FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION

                             Washington, D.C. 20549

              (X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT of 1934

                 For the quarterly period ended March 31, 2000
   --------------------------------------------------------------------------

                                       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
                                     0-21558
                     ---------------------------------------


                            CNL Income Fund XII, Ltd.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


        Florida                                                59-3078856
----------------------------------------           -----------------------------
(State or other jurisdiction of                             (I.R.S. Employer
incorporation or organization)                             Identification No.)


450 South Orange Avenue
Orlando, Florida                                                  32801
----------------------------------------           -----------------------------
(Address of principal executive offices)                        (Zip Code)


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


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by  Sections  13 or 15(d)  of the  Securities  Exchange  Act of 1934
during the preceding 12 months (or for 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 _________





<PAGE>


                                    CONTENTS





Part I                                                                 Page

   Item 1.    Financial Statements:

                  Condensed Balance Sheets

                  Condensed Statements of Income

                  Condensed Statements of Partners' Capital

                  Condensed Statements of Cash Flows

                  Notes to Condensed Financial Statements

   Item 2.    Management's Discussion and Analysis of Financial
                  Condition and Results of Operations

   Item 3.   Quantitative and Qualitative Disclosures About
                  Market Risk

Part II

   Other Information





<PAGE>


                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                            CONDENSED BALANCE SHEETS
<TABLE>
<CAPTION>
                                                                               March 31,              December 31,
                                                                                  2000                    1999
                                                                           -------------------     -------------------
<S> <C>
                               ASSETS

   Land and buildings on operating leases, less
       accumulated depreciation                                                  $ 20,987,858            $ 20,780,828
   Net investment in direct financing leases                                       10,439,801              11,441,924
   Investment in joint ventures                                                     3,395,537               3,415,888
   Mortgage note receivable                                                            49,026                  51,301
   Cash and cash equivalents                                                        1,989,584               1,870,366
   Restricted cash                                                                    790,250                      --
   Receivables, less allowance for doubtful accounts
       of $54,912 and $14,491, respectively                                            60,183                  80,791
   Due from related parties                                                                --                   5,222
   Prepaid expenses                                                                     9,290                  13,552
   Lease costs, less accumulated amortization
       of $7,478 and $6,142, respectively                                              54,945                  56,281
   Accrued rental income, less allowance for doubtful
       accounts of $7,520 and $6,323, respectively                                  2,771,549               2,724,774
                                                                           -------------------     -------------------

                                                                                 $ 40,548,023            $ 40,440,927
                                                                           ===================     ===================

                  LIABILITIES AND PARTNERS' CAPITAL

   Accounts payable                                                              $     56,079            $    136,006
   Accrued and escrowed real estate taxes payable                                      16,199                  11,897
   Distributions payable                                                              956,252                 956,252
   Due to related parties                                                             106,001                  74,909
   Rents paid in advance and deposits                                                 122,729                  50,987
                                                                           -------------------     -------------------
       Total liabilities                                                            1,257,260               1,230,051

   Partners' capital                                                               39,290,763              39,210,876
                                                                           -------------------     -------------------

                                                                                 $ 40,548,023            $ 40,440,927
                                                                           ===================     ===================




See accompanying notes to condensed financial statements.

<PAGE>


                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                         CONDENSED STATEMENTS OF INCOME


                                                                                          Quarter Ended
                                                                                            March 31,
                                                                                     2000               1999
                                                                                 --------------    ---------------
Revenues:
    Rental income from operating leases                                              $ 706,506          $ 607,255
    Earned income from direct financing leases                                         296,499            376,334
    Interest and other income                                                           45,489             19,755
                                                                                 --------------    ---------------
                                                                                     1,048,494          1,003,344
                                                                                 --------------    ---------------

Expenses:
    General operating and administrative                                                48,581             47,284
    Professional services                                                               14,422             11,141
    Management fees to related parties                                                  10,678             10,530
    Real estate taxes                                                                       --              2,125
    State and other taxes                                                               20,703             20,764
    Depreciation and amortization                                                       97,281             84,706
    Transaction costs                                                                   46,395             35,419
                                                                                 --------------    ---------------
                                                                                       238,060            211,969
                                                                                 --------------    ---------------

Income Before Equity in Earnings of Joint Ventures
    and Gain on Sale of Land and Building                                              810,434            791,375

Equity in Earnings of Joint Ventures                                                    78,072             71,138

Gain on Sale of Land and Building                                                      147,633                 --
                                                                                 --------------    ---------------
Net Income                                                                          $1,036,139          $ 862,513
                                                                                 ==============    ===============

Allocation of Net Income:
    General partners                                                                $    8,885          $   8,625
    Limited partners                                                                 1,027,254            853,888
                                                                                 --------------    ---------------

                                                                                    $1,036,139          $ 862,513
                                                                                 ==============    ===============

Net Income Per Limited Partner Unit                                                 $     0.23          $    0.19
                                                                                 ==============    ===============

Weighted Average Number of Limited
    Partner Units Outstanding                                                        4,500,000          4,500,000
                                                                                 ==============    ===============



See accompanying notes to condensed financial statements.

<PAGE>


                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                    CONDENSED STATEMENTS OF PARTNERS' CAPITAL


                                                             Quarter Ended           Year Ended
                                                               March 31,            December 31,
                                                                  2000                  1999
                                                           -------------------    ------------------

General partners:
    Beginning balance                                             $   259,109            $  223,305
    Net income                                                          8,885                35,804
                                                           -------------------    ------------------
                                                                      267,994               259,109
                                                           -------------------    ------------------

Limited partners:
    Beginning balance                                              38,951,767            39,167,536
    Net income                                                      1,027,254             3,609,239
    Distributions ($0.21 and $0.85 per
       limited partner unit, respectively)                           (956,252 )          (3,825,008 )
                                                           -------------------    ------------------
                                                                   39,022,769            38,951,767
                                                           -------------------    ------------------

Total partners' capital                                          $ 39,290,763          $ 39,210,876
                                                           ===================    ==================


See accompanying notes to condensed financial statements.
<PAGE>


                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                       CONDENSED STATEMENTS OF CASH FLOWS


                                                                                     Quarter Ended
                                                                                       March 31,
                                                                               2000                 1999
                                                                          ----------------     ---------------

Increase (Decrease) in Cash and Cash Equivalents

    Net Cash Provided by Operating Activities                                  $1,073,223           $ 853,445
                                                                          ----------------     ---------------

    Cash Flows from Investing Activities:
       Proceeds from sale of land and building                                    791,450                  --
       Investment in joint venture                                                     --            (124,448 )
       Increase in restricted cash                                               (791,450 )                --
       Collections on mortgage note receivable                                      2,247                  --
                                                                          ----------------     ---------------
              Net cash provided by (used in) investing
                  activities                                                        2,247            (124,448 )
                                                                          ----------------     ---------------

    Cash Flows from Financing Activities:
       Distributions to limited partners                                         (956,252 )        (1,091,252 )
                                                                          ----------------     ---------------
              Net cash used in financing activities                              (956,252 )        (1,091,252 )
                                                                          ----------------     ---------------

Net Increase (Decrease) in Cash and Cash
    Equivalents                                                                   119,218            (362,255 )

Cash and Cash Equivalents at Beginning of Quarter                               1,870,366           2,362,980
                                                                          ----------------     ---------------

Cash and Cash Equivalents at End of Quarter                                    $1,989,584          $2,000,725
                                                                          ================     ===============

Supplemental Schedule of Non-Cash Financing
    Activities:

       Distributions declared and unpaid at end of
          quarter                                                               $ 956,252           $ 956,252
                                                                          ================     ===============





</TABLE>

See accompanying notes to condensed financial statements.
<PAGE>




                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                     Quarters Ended March 31, 2000 and 1999


1.       Basis of Presentation:

         The accompanying  unaudited  condensed  financial  statements have been
         prepared in accordance  with the  instructions  to Form 10-Q and do not
         include  all  of the  information  and  note  disclosures  required  by
         generally  accepted  accounting  principles.  The financial  statements
         reflect all adjustments,  consisting of normal  recurring  adjustments,
         which are, in the opinion of management,  necessary to a fair statement
         of the results for the interim periods presented. Operating results for
         the quarter ended March 31, 2000,  may not be indicative of the results
         that may be expected for the year ending December 31, 2000.  Amounts as
         of December 31, 1999, included in the financial  statements,  have been
         derived from audited financial statements as of that date.

         These unaudited financial statements should be read in conjunction with
         the financial statements and notes thereto included in Form 10-K of CNL
         Income Fund XII, Ltd. (the  "Partnership")  for the year ended December
         31, 1999.

         Certain  items in the  prior  year's  financial  statements  have  been
         reclassified to conform to 2000 presentation.  These  reclassifications
         had no effect on partners' capital or net income.

2.       Land and Buildings on Operating Leases:

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

<TABLE>
<CAPTION>
                                                                      March 31, 2000        December 31, 1999
                                                                    -------------------    -------------------
<S> <C>
              Land                                                         $ 12,262,712           $ 12,262,712
              Buildings                                                      10,948,828             10,645,853
                                                                    -------------------    -------------------
                                                                             23,211,540             22,908,565
              Less accumulated depreciation                                  (2,223,682 )           (2,127,737 )
                                                                    -------------------    -------------------
                                                                           $ 20,987,858           $ 20,780,828
                                                                    ===================    ===================
</TABLE>

         Effective  January 1, 2000, the Partnership  amended the lease relating
         to its property in St. Ann, Missouri, to allow for a rent reduction. As
         a result,  the Partnership  reclassified  the building  portion of this
         asset from net  investment  in direct  financing  lease to  building on
         operating  lease. In accordance with statement of Financial  Accounting
         Standards No. 13, "Accounting for Leases," the Partnership recorded the
         reclassified  asset at the lower of original cost,  present fair value,
         or present carrying value.



<PAGE>


                            CNL INCOME FUND XII, LTD.
                         (A Florida Limited Partnership)
                     NOTES TO CONDENSED FINANCIAL STATEMENTS
                     Quarters Ended March 31, 2000 and 1999


3.       Net Investment in Direct Financing Leases:

         In  March  2000,  the  Partnership  sold  its  property  in  Cleveland,
         Tennessee,  for which the land and  building had been  classified  as a
         direct financing lease, for $806,460 and received net sales proceeds of
         $791,450,  resulting  in a gain of  $147,633  for  financial  reporting
         purposes. In connection therewith,  the gross investment (minimum lease
         payments  receivable  and the  estimated  residual  value) and unearned
         income  relating  to the  land  and  building  were  removed  from  the
         accounts.  This property was originally  acquired by the Partnership in
         December  1992  and had a cost  of  approximately  $622,800,  excluding
         acquisition fees and miscellaneous acquisition expenses; therefore, the
         Partnership sold the property for  approximately  $168,700 in excess of
         its original purchase price.

4.       Restricted Cash:

         As of March 31, 2000, the net sales  proceeds of $791,450,  less escrow
         fees of $1,200,  from the sale of the property in Cleveland,  Tennessee
         were being  held in an  interest-bearing  escrow  account  pending  the
         release of funds by the escrow agent to acquire an additional  property
         (See Note 3 and 6).

5.       Termination of Merger:

         On March 1, 2000,  the general  partners  and CNL  American  Properties
         Fund, Inc.  ("APF") mutually agreed to terminate the Agreement and Plan
         of  Merger  entered  into in  March  1999.  The  general  partners  are
         continuing  to evaluate  strategic  alternatives  for the  Partnership,
         including alternatives to provide liquidity to the limited partners.

6.       Subsequent Event:

         In April 2000,  the  Partnership  reinvested  the net sales proceeds it
         received from the sale of the property in Cleveland,  Tennessee,  along
         with  additional  funds,  in a  Krystal  property  located  in  Pooler,
         Georgia, at an approximate cost of $992,000.  In connection  therewith,
         the Partnership  entered into a long term,  triple-net lease with terms
         substantially the same as its other leases.


<PAGE>


ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
         OF OPERATIONS

         CNL Income Fund XII,  Ltd.  (the  "Partnership")  is a Florida  limited
Partnership  that was organized on August 20, 1991, to acquire for cash,  either
directly or through  joint  venture  arrangements,  both newly  constructed  and
existing  restaurants,  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 leases
are generally  triple-net leases,  with the lessees  responsible for all repairs
and maintenance,  Property taxes, insurance and utilities. As of March 31, 2000,
the Partnership owned 47 Properties,  which included interests in six Properties
owned by joint ventures in which the Partnership is a co-venturer.

Capital Resources

         The  Partnership's  primary  source of capital for the  quarters  ended
March 31, 2000 and 1999 was cash from  operations  (which includes cash received
from tenants,  distributions from joint ventures,  and interest and other income
received, less cash paid for expenses).  Cash from operations was $1,073,223 and
$853,445  for the  quarters  ended  March 31, 2000 and 1999,  respectively.  The
increase in cash from  operations  for the  quarter  ended  March 31,  2000,  as
compared to the quarter ended March 31, 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
quarter ended March 31, 2000.

         During the  quarter  ended March 31,  2000,  the  Partnership  sold its
Property in Cleveland,  Tennessee,  to a third party,  for $806,460 and received
net sales  proceeds  of  $791,450,  resulting  in a total gain of  $147,633  for
financial  reporting  purposes.  This  Property was  originally  acquired by the
Partnership  in  December  1992,  and  had a  cost  of  approximately  $622,800,
excluding acquisition fees and miscellaneous  acquisition  expenses;  therefore,
the Partnership  sold the Property for  approximately  $168,700 in excess of its
original  purchase price. As of March 31, 2000, the net sales proceeds  relating
to the sale were being held by an escrow  agent in an interest  bearing  account
pending  reinvestment.  In April 2000, the Partnership  reinvested the net sales
proceeds from this sale,  along with additional  funds, in a Property in Pooler,
Georgia.  The  transaction  relating to the sale of the  Property in  Cleveland,
Tennessee,  and the  reinvestment  of the net sales  proceeds was  structured to
qualify as a like-kind exchange transaction for federal income tax purposes.

         Currently,  rental income from the Partnership's Properties is invested
in money market accounts or other short-term, highly liquid investments, such as
demand deposit accounts at commercial banks,  certificates of deposit, and money
market accounts with less than a 30-day maturity date, pending the Partnership's
use of such funds to pay Partnership  expenses or to make  distributions  to the
partners.  At March 31, 2000, the  Partnership  had $1,989,584  invested in such
short-term  investments,  as compared to  $1,870,366  at December 31, 1999.  The
increase in cash and cash  equivalents  for the quarter ended March 31, 2000, as
compared to December 31, 1999 was  attributable  to an increase in rents paid in
advance at March 31, 2000. The funds remaining at March 31, 2000,  after payment
of distributions and other  liabilities,  will be used to meet the Partnership's
working capital and other needs.

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 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.

         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 operating  expenses of the Partnership,  to the extent that
the general partners  determine that such funds are available for  distribution.
Based on current  and  future  cash from  operations  the  Partnership  declared
distributions to the limited partners of $956,252 for each of the quarters ended
March 31,  2000 and 1999.  This  represents  distributions  for each  applicable
quarter of $0.21 per unit. No  distributions  were made to the general  partners
for the quarters  ended March 31, 2000 and 1999. No amounts  distributed  to the
limited  partners for the quarters ended March 31, 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.

         Total  liabilities of the Partnership  increased to $1,257,260 at March
31, 2000,  from  $1,230,051  at December  31, 1999,  primarily as a result of an
increase  in rents paid in  advance  at March 31,  2000.  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.

Results of Operations

         During the quarter  ended March 31,  1999,  the  Partnership  owned and
leased 43 wholly owned  Properties  (which  included one Property in  Morganton,
North  Carolina,  which was sold in May 1999) and during the quarter ended March
31, 2000, the  Partnership  owned and leased 42 wholly owned  Properties  (which
included one Property in Cleveland,  Tennessee which was sold in March 2000), to
operators  of  fast-food  and  family-style  restaurant  chains.  In  connection
therewith,  during the quarters ended March 31, 2000 and 1999,  the  Partnership
earned  $1,003,005 and $983,589,  respectively,  in rental income from operating
leases and earned income from direct financing leases from these Properties. The
increase in rental and earned income during the quarter ended March 31, 2000, as
compared to the quarter ended March 31, 1999, was primarily due to the fact that
during  the  quarter  ended  March  31,  2000,  the  Partnership  collected  and
recognized as income  approximately  $55,600 in past due rental amounts relating
to Long John Silver's,  Inc. which filed for bankruptcy during 1998 and rejected
the leases relating to three of the eight Properties it leased.  As of March 31,
2000,  the  Partnership  had sold two of the Properties for which the leases had
been  rejected and had entered into a new lease with a new tenant for one of the
Properties.  Rental and earned income increased approximately $31,200 during the
quarter  ended March 31, 2000,  as compared to the quarter ended March 31, 1999,
due to  rental  income  earned on the  re-leased  Property.  In 1999,  Long John
Silver's,   Inc.  assumed  and  affirmed  its  five  remaining  leases  and  the
Partnership has continued receiving rental payments relating to these leases.

         The increase in rental and earned was partially offset by a decrease of
approximately  $38,600  during the quarter  ended March 31, 2000, as compared to
the quarter ended March 31, 1999,  due to the fact that during the quarter ended
March 31, 2000, the Partnership  established an allowance for doubtful  accounts
for past due rental amounts  relating to several  Properties in accordance  with
the  Partnership's  policy.  No such  allowance was recorded  during the quarter
ended March 31, 1999. The general partners will continue to pursue collection of
past due rental  amounts  relating to these  Properties  and will recognize such
amounts as income if collected.

         In  addition,  during the quarters  ended March 31, 2000 and 1999,  the
Partnership owned and leased six and five Properties,  respectively,  indirectly
through joint venture arrangements. In connection therewith, during the quarters
ended March 31,  2000 and 1999,  the  Partnership  earned  $78,072 and  $71,138,
respectively, attributable to net income earned by joint ventures.

         Operating expenses,  including  depreciation and amortization  expense,
were  $238,060  and  $211,969  for the  quarters  ended March 31, 2000 and 1999,
respectively.  The increase in operating expenses during the quarter ended March
31, 2000, as compared to the quarter ended March 31, 1999,  was partially due to
an increase in  depreciation  expense  relating to the fact that  subsequent  to
March 31, 1999, the  Partnership  reclassified  the leases for its Properties in
Asheville,  North  Carolina and  Clarksville,  Tennessee  from direct  financing
leases to operating  leases due to lease  amendments.  The increase in operating
expenses  during the quarter  ended March 31,  2000,  as compared to the quarter
ended March 31,  1999 was also  partially  due to the fact that the  Partnership
incurred $46,395 and $35,419, respectively, in transaction costs relating to the
general  partners  retaining  financial  and legal  advisors  to assist  them in
evaluating  and  negotiating  the proposed  merger with CNL American  Properties
Fund, Inc. ("APF") due to the termination of the proposed  merger,  as described
below in "Termination of Merger."

         As a result of the sale of the  Property in  Cleveland,  Tennessee,  as
described  above in  "Capital  Resources,"  the  Partnership  recorded a gain of
$147,633 for  financial  reporting  purposes  during the quarter ended March 31,
2000. No Properties were sold during the quarter ended March 31, 1999.

Termination of Merger

         On March 1, 2000,  the  general  partners  and APF  mutually  agreed to
terminate  the  Agreement  and Plan of Merger  entered  into in March 1999.  The
general  partners are  continuing  to evaluate  strategic  alternatives  for the
Partnership,   including  alternatives  to  provide  liquidity  to  the  limited
partners.

Dismissal of Legal Action

         As   described   in  greater   detail  in  Part  II,   Item  1  ("Legal
Proceedings"),  in 1999 two groups of  limited  partners  in several  CNL Income
Funds filed  purported  class action suits against the general  partners and APF
alleging,  among other  things,  that the general  partners had  breached  their
fiduciary  duties in  connection  with the proposed  Merger.  These actions were
later  consolidated  into  one  action.  On April  25,  2000,  the  judge in the
consolidated action issued a Stipulated Final Order of Dismissal of Consolidated
Action, dismissing the action without prejudice, with each party to bear its own
costs and attorneys' fees.


ITEM 3.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET
         RISK

         No material  changes in the  Partnership's  market risk  occurred  from
December  31,  1999  through   March  31,  2000.   Information   regarding   the
Partnership's  market risk at December 31, 1999 is included in its Annual Report
on Form 10-K for the year ended December 31, 1999.


<PAGE>


                           PART II. OTHER INFORMATION


Item 1.   Legal Proceedings.

          On May 11,  1999,  four  limited  partners in several CNL Income Funds
          served a derivative and purported class action lawsuit filed April 22,
          1999 against the general  partners and APF in the Circuit Court of the
          Ninth Judicial  Circuit of Orange County,  Florida,  alleging that the
          general   partners   breached  their  fiduciary  duties  and  violated
          provisions of certain of the CNL Income Fund partnership agreements in
          connection  with the  proposed  Merger.  The  plaintiffs  are  seeking
          unspecified  damages  and  equitable  relief.  On  July 8,  1999,  the
          plaintiffs  filed an amended  complaint  which,  in addition to naming
          three  additional  plaintiffs,  includes  allegations  of  aiding  and
          abetting and  conspiring to breach  fiduciary  duties,  negligence and
          breach of duty of good faith  against  certain of the  defendants  and
          seeks additional equitable relief. As amended, the caption of the case
          is Jon Hale,  Mary J. Hewitt,  Charles A. Hewitt,  Gretchen M. Hewitt,
          Bernard J.  Schulte,  Edward M. and Margaret  Berol  Trust,  and Vicky
          Berol  v.  James  M.  Seneff,   Jr.,  Robert  A.  Bourne,  CNL  Realty
          Corporation,   and  CNL  American   Properties  Fund  Inc.,  Case  No.
          CIO-99-0003561.

          On June 22, 1999, a limited partner of several CNL Income Funds served
          a purported  class  action  lawsuit  filed April 29, 1999  against the
          general partners and APF, Ira Gaines,  individually and on behalf of a
          class of persons similarly situated,  v. CNL American Properties Fund,
          Inc., James M. Seneff,  Jr., Robert A. Bourne, CNL Realty Corporation,
          CNL Fund Advisors, Inc., CNL Financial Corporation a/k/a CNL Financial
          Corp.,  CNL Financial  Services,  Inc. and CNL Group,  Inc.,  Case NO.
          CIO-99-3796,  in the Circuit  Court of the Ninth  Judicial  Circuit of
          Orange County,  Florida,  alleging that the general partners  breached
          their fiduciary  duties and that APF aided and abetted their breach of
          fiduciary duties in connection with the proposed Merger. The plaintiff
          is seeking unspecified damages and equitable relief.

          On  September  23,  1999,  Judge  Lawrence  Kirkwood  entered an order
          consolidating  the two cases under the caption In re: CNL Income Funds
          Litigation,  Case No. 99-3561.  Pursuant to this order, the plaintiffs
          in these cases filed a consolidated and amended  complaint on November
          8, 1999.  On December  22, 1999,  the general  partners and CNL Group,
          Inc.  filed motions to dismiss and motions to strike.  On December 28,
          1999,  APF and CNL Fund Advisors,  Inc.  filed motions to dismiss.  On
          March 6, 2000,  all of the  defendants  filed a Joint Notice of Filing
          Form 8-K Reports and Suggestion of Mootness.

          On April 25, 2000,  Judge Kirkwood issued a Stipulated  Final Order of
          Dismissal  of  Consolidated  Action,  dismissing  the  action  without
          prejudice, with each party to bear its own costs and attorneys' fees.

Item 2.   Changes in Securities.       Inapplicable.

Item 3.   Default upon Senior Securities.   Inapplicable.

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

Item 5.   Other Information.        Inapplicable.

Item 6.   Exhibits and Reports on Form 8-K.

          (a)   Exhibits

                3.1        Affidavit and  Certificate of Limited  Partnership of
                           CNL Income Fund XII, Ltd. (Included as Exhibit 3.2 to
                           Registration  Statement No.  33-43278-01 on Form S-11
                           and incorporated herein by reference.)

                4.1        Affidavit and  Certificate of Limited  Partnership of
                           CNL Income Fund XII, Ltd. (Included as Exhibit 3.2 to
                           Registration  Statement No.  33-43278-01 on Form S-11
                           and incorporated herein by reference.)

                4.2        Amended and Restated Agreement of Limited Partnership
                           of CNL Income Fund XII, Ltd. (Included as Exhibit 4.2
                           to Form 10-K filed with the  Securities  and Exchange
                           Commission on April 15, 1993, and incorporated herein
                           by reference.)

                10.1       Management  Agreement  between  CNL Income  Fund XII,
                           Ltd. and CNL Investment  Company (Included as Exhibit
                           10.1 to Form  10-K  filed  with  the  Securities  and
                           Exchange   Commission   on  April   15,   1993,   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 31, 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.)

                27         Financial Data Schedule (Filed herewith.)


<PAGE>



          (b) Reports on Form 8-K

              A Current  Report on Form 8-K dated February 23, 2000 was filed on
              March 1, 2000,  describing the  termination of the proposed merger
              of the  Partnership  with and into a  subsidiary  of CNL  American
              Properties Fund, Inc.


<PAGE>



                                   SIGNATURES


         Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended,  the  registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.

         DATED this 10th day of May, 2000.


                                    By:  CNL INCOME FUND XII, LTD.
                                         General Partner


                                         By:  /s/ James M. Seneff, Jr.
                                              ---------------------------------
                                              JAMES M. SENEFF, JR.
                                              Chief Executive Officer
                                              (Principal Executive Officer)


                                         By:  /s/ Robert A. Bourne
                                              ----------------------------------
                                              ROBERT A. BOURNE
                                              President and Treasurer
                                              (Principal Financial and
                                               Accounting Officer)