The  Partnership   has  no  employees.   The  officers  of  CNL  Realty
Corporation  and the  officers and  employees of APF, the parent  company of the
Advisor, perform certain services for the Partnership.  In addition, the General
Partners have  available to them the resources and expertise of the officers and
employees of CNL Financial Group,  Inc., a diversified real estate company,  and
its affiliates, who may also perform certain services for the Partnership.


Item 2.  Properties

         As of December 31, 2001, the Partnership owned 48 Properties. Of the 48
Properties,  35 are owned by the Partnership in fee simple, 11 are owned through
joint  venture  arrangements  and  two  are  owned  through  tenancy  in  common
arrangements.  See Item 1.  Business  - Joint  Venture  and  Tenancy  in  Common
Arrangements.  The Partnership is not permitted to encumber its Properties under
the terms of its  partnership  agreement.  Reference  is made to the Schedule of
Real Estate and  Accumulated  Depreciation  for a listing of the  Properties and
their  respective  costs,  including  acquisition  fees and certain  acquisition
expenses.

Description of Properties

         Land. The Partnership's  Property sites range from approximately 15,700
to 200,900  square  feet  depending  upon  building  size and local  demographic
factors.  Sites  purchased  by  the  Partnership  are  in  locations  zoned  for
commercial use which have been reviewed for traffic patterns and volume.

         The following table lists the Properties owned by the Partnership as of
December 31, 2001 by state. More detailed information  regarding the location of
the  Properties  is  contained  in the  Schedule of Real Estate and  Accumulated
Depreciation for the year ended December 31, 2001.

          State                                Number of Properties

          Alabama                                           2
          Florida                                           5
          Idaho                                             1
          Illinois                                          1
          Indiana                                           1
          Louisiana                                         2
          Michigan                                          2
          Missouri                                          1
          Montana                                           5
          Nebraska                                          1
          New Hampshire                                     3
          New Mexico                                        3
          New York                                          1
          North Carolina                                    4
          Ohio                                              3
          Pennsylvania                                      1
          South Carolina                                    1
          Tennessee                                         3
          Texas                                             7
          Washington                                        1
                                                        ------
          TOTAL PROPERTIES                                 48
                                                        ======


         Buildings.  Each of the Properties owned by the Partnership  includes a
building that is one of a Restaurant  Chain's  approved  designs.  The buildings
generally are  rectangular  and are  constructed  from various  combinations  of
stucco,  steel,  wood, brick and tile.  Building sizes range from  approximately
1,800 to 10,700 square feet.  All buildings on Properties are  freestanding  and
surrounded by paved  parking  areas.  Buildings  are suitable for  conversion to
various uses, although modifications may be required prior to use for other than
restaurant operations. As of December 31, 2001, the Partnership had no plans for
renovation of the Properties. Depreciation expense is computed for buildings and
improvements using the straight line method using a depreciable life of 40 years
for federal income tax purposes.

         As of December 31, 2001, the aggregate cost of the Properties  owned by
the   Partnership   (including   its   consolidated   joint   venture)  and  the
unconsolidated  joint ventures  (including  Properties  owned through tenancy in
common  arrangements)  for  federal  income tax  purposes  was  $28,408,360  and
$14,108,346, respectively.

         The following table lists the Properties owned by the Partnership as of
December 31, 2001 by Restaurant Chain.


               Restaurant Chain                           Number of Properties

                Burger King                                            13
                Chevy's Fresh Mex                                       1
                Denny's                                                 3
                Golden Corral                                           6
                Hardee's                                                7
                Jack in the Box                                         6
                Long John Silver's                                      2
                Perkins                                                 1
                Pizza Hut                                               5
                Shoney's                                                2
                Other                                                   2
                                                                     -----
                TOTAL PROPERTIES                                       48
                                                                     =====

         The General Partners consider the Properties to be well-maintained  and
sufficient for the Partnership's operations.

         The General Partners believe that the Properties are adequately covered
by  insurance.  In  addition,  the General  Partners  have  obtained  contingent
liability and property coverage for the Partnership.  This insurance is intended
to reduce the Partnership's  exposure in the unlikely event a tenant's insurance
policy lapses or is insufficient to cover a claim relating to the Property.

         Leases.  The Partnership leases the Properties to operators of selected
national and regional fast-food restaurant chains. The leases are generally on a
long-term  "triple  net"  basis,  meaning  that the  tenant is  responsible  for
repairs,  maintenance,  property taxes,  utilities and insurance.  Generally,  a
lessee is required, under the terms of its lease agreement, to make such capital
expenditures as may be reasonably necessary to refurbish  restaurant  buildings,
premises, signs and equipment so as to comply with the lessee's obligations,  if
applicable,  under the  franchise  agreement  to reflect the current  commercial
image of its Restaurant  Chain.  These capital  expenditures  are required to be
paid by the lessee during the term of the lease.  The terms of the leases of the
Properties owned by the Partnership are described in Item 1. Business - Leases.

         At December 31, 2001,  2000,  1999, 1998, and 1997, the Properties were
97%, 97%, 96%, 96%, and 100% occupied, respectively. The following is a schedule
of the average rent per Property for the years ended December 31:
<TABLE>
<CAPTION>

                                       2001              2000             1999              1998              1997
                                 --------------    -------------    --------------    -------------     -------------

 <c>
Rental Revenues (1)(2)              $ 3,345,782      $3,462,549        $3,490,765       $3,163,838        $3,823,808
Properties (2)                               47              47                47               47                49
Average Rent Per Property            $   71,187        $ 73,671          $ 74,272         $ 67,316          $ 78,037
</TABLE>


(1)      Rental income  includes the  Partnership's  share of rental income from
         the  Properties  owned  through  joint  venture  arrangements  and  the
         Properties  owned  through  tenancy  in  common  arrangements.   Rental
         revenues have been adjusted,  as applicable,  for any amounts for which
         the Partnership has established an allowance for doubtful accounts.

(2)      Excludes  Properties  that were  vacant at December  31,  which did not
         generate any rental revenues during the year ended December 31.

         The following is a schedule of lease expirations for leases in place as
of December 31, 2001, for the next ten years and thereafter.
<TABLE>
<CAPTION>

                                                                            Percentage of
                                Number           Annual Rental              Gross Annual
  Expiration Year              of Leases            Revenues                Rental Income
--------------------         --------------     -----------------         ------------------

 <c>
        2002                     --                      $     --                        --
        2003                     --                            --                        --
        2004                     --                            --                        --
        2005                     --                            --                        --
        2006                      10                      645,012                    16.86%
        2007                      3                       538,740                    14.08%
        2008                     --                            --                        --
        2009                      4                       416,353                    10.88%
        2010                      1                       107,505                     2.81%
        2011                      5                       525,469                    13.73%
        Thereafter                24                    1,593,817                    41.64%
                               ---------          ----------------         -----------------
        Total (1)                 47                 $  3,826,896                   100.00%
                               =========          ================         =================
</TABLE>


(1)      Excludes one Property which was vacant at December 31, 2001.

         Leases  with  Major   Tenants.   The  terms  of  the  leases  with  the
Partnership's  major  tenants as of December  31,  2001 (see Item 1.  Business -
Major  Tenants),  are  substantially  the  same as  those  described  in Item 1.
Business - Leases.

         Diageo,  PLC leases seven Burger King restaurants.  The initial term of
each lease is 14 years  (expiring in 2006) and the average  minimum base rent is
approximately $107,000 (ranging from approximately $73,800 to $134,100).

         Golden Corral  Corporation  leases six Golden Corral  restaurants.  The
initial term of each lease is 15 years (expiring  between 2007 and 2016) and the
average minimum base rent is approximately  $164,658 (ranging from approximately
$88,047 to $225,800).

         Jack in the Box  Inc.  leases  six  Jack  in the Box  restaurants.  The
initial term of each lease is between 18 and 20 years (expiring between 2009 and
2016) and the average minimum base rent is  approximately  $80,374 (ranging from
approximately $63,000 to $92,600).


Item 3.  Legal Proceedings

         Neither the  Partnership,  nor its General Partners or any affiliate of
the General Partners,  nor any of their respective  Properties,  is party to, or
subject to, any material legal proceedings.


Item 4.  Submission of Matters to a Vote of Security Holders

         Not applicable.

<page>
                                     PART II


Item 5.  Market for Registrant's Common Equity and Related Stockholder Matters

         (a) As of March 15,  2002,  there were  3,491  holders of record of the
Units.  There  is no  public  trading  market  for  the  Units,  and  it is  not
anticipated  that a public  market  for the Units  will  develop.  During  1999,
Limited  Partners  who wished to sell their Units may have offered the Units for
sale pursuant to the Partnership's  distribution reinvestment plan (the "Plan"),
and  Limited  Partners  who wished to have their  distributions  used to acquire
additional  Units (to the extent Units were  available for  purchase),  may have
done so pursuant to such Plan.  The General  Partners have the right to prohibit
transfers of Units. From inception,  the price for any Unit transferred pursuant
to the Plan was $9.50 per Unit.  The price paid for any Unit  transferred  other
than  pursuant to the Plan was subject to  negotiation  by the purchaser and the
selling Limited Partner. The Partnership will not redeem or repurchase Units.

         The following table reflects,  for each calendar quarter, the high, low
and average  sales prices for transfers of Units during 2001 and 2000 other than
pursuant to the Plan, net of commissions.
<TABLE>
<CAPTION>

                                             2001 (1)                               2000 (1)
                                 ----------------------------------     ----------------------------------
                                   High         Low        Average        High         Low       Average
                                 ---------    --------    ----------    ---------    --------   -----------

 <c>
         First Quarter              $7.56      $ 7.10        $ 7.34        $7.64       $7.41        $ 7.54
         Second Quarter              7.36        7.36          7.36         7.85        7.85          7.85
         Third Quarter               7.54        4.65          7.19         8.26        6.42          7.52
         Fourth Quarter              8.00        6.30          7.67         8.00        6.30          7.43
</TABLE>

(1)      A total of 16,779 and 15,966 Units were transferred other than pursuant
         to  the  Plan  for  the  years  ended   December  31,  2001  and  2000,
         respectively.

         The  capital  contribution  per Unit was $10.  All cash  available  for
distribution  will be distributed to the partners  pursuant to the provisions of
the partnership agreement.

         For the  years  ended  December  31,  2001 and  2000,  the  Partnership
declared cash distributions of $3,600,004 to the Limited Partners. Distributions
of $900,001  were  declared to the Limited  Partners at the close of each of the
Partnership's  calendar  quarters  during 2001 and 2000.  These amounts  include
monthly  distributions  made in arrears  for the  Limited  Partners  electing to
receive such distributions on this basis. No amounts distributed to partners for
the years  ended  December  31,  2001 and 2000 are  required  to be or have been
treated by the  Partnership  as a return of capital for purposes of  calculating
the  Limited  Partners'  return  on their  adjusted  capital  contributions.  No
distributions have been made to the General Partners to date.

         The  Partnership  intends to  continue  to make  distributions  of cash
available  for  distribution  to the  Limited  Partners  on a  quarterly  basis,
although some Limited  Partners,  in  accordance  with their  election,  receive
monthly distributions, for an annual fee.

(b)      Not applicable.


Item 6.  Selected Financial Data
<TABLE>
<CAPTION>

                                        2001              2000               1999               1998              1997
                                   ---------------    --------------     --------------    ---------------    --------------

 <c>
  Year ended December 31:
    Revenues (1)                       $2,845,686        $3,388,786         $3,437,012         $3,627,060        $3,842,060
    Net income (2)                      1,732,654         2,465,788          2,269,401          1,878,858         3,531,381
    Cash distributions
       declared (3)                     3,600,004         3,600,004          3,600,004          3,680,004         3,600,003
    Net income per Unit (2)                  0.43              0.62               0.56               0.46              0.87
    Cash distributions
       declared per Unit (3)                 0.90              0.90               0.90               0.92              0.90

  At December 31:
    Total assets                      $30,087,645       $32,124,183        $33,248,120        $34,480,865       $36,289,727
    Partners' capital                  29,020,728        30,888,078         32,022,294         33,352,897        35,154,043
</TABLE>


(1)      Revenues  include  equity in earnings  (loss) of  unconsolidated  joint
         ventures  and  minority  interest in income of the  consolidated  joint
         venture.

(2)      Net income for the years ended December 31, 2000, 1999, 1998, and 1997,
         includes $50,755, $32,499, $218,960, and $132,238,  respectively,  from
         gains on sale of assets.  Net income for the years ended  December  31,
         2001, 2000, 1999 and 1998,  includes $391,186,  $289,453,  $377,266 and
         $1,001,846, respectively, from provision for write-down of assets.

(3)      Distributions  for the year ended  December  31, 1998 include a special
         distribution  to the  Limited  Partners  of $80,000  which  represented
         cumulative excess operating reserves.

         The above selected  financial  data should be read in conjunction  with
the financial statements and related notes contained in Item 8 hereof.


Item 7.  Management's Discussion and Analysis of Financial Condition and Results
         of Operations

         The  Partnership  was organized on April 16, 1990, to acquire for cash,
either directly or through joint venture  arrangements,  both newly  constructed
and  existing  restaurant  Properties,  as well as land  upon  which  restaurant
Properties  were to be  constructed,  to be leased  primarily  to  operators  of
selected national and regional fast-food and family-style Restaurant Chains. The
leases are generally  triple-net  leases,  with the lessees  responsible for all
repairs and maintenance, property taxes, insurance and utilities. As of December
31, 2001, the Partnership owned 35 Properties  directly and held interests in 13
Properties either through joint venture or tenancy in common arrangements.

Capital Resources

         The  Partnership's  primary  source  of  capital  for the  years  ended
December 31, 2001, 2000, and 1999, was cash from operations (which includes cash
received from tenants,  distributions from joint ventures and interest received,
less cash paid for expenses).  Cash from operations was $3,127,850,  $3,298,666,
and  $3,182,882,  for the  years  ended  December  31,  2001,  2000,  and  1999,
respectively.  The decrease in cash from  operations  during 2001 as compared to
2000,  and the increase  during 2000 as compared to 1999, was primarily a result
of changes in income and expenses as described in "Results of Operations"  below
and changes in the Partnership's working capital.

         Other  sources and uses of capital  included the  following  during the
years ended December 31, 2001, 2000, and 1999.

         In January 1999,  the  Partnership  reinvested  the majority of the net
sales  proceeds  from the 1998 sale of the  Property in  Billings,  Montana plus
remaining  net  proceeds  from  other  sales of  properties  in a joint  venture
arrangement,  Ocean  Shores  Joint  Venture,  with an  affiliate  of the General
Partners,  to purchase and hold one restaurant property.  The Partnership owns a
69.06% interest in the profits and losses of the joint venture.  The Partnership
distributed amounts sufficient to enable the Limited Partners to pay federal and
state  income  taxes,  if any  (at a level  reasonably  assumed  by the  General
Partners), resulting from the sale.

         In March 1999, the Partnership  sold its Property in Amherst,  New York
to a third party and received net sales proceeds of $1,150,000.  The Partnership
had recorded a provision for  impairment in the carrying  value relating to this
Property  of  $93,328  at  December  31,  1998  due to  the  tenant  filing  for
bankruptcy.  The provision represented the difference between the carrying value
of the Property at December  31, 1998 and the general  partners'  estimated  net
realizable value for the Property.  During 1999, the Partnership recorded a gain
relating to the sale of this Property of $74,640,  resulting in an aggregate net
loss of approximately $18,700. In March 1999, the Partnership reinvested the net
sales proceeds plus additional  funds,  totaling  approximately  $1,257,200 in a
Golden Corral Property in Fremont, Nebraska. The Partnership distributed amounts
sufficient to enable the Limited Partners to pay federal and state income taxes,
if any (at a level reasonably assumed by the General  Partners),  resulting from
the sale.

         In addition,  in August 1999, the Partnership sold its Property in Fort
Myers Beach,  Florida for $931,725,  resulting in a loss of $42,141. In November
1999,  the  Partnership  reinvested  the  majority of these  proceeds in a joint
venture  arrangement,  Peoria  Joint  Venture,  with CNL Income Fund II, Ltd., a
Florida  limited  partnership  and an  affiliate  of the  General  Partners,  to
purchase  and  hold  one  restaurant  Property.   The  Partnership   contributed
approximately  $825,700  and had a 52% interest in the profits and losses of the
joint  venture as of December  31, 1999.  The  Partnership  distributed  amounts
sufficient to enable the Limited Partners to pay federal and state income taxes,
if any (at a level reasonably  assumed by the General  Partners)  resulting from
the sale.

         In December 2000, the Partnership  sold its Property in Lancaster,  New
York to a  third  party  and  received  net  sales  proceeds  of  $749,675.  The
Partnership  had recorded a provision for write-down of assets  relating to this
Property  of  $387,202  at  December  31,  1998  due to the  tenant  filing  for
bankruptcy.  The provision represented the difference between the carrying value
of the Property at December  31, 1998 and the general  partners'  estimated  net
realizable value for the Property.  During 2000, the Partnership recorded a gain
relating to the sale of this Property of $50,755,  resulting in an aggregate net
loss of approximately  $336,400. The Partnership  distributed amounts sufficient
to enable the Limited Partners to pay federal and state income taxes, if any (at
a level reasonably assumed by the General Partners), resulting from the sale. In
April 2001, the  Partnership  reinvested a portion of the proceeds from the sale
of this Property in a joint venture  arrangement,  CNL VIII, X, XII Kokomo Joint
Venture,  with CNL Income Fund VIII, Ltd. and CNL Income Fund XII, Ltd., each of
which is a  Florida  limited  partnership  pursuant  to the laws of the state of
Florida and an  affiliate  of the  General  Partners,  to purchase  and hold one
restaurant Property. The joint venture acquired this Property from CNL BB Corp.,
an  affiliate  of  the  General  Partners.   The  affiliate  had  purchased  and
temporarily held title to the Property in order to facilitate the acquisition of
the Property by the joint venture.  The  Partnership  contributed  approximately
$211,200 and had a 10%  interest in the profits and losses of the joint  venture
as of December 31, 2001.

         In addition,  during 2000,  the  Partnership  entered into a promissory
note with the corporate  General Partner for a loan in the amount of $125,000 in
connection   with   the   operations   of  the   Partnership.   The   note   was
uncollateralized,  non-interest  bearing and due on demand.  As of December  31,
2000,  the  Partnership  had  repaid the loan in full to the  corporate  General
Partner.  No such  promissory  notes were  entered  into  during the years ended
December 31, 2001 and 1999.


         In August 2001, Peoria Joint Venture,  in which the Partnership owned a
52% interest,  sold its Property to a third party for  approximately  $1,786,900
resulting in a gain of  approximately  $136,700.  As a result,  the  Partnership
received   approximately   $899,500  representing  its  pro-rata  share  of  the
liquidation  proceeds  received by the joint venture.  In September 2001, Peoria
Joint Venture was dissolved in accordance with the joint venture  agreement.  No
gain or loss on the  dissolution  of the joint venture was recorded.  In January
2002, the Partnership  reinvested the majority of the liquidation  proceeds in a
Property  in Austin,  Texas,  as  tenants-in-common  with CNL Income Fund XVIII,
Ltd., a Florida limited partnership and an affiliate of the General Partners.

         None of the Properties owned by the Partnership,  or the joint ventures
or tenancy in common arrangements in which the Partnership owns an interest,  is
or may be  encumbered.  Under its  partnership  agreement,  the  Partnership  is
prohibited from borrowing for any purpose;  provided,  however, that the General
Partners or their affiliates are entitled to reimbursement,  at cost, for actual
expenses  incurred by the General  Partners or their affiliates on behalf of the
Partnership.  Affiliates of the General Partners from time to time incur certain
operating  expenses  on behalf  of the  Partnership  for  which the  Partnership
reimburses the affiliates without interest.

         Currently,  rental  income from the  Partnership's  Properties  and net
sales proceeds from the sale of Properties are invested in money market accounts
or other short-term highly liquid investments such as demand deposit accounts at
commercial  banks,  money market accounts and  certificates of deposit with less
than a 90-day maturity date,  pending the Partnership's use of such funds to pay
Partnership  expenses,  to make  distributions  to  partners  or to  reinvest in
additional  Properties.  At December 31, 2001, the  Partnership  had $1,565,888,
invested in such  short-term  investments  as compared to $1,361,652 at December
31, 2000.  The increase in cash and cash  equivalents  during 2001 was partially
attributable to the fact that the  Partnership  received as a return of capital,
its pro rata share of the  liquidation  proceeds from the  dissolution of Peoria
Joint Venture, as described above. The increase in cash and cash equivalents was
offset  by the fact that the  Partnership  used a  portion  of the net  proceeds
received from the 2000 sale of its Property in Lancaster,  New York to invest in
CNL VIII, X, XII Kokomo Joint Venture,  as described  above.  As of December 31,
2001, the average  interest rate earned on the rental income deposited in demand
deposit accounts at commercial banks was approximately 2.1% annually.  The funds
remaining  at  December  31,  2001,  after  payment of  distributions  and other
liabilities,  will be used to invest in an  additional  Property and to meet the
Partnership's working capital needs.

         In September  2001, the  Partnership  entered into an agreement with an
unrelated third party to sell its Property in North Richland Hills, Texas and in
February 2002, the Partnership entered into an agreement with an unrelated third
party to sell its Property in San Marcos, Texas. As of March 15, 2002, the sales
had not occurred.

Short-Term Liquidity

         The Partnership's  short-term liquidity  requirements consist primarily
of the operating expenses of the Partnership.

         The Partnership's  investment strategy of acquiring Properties for cash
and  leasing  them under  triple-net  leases to  operators  who  generally  meet
specified financial  standards  minimizes the Partnership's  operating expenses.
The General Partners believe that the leases will continue to generate cash flow
in excess of operating expenses.

         Due to low  operating  expenses  and  ongoing  cash flow,  the  General
Partners believe that the Partnership has sufficient working capital reserves at
this time. In addition,  because all leases of the Partnership's  Properties are
on a  triple-net  basis,  it is not  anticipated  that a  permanent  reserve for
maintenance  and  repairs  will be  established  at this  time.  To the  extent,
however,  that the  Partnership  has  insufficient  funds for such purpose,  the
General Partners will contribute to the Partnership an aggregate amount of up to
one percent of the offering proceeds for maintenance and repairs.

         The General  Partners have the right,  but not the obligation,  to make
additional capital  contributions if they deem it appropriate in connection with
the operations of the Partnership.

         The Partnership  generally  distributes cash from operations  remaining
after the payment of the operating  expenses of the  Partnership,  to the extent
that  the  General  Partners   determine  that  such  funds  are  available  for
distribution.  Based on current and anticipated future cash from operations, the
Partnership  declared  distributions to the Limited Partners of $3,600,004,  for
the years ended December 31, 2001, 2000 and 1999. This represents  distributions
of $0.90 per Unit for the years  ended  December  31,  2001,  2000 and 1999.  No
distributions  were made to the General Partners during the years ended December
31, 2001,  2000 and 1999,  respectively.  No amounts  distributed to the Limited
Partners for the years ended December 31, 2001,  2000, and 1999, are required to
be or have been treated by the  Partnership  as a return of capital for purposes
of  calculating  the  Limited   Partners'   return  on  their  adjusted  capital
contributions. The Partnership intends to continue to make distributions of cash
available for distribution to the Limited Partners on a quarterly basis.

         During 2000, the general  partners waived their right to receive future
distributions  from the Partnership,  including both  distributions of operating
cash flow and  distributions  of  liquidation  proceeds,  to the extent that the
cumulative amount of such distributions  would exceed the balance in the general
partners'  capital  account as of December  31, 1999.  Accordingly,  the general
partners were not allocated any net income and did not receive any distributions
during the years ended December 31, 2001 and 2000.

         As of  December  31,  2001 and 2000,  the  Partnership  owed $5,539 and
$147,099,   respectively,   to  affiliates  for  accounting  and  administrative
services. As of March 15, 2002, the Partnership had reimbursed the affiliates of
all such amounts. Other liabilities,  including distributions payable, decreased
to $997,122  at December  31,  2001,  from  $1,024,908  at  December  31,  2000,
primarily  as a result of a decrease in accounts  payable  and  deferred  rental
income at December 31, 2001, as compared to December 31, 2000.  The decrease was
partially  offset by an  increase  of rents paid in advance as of  December  31,
2001. The General  Partners  believe that the Partnership has sufficient cash on
hand to meet its current working capital needs.

Long-Term Liquidity

         The  Partnership  has no long-term  debt or other  long-term  liquidity
requirements.

Critical Accounting Policies

         The  Partnership's  leases are  accounted  for under the  provisions of
Statement of Accounting Standard No. 13, "Accounting for Leases" ("FAS 13"), and
have been  accounted  for using  either the direct  financing  or the  operating
method.  FAS 13 requires  management to estimate the economic life of the leased
property,  the residual  value of the leased  property and the present  value of
minimum lease payments to be received from the tenant.  In addition,  management
assumes  that all  payments  to be  received  under its leases are  collectible.
Changes in  management's  estimates or assumption  regarding  collectibility  of
lease  payments  could  result  in a change in  accounting  for the lease at the
inception of the lease.

         The Partnership  accounts for its  unconsolidated  joint ventures using
the equity method of accounting. Under generally accepted accounting principles,
the equity method of accounting is  appropriate  for entities that are partially
owned by the  Partnership,  but for which  operations of the investee are shared
with other partners.  The  Partnership's  joint venture  agreements  require the
consent of all partners on all key  decisions  affecting  the  operations of the
underlying Property.

         Management  reviews its  Properties and  investments in  unconsolidated
entities  periodically  (no less than once per  year)  for  impairment  whenever
events or changes in  circumstances  indicate  that the  carrying  amount of the
assets may not be recoverable through operations.  Management determines whether
impairment in value has occurred by comparing the estimated future  undiscounted
cash flows, including the residual value of the Property, with the carrying cost
of the  individual  Property.  If an  impairment  is  indicated,  the assets are
adjusted to their fair value.

Results of Operations

         During  1999,  the  Partnership  and its  consolidated  joint  venture,
Allegan Real Estate Joint Venture,  owned and leased 39 wholly owned  Properties
(including  two  Properties  sold  in  1999)  and  during  2000  and  2001,  the
Partnership and its consolidated joint venture, owned and leased 36 wholly owned
Properties  (including  one  Property  which  was  sold in  August  2001 and one
Property which was sold in December 2000). In addition,  during 2001,  2000, and
1999,  the  Partnership  was a co-venturer  in four separate joint ventures that
each owned and leased one Property and one joint  venture which owned and leased
six Properties. During 2001, the Partnership was a co-venturer in one additional
joint venture that owned and leased one Property. In addition, during 2001, 2000
and 1999, the  Partnership  owned and leased two Properties  with  affiliates as
tenants-in-common.  As of December  31,  2001,  the  Partnership  owned,  either
directly  or  through  joint  venture  arrangements,  48  Properties  which  are
generally subject to long-term,  triple-net leases. The leases of the Properties
provide for minimum base annual rental amounts (payable in monthly installments)
ranging  from  approximately  $29,400 to  $225,800.  The  majority of the leases
provide for percentage rent based on sales in excess of a specified  amount.  In
addition,  a majority of the leases provide that,  commencing in specified lease
years  (ranging  from the second to the sixth lease year),  the annual base rent
required under the terms of the lease will increase.  For further description of
the Partnership's leases and Properties,  see Item 1. Business - Leases and Item
2. Properties, respectively.

         During  the  years  ended  December  31,  2001,  2000,  and  1999,  the
Partnership and its consolidated joint venture,  earned $2,859,338 , $2,849,565,
and $2,918,175,  respectively, in rental income from operating leases and earned
income from direct  financing  leases.  The decrease in rental and earned income
during 2000, as compared to 1999, was due to a decrease of approximately $99,900
as the result of the sale of several Properties during 1999. In addition, rental
and earned income were lower in 2000, as compared to 1999,  due to the fact that
in September 1999, the tenant of the Property in Ft. Pierce, Florida vacated the
Property and ceased making rental  payments to the  Partnership,  resulting in a
decrease in rental and earned income of  approximately  $40,500 during 2000. The
General Partners are currently seeking either a new tenant or purchaser for this
Property.  The lost revenues  resulting from this vacated Property could have an
adverse  affect  on  the  results  of  operations  of  the  partnership  if  the
Partnership is unable to re-lease or sell this property in a timely manner. This
decrease was partially  offset by an increase of  approximately  $48,800  during
2000 due to the  reinvestment  of the  majority  of the net  sales  proceeds  in
additional Properties, as described in "Capital Resources."

         The  decrease in rental and earned  income  during  2000 was  partially
offset by an increase of approximately  $71,900, as a result of the fact that in
January  2000,  the  Partnership  entered  into a new lease with a new tenant to
operate  the  location  as  a  Kinko's  Copies.  In  connection  therewith,  the
Partnership  agreed to remove the old building so the tenant  could  construct a
new building.  As a result,  the Partnership  recorded a loss  representing  the
undepreciated  cost of the building as of December 31,  1999.  In October  1998,
Boston  Chicken,  Inc.,  the tenant of the Boston  Market  Property in Homewood,
Alabama,  filed for  bankruptcy and rejected the lease relating to this Property
and ceased making payments to the Partnership.

         During  the  years  ended  December  31,  2001,  2000,  and  1999,  the
Partnership  also  earned  $51,376,  $65,717,  and  $96,541,   respectively,  in
contingent  rental income.  The decrease in contingent rental income during 2001
and 2000 each as compared to the previous year was primarily  attributable  to a
decrease in gross sales relating to certain  restaurant  properties whose leases
require the payment of contingent rent.

         During  the  years  ended  December  31,  2001,  2000,  and  1999,  the
Partnership also earned $32,588, $30,303, and $48,935, respectively, in interest
and other  income.  The  decrease in interest  and other  income  during 2000 as
compared to 1999, was primarily  attributable  to the fact that during 1999, the
Partnership  earned interest on the net sales proceeds  relating to the sales of
several  Properties,  pending  the  reinvestment  of the net sales  proceeds  in
additional Properties.

         During the year ended  December 31, 2001,  three  lessees (or groups of
affiliated  tenants) of the Partnership and its consolidated joint venture,  (i)
Burger King Corporation and BK Acquisition,  Inc. (which are affiliated entities
under common control of Diageo, PLC) (hereinafter referred to as "Diageo, PLC"),
(ii) Golden  Corral  Corporation  and (iii) Jack in the Box Inc. and Jack in the
Box Eastern Division,  L.P. (which are affiliated  entities under common control
of Jack in the Box Inc.)  (hereinafter  referred  to as "Jack in the Box Inc."),
each  contributed  more than 10% of the  Partnership's  total  rental and earned
income (including  rental and earned income from the Partnership's  consolidated
joint venture and the  Partnership's  share of rental and earned income from ten
Properties owned by unconsolidated  joint ventures and two Properties owned with
affiliates  of the General  Partners as  tenants-in-common).  As of December 31,
2001,  Diageo,  PLC was the lessee under leases  relating to seven  restaurants,
Golden  Corral   Corporation  was  the  lessee  under  leases  relating  to  six
restaurants and Jack in the Box Inc. was the lessee under leases relating to six
restaurants.  It is  anticipated  that  based  on the  minimum  rental  payments
required by the leases,  these three lessees will  continue to  contribute  more
than 10% of the  Partnership's  total rental and earned  income  during 2002. In
addition,  during the year ended  December 31,  2001,  four  Restaurant  Chains,
Golden  Corral,  Hardee's,  Burger King, and Jack in the Box, each accounted for
more than 10% of the  Partnership's  total rental and earned  income  (including
rental and earned income from the Partnership's  consolidated  joint venture and
the Partnership's share of rental and earned income from ten Properties owned by
unconsolidated  joint  ventures  and two  Properties  owned with  affiliates  as
tenants-in-common). In 2002, it is anticipated that these four Restaurant Chains
will continue to account for more than 10% of the Partnership's total rental and
earned  income  to which  the  Partnership  is  entitled  under the terms of the
leases.  Any failure of these  lessees or  Restaurant  Chains  could  materially
affect the  Partnership's  income if the Partnership is not able to re-lease the
Properties in a timely manner.

         Operating expenses, including depreciation and amortization expense and
provisions for write-down of assets were $1,113,032,  $971,575,  and $1,198,900,
for the years  ended  December  31,  2001,  2000,  and 1999,  respectively.  The
increase in  operating  expenses  during 2001 as compared to 2000 was  primarily
attributable  to an increase in the costs incurred for  administrative  expenses
for  servicing  the  Partnership  and  its  Properties,   as  permitted  by  the
Partnership  agreement.  The increase in operating expenses during 2001 was also
partially  attributable to the Partnership  recording a provision for write-down
of assets  related to two  Properties,  as  described  below.  The  increase  in
operating  expenses during 2001 was partially offset by, and the decrease during
2000, as compared to 1999,  was primarily due to, the fact that the  Partnership
incurred $38,333 and $195,746 during 2000 and 1999, respectively, in transaction
costs related to the General Partners retaining  financial and legal advisors to
assist them in evaluating and  negotiating  the proposed and  terminated  merger
with APF, as described in  "Termination  of Merger." No such  transaction  costs
were incurred during the year ended December 31, 2001.

         The decrease in operating expenses during 2000, as compared to 1999 was
partially  due to the fact  that  during  1999 the  Partnership  recorded  legal
expenses,   real  estate  taxes,  insurance  and  maintenance  relating  to  the
Properties in Lancaster, New York and Homewood, Alabama due to the fact that the
tenants  of these  Properties  filed for  bankruptcy,  and the  Property  in Ft.
Pierce,  Florida, due to the tenant vacating the Property.  In January 2000, the
Partnership  re-leased the Property in Homewood,  Alabama to a new tenant who is
responsible  for such  expenses in the  future,  based on the terms of the lease
agreement.  The increase in operating  expenses during 2001 was partially offset
by the  fact  that in  December  2000,  the  Partnership  sold the  Property  in
Lancaster,  New York for which the  Partnership  had  previously  incurred  such
expenses. The Partnership expects to continue to incur such expenses relating to
the remaining vacant Property in Ft. Pierce, Florida, until a replacement tenant
or  purchaser  is  located.  The  Partnership  is  currently  seeking  either  a
replacement tenant or purchaser for this Property.

         In January 2000,  the  Partnership  entered into a new lease with a new
tenant for the Property in  Homewood,  Alabama.  In  connection  therewith,  the
Partnership  agreed to remove  the old  building  from the  Property  so the new
tenant can  construct a new  building.  Therefore,  at December  31,  1999,  the
Partnership   recorded  a  provision  for  write-down  of  assets  of  $357,760,
representing the undepreciated  cost of the old building.  During the year ended
December 31, 2000, the building was demolished and the total  undepreciated cost
of the building of $629,785,  for which the Partnership had recorded  provisions
in prior  years,  was  removed.  No gain or loss on  demolition  relating to the
building  was  recorded in 2000.  During the years ended  December  31, 2001 and
2000,  the  Partnership  recorded a provision  for  write-down  of assets in the
amount of $306,659 and $287,275,  respectively,  relating to the Property in Ft.
Pierce,  Florida due to the fact that the tenant vacated the Property and ceased
making  rental  payments  to the  Partnership.  The  provision  represented  the
difference  between the carrying  value of the Property at December 31, 2001 and
2000, and the General  Partners'  estimated net realizable value of the Property
for each year.  In  addition,  during  the year ended  December  31,  2001,  the
Partnership  established a provision  for  write-down of assets in the amount of
$84,527  related to the Property in North Richland Hills,  Texas.  The provision
represented  the  difference  between  the  carrying  value of the  Property  at
December 31, 2001 and the anticipated sales price for the Property.

         As a result of the sale of the  Property in  Lancaster,  New York,  the
Partnership  recorded a gain of $50,755 during the year ended December 31, 2000.
As a result of the sale of the  Properties  in Amherst,  New York and Fort Myers
Beach,  Florida,  the  Partnership  recorded  a gain  of  $74,640  and a loss of
$42,141,  respectively,  during the year ended December 31, 1999. For additional
information on the sales of these Properties, see "Capital Resources."

         For the year ended December 31, 2001, the  Partnership  recorded a loss
of $88,921,  and for the years ended December 31, 2000 and 1999, the Partnership
earned $449,576 and $380,616, respectively, attributable to net income earned by
unconsolidated  joint ventures in which the  Partnership  is a co-venturer.  The
decrease in net income earned by these joint  ventures  during 2001, as compared
to 2000,  was due to the fact  that the  tenant of the  Property  owned by Ocean
Shores  Joint  Venture,  in  which  the  Partnership  owns  a  69.06%  interest,
experienced financial difficulties,  ceased operations and vacated the Property.
As a result, during 2001 the joint venture established an allowance for doubtful
accounts of approximately $91,300 for past due rental amounts in accordance with
the joint venture's policy.  No such allowance was established  during the years
ended  December 31, 2000 and 1999.  The joint  venture  will  continue to pursue
collection of past due amounts.  The joint venture will not record rental income
relating to this  Property  until it locates a new tenant or purchaser  for this
Property.  The joint venture is beginning the process of seeking a new tenant or
purchaser  for this  Property.  In  addition,  during  2001,  the joint  venture
established a provision for write-down of assets in the amount of $781,749.  The
provision  represented the difference between the carrying value of the Property
and the joint venture partners' estimated net realizable value for the Property.
No such  provision  was  recorded  during the years ended  December 31, 2000 and
1999.

         The decrease in net income earned from joint  ventures  during 2001 was
partially  offset by the fact that in April 2001, the Partnership used a portion
of the net  sales  proceeds  received  from the  2000  sale of its  Property  in
Lancaster,  New York to invest in a joint venture arrangement,  CNL VIII, X, XII
Kokomo Joint Venture,  with CNL Income Fund VIII,  Ltd. and CNL Income Fund XII,
Ltd. to purchase and hold one restaurant Property.  Each of the CNL Income Funds
is a Florida limited  partnership  pursuant to the laws of the state of Florida,
and an  affiliate  of the general  partners.  In  addition,  the decrease in net
income during 2001 was partially offset by the fact that in August 2001,  Peoria
Joint Venture, in which the Partnership owned a 52% interest,  sold its Property
to a third party for $1,786,900  resulting in a gain of approximately  $136,700.
The Partnership dissolved the joint venture in accordance with the joint venture
agreement and did not record a gain or loss on the dissolution.  The Partnership
received  $899,500  representing its pro rata share of the liquidation  proceeds
from the joint venture, as described in "Capital Resources." The increase in net
income earned by  unconsolidated  joint ventures  during 2000 as compared to the
1999, was primarily  attributable to the fact that the  Partnership  invested in
Ocean Shores Joint  Venture in January 1999 and Peoria Joint Venture in December
1999, as described above in "Capital Resources."

         The  restaurant  industry,  as a  whole,  has  been  one  of  the  many
industries affected by the general slowdown in the economy. The General Partners
remain  confident in the overall  performance  of the fast-food and family style
restaurants,  the  concepts  that  comprise  the  majority of the  Partnership's
portfolio.  Industry  data shows  that these  restaurant  concepts  continue  to
outperform and remain more stable than higher-end  restaurants,  which have been
more adversely affected by the slowing economy.

         The  Partnership's  leases  as of  December  31,  2001,  are  generally
triple-net  leases and  contain  provisions  that the General  Partners  believe
mitigate  the adverse  effect of  inflation.  Such  provisions  include  clauses
requiring the payment of percentage rent based on certain restaurant sales above
a specified  level and/or  automatic  increases in base rent at specified  times
during the term of the lease.  Inflation,  overall,  has had a minimal effect on
results of operations of the  Partnership.  Continued  inflation  also may cause
capital  appreciation of the  Partnership's  Properties.  Inflation and changing
prices, however, also may have an adverse impact on the sales of the restaurants
and on potential capital appreciation of the Properties.

         In December 1999, the Securities and Exchange  Commission  released SAB
101, which provides the staff's view in applying generally  accepted  accounting
principles  to  selected  revenue  recognition  issues.  SAB  101  requires  the
Partnership  to defer  recognition  of certain  percentage  rental  income until
certain defined  thresholds are met. The  Partnership  adopted SAB 101 beginning
January 1, 2000. Implementation of SAB 101 did not have a material impact on the
partnership's result of operations.

         In July 2001, the Financial Accounting Standards Board issued Statement
of Financial Accounting  Standards No. 141 "Business  Combination" (FAS 141) and
Statement  of  Financial  Accounting  Standards  No.  142  "Goodwill  and  Other
Intangible  Assets" (FAS 142). The  Partnership has reviewed both statements and
has determined  that both FAS 141 and FAS 142 do not apply to the Partnership as
of December 31, 2001.

         In October  2001,  the  Financial  Accounting  Standards  Board  issued
Statement  of  Financial  Accounting  Standards  No.  144  "Accounting  for  the
Impairment or Disposal of Long-Lived  Assets" (FAS 144). This statement requires
that a long-lived asset be tested for recoverability  whenever events or changes
in circumstances  indicate that its carrying amount may not be recoverable.  The
carrying  amount of a long-lived  asset is not recoverable if it exceeds the sum
of the  undiscounted  cash flows  expected to result  from the use and  eventual
disposition of the asset.  The assessment is based on the carrying amount of the
asset  at the  date it is  tested  for  recoverability.  An  impairment  loss is
recognized  when the  carrying  amount of a long-lived  assets  exceeds its fair
value.  If an  impairment  is  recognized,  the  adjusted  carrying  amount of a
long-lived asset is its new cost basis. The adoption of FAS 144 did not have any
effect on the  Partnership's  recording of impairment  losses as this  Statement
retain the fundamental  provisions of FAS No. 121 "Accounting for the Impairment
of Long-Lived Assets and for Long-Lived Assets to be disposed of."

Termination of Merger

         On March 11, 1999, the  Partnership  entered into an Agreement and Plan
of Merger with CNL American Properties Fund, Inc. ("APF"), pursuant to which the
Partnership  would be merged with and into a subsidiary  of APF (the  "Merger").
APF is a real estate investment trust whose primary business is the ownership of
restaurant  properties leased on a long term, "triple net" basis to operators of
national and regional restaurant chains. Under the Agreement and Plan of Merger,
APF was to issue shares of its common stock as consideration  for the Merger. On
March 1, 2000,  the General  Partners and APF  announced  that they had mutually
agreed to terminate the Agreement and Plan of Merger entered into in March 1999.
The agreement to terminate the Agreement and Plan of Merger was based,  in large
part,  on the General  Partners'  concern  that,  in light of market  conditions
relating to publicly  traded real  estate  investment  trusts,  the value of the
transaction  had  diminished.  As a result  of such  diminishment,  the  General
Partners' ability to unequivocally recommend voting for the transaction,  in the
exercise  of their  fiduciary  duties,  had  become  questionable.  The  General
Partners are continuing to evaluate strategic  alternatives for the Partnership,
including alternatives to provide liquidity to the limited partners.


Item 7A.  Quantitative and Qualitative Disclosures About Market Risk

         Not applicable.


Item 8.  Financial Statements and Supplementary Data
<page>

                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                                    CONTENTS






                                                                           Page

Report of Independent Certified Public Accountants                          19

Financial Statements:

     Balance Sheets                                                         20

     Statements of Income                                                   21

     Statements of Partners' Capital                                        22

     Statements of Cash Flows                                            23-24

     Notes to Financial Statements                                       25-42






               Report of Independent Certified Public Accountants



To the Partners
CNL Income Fund X, Ltd.



In our opinion,  the accompanying  balance sheets and the related  statements of
income,  of partners'  capital and of cash flows present fairly, in all material
respects,  the financial  position of CNL Income Fund X, Ltd. (a Florida limited
partnership)  at December 31, 2001 and 2000,  and the results of its  operations
and its cash flows for each of the three years in the period ended  December 31,
2001 in conformity with accounting  principles  generally accepted in the United
States  of  America.  In  addition,  in our  opinion,  the  financial  statement
schedules listed in the index appearing under item 14(a)(2)  present fairly,  in
all  material  respects,   the  information  set  forth  therein  when  read  in
conjunction with the related financial  statements.  These financial  statements
and financial  statement  schedules are the  responsibility of the Partnership's
management;  our  responsibility  is to express  an  opinion on these  financial
statements and financial  statement  schedules based on our audits. We conducted
our audits of these statements in accordance with auditing  standards  generally
accepted in the United States of America, which require that we plan and perform
the audit to obtain reasonable  assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence  supporting the amounts and  disclosures  in the financial  statements,
assessing the  accounting  principles  used and  significant  estimates  made by
management,  and evaluating the overall  financial  statement  presentation.  We
believe that our audits provide a reasonable basis for our opinion.


/s/ PricewaterhouseCoopers LLP


Orlando, Florida
February 8, 2002

<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                                 BALANCE SHEETS
<TABLE>
<CAPTION>


                                                                                         December 31,
                                                                              2001                         2000
                                                                       -------------------          --------------------

 <c>
                         ASSETS

Land and buildings on operating leases, net                                  $ 14,458,854                  $ 15,078,329
Net investment in direct financing leases                                       8,911,232                     9,164,968
Investment in joint ventures                                                    3,664,241                     4,929,505
Cash and cash equivalents                                                       1,565,888                     1,361,652
Receivables, less allowance for doubtful accounts of
     $24,814 and $284,513, respectively
                                                                                   29,930                        48,978
Due from related party                                                                360                        13,063
Accrued rental income, less allowance for
     doubtful accounts of $4,841 and $3,388,
     respectively                                                               1,369,931                     1,431,637
Other assets                                                                       87,209                        96,051
                                                                       -------------------          --------------------

                                                                             $ 30,087,645                  $ 32,124,183
                                                                       ===================          ====================

            LIABILITIES AND PARTNERS' CAPITAL

Accounts payable                                                               $   11,105                    $   35,472
Escrowed real estate taxes payable                                                  8,256                        10,114
Distributions payable                                                             900,001                       900,001
Due to related parties                                                              5,539                       147,099
Rents paid in advance                                                              77,760                        71,418
Deferred rental income                                                                 --                         7,903
                                                                       -------------------          --------------------
         Total liabilities                                                      1,002,661                     1,172,007

Minority interest                                                                  64,256                        64,098

Commitment (Note 11)

Partners' capital                                                              29,020,728                    30,888,078
                                                                       -------------------          --------------------

                                                                             $ 30,087,645                  $ 32,124,183
                                                                       ===================          ====================
                See accompanying notes to financial statements.
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                              STATEMENTS OF INCOME


                                                                                  Year Ended December 31,
                                                                        2001               2000                1999
                                                                  -----------------   ----------------   -----------------

Revenues:
     Rental income from operating leases                             $  1,893,271       $  1,868,756        $  1,771,827
     Earned income from direct financing leases                           966,067            980,809           1,146,348
     Contingent rental income                                              51,376             65,717              96,541
     Interest and other income                                             32,588             30,303              48,935
                                                                  -----------------   ----------------   -----------------
                                                                        2,943,302          2,945,585           3,063,651
                                                                  -----------------   ----------------   -----------------
Expenses:
     General operating and administrative                                 308,138            206,381             182,554
     Professional services                                                 63,711             44,002              64,806
     Real estate taxes                                                     10,760             54,513              39,219
     State and other taxes                                                 36,829             22,580              15,457
     Depreciation and amortization                                        302,408            318,491             325,062
     Provision for write-down of assets                                   391,186            287,275             376,056
     Transaction costs                                                         --             38,333             195,746
                                                                  -----------------   ----------------   -----------------
                                                                        1,113,032            971,575           1,198,900
                                                                  -----------------   ----------------   -----------------
Income Before Gain on Sale of Assets Minority Interest in
     Income of Consolidated Joint Venture and Equity in
     Earnings (Loss) of Unconsolidated Joint Ventures                   1,830,270          1,974,010           1,864,751

Gain on Sale of Assets                                                         --             50,755              32,499

Minority Interest in Income of Consolidated
     Joint Venture                                                         (8,695  )          (8,553  )           (8,465  )

Equity in Earnings (Loss) of Unconsolidated Joint Ventures                (88,921  )         449,576             380,616
                                                                  -----------------   ----------------   -----------------

Net Income                                                           $  1,732,654       $  2,465,788        $  2,269,401
                                                                  =================   ================   =================

Allocation of Net Income
     General partners                                                    $     --           $     --          $   23,210
     Limited partners                                                   1,732,654          2,465,788           2,246,191
                                                                  -----------------   ----------------   -----------------
                                                                     $  1,732,654       $  2,465,788          $2,269,401
                                                                  =================   ================   =================

Net Income Per Limited Partner Unit                                    $     0.43         $     0.62         $      0.56
                                                                  =================   ================   =================

Weighted Average Number of  Limited Partner Units
     Outstanding                                                        4,000,000          4,000,000           4,000,000
                                                                  =================   ================   =================

                                            See accompanying notes to financial statements.

<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                         STATEMENTS OF PARTNERS' CAPITAL

                  Years Ended December 31, 2001, 2000 and 1999

                                         General Partners                                           Limited Partners
                               -------------------------------------   ---------------------------------------------------------
                                                     Accumulated                                               Accumulated
                                 Contributions         Earnings         Contributions      Distributions        Earnings
                               ------------------  -----------------   -----------------  ----------------- ------------------ -

Balance, December 31, 1998           $     1,000       $    228,725       $  40,000,000     $ (24,643,143 )     $  22,556,315

    Distributions to limited
      partners ($0.90 per
      limited partner unit)                   --                 --                  --        (3,600,004 )                --
    Net income                                --             23,210                  --                --           2,246,191
                               ------------------  -----------------   -----------------  ----------------- ------------------ -

Balance, December 31, 1999                 1,000            251,935          40,000,000       (28,243,147 )        24,802,506

    Distributions to limited
      partners ($0.90 per
      limited partner unit)                   --                 --                  --        (3,600,004 )                --
    Net income                                --                 --                  --                --           2,465,788
                               ------------------  -----------------   -----------------  ----------------- ------------------ -

Balance, December 31, 2000                 1,000            251,935          40,000,000       (31,843,151 )        27,268,294

    Distributions to limited
      partners ($0.90 per
      limited partner unit)                   --                 --                  --        (3,600,004 )                --
    Net income                                --                 --                  --                --           1,732,654
                               ------------------  -----------------   -----------------  ----------------- ------------------ -

Balance, December 31, 2001           $     1,000       $    251,935       $  40,000,000     $ (35,443,155 )     $  29,000,948
                               ==================  =================   =================  ================= ================== =
                See accompanying notes to financial statements.
<page>

-----------------------------------
 Syndication
    Costs             Total
---------------  ------------------

  $ (4,790,000)      $ 33,352,897



            --         (3,600,004 )
            --          2,269,401
---------------  ------------------

    (4,790,000)        32,022,294



            --         (3,600,004 )
            --          2,465,788
---------------  ------------------

    (4,790,000)        30,888,078



            --         (3,600,004 )
            --          1,732,654
---------------  ------------------

  $ (4,790,000)      $ 29,020,728
===============  ==================



See accompanying notes to financial statements.



<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                            STATEMENTS OF CASH FLOWS


                                                                               Year Ended December 31,
                                                                      2001               2000               1999
                                                                 ----------------   ----------------   ---------------

Increase (Decrease) in Cash and Cash Equivalents:

      Cash Flows from Operating Activities:
         Cash received from tenants                                  $ 3,182,685        $ 3,130,836    $    3,049,409
         Distributions from unconsolidated
             joint venture                                               488,092            509,280           440,831
         Cash paid for expenses                                         (564,409)          (365,756)         (355,273)
         Interest received                                                21,482             24,306            47,915
                                                                 ----------------   ----------------   ---------------
             Net cash provided by operating activities                 3,127,850          3,298,666         3,182,882
                                                                 ----------------   ----------------   ---------------

      Cash Flows from Investing Activities:
         Proceeds from sale of assets                                         --            749,675         2,081,725
         Additions to land and buildings on operating
             leases                                                           --                 --        (1,257,217)
         Liquidating distribution from joint venture                     899,452                 --                --
         Investment in joint ventures                                   (211,201)                --        (1,628,095)
         Decrease in restricted cash                                          --                 --           359,990
         Payment of lease costs                                           (3,324)           (44,273)               --
                                                                 ----------------   ----------------   ---------------
             Net cash provided by (used in)
                Investing activities                                     684,927            705,402          (443,597)
                                                                 ----------------   ----------------   ---------------

      Cash Flows from Financing Activities:
         Proceeds from loan from corporate general
             partners                                                         --            125,000                --
         Repayment of loan from corporate general
             partners                                                         --           (125,000)               --
         Distributions to limited partners                            (3,600,004)        (3,600,004)       (3,600,004)
         Distributions to holder of minority interest                     (8,537)            (9,506)           (8,159)
                                                                 ----------------   ----------------   ---------------
             Net cash used in financing activities                    (3,608,541)        (3,609,510)       (3,608,163)
                                                                 ----------------   ----------------   ---------------

Net Increase (Decrease) in Cash and Cash Equivalents                     204,236            394,558          (868,878)

Cash and Cash Equivalents at Beginning of Year                         1,361,652            967,094         1,835,972
                                                                 ----------------   ----------------   ---------------

Cash and Cash Equivalents at End of Year                             $ 1,565,888        $ 1,361,652        $  967,094
                                                                 ================   ================   ===============

                See accompanying notes to financial statements.
<page>



                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                      STATEMENTS OF CASH FLOWS - CONTINUED


                                                                               Year Ended December 31,
                                                                        2001              2000               1999
                                                                   ---------------   ----------------   ----------------

 Reconciliation of Net Income to Net Cash Provided by
     Operating Activities:

     Net income                                                       $ 1,732,654        $ 2,465,788        $ 2,269,401
                                                                   ---------------   ----------------   ----------------
     Adjustments to reconcile net income to net cash provided
        by operating activities:
           Depreciation                                                   297,383            317,491            325,062
           Amortization                                                     5,025              1,000                 --
           Minority interest in income of consolidated joint
              venture                                                       8,695              8,553              8,465
           Equity in earnings of unconsolidated joint
              ventures, net of distributions                              577,013             59,704             60,215
           Gain on sale of assets                                              --            (50,755)           (32,499)
           Provision for write-down of assets                             391,186            289,453            377,266
           Decrease (increase) in receivables                              19,048             51,974            (18,439)
           Decrease (increase) in due from related party                   12,703             (3,635)                --
           Decrease in net investment in direct financing                 253,736            226,323            209,710
              leases
           Increase in accrued rental income                               (7,388)           (80,655)           (99,597)
           Decrease (increase) in other assets                              7,141              2,189            (14,254)
           Increase (decrease) in accounts payable and
              escrowed real estate taxes payable                          (26,225)           (74,006)            99,203
           Increase (decrease) in due to related parties                 (141,560)            77,555             30,129
           Increase (decrease) in rents paid in advance and
              deposits                                                      6,342              7,687            (31,780)
           Decrease in deferred rental income                              (7,903)                --                 --
                                                                   ---------------   ----------------   ----------------
                  Total adjustments                                     1,395,196            832,878            913,481
                                                                   ---------------   ----------------   ----------------

 Net Cash Provided by Operating Activities                            $ 3,127,850        $ 3,298,666        $ 3,182,882
                                                                   ===============   ================   ================

 Supplemental Schedule of Non-Cash Financing Activities:

           Distributions declared and unpaid at December 31            $  900,001         $  900,001         $  900,001
                                                                   ===============   ================   ================
</TABLE>

                See accompanying notes to financial statements.
<page>

                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


1.       Significant Accounting Policies:

         Organization  and Nature of  Business - CNL  Income  Fund X, Ltd.  (the
         "Partnership") is a Florida limited  partnership that was organized for
         the purpose of acquiring both newly constructed and existing restaurant
         properties,  as well as properties  upon which  restaurants  were to be
         constructed,  which are leased  primarily  to operators of national and
         regional fast-food and family-style restaurant chains.

         The general partners of the Partnership are CNL Realty Corporation (the
         "Corporate  General  Partner"),  James M.  Seneff,  Jr.  and  Robert A.
         Bourne.  Mr.  Seneff and Mr.  Bourne are also 50%  shareholders  of the
         Corporate General Partner. The general partners have responsibility for
         managing the day-to-day operations of the Partnership.

         Real  Estate  and  Lease  Accounting  -  The  Partnership  records  the
         acquisition of land and buildings at cost,  including  acquisition  and
         closing costs. Land and buildings are leased to unrelated third parties
         generally on a triple-net basis,  whereby the tenant is responsible for
         all operating  expenses  relating to the property,  including  property
         taxes, insurance, maintenance and repairs. The leases are accounted for
         using  either the  direct  financing  or the  operating  methods.  Such
         methods are described below:

                  Direct  financing  method - The leases accounted for using the
                  direct  financing  method are recorded at their net investment
                  (which at the inception of the lease generally  represents the
                  cost of the asset) (see Note 4).  Unearned  income is deferred
                  and  amortized to income over the lease terms so as to produce
                  a constant  periodic rate of return on the  Partnership's  net
                  investment in the leases.

                  Operating  method - Land and  building  leases  accounted  for
                  using the  operating  method are recorded at cost,  revenue is
                  recognized as rentals are earned and  depreciation  is charged
                  to operations as incurred.  Buildings are  depreciated  on the
                  straight-line  method over their estimated  useful lives of 30
                  years.  When  scheduled  rentals  vary  during the lease term,
                  income is recognized on a straight-line basis so as to produce
                  a constant periodic rent over the lease term commencing on the
                  date the property is placed in service.
<page>

                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


1.       Significant Accounting Policies - Continued:

                  Accrued  rental  income  represents  the  aggregate  amount of
                  income  recognized  on a  straight-line  basis  in  excess  of
                  scheduled  rental  payments  to date.  In  contrast,  deferred
                  rental income  represents  the  aggregate  amount of scheduled
                  rental payments to date (including  rental payments due during
                  construction  and  prior  to  the  property  being  placed  in
                  service)  in excess of income  recognized  on a  straight-line
                  basis over the lease term  commencing on the date the property
                  is placed in  service.  Whenever a tenant  defaults  under the
                  terms of its  lease,  or events  or  changes  in  circumstance
                  indicate  that the tenant will not lease the property  through
                  the end of the lease term, the Partnership  either reserves or
                  reverses the cumulative accrued rental income balance.

         When  the  properties  are  sold,  the  related  cost  and  accumulated
         depreciation  for operating  leases and the net  investment  for direct
         financing leases,  plus any accrued rental income, are removed from the
         accounts and gains or losses from sales are  reflected  in income.  The
         general  partners of the Partnership  review  properties for impairment
         whenever events or changes in circumstances  indicate that the carrying
         amount of the assets may not be  recoverable  through  operations.  The
         general partners  determine whether an impairment in value has occurred
         by comparing the estimated future  undiscounted  cash flows,  including
         the  residual  value of the  property,  with the  carrying  cost of the
         individual property. Although the general partners have made their best
         estimate of these factors based on current conditions, it is reasonably
         possible  that  changes  could  occur  in the  near  term  which  could
         adversely  affect  the  general  partners'  estimate  of net cash flows
         expected to be  generated  from its  properties  and the need for asset
         impairment write-downs.  If an impairment is indicated,  the assets are
         adjusted to their fair value.

         When the  collection  of amounts  recorded as rental or other income is
         considered  to be  doubtful,  an  adjustment  is made to  increase  the
         allowance for doubtful accounts,  which is netted against  receivables,
         although  the  Partnership  continues  to  pursue  collection  of  such
         amounts.  If amounts are subsequently  determined to be  uncollectible,
         the  corresponding  receivable and allowance for doubtful  accounts are
         decreased accordingly.

<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


1.       Significant Accounting Policies - Continued:

         Investment in Joint Ventures - The Partnership  accounts for its 88.26%
         interest in Allegan Real Estate Joint Venture  using the  consolidation
         method.   Minority  interest  represents  the  minority  joint  venture
         partner's  proportionate  share  of the  equity  in  the  Partnership's
         consolidated joint venture. All significant  intercompany  accounts and
         transactions have been eliminated.

         The  Partnership's  investments  in  CNL  Restaurant  Investments  III,
         Williston  Real Estate Joint  Venture,  Ashland  Joint  Venture,  Ocean
         Shores Joint Venture and CNL VIII, X, XII Kokomo Joint Venture, and the
         properties in Clinton,  North Carolina,  and Miami,  Florida, for which
         each  property  is  held  as  tenants-in-common  with  affiliates,  are
         accounted  for  using  the  equity  method  since  each  joint  venture
         agreement  requires  the consent of all  partners on all key  decisions
         affecting the operations of the underlying property.

         Cash and Cash Equivalents - The Partnership considers all highly liquid
         investments  with a maturity of three months or less when  purchased to
         be cash  equivalents.  Cash  and cash  equivalents  consist  of  demand
         deposits at commercial  banks and money market funds (some of which are
         backed by government  securities).  Cash equivalents are stated at cost
         plus accrued interest, which approximates market value.

         Cash  accounts  maintained  on  behalf  of the  Partnership  in  demand
         deposits  at  commercial  banks  and  money  market  funds  may  exceed
         federally insured levels;  however, the Partnership has not experienced
         any losses in such accounts.

         Lease Costs - Other assets include  brokerage fees and lease  incentive
         costs  incurred  in  negotiating  new  leases  for  the   Partnership's
         properties  which are amortized  over the terms of the new leases using
         the straight-line method.

         Income Taxes - Under  Section 701 of the  Internal  Revenue  Code,  all
         income,  expenses and tax credit items flow through to the partners for
         tax  purposes.  Therefore,  no  provision  for federal  income taxes is
         provided in the accompanying  financial statements.  The Partnership is
         subject to certain state taxes on its income and property.
<page>

                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


1.       Significant Accounting Policies - Continued:

         Additionally,  for tax  purposes,  syndication  costs are  included  in
         Partnership equity and in the basis of each partner's  investment.  For
         financial  reporting  purposes,  syndication  costs are netted  against
         partners' capital and represent a reduction of Partnership equity and a
         reduction in the basis of each partner's investment. See "Income Taxes"
         footnote for a  reconciliation  of net income for  financial  reporting
         purposes to net income for federal income tax purposes.

         Use of Estimates - The general  partners of the Partnership have made a
         number of estimates and assumptions relating to the reporting of assets
         and liabilities and the disclosure of contingent assets and liabilities
         to prepare these  financial  statements in  conformity  with  generally
         accepted  accounting  principles.  The more significant areas requiring
         the use of  management  estimates  relate to the allowance for doubtful
         accounts  and future  cash flows  associated  with  long-lived  assets.
         Actual results could differ from those estimates.

         Reclassification   -  Certain  items  in  the  prior  years'  financial
         statements  have been  reclassified  to conform  to 2001  presentation.
         These  reclassifications  had no effect  on  partners'  capital  or net
         income.

         Staff Accounting  Bulleting No. 101 ("SAB 101") - In December 1999, the
         Securities and Exchange Commission released SAB 101, which provides the
         staff's view in applying  generally accepted  accounting  principles to
         selected revenue  recognition  issues. SAB 101 requires the Partnership
         to defer recognition of certain  percentage rental income until certain
         defined  thresholds are met. The Partnership  adopted SAB 101 beginning
         January  1,  2000.  Implementation  of SAB 101 did not have a  material
         impact on the partnership's result of operations.

         Statement  of  Financial  Accounting  Standard  No. 141 ("FAS 141") and
         Statement  of  Financial  Accounting  Standard No. 142 ("FAS 142") - In
         July 2001, the Financial Accounting Standards Board issued Statement of
         Financial  Accounting  Standards No. 141 "Business  Combinations"  (FAS
         141) and Statement of Financial  Accounting Standards No. 142 "Goodwill
         and Other  Intangible  Assets" (FAS 142). The  Partnership has reviewed
         both statements and has determined that both FAS 141 and FAS 142 do not
         apply to the Partnership as of December 31, 2001.

<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


1.       Significant Accounting Policies - Continued:

         Statement of Financial  Accounting  Standard No. 144 - In October 2001,
         the Financial  Accounting Standards Board issued Statement of Financial
         Accounting Standards No. 144 "Accounting for the Impairment or Disposal
         of  Long-Lived  Assets"  (FAS  144).  This  statement  requires  that a
         long-lived  asset be  tested  for  recoverability  whenever  events  or
         changes in  circumstances  indicate that its carrying amount may not be
         recoverable.   The  carrying  amount  of  a  long-lived  asset  is  not
         recoverable  if it  exceeds  the  sum of the  undiscounted  cash  flows
         expected to result from the use and eventual  disposition of the asset.
         The assessment is based on the carrying amount of the asset at the date
         it is tested for recoverability.  An impairment loss is recognized when
         the carrying amount of a long-lived asset exceeds its fair value. If an
         impairment is recognized,  the adjusted carrying amount of a long-lived
         asset is its new cost basis.  The  adoption of FAS 144 did not have any
         effect on the  partnership's  recording  of  impairment  losses as this
         Statement   retained  the   fundamental   provisions  of  FAS  No.  121
         "Accounting for the Impairment of Long-Lived  Assets and for Long-Lived
         Assets to be Disposed of."

2.       Leases:

         The Partnership  leases its land and buildings to operators of national
         and regional  fast-food and  family-style  restaurants.  The leases are
         accounted for under the provisions of Statement of Financial Accounting
         Standards No. 13, "Accounting for Leases." Some of the leases have been
         classified  as  operating  leases  and  some of the  leases  have  been
         classified as direct  financing  leases.  For the leases  classified as
         direct financing  leases,  the building portions of the Property leases
         are accounted for as direct financing leases while the land portions of
         the majority of these leases are operating  leases.  Substantially  all
         leases are for 15 to 25 years and provide  for  minimum and  contingent
         rentals. In addition,  the tenant generally pays all property taxes and
         assessments,  fully maintains the interior and exterior of the building
         and carries insurance  coverage for public liability,  property damage,
         fire and extended  coverage.  The lease options generally allow tenants
         to  renew  the  leases  for two to five  successive  five-year  periods
         subject to the same terms and  conditions  as the initial  lease.  Most
         leases  also allow the tenant to purchase  the  property at fair market
         value after a specified portion of the lease has elapsed.

<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


3.       Land and Buildings on Operating Leases:

         Land and  buildings on operating  leases  consisted of the following at
         December 31:

<TABLE>
<CAPTION>

                                                              2001                 2000
                                                       -------------------   ------------------

 <c>
                   Land                                      $  8,190,740          $ 8,345,548
                   Building                                     8,456,224            8,623,508
                                                       -------------------   ------------------
                                                               16,646,964           16,969,056

                   Less accumulated depreciation              (2,188,110)           (1,890,727 )
                                                       -------------------   ------------------

                                                             $ 14,458,854         $ 15,078,329
                                                       ===================   ==================
</TABLE>

         In January 2000,  the  Partnership  entered into a new lease with a new
         tenant for the Property in Homewood,  Alabama. In connection therewith,
         the Partnership  agreed to remove the old building from the property so
         the new tenant could construct a new building.  Therefore,  at December
         31,  1999,  the  Partnership   recorded  an  impairment  for  $357,760,
         representing the undepreciated cost of the old building. As of December
         31, 2000, the building was demolished and the total  undepreciated cost
         of the  old  building  was  removed  from  the  accounts.  Because  the
         Partnership  had  recorded  provisions  in  prior  years,  no  loss  on
         demolition of the building was recognized in 2000.

         In December 2000, the Partnership  sold its property in Lancaster,  New
         York and received net sales  proceeds of $749,675  resulting in a total
         gain  of  $50,755.  During  the  year  ended  December  31,  2000,  the
         Partnership recorded a provision for write-down of assets in the amount
         of  $287,275,  relating to the  property in Ft.  Pierce,  Florida.  The
         tenant of this property vacated the property and  discontinued  payment
         of rents to the  Partnership.  Due to the fact that the Partnership had
         not been able to successfully  re-lease this property,  the Partnership
         increased  the  allowance  by  $306,659   during  2001.  The  provision
         represented  the difference  between the carrying value of the property
         at December 31, 2001 and general partners' the estimated net realizable
         value of the property.

<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


3.       Land and Buildings on Operating Leases:

         In September  2001,  the  Partnership  entered into an agreement with a
         third party to sell its property in North Richland  Hills,  Texas.  The
         Partnership  established  a provision  for  write-down of assets in the
         amount  of  $84,527  (see  Note  11).  The  provision  represented  the
         difference  between the carrying  value of the property at December 31,
         2001 and the anticipated sales price for the property.

         The following is a schedule of the future  minimum lease payments to be
         received on non-cancellable operating leases at December 31, 2001:

                     2002                                     $1,946,843
                     2003                                      1,955,623
                     2004                                      2,011,708
                     2005                                      2,025,557
                     2006                                      1,991,597
                     Thereafter                                6,786,358
                                                         ----------------

                                                             $16,717,686
                                                         ================

         Since  lease  renewal  periods  are  exercisable  at the  option of the
         tenant, the above table only presents future minimum lease payments due
         during  the  initial  lease  terms.  In  addition,  this table does not
         include any amounts for future contingent rentals which may be received
         on the leases based on a percentage of the tenant's gross sales.  These
         amounts do not include minimum lease payments that will become due when
         the property under development is completed.
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


4.       Net Investment in Direct Financing Leases:

         The  following  lists the  components  of the net  investment in direct
         financing leases at December 31:
<TABLE>
<CAPTION>

                                                                    2001                2000
                                                              -----------------    ----------------

 <c>
                 Minimum lease payments receivable                 $12,503,573        $ 13,727,040
                 Estimated residual values                           3,229,175           3,229,175
                 Less unearned income                               (6,821,516 )        (7,791,247 )
                                                              -----------------    ----------------

                 Net investment in direct financing leases         $ 8,911,232         $ 9,164,968
                                                              =================    ================
</TABLE>

         The  following  is a schedule of future  minimum  lease  payments to be
         received on the direct financing leases at December 31, 2001:

                      2002                                     $1,253,453
                      2003                                      1,264,963
                      2004                                      1,275,746
                      2005                                      1,277,081
                      2006                                      1,277,402
                      Thereafter                                6,154,928
                                                          ----------------

                                                              $12,503,573
                                                          ================

         The above table does not include  future  minimum  lease  payments  for
         renewal  periods or for contingent  rental payments that may become due
         in future periods (see Note 3).

5.       Investment in Joint Ventures:

         The Partnership has a 50%, a 10.51%, a 40.95%,  a 13%, a 69.06%,  and a
         6.69% interest in the profits and losses of CNL Restaurant  Investments
         III, Ashland Joint Venture,  Williston Real Estate Joint Venture, Ocean
         Shores Joint Venture, and a property in Clinton,  North Carolina, and a
         property in Miami, Florida,  held as tenants-in-common  with affiliates
         of the  general  partners.  The  remaining  interests  in  these  joint
         ventures are held by affiliates of the Partnership  which have the same
         general partners.

<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


5.       Investment in Joint Ventures - Continued:

         In  November  1999,  the  Partnership  entered  into  a  joint  venture
         arrangement,  Peoria Joint  Venture,  with CNL Income Fund II, Ltd., an
         affiliate  of the  general  partners,  to own and lease one  restaurant
         property. The Partnership had contributed approximately $825,700 to the
         joint  venture.  In August  2001,  Peoria Joint  Venture,  in which the
         Partnership  owned a 52%  interest,  sold its property to a third party
         for  approximately  $1,786,900  resulting  in a gain  of  approximately
         $136,700.  The Partnership and the joint venture partner  dissolved the
         joint  venture in accordance  with the joint venture  agreement and did
         not  recognize  a gain or loss on the  dissolution.  As a  result,  the
         Partnership received  approximately  $899,500 representing its pro rata
         share of the liquidation proceeds received from the joint venture.

         In April 2001,  the  Partnership  used a portion of the sales  proceeds
         from the 2000 sale of its property in Lancaster,  New York to invest in
         a joint venture  arrangement,  CNL VIII,  X, XII Kokomo Joint  Venture,
         with CNL  Income  Fund VIII,  Ltd.  and CNL Income  Fund XII,  Ltd.  to
         purchase and hold one restaurant property. Each of the CNL Income Funds
         is  an  affiliate  of  the  general  partners  and  a  Florida  limited
         partnership  pursuant  to the laws of the state of  Florida.  The joint
         venture  acquired this property from CNL BB Corp.,  an affiliate of the
         general partners (see Note 8). As of December 31, 2001, the Partnership
         had contributed  approximately $211,200 and owned a 10% interest in the
         profits and losses of the joint venture.

         During  the year  ended  December  2001,  Ocean  Shores  Joint  Venture
         recorded  a  provision  for  write-down  of  assets  in the  amount  of
         $738,349,  relating  to its  Burger  King  property  in  Ocean  Shores,
         Washington,  due to the fact that the tenant  vacated the  property and
         ceased  payment of rents  under the terms of its lease  agreement.  The
         provision  represented the difference between the carrying value of the
         property at December 31, 2001 and the joint venture partners' estimated
         net realizable value for the property.

<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


5.       Investment in Joint Ventures - Continued:

         CNL  Restaurant  Investments  III owns and leases six  properties to an
         operator of national  fast-food  restaurants.  Ashland  Joint  Venture,
         Williston  Real Estate Joint Venture,  Ocean Shores Joint Venture,  CNL
         VIII, X, XII Kokomo Joint Venture and the Partnership and affiliates as
         tenants-in-common in two separate tenancy-in-common  arrangements, each
         own and lease one  property to an operator  of  national  fast-food  or
         family-style  restaurants.  The following  presents the joint ventures'
         combined, condensed financial information at December 31:
<TABLE>
<CAPTION>

                                                               2001                    2000
                                                           --------------     -------------------

 <c>
                Land and buildings on operating
                    leases, net                             $ 11,106,444             $ 9,693,530
                Net investment in direct financing
                    leases                                       640,381               2,546,467
                Cash                                              31,907                  57,379
                Receivables, less allowance for
                    doubtful accounts                             74,611                   3,100
                Accrued rental income                             79,333                 120,282
                Other assets                                      24,639                  33,863
                Liabilities                                        7,593                   7,375
                Partners' capital                             11,949,722              12,447,246
                Revenues                                       1,346,578               1,404,081
                Provision for write-down of assets               781,749                      --
                Gain on sale of assets                           136,665                      --
                Net income                                       284,208               1,126,840
</TABLE>

         The  Partnership  recognized  a loss of  $88,921  and  income  totaling
         $449,576 and $380,616 for the years ended December 31, 2001,  2000, and
         1999, respectively, from these joint ventures.
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


6.       Allocations and Distributions:

         From inception through December 31, 1999, all net income and net losses
         of the  Partnership,  excluding  gains  and  losses  from  the  sale of
         properties,  were allocated 99% to the limited partners and one percent
         to the general  partners.  From  inception  through  December 31, 1999,
         distributions  of net cash flow were made 99% to the  limited  partners
         and one percent to the general partners;  provided,  however,  that the
         one percent of net cash flow to be distributed to the general  partners
         was  subordinated  to receipt by the limited  partners of an aggregate,
         10%, cumulative,  noncompounded annual return on their adjusted capital
         contributions (the "10% Preferred Return").

         From inception through December 31, 1999, generally, net sales proceeds
         from the sale of properties not in liquidation of the  Partnership,  to
         the extent distributed,  were distributed first to the limited partners
         in an  amount  sufficient  to  provide  them with  their 10%  Preferred
         Return, plus the return of their adjusted capital contributions.

         The  general   partners  then  received,   to  the  extent   previously
         subordinated   and  unpaid,   a  one  percent  interest  in  all  prior
         distributions   of  net  cash  flow  and  a  return  of  their  capital
         contributions. Any remaining sales proceeds were distributed 95% to the
         limited  partners  and five percent to the general  partners.  Any gain
         from the sale of a property not in liquidation of the Partnership  was,
         in  general,  allocated  in the same manner as net sales  proceeds  are
         distributable.  Any loss from the sale of a property  was,  in general,
         allocated  first,  on a pro  rata  basis,  to  partners  with  positive
         balances in their capital accounts; and thereafter,  95% to the limited
         partners and 5% to the general partners.

         Generally,  net sales  proceeds from a liquidating  sale of properties,
         will be used in the following order: (i) first to pay and discharge all
         of  the  Partnership's   liabilities  to  creditors,  (ii)  second,  to
         establish  reserves that may be deemed necessary for any anticipated or
         unforeseen liabilities or obligations of the Partnership,  (iii) third,
         to pay all of the Partnership's liabilities, if any, to the general and
         limited partners,  (iv) fourth,  after allocations of net income, gains
         and/or  losses,  to distribute  to the partners  with positive  capital
         accounts  balances,  in  proportion  to such  balances,  up to  amounts
         sufficient  to  reduce  such  positive   balances  to  zero,   and  (v)
         thereafter,  any funds  remaining  shall then be distributed 95% to the
         limited partners and 5% to the general partners.
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


6.       Allocations and Distributions - Continued:

         Effective  January 1, 2000, the general  partners waived their right to
         receive  future  distributions  from the  Partnership,  including  both
         distributions  of operating cash flow and  distributions of liquidation
         proceeds,   to  the  extent   that  the   cumulative   amount  of  such
         distributions would exceed the balance in the general partners' capital
         account as of December  31,  1999.  Accordingly,  for years  commencing
         January  1,  2000 and  after,  the  Partnership's  net  income  will be
         allocated entirely among the limited partners.  However,  if losses are
         allocated to the general  partners in a year, an amount of income equal
         to the sum of such losses may be allocated  to the general  partners in
         succeeding years. Accordingly,  the general partners were not allocated
         any net income and did not receive any  distributions  during the years
         ended December 31, 2001 and 2000.

         During  the  years  ended  December  31,  2001,   2000  and  1999,  the
         Partnership   declared   distributions   to  the  limited  partners  of
         $3,600,004.  No distributions have been made to the general partners to
         date.
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2001, 2000, and 1999


7.       Income Taxes:

         The following is a reconciliation of net income for financial reporting
         purposes to net income for federal  income tax  purposes  for the years
         ended December 31:
<TABLE>
<CAPTION>

                                                                           2001            2000            1999
                                                                       --------------  --------------  --------------

 <c>
             Net income for financial reporting purposes                 $ 1,732,654     $ 2,465,788     $ 2,269,401

             Depreciation for tax reporting purposes in excess
                 of depreciation for financial reporting
                  purposes                                                  (159,214)       (159,851)       (171,877)

             Direct financing leases recorded as operating
                 leases for tax reporting purposes                           253,735         226,323         209,517

             Equity in earnings of unconsolidated joint
                ventures for tax reporting purposes in excess of
                 (less than)equity in earnings of unconsolidated
                 equity in earnings of unconsolidated joint
                 ventures for financial reporting purposes                   635,668         (47,498)         20,342

             Gain on sale of assets for financial reporting
                 purposes (less than) in excess of gain for
                 tax reporting purposes                                           --        (308,959)        138,449

             Provision for write-down of assets                              391,186         287,275         376,056

             Allowance for doubtful accounts                                (259,699)        161,599        (113,896)

             Accrued rental income                                           (32,350)        (78,478)        (98,387)

             Deferred rental income                                          (1,645)              --              --

             Rents paid in advance                                            25,046           7,687         (31,780)

             Minority interest in timing differences of
                 consolidated joint venture                                    1,089           1,108           1,846

             Capitalization (Deduction) of transaction costs
             for tax reporting purposes                                           --        (219,525)        195,746

             Other                                                                --           9,432              --
                                                                       --------------  --------------  --------------

             Net income for federal income tax purposes                  $ 2,586,470     $ 2,344,901     $ 2,795,417
                                                                       ==============  ==============  ==============
</TABLE>
<page>

                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2001, 2000, and 1999


8.       Related Party Transactions:

         One of the individual general partners, James M. Seneff, Jr., is one of
         the principal  shareholders of CNL Holdings,  Inc. The other individual
         general partner, Robert A. Bourne, serves as President and Treasurer of
         CNL Financial  Group,  Inc., a wholly owned subsidiary of CNL Holdings,
         Inc. CNL APF Partners,  LP (the "Advisor") is a wholly owned subsidiary
         of CNL American Properties Fund, Inc. ("APF"). CNL Fund Advisors, Inc.,
         a majority  owned  subsidiary of CNL  Financial  Group,  Inc.  until it
         merged with and into APF  effective  September  1, 1999,  served as the
         Partnership's  advisor  until it  assigned  its rights and  obligations
         under a  management  agreement  with  the  Partnership  to the  Advisor
         effective   July  1,  2000.  The   individual   general   partners  are
         stockholders and directors of APF.

         The Advisor  provides  certain  services  relating to management of the
         Partnership and its properties pursuant to a management  agreement with
         the Partnership. In connection therewith, the Partnership has agreed to
         pay the Advisor an annual,  noncumulative,  subordinated management fee
         of one  percent of the sum of gross  revenues  from  properties  wholly
         owned by the Partnership and the Partnership's allocable share of gross
         revenues from joint ventures, but not in excess of competitive fees for
         comparable  services.  These fees will be incurred  and will be payable
         only after the limited partners receive their 10% Preferred Return. Due
         to the fact that these fees are noncumulative,  if the limited partners
         do not receive their 10% Preferred  Return in any  particular  year, no
         management  fees will be due or payable  for such year.  As a result of
         such threshold, no management fees were incurred during the years ended
         December 31, 2001, 2000, and 1999.

         The Advisor is are also  entitled  to receive a deferred,  subordinated
         real  estate  disposition  fee,  payable  upon  the sale of one or more
         properties based on the lesser of one-half of a competitive real estate
         commission  or  3% of  the  sales  price  if  the  Advisor  provides  a
         substantial amount of services in connection with the sale. However, if
         the net sales  proceeds are  reinvested in a replacement  property,  no
         such  real  estate   disposition  fees  will  be  incurred  until  such
         replacement   property  is  sold  and  the  net  sales   proceeds   are
         distributed.   In  addition,   the  real  estate   disposition  fee  is
         subordinated to the receipt by the limited  partners of their aggregate
         10% Preferred  Return,  plus their adjusted capital  contributions.  No
         deferred,  subordinated real estate disposition fees have been incurred
         since inception.
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2001, 2000, and 1999


8.       Related Party Transactions - Continued:

         During  2001,  the  Partnership,  CNL Income Fund VIII,  Ltd.,  and CNL
         Income Fund XII,  Ltd.  invested in a joint  venture  arrangement,  CNL
         VIII, X, XII Kokomo Joint  Venture to acquire a Golden Corral  property
         from CNL BB Corp., an affiliate of the general  partners for a purchase
         price of $2,112,011  (see Note 5). CNL Income Fund VIII,  Ltd., and CNL
         Income  Fund  XII,  Ltd.  are each  Florida  limited  partnerships  and
         affiliates  of the general  partners.  CNL BB Corp.  had  purchased and
         temporarily  held title to this  property  in order to  facilitate  the
         acquisition  of the property by the joint  venture.  The purchase price
         paid by the joint venture represents the costs incurred by CNL BB Corp.
         to acquire and carry the property, including closing costs.

         During  the  years  ended  December  31,  2001,  2000,  and  1999,  the
         Partnership's  advisor  and  its  affiliates  provided  accounting  and
         administrative  services  to  the  Partnership  on a  day-to-day  basis
         including  services relating to the proposed and terminated merger. The
         Partnership incurred $204,843,  $100,929,  and $129,209,  for the years
         ended  December  31,  2001,  2000,  and  1999,  respectively,  for such
         services.

         The  amounts  due to related  parties at  December  31,  2001 and 2000,
         totaled $5,539 and $147,099, respectively.

9.       Concentration of Credit Risk:

         The  following  schedule  presents  total rental and earned income from
         individual lessees, or affiliated groups of lessees,  each representing
         more than 10% of the  Partnership's  total  rental  and  earned  income
         (including  the  Partnership's  share of total rental and earned income
         from   unconsolidated   joint  ventures  and  the  properties  held  as
         tenants-in-common  with affiliates of the general partners) for each of
         the years ended December 31:
<TABLE>
<CAPTION>

                                                              2001               2000                1999
                                                         ---------------    ---------------     ---------------

 <c>
          Golden Corral Corporation                            $702,567          $ 707,882           $ 686,144
          Jack in the Box Inc. (and Jack in
              the Box Eastern Division, L.P.
              in 2001)                                          506,446            517,974             514,747
          Burger King Corporation                               339,808                N/A                 N/A

</TABLE>
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2001, 2000, and 1999


9.       Concentration of Credit Risk - Continued:

         In addition,  the following  schedule  presents total rental and earned
         income from individual  restaurant chains,  each representing more than
         10% of the Partnership's  total rental and earned income (including the
         Partnership's   share  of  total   rental   and  earned   income   from
         unconsolidated    joint   ventures   and   the   properties   held   as
         tenants-in-common  with affiliates of the general partners) for each of
         the years ended December 31:
<TABLE>
<CAPTION>

                                                          2001                 2000                1999
                                                     ----------------     ----------------    ---------------

 <c>
              Burger King                                  $ 741,334            $ 791,749          $ 797,192
              Golden Corral Family
                  Steakhouse Restaurant                      702,567              707,882            686,144
              Jack in the Box                                506,446              517,974            514,747
              Hardee's                                       384,914              390,528            395,902
              Shoney's                                           N/A                  N/A            398,103
</TABLE>

         The  information   denoted  by  N/A  indicates  that  for  each  period
         presented, the tenant and the chains did not represent more than 10% of
         the Partnership's total rental and earned income.

         Although  the  Partnership's   properties  are  geographically  diverse
         throughout the United States and the  Partnership's  lessees  operate a
         variety of restaurant concepts,  default by any one of these lessees or
         restaurant chains could significantly  impact the results of operations
         of the  Partnership  if the  Partnership  is not able to  re-lease  the
         properties in a timely manner.
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2001, 2000, and 1999


10.      Selected Quarterly Financial Data:

         The following table presents  selected  unaudited  quarterly  financial
         data for each full quarter during the years ended December 31, 2001 and
         2000:
<TABLE>
<CAPTION>

              2001 Quarter              First            Second             Third            Fourth             Year
          ----------------------   ----------------   --------------    ---------------   -------------    ---------------

 <c>
          Revenues (1)(2)               $  847,014        $ 821,561         $  342,894       $ 834,217        $ 2,845,686
          Net income (loss)                588,085          650,628           (181,424 )       675,365          1,732,654
          Net income (loss)
              per limited
              partner unit                    0.15             0.16              (0.05 )          0.17               0.43

            2000 Quarter                First            Second             Third            Fourth             Year
          ----------------------   ----------------   --------------    ---------------   -------------    ---------------

          Revenues (1)(2)               $  806,164        $ 840,735         $  873,727       $ 868,160        $ 3,388,786
          Net Income                       271,897          642,974            718,302         832,615          2,465,788
          Net income per
              limited partner
              unit                            0.07             0.16               0.18            0.21               0.62
</TABLE>

(1)      Revenues include equity in earning of unconsolidated joint ventures and
         minority interest in income of the consolidated joint venture.

(2)      Revenues  have been  adjusted to  reclassify  any  reversals of accrued
         rental  income  to   provisions   for   write-down   of  assets.   This
         reclassification had no effect on total net income.

11.      Commitment:

         In September  2001, the  Partnership  entered into an agreement with an
         unrelated  third party to sell the  property in North  Richland  Hills,
         Texas.  During  the year  ended  December  31,  2001,  the  Partnership
         established  a  provision  for  write-down  of  assets  related  to the
         anticipated sale of this property (see Note 3).
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                    NOTES TO FINANCIAL STATEMENTS - CONTINUED

                  Years Ended December 31, 2001, 2000, and 1999


12.      Subsequent Event:

         In  January  2002,  the   Partnership   reinvested  a  portion  of  the
         liquidation  proceeds from the 2001 liquidation of Peoria Joint Venture
         in a property in Austin, Texas, as  tenants-in-common,  with CNL Income
         Fund XVIII, Ltd., a Florida limited partnership and an affiliate of the
         general partners. The Partnership entered into a long-term,  triple-net
         lease with terms substantially the same as its other leases.
                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                                    CONTENTS






                                                                        Page

Report of Independent Certified Public Accountants                        1

Financial Statements:

     Balance Sheets                                                       2

     Statements of Income                                                 3

     Statements of Partners' Capital                                      4

     Statements of Cash Flows                                           5-6

     Notes to Financial Statements                                     7-10


<PAGE>






               Report of Independent Certified Public Accountants



To the Partners
CNL Ocean Shores Joint Venture


In our opinion,  the  accompanying  balance sheet and the related  statements of
operations,  of  partners'  capital  and of cash flows  present  fairly,  in all
material  respects,  the financial position of CNL Ocean Shores Joint Venture (a
Florida  limited  partnership)  at  December  31,  2001,  and the results of its
operations  and its cash  flows  for the year  then  ended  in  conformity  with
accounting principles generally accepted in the United States of America.  These
financial statements are the responsibility of the Partnership's management; our
responsibility  is to express an opinion on these financial  statements based on
our audits.  We  conducted  our audit of these  statements  in  accordance  with
auditing  standards  generally  accepted in the United States of America,  which
require that we plan and perform the audit to obtain reasonable  assurance about
whether the financial  statements  are free of material  misstatement.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements,  assessing the  accounting  principles
used and  significant  estimates made by management,  and evaluating the overall
financial  statement  presentation.   We  believe  that  our  audit  provides  a
reasonable basis for our opinion.


/s/ PricewaterhouseCoopers LLP


Orlando, Florida
February 8, 2002





<PAGE>
                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                                 BALANCE SHEETS
<TABLE>
<CAPTION>


                                                                                         December 31,
                                                                                2001                     2000
                                                                          ------------------       ------------------
                                                                                                       (unaudited)

 <c>
                             ASSETS
    Land and building, net                                                       $  387,104               $  351,015
    Net investment in direct financing lease                                             --                  792,921
    Cash                                                                                596                    9,509
    Receivables, less allowance for doubtful
         accounts of $91,258 in 2001                                                     --                    1,001
    Accrued rental income                                                                --                   34,455
    Other assets                                                                        284                      247
                                                                          ------------------       ------------------

                                                                                 $  387,984              $ 1,189,148
                                                                          ==================       ==================

               LIABILITIES AND PARTNERS' CAPITAL

    Partners' capital                                                               387,984                1,189,148
                                                                          ------------------       ------------------

                                                                                 $  387,984              $ 1,189,148
                                                                          ==================       ==================


                See accompanying notes to financial statements.


<PAGE>


                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                            STATEMENTS OF OPERATIONS


                                                                                                    January 29, 1999
                                                                                                        (Date of
                                                                                                       Inception)
                                                                                                    through December
                                                                      Year Ended December 31,              31,
                                                                      2001               2000              1999
                                                                 ----------------   ---------------   ----------------
                                                                                     (unaudited)        (unaudited)
 Revenues:
      Rental income from operating leases                             $   33,503         $  40,887          $  37,496
      Earned income from direct financing leases                              --            79,393             74,486
      Interest and other income                                               --               535                 --
                                                                 ----------------   ---------------   ----------------
                                                                          33,503           120,815            111,982
                                                                 ----------------   ---------------   ----------------
 Expenses:
      General operating and administrative                                 1,695             1,508              1,511
      Provision for doubtful accounts                                        931                --                 --
      Professional services                                                  624               398                 --
      Depreciation and amortization                                       15,122                --                 --
      Provision for write-down of assets                                 781,741                --                 --
                                                                 ----------------   ---------------   ----------------
                                                                         800,113             1,906              1,511
                                                                 ----------------   ---------------   ----------------

 Net (Loss) Income                                                    $ (766,610  )     $  118,909         $  110,471
                                                                 ================   ===============   ================

 Allocation of Net (Loss)Income
      CNL Income Fund X, Ltd.                                         $ (529,421  )      $  82,119          $  76,291
      CNL Income Fund XVII, Ltd.                                        (237,189  )         36,790             34,180
                                                                 ----------------   ---------------   ----------------

                                                                      $ (766,610  )     $  118,909         $  110,471
                                                                 ================   ===============   ================


                See accompanying notes to financial statements.


<PAGE>


                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                         STATEMENTS OF PARTNERS' CAPITAL

   Years Ended December 31, 2001, 2000, and the Period January 29, 1999 (Date
                     of Inception) through December 31, 1999

                                                 CNL Income Fund X, Ltd.                                  CNL Income Fund XVII, Ltd.
                                  --------------------------------------------------------    -------------------------------------
                                                                            Accumulated
                                      Contributions     Distributions         Earnings         Contributions      Distributions
                                    ------------------  ---------------   -----------------   ----------------   -----------------

Balance, January 29, 1999
(Date of Inception)                         $      --         $     --            $     --           $     --            $     --

    Contributions from joint
       venture partners                       802,432               --                  --            359,485                  --
    Distributions to joint venture
       partners                                    --          (70,190 )                --                 --             (31,447 )
    Net income                                     --               --              76,291                 --                  --
                                    ------------------  ---------------   -----------------   ----------------   -----------------

Balance, December 31, 1999
    (unaudited)                               802,432          (70,190 )            76,291            359,485             (31,447 )

    Contributions from joint
       venture partners                           (12 )             --                  --                 12                  --
    Distributions to joint venture                 --          (69,414 )                --                 --             (31,098 )
    Net income                                     --               --              82,119                 --                  --
                                    ------------------  ---------------   -----------------   ----------------   -----------------

Balance, December 31, 2000
    (unaudited)                               802,420         (139,604 )           158,410            359,497             (62,545 )

    Distributions to joint venture                 --          (23,863 )                --                 --             (10,691 )
    Net loss                                       --               --            (529,421 )               --                  --
                                    ------------------  ---------------   -----------------   ----------------   -----------------

Balance, December 31, 2001               $    802,420     $   (163,467 )      $   (371,011 )      $   359,497         $   (73,236 )
                                    ==================  ===============   =================   ================   =================

                See accompanying notes to financial statements.


<PAGE>
---------------
   Accumulated
    Earnings           Total
  --------------   --------------


        $    --           $   --


             --        1,161,917

             --         (101,637 )
         34,180          110,471
  --------------   --------------


         34,180        1,170,751


             --               --
             --         (100,512 )
         36,790          118,909
  --------------   --------------


         70,970        1,189,148

             --          (34,554 )
       (237,189 )       (766,610 )
  --------------   --------------

    $  (166,219 )      $ 387,984
  ==============   ==============



                See accompanying notes to financial statements.



<page>
                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                            STATEMENTS OF CASH FLOWS


                                                                                                        January 29, 1999
                                                                                                            (Date of
                                                                                                           Inception)
                                                                                                        through December
                                                                         Years Ended December 31,             31,
                                                                         2001               2000                1999
                                                                    ---------------    ---------------     ---------------
                                                                                        (unaudited)         (unaudited)
Increase (Decrease) in Cash and Cash Equivalents:

      Cash Flows from Operating Activities:
         Cash received from tenants                                      $  27,997          $ 111,703           $ 103,619
         Cash paid for expenses                                             (2,356 )           (1,992 )            (1,672 )
                                                                    ---------------    ---------------     ---------------
             Net cash provided by operating activities                      25,641            109,711             101,947
                                                                    ---------------    ---------------     ---------------

      Cash Flows from Investing Activities:
             Additions to land and buildings on
                operating leases                                                --                 --            (351,015 )
             Investment in direct financing lease                               --                 --            (810,902 )
                                                                    ---------------    ---------------     ---------------

             Net cash used in investing activities                              --                 --          (1,161,917 )
                                                                    ---------------    ---------------     ---------------

      Cash Flows from Financing Activities:
         Contribution from CNL Income Fund X,
Ltd.                                                                            --                 --             802,432
         Contributions from CNL Income Fund
             XVII, Ltd.                                                         --                 --             359,485
         Distributions to CNL Income Fund X, Ltd.                          (23,863 )          (69,414 )           (70,190 )
         Distributions to CNL Income Fund XVII,
             Ltd.                                                          (10,691 )          (31,098 )           (31,447 )
                                                                    ---------------    ---------------     ---------------

             Net cash used in financing activities                         (34,554 )         (100,512 )         1,060,280
                                                                    ---------------    ---------------     ---------------

Net Increase (Decrease) in Cash                                             (8,913 )            9,199                 310

Cash at Beginning of Year                                                    9,509                310                  --
                                                                    ---------------    ---------------     ---------------

Cash at End of Year                                                       $    596          $   9,509            $    310
                                                                    ===============    ===============     ===============


                See accompanying notes to financial statements.
<PAGE>


                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                      STATEMENTS OF CASH FLOWS - CONTINUED


                                                                                                   January 29, 1999
                                                                                                       (Date of
                                                                                                      Inception)
                                                                                                   through December
                                                                     Years Ended December 31,            31,
                                                                      2001               2000              1999
                                                                 ---------------    ---------------    --------------
                                                                                     (unaudited)        (unaudited)

Reconciliation of Net Income to Net Cash
    Provided by Operating Activities:

      Net (Loss) Income                                               $(766,610 )        $ 118,909         $ 110,471
                                                                 ---------------    ---------------    --------------
      Adjustments to reconcile net income to net cash provided by operating
         activities:
             Depreciation                                                15,122                 --                --
             Decrease in net investment in
                direct financing leases                                   3,361              9,763             8,218
             Provision for write-down of assets                         781,741                 --                --
             Decrease (increase) in receivables                              70             (1,001 )              --
             Provision for doubtful accounts                                931                 --                --
             Increase in accrued rental income                           (8,937 )          (17,874 )         (16,581 )
             Decrease (increase) in other assets                            (37 )               52              (299 )
             (Increase) decrease in accounts
                payable                                                      --               (138 )             138
                                                                 ---------------    ---------------    --------------
                  Total adjustments                                     792,251             (9,198 )          (8,524 )
                                                                 ---------------    ---------------    --------------

Net Cash Provided by Operating Activities                              $ 25,641          $ 109,711         $ 101,947
                                                                 ===============    ===============    ==============

</TABLE>

                See accompanying notes to financial statements.
<PAGE>
                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


1.       Significant Accounting Policies:
         -------------------------------

         Organization  and Nature of Business - CNL Ocean Shores  Joint  Venture
         (the  "Joint  Venture")  is a  Florida  limited  partnership  that  was
         organized for the purpose of acquiring a real property located in Ocean
         Shores,  Washington to be leased primarily to an operator of a national
         or regional  fast-food and family-style  restaurant chain. The partners
         of the joint  venture are CNL Income  Fund X, Ltd.  and CNL Income Fund
         XVII,  Ltd.  (the  "Co-Venturers"),   which  are  limited  partnerships
         organized pursuant to the laws of the state of Florida. CNL Income Fund
         X, Ltd.  holds a 69.06%  interest  in the Joint  Venture and CNL Income
         Fund XVII,  Ltd.  holds a 30.94%  interest.  The Joint  Venture  has an
         initial term of twenty years unless  terminated at the option of either
         Co-Venturer  after an  event  of  dissolution.  Events  of  dissolution
         include bankruptcy,  insolvency or termination of any co-venturer, sale
         of the property and mutual  agreement of the  Co-Venturers  to dissolve
         the joint  venture.  During the year ended  December  2001,  the tenant
         vacated the property and ceased payment of rents under the terms of its
         lease  agreement.   The  general  partners  are  currently   seeking  a
         replacement tenant or purchaser for this property.

         The joint venture arrangement provides for the Co-Venturers to share in
         all costs and  benefits  in  proportion  to each  partners'  percentage
         interest.  The Co-Venturers share management control equally. The joint
         venture  agreement  restricts  each  Co-Venturer's   ability  to  sell,
         transfer or assign its joint venture interest without first offering it
         for sale to its joint  venture  partner,  either  upon  such  terms and
         conditions as to which the Co-Venturers, may agree or, in the event the
         Co-Venturers  cannot  agree,  on the same terms and  conditions  as any
         offer from a third party to purchase such joint venture interest.  In a
         dissolution, liquidation proceeds, after paying joint venture debts and
         liabilities  and  funding  reserves  for  contingent  liabilities,  are
         distributed  first to the  Co-Venturers  with positive  capital account
         balances in proportion to such balances until such balances equal zero,
         and thereafter, in proportion to each Co-Venturer's percentage interest
         in the joint venture.

         The  Co-Venturers'  general  partners are CNL Realty  Corporation  (the
         "Corporate  General  Partner"),  James M.  Seneff,  Jr.  and  Robert A.
         Bourne.  Mr.  Seneff and Mr.  Bourne are also 50%  shareholders  of the
         Corporate  General  Partner.  The general  partners of the Co-Venturers
         have responsibility for managing the day-to-day operations of the joint
         venture.


<PAGE>


                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


1.       Significant Accounting Policies - Continued:
         -------------------------------------------

         Real  Estate and Lease  Accounting  - The Joint  Venture  recorded  the
         acquisition of the land and building at cost, including acquisition and
         closing costs.  The land and building was leased to an unrelated  third
         party on a triple-net basis, whereby the tenant was responsible for all
         operating expenses relating to the property,  including property taxes,
         insurance,  maintenance and repairs.  The lease was accounted for using
         the direct  financing method for the building portion and the operating
         method for the land portion. Such methods are described below:

                  Direct financing method - The leases accounted for using the
                  direct financing method are recorded at their net investment
                  (which at the inception of the lease generally represents the
                  cost of the asset). Unearned income is deferred and amortized
                  to income over the lease terms so as to produce a constant
                  periodic rate of return on the joint venture's net investment
                  in the leases.

                  Operating method - The leases accounted for using the
                  operating method are recorded at cost and revenue is
                  recognized as rentals are earned. When scheduled rentals vary
                  during the lease term, income is recognized on a straight-line
                  basis so as to produce a constant periodic rent over the lease
                  term commencing on the date the property is placed in service.

                  Accrued rental income represents the aggregate amount of
                  income recognized on a straight-line basis in excess of
                  scheduled rental payments to date. Whenever a tenant defaults
                  under the terms of its lease or events or changes in
                  circumstances indicate that the tenant will not lease the
                  property through the end of the lease term, the joint venture
                  records a charge to reduce the carrying value to its current
                  value.

         During  2001,  the  tenant  of  this  property  experienced   financial
         difficulties,  vacated the property  and ceased  payment of rents under
         the terms of the lease agreement.  As a result,  during 2001, the Joint
         Venture  reclassified  the building  portion of the  property  from net
         investment in direct  financing  lease to land and building.  The Joint
         Venture recorded the reclassified  asset at fair value,  which was less
         than cost,  through the  recording  of a provision  for  write-down  of
         assets in the amount of $781,741.


<PAGE>


                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


1.       Significant Accounting Policies - Continued:
         -------------------------------------------

         When the  collection  of amounts  recorded as rental or other income is
         considered  to be  doubtful,  an  adjustment  is made to  increase  the
         allowance for doubtful accounts,  which is netted against  receivables,
         although  the  Partnership  continues  to  pursue  collection  of  such
         amounts.  If amounts are subsequently  determined to be  uncollectible,
         the  corresponding  receivable and the allowance for doubtful  accounts
         are decreased  accordingly.  During 2001, the Joint Venture  recorded a
         $91,258 allowance for doubtful accounts.

         Cash - Cash  accounts are  maintained on behalf of the joint venture at
         commercial banks.

         Income Taxes - Under  Section 701 of the  Internal  Revenue  Code,  all
         income,  expenses and tax credit items flow through to the partners for
         tax  purposes.  Therefore,  no  provision  for federal  income taxes is
         provided in the accompanying  financial statements.  The Partnership is
         subject to certain state taxes on its income and property.  See "Income
         Taxes"  footnote  for a  reconciliation  of net  income  for  financial
         reporting purposes to net income for federal income tax purposes.

         Use of Estimates - The general  partners of the joint venture have made
         a number of  estimates  and  assumptions  relating to the  reporting of
         assets and  liabilities  and the  disclosure of  contingent  assets and
         liabilities to prepare these  financial  statements in conformity  with
         generally accepted  accounting  principles.  The more significant areas
         requiring the use of management  estimates  relate to the allowance for
         doubtful  accounts  and future cash flows  associated  with  long-lived
         assets. Actual results could differ from those estimates.

         Statement of Financial  Accounting  Standards  No. 144 ("FAS 144") - In
         October 2001, the Financial Accounting Standards Board issued Statement
         of  Financial   Accounting   Standards  No.  144  "Accounting  for  the
         Impairment or Disposal of Long-Lived  Assets".  This statement requires
         that a long-lived asset be tested for recoverability whenever events or
         changes in  circumstances  indicate that its carrying amount may not be
         recoverable.   The  carrying  amount  of  a  long-lived  asset  is  not
         recoverable  if it  exceeds  the  sum of the  undiscounted  cash  flows
         expected to result from the use and eventual  disposition of the asset.
         The assessment is based on the carrying amount of the asset at the date
         it is tested for recoverability.  An impairment loss is recognized when
         the carrying amount of a long-lived asset exceeds its fair value. If an
         impairment is recognized,  the adjusted carrying amount of a long-lived
         asset is its new cost basis.  The  adoption of FAS 144 did not have any
         effect on the joint  venture's  recording of impairment  losses as this
         Statement   retained  the   fundamental   provisions  of  FAS  No.  121
         "Accounting for the Impairment of Long-Lived  Assets and for Long-Lived
         Assets to be Disposed of."


<PAGE>


                         CNL OCEAN SHORES JOINT VENTURE
                         (A Florida Limited Partnership)

                          NOTES TO FINANCIAL STATEMENTS

                  Years Ended December 31, 2001, 2000, and 1999


2.       Land and Buildings:
         ------------------

         Land and building consist of the following at December 31:
<TABLE>
<CAPTION>

                                                                    2001                  2000
                                                              -----------------     -----------------
                                                                                         (unaudited)

 <c>

                  Land                                              $  120,916            $  351,015
                  Buildings                                            281,310                    --
                                                              -----------------     -----------------
                                                                       402,226               351,015
                  Less accumulated depreciation                         15,122                    --
                                                              -----------------     -----------------

                                                                    $  387,104            $  351,015
                                                              =================     =================
</TABLE>

3.       Income Taxes:
         -------------

         The following is a reconciliation of net income for financial reporting
         purposes to net income for federal  income tax  purposes  for the years
         ended December 31:
<TABLE>
<CAPTION>

                                                                           2001            2000            1999
                                                                       --------------  --------------  --------------
                                                                                        (unaudited)     (unaudited)

 <c>

             Net income for financial reporting purposes                 $  (766,610)    $   118,909      $  110,471

             Depreciation for tax reporting purposes in excess
                 of depreciation for financial reporting
                 purposes                                                     (5,132)        (20,255)        (19,411)

             Direct financing leases recorded as operating
                 leases for tax reporting purposes                             3,360           9,763           8,218

             Provision for write-down of assets                              781,741              --              --

             Allowance for doubtful accounts                                  91,258              --              --

             Accrued rental income                                            (8,937)        (17,874)        (16,581)

             Other                                                              (200)          (200)           (183)
                                                                       --------------  --------------  --------------

             Net income for federal income tax purposes                   $   95,480      $   90,343      $   82,514
                                                                       ==============  ==============  ==============

</TABLE>






Item 9. Changes in and Disagreements with Accountants on Accounting and
        Financial Disclosure

         None.

<page>
                                    PART III


Item 10.  Directors and Executive Officers of the Registrant

         The General Partners of the Registrant are James M. Seneff, Jr., Robert
A.  Bourne  and CNL  Realty  Corporation,  a Florida  corporation.  The  General
Partners  manage  and  control  the  Partnership's   affairs  and  have  general
responsibility   and  the  ultimate  authority  in  all  matters  affecting  the
Partnership's  business.  The  Partnership  has  available  to it the  services,
personnel and experience of CNL Fund Advisors,  Inc., CNL Financial Group,  Inc.
and their affiliates, all of which are affiliates of the General Partners.

         James M. Seneff, Jr., age 55. Since 1971, Mr. Seneff has been active in
the  acquisition,  development,  and  management  of real estate  projects  and,
directly or through an  affiliated  entity,  has served as a general  partner or
co-venturer in over 100 real estate  ventures.  These ventures have involved the
financing,  acquisition,   construction,  and  leasing  of  restaurants,  office
buildings,  apartment  complexes,  hotels, and other real estate. Mr. Seneff has
served as Director and Chairman of the Board of CNL  American  Properties  Fund,
Inc. ("APF"),  a public,  unlisted real estate investment trust, since 1994. Mr.
Seneff served as Chief  Executive  Officer of APF from 1994 through August 1999,
and has served as Co-Chief  Executive  Officer of APF since  December  2000. Mr.
Seneff served as Chairman of the Board and Chief  Executive  Officer of CNL Fund
Advisors,  Inc.,  formerly  the  Partnership's  advisor,  until it merged with a
wholly-owned  subsidiary  of APF  in  September  1999,  and in  June  2000,  was
re-elected  to those  positions  of CNL Fund  Advisors,  Inc.  Mr.  Seneff  is a
principal stockholder of CNL Holdings, Inc., the parent company of CNL Financial
Group,  Inc., a diversified  real estate company,  and has served as a Director,
Chairman of the Board and Chief Executive  Officer of CNL Financial Group,  Inc.
since its formation in 1980. CNL Financial  Group,  Inc. is the parent  company,
either directly or indirectly through subsidiaries, of CNL Real Estate Services,
Inc., CNL Capital Markets, Inc., CNL Investment Company and CNL Securities Corp.
Mr. Seneff also serves as a Director,  Chairman of the Board and Chief Executive
Officer of CNL  Hospitality  Properties,  Inc., a public,  unlisted  real estate
investment trust, as well as, CNL Hospitality  Corp., its advisor.  In addition,
he serves as a Director,  Chairman of the Board and Chief  Executive  Officer of
CNL Retirement Properties, Inc., a public, unlisted real estate investment trust
and its advisor,  CNL Retirement Corp. Since 1992, Mr. Seneff has also served as
a Director,  Chairman of the Board and Chief Executive Officer of Commercial Net
Lease Realty,  Inc., a public real estate investment trust that is listed on the
New York Stock Exchange.  Mr. Seneff has also served as a Director,  Chairman of
the Board and Chief Executive  Officer of CNL Securities  Corp.  since 1979; CNL
Investment  Company  since  1990;  and  CNL  Institutional  Advisors,   Inc.,  a
registered investment advisor for pension plans, since 1990. Mr. Seneff formerly
served  as a  Director  of First  Union  National  Bank of  Florida,  N.A.,  and
currently serves as the Chairman of the Board of CNL Bank. Mr. Seneff previously
served on the Florida State Commission on Ethics and is a former member and past
Chairman of the State of Florida Investment  Advisory Council,  which recommends
to the Florida Board of Administration  investments for various Florida employee
retirement  funds.  The Florida  Board of  Administration,  Florida's  principal
investment advisory and money management agency, oversees the investment of more
than $60 billion of retirement funds. Mr. Seneff received his degree in Business
Administration from Florida State University in 1968.

         Robert A.  Bourne,  age 54. Mr.  Bourne has  participated  as a general
partner  or  co-venturer  in over  100  real  estate  ventures  involved  in the
financing,  acquisition,   construction,  and  leasing  of  restaurants,  office
buildings,  apartment  complexes,  hotels,  and other real estate. Mr. Bourne is
Director of the Board of Directors of APF. Mr. Bourne served as President of APF
from 1994 through  February 1999. He also served as Treasurer from February 1999
through  August 1999 and from May 1994 through  December 1994. He also served in
various  executive  positions with CNL Fund  Advisors,  Inc. prior to its merger
with a  wholly-owned  subsidiary of APF  including,  President from 1994 through
September 1997, and Director from 1994 through August 1999. Mr. Bourne serves as
President and Treasurer of CNL Financial Group, Inc.; Director, Vice Chairman of
the Board,  President  and  Treasurer  of CNL  Hospitality  Properties,  Inc., a
public,  unlisted  real estate  investment  trust;  as well as,  Director,  Vice
Chairman of the Board,  President and Treasurer of CNL  Hospitality  Corp.,  its
advisor. In addition, Mr. Bourne serves as Director, Vice Chairman of the Board,
President and Treasurer of CNL Retirement Properties,  Inc., a public,  unlisted
real  estate  investment  trust;  as well as, a Director,  Vice  Chairman of the
Board,  President and Treasurer of its advisor,  CNL Retirement Corp. Mr. Bourne
also serves as a Director of CNL Bank.  He has served as a Director  since 1992,
Vice Chairman of the Board since  February  1996,  Secretary and Treasurer  from
February 1996 through 1997, and President from July 1992 through  February 1996,
of Commercial  Net Lease  Realty,  Inc., a public real estate  investment  trust
listed on the New York Stock  Exchange.  Mr.  Bourne  also  serves as  Director,
President  and Treasurer for various  affiliates  of CNL Financial  Group,  Inc.
including,  CNL Investment  Company,  CNL Securities Corp. and CNL Institutional
Advisors,  Inc., a registered  investment  advisor for pension plans. Mr. Bourne
began his career as a certified public accountant employed by Coopers & Lybrand,
Certified  Public  Accountants,  from 1971 through  1978,  where he attained the
position  of Tax  Manager in 1975.  Mr.  Bourne  graduated  from  Florida  State
University in 1970 where he received a B.A. in Accounting, with honors.

         Curtis B.  McWilliams,  age 46. Mr.  McWilliams  has served as Co-Chief
Executive  Officer of APF since  December  2000 and  previously  served as Chief
Executive  Officer from  September  1999  through  December  2000.  Prior to the
acquisition of CNL Fund Advisors,  Inc., Mr.  McWilliams  served as President of
APF from  February  1999 until  September  1999.  From February 1998 to February
1999, he served as Executive  Vice President of APF. Mr.  McWilliams  joined CNL
Financial  Group,  Inc. in April 1997 and served as an Executive  Vice President
from October 1997 until September 1999. In addition,  Mr.  McWilliams  served as
President of CNL Fund Advisors, Inc. and CNL Financial Services, Inc. from April
1997 until the acquisition of such entities by wholly-owned  subsidiaries of APF
in September  1999.  From September 1983 through March 1997, Mr.  McWilliams was
employed by Merrill  Lynch & Co. The  majority of his career at Merrill  Lynch &
Co.  was in the  Investment  Banking  division  where he  served  as a  Managing
Director.  Mr.  McWilliams  received  a  B.S.E.  in  Chemical  Engineering  from
Princeton University in 1977 and a Master of Business Administration degree with
a concentration in finance from the University of Chicago in 1983.

         Steven  D.  Shackelford,  age  38.  Mr.  Shackelford  was  promoted  to
Executive Vice President of APF in June 2000. He served as Senior Vice President
from September 1999 until his promotion in June 2000. Mr. Shackelford has served
as Chief  Financial  Officer  since January 1997 and has served as Secretary and
Treasurer of APF since September 1999. He also served as Chief Financial Officer
of CNL Fund Advisors,  Inc. from September  1996 to September  1999.  From March
1995 to July 1996, Mr.  Shackelford  was a senior manager in the national office
of Price  Waterhouse LLP where he was responsible  for advising  foreign clients
seeking to raise capital and a public listing in the United States.  From August
1992 to March  1995,  he was a  manager  in the  Paris,  France  office of Price
Waterhouse, serving several multi-national clients. Mr. Shackelford was an audit
staff and  senior  from  1986 to 1992 in the  Orlando,  Florida  office of Price
Waterhouse.  Mr.  Shackelford  received a Bachelor of Arts degree in Accounting,
with honors, and a Master of Business  Administration  degree from Florida State
University and is a certified public accountant.


Item 11.  Executive Compensation

         Other than as  described in Item 13, the  Partnership  has not paid and
does not intend to pay any executive compensation to the General Partners or any
of their affiliates.  There are no compensatory plans or arrangements  regarding
termination of employment or change of control.


Item 12.  Security Ownership of Certain Beneficial Owners and Management

         As of March 15,  2002,  no person was known to the  Registrant  to be a
beneficial owner of more than 5% of the Units.

         The following  table sets forth,  as of March 15, 2002,  the beneficial
ownership interests of the General Partners in the Registrant.
<TABLE>
<CAPTION>

                    Title of Class                           Name of Partner                 Percent of Class

 <c>
           General Partnership Interests                James M. Seneff, Jr.                           45%
                                                        Robert A. Bourne                               45%
                                                        CNL Realty Corporation                         10%
                                                                                                   --------
                                                                                                      100%
                                                                                                   ========
</TABLE>

         Neither the General  Partners,  nor any of their  affiliates,  owns any
interest in the Registrant, except as noted above.



Item 13.  Certain Relationships and Related Transactions

         The  table  below   summarizes  the  types,   recipients,   methods  of
computation and amounts of compensation,  fees and distributions paid or payable
by the  Partnership  to the General  Partners and their  affiliates for the year
ended  December 31, 2001,  exclusive of any  distributions  to which the General
Partners or their  affiliates  may be entitled by reason of their  purchase  and
ownership of Units.
<TABLE>
<CAPTION>

                                                                                          Amount Incurred
      Type of Compensation                                                                 For the Year
          and Recipient                        Method of Computation                  Ended December 31, 2001
----------------------------------     --------------------------------------      ------------------------------

 <c>
Reimbursement  to affiliates  for      Operating  expenses are reimbursed at       Accounting                and
operating expenses                     the  lower  of  cost  or  90%  of the       administra-tive     services:
                                       prevailing  rate at which  comparable       $204,843
                                       services  could have been obtained in
                                       the     same     geographic     area.
                                       Affiliates  of the  General  Partners
                                       from  time  to  time  incur   certain
                                       operating  expenses  on behalf of the
                                       Partnership     for     which     the
                                       Partnership       reimburses      the
                                       affiliates without interest.

Annual, subordinated manage-           One  percent  of  the  sum  of  gross       $-0-
ment fee to affiliates                 operating  revenues  from  Properties
                                       wholly owned by the Partnership  plus
                                       the Partnership's  allocable share of
                                       gross  revenues of joint  ventures in
                                       which    the    Partnership    is   a
                                       co-venturer,  subordinated to certain
                                       minimum   returns   to  the   Limited
                                       Partners.  The  management  fee  will
                                       not  exceed   competitive   fees  for
                                       comparable   services.   Due  to  the
                                       fact    that     these    fees    are
                                       noncumulative,    if   the    Limited
                                       Partners have not received  their 10%
                                       Preferred  Return  in any  particular
                                       year, no management  fees will be due
                                       or payable for such year.

<page>

                                                                                          Amount Incurred
      Type of Compensation                                                                 For the Year
         and Recipient                         Method of Computation                  Ended December 31, 2001
---------------------------------      --------------------------------------      ------------------------------

Deferred,    subordinated   real       A deferred,  subordinated real estate       $-0-
estate  disposition  fee payable       disposition  fee,  payable  upon sale
to affiliates                          of  one  or  more  Properties,  in an
                                       amount  equal  to the  lesser  of (i)
                                       one-half   of  a   competitive   real
                                       estate commission,  or (ii) 3% of the
                                       sales  price  of  such   Property  or
                                       Properties.   Payment   of  such  fee
                                       shall be made only if  affiliates  of
                                       the   General   Partners   provide  a
                                       substantial  amount  of  services  in
                                       connection   with   the   sale  of  a
                                       Property or  Properties  and shall be
                                       subordinated   to   certain   minimum
                                       returns  to  the  Limited   Partners.
                                       However,  if the net  sales  proceeds
                                       are   reinvested   in  a  replacement
                                       Property,   no   such   real   estate
                                       disposition   fee  will  be  incurred
                                       until such  replacement  Property  is
                                       sold and the net sales  proceeds  are
                                       distributed.

General   Partners'    deferred,       A deferred,  subordinated share equal       $-0-
subordinated       share      of       to   one   percent   of   Partnership
Partnership net cash flow              distributions   of  net  cash   flow,
                                       subordinated   to   certain   minimum
                                       returns to the Limited Partners.

General   Partners'    deferred,       A deferred,  subordinated share equal       $-0-
subordinated       share      of       to  5% of  Partnership  distributions
Partnership  net sales  proceeds       of   such   net    sales    proceeds,
from  a  sale  or  sales  not in       subordinated   to   certain   minimum
liquidation of the Partnership         returns to the Limited Partners.
<page>
                                                                                          Amount Incurred
      Type of Compensation                                                                 For the Year
         And Recipient                         Method of Computation                  Ended December 31, 2001
---------------------------------      --------------------------------------      ------------------------------

General   Partners'   share   of       Distributions  of net sales  proceeds       $-0-
Partnership  net sales  proceeds       from   a    sale    or    sales    of
from  a   sale   or   sales   in       substantially      all     of     the
liquidation of the Partnership         Partnership's    assets    will    be
                                       distributed  in the  following  order
                                       or  priority:  (i) first,  to pay all
                                       debts   and    liabilities   of   the
                                       Partnership    and    to    establish
                                       reserves;  (ii)  second,  to Partners
                                       with   positive    capital    account
                                       balances,    determined   after   the
                                       allocation  of net income,  net loss,
                                       gain and loss,  in proportion to such
                                       balances,  up to  amounts  sufficient
                                       to reduce such balances to zero;  and
                                       (iii) thereafter,  95% to the Limited
                                       Partners   and  5%  to  the   General
                                       Partners.

</TABLE>

The Partnership  entered into a joint venture  arrangement  with CNL Income Fund
VIII, Ltd., and CNL Income Fund XII, Ltd., affiliates of the General Partners to
acquire a Golden Corral  Property from CNL BB Corp., an affiliate of the General
Partners,  for a purchase  price of  $2,112,011.  CNL BB Corp. had purchased and
temporarily  held title to this Property in order to facilitate the  acquisition
of the Property by the  Partnership.  The purchase price paid by the Partnership
represents the costs incurred by CNL BB Corp. to acquire and carry the Property,
including closing costs.

<page>
                                     PART IV


Item 14.  Exhibits, Financial Statement Schedules and Reports on Form 8-K

(a)      The following documents are filed as part of this report.

         1.   Financial Statements - CNL Income Fund X, Ltd.

                  Report of Independent Certified Public Accountants

                  Balance Sheets at December 31, 2001 and 2000

                  Statements of Income for the years ended December 31, 2001,
                  2000, and 1999

                  Statements of Partners' Capital for the years ended December
                  31, 2001, 2000, and 1999

                  Statements of Cash Flows for the years ended December 31,
                  2001, 2000, and 1999

                  Notes to Financial Statements

         2.   Financial Statements - CNL Ocean Shores Joint Venture

                  Report of Independent Certified Public Accountants

                  Balance Sheets at December 31, 2001 and 2000

                  Statements of Operations for the years ended December 31,
                  2001, 2000, and 1999

                  Statements of Partners' Capital for the years ended December
                  31, 2001, 2000, and 1999

                  Statements of Cash Flows for the years ended December 31,
                  2001, 2000, and 1999

                  Notes to Financial Statements

         3.   Financial Statement Schedules

                  Schedule II -Valuation and Qualifying Accounts for the years
                  ended December 31, 2001, 2000, and 1999

                  Schedule III - Real Estate and Accumulated Depreciation at
                  December 31, 2001

                  Notes to Schedule III - Real Estate and Accumulated
                  Depreciation at December 31, 2001

                  All other  Schedules  are omitted as the required  information
                  is  inapplicable  or is  presented  in the  financial
                  statements or notes thereto.

         4.   Exhibits

                3.1      Affidavit and Certificate of Limited Partnership of CNL
                         Income  Fund  X,  Ltd.  (Included  as  Exhibit  3.2  to
                         Registration  Statement  No.  33-35049 on Form S-11 and
                         incorporated herein by reference.)

                4.1      Affidavit and Certificate of Limited Partnership of CNL
                         Income  Fund  X,  Ltd.  (Included  as  Exhibit  3.2  to
                         Registration  Statement  No.  33-35049 on Form S-11 and
                         incorporated herein by reference.)

                4.2      Amended and Restated  Agreement of Limited  Partnership
                         of CNL Income Fund X, Ltd.  (Included as Exhibit 3.3 to
                         Post-Effective   Amendment   No.   4  to   Registration
                         Statement  No.  33-35049 on Form S-11 and  incorporated
                         herein by reference.)

                10.1     Management  Agreement  between  CNL Income Fund X, Ltd.
                         and CNL Investment Company (Included as Exhibit 10.1 to
                         Form  10-K  filed  with  the  Securities  and  Exchange
                         Commission on March 17, 1998, and  incorporated  herein
                         by reference.)

                10.2     Assignment of Management  Agreement from CNL Investment
                         Company to CNL Income Fund Advisors,  Inc. (Included as
                         Exhibit 10.2 to Form 10-K filed with the Securities and
                         Exchange Commission on March 30, 1995, and incorporated
                         herein by reference.)

                10.3     Assignment of Management Agreement from CNL Income Fund
                         Advisors,  Inc. to CNL Fund Advisors, Inc. (Included as
                         Exhibit 10.3 to Form 10-K filed with the Securities and
                         Exchange  Commission on April 1, 1996, and incorporated
                         herein by reference.)

                10.4     Assignment  of  Management   Agreement  from  CNL  Fund
                         Advisors,  Inc. to CNL APF Partners,  LP.  (Included as
                         Exhibit 10.4 to Form 10-Q filed with the Securities and
                         Exchange   Commission   on   August   13,   2001,   and
                         incorporated herein by reference.)

(b)      The  Registrant  filed no reports on Form 8-K during the period October
         1, 2001 through December 31, 2001.
<page>

                                   SIGNATURES


         Pursuant to the  requirements  of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the  undersigned,  thereunto duly  authorized,  on the 20th day of
March, 2002.

                                            CNL INCOME FUND X, LTD.

                                            By:      CNL REALTY CORPORATION
                                                     General Partner

                                                     /s/ Robert A. Bourne
                                                     --------------------------
                                                     ROBERT A. BOURNE, President


                                            By:      ROBERT A. BOURNE
                                                     General Partner

                                                     /s/ Robert A. Bourne
                                                     --------------------------
                                                     ROBERT A. BOURNE


                                            By:      JAMES M. SENEFF, JR.
                                                     General Partner

                                                     /s/ James M. Seneff, Jr.
                                                     --------------------------
                                                     JAMES M. SENEFF, JR.


<page>
         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
this  report has been  signed  below by the  following  persons on behalf of the
Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>

               Signature                                  Title                                  Date


 <c>

/s/ Robert A. Bourne                     President,   Treasurer   and   Director            March 20, 2002
Robert A. Bourne                         (Principal   Financial  and  Accounting
                                         Officer)

/s/ James M. Seneff, Jr.                 Chief  Executive  Officer and  Director            March 20, 2002
James M. Seneff, Jr.                     (Principal Executive Officer)
</TABLE>

<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS

                  Years Ended December 31, 2001, 2000, and 1999

<TABLE>
<CAPTION>


                                                     Additions                           Deductions
                                          ---------------------------------    -------------------------------
                                                                                                          Collected
                                                                                                          or Deter-
                                   Balance at       Charged to       Charged to           Deemed          mined to       Balance
                                    Beginning       Costs and           Other           Uncollec-          be Col-       at End
  Year          Description          of Year         Expenses         Accounts            tible           lectible       of Year
----------    -----------------   --------------  ---------------  ----------------    -------------     ------------  ------------

 <c>
  1999        Allowance for
                  doubtful
                  accounts (a)     $    506,231     $       --       $    138,445  (b)   $  482,523  (c)   $  38,029      $ 124,124
                                  ==============  ===============  ================    =============     ============  ============

  2000        Allowance for
                  doubtful
                  accounts (a)        $ 124,124          $    --        $  182,864 (b)    $   1,989 (c)     $ 17,098     $ 287,901
                                  ==============  ===============  ================    =============     ============  ============

  2001        Allowance for
                  doubtful
                  accounts (a)        $ 287,901          $    --        $   86,387 (b)    $ 343,554 (c)     $  1,079      $ 29,655
                                  ==============  ===============  ================    =============     ============  ============

</TABLE>


(a)   Deducted from receivables and accrued rental income on the balance sheet.

(b)   Reduction of rental, earned and other income.

(c)   Amounts written off as uncollectible.
<page>
                                     CNL INCOME FUND X, LTD.
                                 (A Florida Limited Partnership)

                      SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION

                                December 31, 2001

<TABLE>
<CAPTION>

                                                                                 Costs Capitalized
                                                                                 Subsequent To
                                                        Initial Cost             Acquisition
                                         ---------------------------- --------------------
                              Encum-                      Buildings andImprove-    Carrying
                             brances          Land         Improvements ments      Costs
                            -----------  ---------------  ----------- -----------  -------

 <c>
Properties the Partnership
  has Invested in Under
  Operating Leases:

    Burger King Restaurants:
      Hendersonville, North Caro-ina            222,632      568,573           -        -
      Irondequoit, New York     -               383,359      554,084           -        -

    Denny's Restaurants:
      Fremont, Ohio             -               160,896            -     273,700        -
      Romulus, Michigan         -               285,842            -           -        -
      Spartanburg, South Carolin-               287,959            -           -        -

    Golden Corral Family
      Steakhouse Restaurants:
          Austin, Texas         -               592,837            -   1,106,384        -
          Austin, Texas         -               711,354            -   1,124,040        -
          Las Cruces, New Mexico-               580,655      920,521           -        -
          Freemont, Nebraska                    203,166    1,054,051           -        -

    Hardee's Restaurants:
      Pace, Florida             -               174,850            -           -        -
      Jacksonville, Florida     -               326,972            -           -        -
      Centerville, Tennnessee   -               130,494            -           -        -

    Jack in the Box Restaurants:
      Desloge, Missouri         -               276,701            -           -        -
      San Antonio, Texas        -               327,322            -           -        -
      San Marcos, Texas         -               427,386            -     592,943        -
      Missouri City, Texas      -               348,646            -           -        -
      Pasadena, Texas           -               202,393            -           -        -

    Long John Silver's Restaurants:
      Alamogordo, New Mexico    -               157,401            -           -        -
      Las Cruces, New Mexico    -               222,778            -           -        -

    Perkins Restaurant:
      Ft. Pierce, Florida (k)   -               487,751            -     567,922        -

    Pizza Hut Restaurants:
      Bozeman, Montana          -                99,879      224,614           -        -
      Sidney, Montana                           101,690            -           -        -
      Livingston, Montana       -                71,989      161,211           -        -
      Laurel, Montana                           109,937      255,060           -        -

    Shoney's Restaurants:
      North Richland Hills, Texa- (m)           528,465            -     404,786        -
      Pelham, Alabama                           410,448            -     427,317        -

    Other:
      Homewood, Alabama         -               597,907            -           -        -
      Greenville, North Carolina-               323,573      515,134           -        -

                                         ---------------  ----------  -----------  -------

                                             $8,755,282   $4,253,248  $4,497,092        -
                                         ===============  =========== ===========  =======
Properties of Joint Venture in
   Which the Partnership has a
   50% Interest and has Invested
   in Under Operating Leases:

    Burger King Restaurants:
      Greensboro, North Carolina-              $338,800     $650,109           -        -
      Metairie, Louisiana       -               429,883      342,455           -        -
      Lafayette, Louisiana      -               350,932      773,129           -        -
      Nashua, New Hampshire     -               514,815      838,536           -        -
      Pontiac, Illinois         -               203,095      719,226           -        -
      Dover, New Hampshire      -               406,259      998,023           -        -
                                         ---------------                           -------
                                                          ----------- -----------

                                             $2,243,784   $4,321,478           -        -
                                         ===============  =========== ===========  =======

Property of Joint Venture in
  Which the Partnership has a
  10.51% Interest and has
  Invested in Under an
  Operating Lease:

    Burger King Restaurant:
      Ashland, New Hampshire    -              $293,478     $997,104           -        -
                                         ===============  =========== ===========  =======

Property in Which the
  Partnership has a 13%
  Interest as Tenants-
  in-Common and has Invested
  in Under an Operating Lease:

    Golden Corral Family
      Steakhouse Restaurant:
          Clinton, North Carolin-              $138,382     $676,588           -        -
                                         ===============  =========== ===========  =======

Property in Which the Parnership
  has a 6.69% Interest as Tenants-
  in-Common and has Invested in
  Under an Operating Lease:

    Chevy's Fresh Mex
      Miami, Florida            -              $976,357     $974,016           -        -
                                         ===============  =========== ===========  =======

Property of Joint Venture in
  Which the Partnership has a
  69.06% Interest and has
  Invested in Under an Operating
  Lease:

    Burger King Restaurant:
      Ocean Shores, Washington  -l)            $351,015     $789,560           -        -
                                         ===============  =========== ===========  =======

Property of Joint Venture in
  Which the Partnership has a
  10% Interest and has Invested
  in Under an Operating Lease:

    Golden Corral Restaurant:
      Kokomo, Indiana           -              $644,163   $1,467,848           -        -
                                         ===============  =========== ===========  =======

Properties the Partnership
   has Invested in Under
   Direct Financing Leases:

    Burger King Restaurants:
        Ashland Ohio            -              $190,695     $724,348           -        -
        Allegan, Michigan       -                91,238            -     418,782        -
        New Bethlehem, Pennsylva-ia             135,929      452,507           -        -

    Denny's Restaurants:
        Romulus, Michigan       -                     -      752,829           -        -
        Spartanburg,
             South Carolina     -                     -      529,410           -        -

    Hardee's Restaurants:
        Pace, Florida           -                     -      467,272           -        -
        Jacksonville, Florida   -                     -      405,985           -        -
        Hohenwald, Tennessee    -                49,201      376,415           -        -
        Ravenna, Ohio           -               114,244      496,032           -        -
        Morristown, Tennessee   -               131,289      456,925           -        -
        Centerville, Tennessee  -                     -      348,032           -        -

    Jack in the Box Restaurants:
        Desloge, Missouri       -                     -      630,981           -        -
        San Antonio, Texas      -                     -            -     206,031        -
        Nampa, Idaho            -               151,574      584,533           -        -
        Missouri City, Texas    -                     -      619,686           -        -
        Pasadena, Texas         -                     -      575,429           -        -

    Long John Silver's Restaurants:
        Alamogordo, New Mexico  -                     -      275,270      20,204        -
        Las Cruces, New Mexico  -                     -      318,378      57,828        -

    Pizza Hut Restaurants:
        Glasgow, Montana        -                57,482      266,726           -        -
        Sidney, Montana         -                     -      291,238           -        -

                                         ---------------  ----------- -----------
                                               $921,652   $8,571,996    $702,845        -
                                         ===============  =========== ===========  -------

Property of Joint Venture in
   Which the Partnership has
   a 40.95% Interest and has
   Invested in Under Direct
   Financing Lease:

    Hardee's Restaurant:
        Williston, Florida      -              $150,143            -    $499,071        -
                                         ===============  =========== ===========  =======



                                                                              Life on Which
                Net Cost Basis at Which                                       Depreciation in
               Carried at Close of Period (c)           Date                  Latest Income
-----------------------------------------
               Buildings and               Accumulated of Con-    Date        Statement is
    Land       Improvements     Total      DepreciationstructionAcquired        Computed
-------------  ------------  ------------  ----------  -------  ---------     ------------


                                                                                  (b)


     222,632       568,573       791,205      83,482    1986     11/91            (j)
     383,359       554,084       937,443      81,355    1986     11/91            (j)


     160,896       273,700       434,596      78,061    1992     12/91            (g)
     285,842            (f)      285,842           -    1992     02/92            (d)
     287,959            (f)      287,959           -    1992     03/92            (d)



     592,837     1,106,384     1,699,221     361,217    1992     12/91            (b)
     711,354     1,124,040     1,835,394     360,104    1992     12/91            (b)
     580,655       920,521     1,501,176     296,164    1992     05/92            (b)
     203,166     1,054,051     1,257,217      96,814    1998     03/99            (b)


     174,850            (f)      174,850           -    1992     01/92            (d)
     326,972            (f)      326,972           -    1990     02/92            (d)
     130,494            (f)      130,494           -    1991     02/92            (d)


     276,701            (f)      276,701           -    1991     12/91            (d)
     327,322            (f)      327,322           -    1992     02/92            (d)
     427,386       592,943     1,020,329      55,923    1998     10/98            (b)
     348,646            (f)      348,646           -    1991     04/92            (d)
     202,393            (f)      202,393           -    1991     04/92            (d)


     157,401            (f)      157,401           -    1977     03/92            (d)
     222,778            (f)      222,778           -    1975     03/92            (d)


     187,933       273,806       461,739     113,835    1992     01/92            (h)


      99,879       224,614       324,493      72,718    1976     03/91            (b)
     101,690            (f)      101,690           -    1985     03/91            (d)
      71,989       161,211       233,200      52,191    1979     03/91            (b)
     109,937       255,060       364,997      82,574    1985     03/91            (b)


     513,032       404,786       917,818     136,882    1992     12/91            (b)
     410,448       427,317       837,765     142,400    1992     01/92            (b)


     348,616             -       348,616           -    1997     10/97            (b)
     323,573       515,134       838,707     174,392    1987     11/91            (b)

-------------  ------------  ------------  ----------

  $8,190,740    $8,456,224   $16,646,964   $2,188,112
=============  ============  ============  ==========






    $338,800      $650,109      $988,909    $211,478    1990     03/92            (b)
     429,883       342,455       772,338     111,399    1990     03/92            (b)
     350,932       773,129     1,124,061     251,496    1989     03/92            (b)
     514,815       838,536     1,353,351     272,773    1987     03/92            (b)
     203,095       719,226       922,321     233,962    1988     03/92            (b)
     406,259       998,023     1,404,282     324,653    1987     03/92            (b)
-------------
-------------  ------------  ------------  ----------

  $2,243,784    $4,321,478    $6,565,262   $1,405,761
=============  ============  ============  ==========







    $293,478      $997,104    $1,290,582    $307,507    1987     10/92            (b)
=============  ============  ============  ==========








    $138,382      $676,588      $814,970    $133,933    1996     01/96            (b)
=============  ============  ============  ==========







    $976,357      $974,016    $1,950,373    $129,959    1995     12/97            (b)
=============  ============  ============  ==========







    $120,916      $281,310      $402,226     $15,123    1998     01/99            (i)
=============  ============  ============  ==========







    $644,163    $1,467,848    $2,112,011     $36,697    2000     04/01            (b)
=============  ============  ============  ==========






          (f)           (f)           (f)          -    1988     11/91            (e)
          (f)           (f)           (f)          -    1992     04/92            (e)
          (f)           (f)           (f)          -    1991     04/92            (e)


           -            (f)           (f)          -    1992     02/92            (d)

           -            (f)           (f)          -    1992     03/92            (d)


           -            (f)           (f)          -    1992     01/92            (d)
           -            (f)           (f)          -    1990     02/92            (d)
          (f)           (f)           (f)          -    1991     02/92            (e)
          (f)           (f)           (f)          -    1991     04/92            (e)
          (f)           (f)           (f)          -    1991     04/92            (e)
           -            (f)           (f)          -    1991     02/92            (d)


           -            (f)           (f)          -    1991     12/91            (d)
           -            (f)           (f)          -    1992     12/91            (d)
          (f)           (f)           (f)          -    1991     12/92            (e)
           -            (f)           (f)          -    1991     04/92            (d)
           -            (f)           (f)          -    1991     04/92            (d)


           -            (f)           (f)          -    1977     03/92            (d)
           -            (f)           (f)          -    1975     03/92            (d)


          (f)           (f)           (f)          -    1985     03/91            (e)
           -            (f)           (f)          -    1985     03/91            (d)









          (f)           (f)           (f)          -    1993     12/92            (e)

</TABLE>

                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                                  DEPRECIATION

                                December 31, 2001

(a)      Transactions in real estate and accumulated  depreciation  during 2001,
         2000, and 1999, are summarized as follows:
<TABLE>
<CAPTION>


                                                                                        Accumulated
                                                                        Cost           Depreciation
                                                                  -----------------   ----------------

 <c>
               Properties the Partnership has Invested in
                  Under Operating Leases:

                      Balance, December 31, 1998                     $  17,422,071       $  1,329,832
                      Acquisition                                        1,850,160                 --
                      Provision for write-down of assets                  (357,760 )               --
                      Disposition                                         (868,130 )               --
                      Depreciation expense                                      --            325,062
                                                                  -----------------   ----------------

                      Balance, December, 31, 1999                       18,046,341          1,654,894
                      Provision for write-down of assets                  (287,275 )               --
                      Disposition                                         (790,010 )          (81,658 )
                      Depreciation expense                                      --            317,491
                                                                  -----------------   ----------------

                      Balance, December, 31 2000                        16,969,056          1,890,727
                      Provision for write-down of assets                  (322,092 )               --
                      Depreciation expense                                      --            297,383
                                                                  -----------------   ----------------

                      Balance, December 31, 2001                     $  16,646,964       $  2,188,110
                                                                  =================   ================

               Properties of Joint Venture in Which the
                  Partnership has a 50% Interest and has
                  Invested in Under Operating Leases:

                      Balance, December 31, 1998                      $  6,565,262        $   973,614
                      Depreciation expense                                      --            144,049
                                                                  -----------------   ----------------

                      Balance, December 31, 1999                         6,565,262          1,117,663
                      Depreciation expense                                      --            144,049
                                                                  -----------------   ----------------

                      Balance, December 31, 2000                         6,565,262          1,261,712
                      Depreciation expense                                      --            144,049
                                                                  -----------------   ----------------

                      Balance, December 31, 2001                      $  6,565,262       $  1,405,761
                                                                   ================    ===============


<page>

                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 2001

                                                                                        Accumulated
                                                                        Cost           Depreciation
                                                                  -----------------   ----------------
               Property  of Joint  Venture in Which the
                    Partnership  has a 10.51%  Interest
                    and  has   Invested   in  Under  an
                    Operating Lease:

                      Balance, December 31, 1998                      $  1,290,582        $   207,799
                      Depreciation expense                                      --             33,236
                                                                  -----------------   ----------------

                      Balance, December 31, 1999                         1,290,582            241,035
                      Depreciation expense                                      --             33,236
                                                                  -----------------   ----------------

                      Balance, December 31, 2000                         1,290,582            274,271
                      Depreciation expense                                      --             33,236
                                                                  -----------------   ----------------

                      Balance, December 31, 2001                      $  1,290,582        $   307,507
                                                                  =================   ================

               Property of Joint Venture in Which the
                   Partnership has a 69.06% Interest
                   and has Invested in Under an
                   Operating Lease:

                     Balance, December 31, 1998                            $    --            $    --
                     Acquisition                                           351,015                 --
                     Depreciation expense (d)                                   --                 --
                                                                  -----------------   ----------------

                     Balance, December 31, 1999                            351,015                 --
                     Depreciation expense (d)                                   --                 --
                                                                  -----------------   ----------------

                     Balance, December 31, 2000                            351,015                 --
                     Reclassified to operating lease                       789,560                 --
                     Provision for write-down of assets                   (738,349 )               --
                     Depreciation expense                                       --             15,123
                                                                  -----------------   ----------------
                     Balance, December 31, 2001                        $   402,226        $    15,123
                                                                  =================   ================
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 2001

                                                                                        Accumulated
                                                                        Cost           Depreciation
                                                                 -----------------   ----------------
               Property of Joint Venture in Which the
                   Partnership has a 10% Interest and
                   has Invested in Under Operating
                   Leases:


                    Balance, December 31, 2000                           $     --           $     --
                    Acquisition                                         2,112,011                 --
                    Depreciation expense (d)                                   --             36,697
                                                                  -----------------   ----------------

                     Balance, December 31, 2001                       $  2,112,011        $    36,697
                                                                  =================   ================

               Property in Which the Partnership has
                    a 13% Interest as Tenants-in-
                    Common and has Invested in Under
                    an Operating Lease:

                      Balance, December 31, 1998                       $   814,970        $    66,274
                      Depreciation expense                                      --             22,553
                                                                  -----------------   ----------------

                      Balance, December 31, 1999                           814,970             88,827
                      Depreciation expense                                      --             22,553
                                                                  -----------------   ----------------

                      Balance, December 31, 2000                           814,970            111,380
                      Depreciation expense                                      --             22,553
                                                                  -----------------   ----------------

                      Balance, December 31, 2001                       $   814,970        $   133,933
                                                                  =================   ================

               Property in Which the Partnership has
                    a 6.69% Interest as Tenants-in-
                    Common and has Invested in
                    Under an Operating Lease:

                      Balance, December 31, 1998                      $  1,950,373        $    32,556
                      Depreciation expense                                      --             32,467
                                                                  -----------------   ----------------

                      Balance, December 31, 1999                         1,950,373             65,023
                      Depreciation expense                                      --             32,468
                                                                  -----------------   ----------------

                      Balance, December 31, 2000                         1,950,373             97,491
                      Depreciation expense                                      --             32,468
                                                                  -----------------   ----------------

                      Balance, December 31, 2001                      $  1,950,373        $   129,959
                                                                  =================   ================

</TABLE>

(b)      Depreciation  expense is computed for buildings and improvements  based
         upon estimated lives of 30 years.
<page>
                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 2001


(c)      As of December 31, 2001, the aggregate cost of the Properties  owned by
         the  Partnership   and  its   consolidated   joint  venture,   and  the
         unconsolidated  joint  ventures  for federal  income tax  purposes  was
         $20,408,360  and  $14,108,347,  respectively.  All  of the  leases  are
         treated as operating leases for federal income tax purposes.

(d)      The portion of the lease  relating to the building has been recorded as
         a direct financing lease. The cost of the building has been included in
         net investment in direct financing leases;  therefore,  depreciation is
         not applicable.

(e)      The  lease  for the land and  building  has been  recorded  as a direct
         financing lease. The cost of the land and building has been included in
         net investment in direct financing leases;  therefore,  depreciation is
         not applicable.

(f)      Certain components of the lease relating to land and building have been
         recorded as a direct  financing lease.  Accordingly,  costs relating to
         these components of this lease are not shown.

(g)      Effective  January 1, 1994,  the lease for this  Property  was amended,
         resulting in the  reclassification of the building portion of the lease
         to an operating  lease. The building was recorded at net book value and
         depreciated  over its  remaining  estimated  life of  approximately  28
         years.

(h)      Effective  March 1,  1996,  the lease for this  Property  was  amended,
         resulting in the  reclassification of the building portion of the lease
         to an operating  lease. The building was recorded at net book value and
         depreciated  over its  remaining  estimated  life of  approximately  26
         years.

(i)      Effective  April 26, 2001,  the tenant  vacated the Property and ceased
         restaurant  operations,   resulting  in  the  reclassification  of  the
         building  portion of the lease to an operating  lease. The building was
         recorded at net book value and depreciated over its remaining estimated
         life of approximately 28 years.

(j)      Effective  August 1, 1998,  the lease for this  Property  was  amended,
         resulting in the  reclassification of the building portion of the lease
         to an operating  lease. The building was recorded at net book value and
         depreciated  over its  remaining  estimated  life of  approximately  23
         years.

(k)      The  undepreciated  cost of the  Property  in Ft.  Pierce,  Florida was
         reduced to its estimated net  realizable  value due to an impairment in
         value.  The  Partnership  recognized  the  impairment  by  recording  a
         provision  for  write-down  of assets in the  amount  of  $306,659  and
         $287,275 at December 31, 2001 and 2000, respectively.  The provision at
         December  31,  2001 and 2000  represented  the  difference  between the
         Property's carrying value and the net realizable value of the Property.
         The cost of the Property  presented on this  schedule is the net amount
         at which the Property was carried at December 31, 2001,  including  the
         provision for write-down of assets.

(l)      The undepreciated cost of the Property in Ocean Shores,  Washington was
         reduced to its estimated net  realizable  value due to an impairment in
         value.  The  Partnership  recognized  the  impairment  by  recording  a
         provision  for  write-down  of assets  in the  amount  of  $738,349  at
         December 31, 2001. The provision at December 31, 2001  represented  the
         difference between the Property's carrying value and the net realizable
         value of the  Property.  The  cost of the  Property  presented  on this
         schedule  is the net  amount  at which  the  Property  was  carried  at
         December 31, 2001, including the provision for write-down of assets.
<page>

                             CNL INCOME FUND X, LTD.
                         (A Florida Limited Partnership)

               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED

                                December 31, 2001


(m)      The undepreciated  cost of the Property in North Richland Hills,  Texas
         was reduced to its estimated net realizable  value due to an impairment
         in value.  The  Partnership  recognized  the  impairment by recording a
         provision for write-down of assets in the amount of $15,433 at December
         31,  2001.  The  impairment  at  December  31,  2001   represented  the
         difference between the Property's carrying value and the net realizable
         value of the  Property.  The  cost of the  Property  presented  on this
         schedule  is the net  amount  at which  the  Property  was  carried  at
         December 31, 2001, including the provision for write-down of assets.