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

                                    FORM 10-K

                        FOR ANNUAL AND TRANSITION REPORTS
                     PURSUANT TO SECTIONS 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

(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, 2002

                                       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 001-15581

                       CNL AMERICAN PROPERTIES FUND, INC.
             (Exact name of registrant as specified in its charter)

             Florida                                    59-323911
(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:

                     Common Stock, $0.01 par value per share
                                (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]

         Indicate by checkmark if the  registrant  is an  accelerated  filer (as
defined in Exchange Act Rules 12b2). Yes X No___

         Aggregate market value of the voting stock held by nonaffiliates of the
registrant:  The registrant  has made three  offerings of Shares of common stock
(the "Shares") on Form S-11 under the  Securities  Act of 1933, as amended.  The
number of Shares held by  non-affiliates  as of March 14,  2003 was  38,469,559.
Since no established market for such Shares exists, there is no market value for
such Shares. Each Share was originally sold at $20 per Share.

         The number of Shares of common stock  outstanding  as of March 14, 2003
was 45,248,670.

                      DOCUMENTS INCORPORATED BY REFERENCE:

Registrant  incorporates  by reference  portions of the CNL American  Properties
Fund,  Inc.   Definitive   Proxy  Statement  for  the  2003  Annual  Meeting  of
Stockholders  (Items  10,  11, 12 and 13 of Part III) to be filed no later  than
April 30, 2003.


<PAGE>
                                     PART I

Item 1.  Business

         CNL  American  Properties  Fund,  Inc.,  a  Maryland  corporation  (the
"Company"), is a self-advised real estate investment trust ("REIT"). The Company
operates as a holding company for two primary  subsidiary  operating  companies,
CNL Restaurant Properties,  Inc. and CNL Franchise Network Corp. Please see Note
14 of the Company's  Consolidated  Financial  Statements  appearing in Item 8 of
this report for certain financial information about these two business segments.
The  Company  was  founded  in 1994 and at  December  31,  2002,  has  financial
interests in  approximately  1,050  properties  diversified  among more than 125
restaurant  concepts in 47 states.  The  Company's  total real  estate  holdings
subject  to lease  includes  over 650  properties,  of which  approximately  145
properties  are classified as held for sale. At December 31, 2002, the servicing
portfolio of net lease  properties and mortgages  includes  approximately  2,300
units, of which over 1,200 are serviced on behalf of third parties.

         In June 2000 the  Company  divided  its  operations  into two  business
segments, real estate and specialty finance, in order to distinguish between its
real estate segment, an entity with a strong capital base and stable cash flows,
and a  specialty  finance  growth  business  partnered  with a  large  financial
institution to provide an additional source of earnings and liquidity.

o          The real estate segment,  operated  principally through the Company's
           wholly owned subsidiary CNL Restaurant  Properties,  Inc.  ("CNL-RP")
           and its subsidiaries, is charged with overseeing and maximizing value
           on a portfolio of primarily  long-term  triple-net lease  properties.
           Those   responsibilities   include  portfolio  management,   property
           management   and   dispositions.    In   addition,   CNL-RP   manages
           approximately   $550  million  in  affiliate   portfolios  and  earns
           management fees related thereto.

o          The  specialty  finance  segment,   operated  through  the  Company's
           wholly-owned   subsidiary  CNL  Franchise  Network  Corp  ("CNL-FNC")
           partnered with Bank of America,  CNL Franchise Network, LP ("CNL-FN")
           and its subsidiaries,  delivers  financial  solutions in the forms of
           financing,  servicing,  advisory  and other  services to national and
           larger   regional   restaurant   operators   primarily  by  acquiring
           restaurant  real  estate  properties,  which  have been  subject to a
           triple-net  lease,   utilizing   short-term  debt  and  selling  such
           properties at a profit.

         In June 2000, the Company formed CNL-FN and contributed  certain assets
and  operations  in  exchange  for an 84.39  percent  interest.  Bank of America
contributed  its  franchise  finance  originations  group in exchange for a 9.18
percent non-voting redeemable interest in the Partnership.  Bank of America also
served as lender at the time of  alliance  on a $500  million  warehouse  credit
facility and a $43.75 million subordinated debt facility (the "Subordinated Note
Payable").  Bank of America's  interest in the  Partnership  on a fully  diluted
basis after a conversion  of the fully  committed  Subordinated  Note Payable is
22.28 percent. The strategic alliance with Bank of America reduced the Company's
reliance  on  public  markets  to raise  capital  by  broadening  the  Company's
financial  products and offerings  and  enhancing  the Company's  securitization
platform.

         The Company also issued a 6.43 percent limited partnership  interest in
CNL-FN to CNL Financial Group,  Inc., an affiliate of a director of the Company,
in exchange for the  operations  of CNL Advisory  Services,  Inc.  ("CAS").  CAS
specializes in providing  merger,  acquisition  and other  advisory  services to
restaurant operators and expands the Company's services to the sector.

         Effective  January 1, 2001,  CNL-FNC elected to be treated as a taxable
REIT  subsidiary  ("TRS")  pursuant to the provisions of the REIT  Modernization
Act. As a TRS,  CNL-FNC engages in activities that would  previously have caused
income to the Company from CNL-FN to be  disqualified  from being  eligible REIT
income under the federal  income tax rules.  Now CNL-FN  earnings are subject to
tax,  but  management  can control the timing of  distributions  to the Company.
CNL-FNC originates triple-net lease properties for sale to third parties and, in
some cases,  securitization.  CNL-FNC also performs net lease and loan servicing
on behalf of third parties.  Also, certain activities of CNL-RP are conducted in
a subsidiary that has made a similar TRS election.

         When the  Company  was  created  in 1994,  the  intent  was to  provide
stockholders liquidity by December 31, 2005 through either listing on a national
exchange,  merging with another public company or  liquidating  its assets.  The
Company's  officers  and  directors  continue to monitor the public  markets for
opportunities  and the Company's board does not intend to liquidate the Company.
To comply with certain tax guidelines governing the significance of taxable REIT
subsidiaries, the Company may pursue other alternatives relative to CNL-FNC that
would  provide  stockholder  liquidity  for all or a  portion  of the  Company's
investment.

Leases

         As of December 31, 2002,  the Company's  real estate  segment,  CNL-RP,
owns,  either  directly or indirectly  through joint venture  arrangements,  584
properties,  which  are  generally  subject  to  long-term,  triple-net  leases.
Although there are variations in the specific terms of the leases, the following
summarizes  the general  structure of the  Company's  leases.  The leases of the
properties  provide for initial terms generally  ranging from 13 to 25 years and
expire between 2006 and 2024.  The leases are on a triple-net  basis which means
the lessee is  responsible  for all repairs  and  maintenance,  property  taxes,
insurance  and  utilities.  The leases  provide for minimum  base annual  rental
payments (payable in monthly installments) ranging from approximately $31,000 to
$369,000.  The majority of the leases also provide that, commencing in specified
lease years  (generally  the sixth lease  year),  the annual base rent  required
under the terms of the lease will increase. In addition,  certain leases provide
for percentage rent based on sales in excess of a specified amount.

         Generally,  the leases  provide for two to five  five-year  or ten-year
renewal  options.  Lessees of 465 of the 584  properties  also have been granted
options to purchase the property 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. The option
purchase  price may equal the  Company's  original cost to purchase the property
plus a specified percentage from the date of the lease or a specified percentage
of the Company'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 Company  wishes to sell the property
subject  to that  lease,  the  Company  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 Company has received for the sale of the property.

Major Tenants

         During  2002,  no single  lessee,  borrower  (or  affiliated  groups of
lessees or borrowers) or restaurant  chain  contributed more than ten percent of
the Company's  revenues relating to its properties,  loans and secured equipment
leases.  In the event that  certain  lessees,  borrowers  or  restaurant  chains
contribute  more than ten percent of the Company's  rental,  earned and interest
income in future  years,  any failure of such  lessees,  borrowers or restaurant
chains  could  materially  affect  the  Company's  income.  Additionally,  as of
December 31, 2002, no single lessee or borrower,  or group of affiliated lessees
or  borrowers,  leased  properties  or was  the  borrower  under  loans  with an
aggregate carrying value in excess of 20 percent of total assets of the Company.

Real Estate Held for Sale

         The Company sells certain real estate  properties to private  investors
as an alternative to either  retaining the properties as a long-term  investment
or offering to sell net lease cash flows in the securitization  marketplace.  As
of  December  31, 2002 and 200l,  the Company had a total of $144.5  million and
$251.4  million of real estate  assets  classified as Real Estate Held for Sale.
For the years ended December 31, 2002 and 2001,  gross proceeds from real estate
sales were $335.3 million and $105.6  million,  respectively,  and cost of sales
were $310.0  million and $97.6 million,  respectively.  The accounting for these
properties  differs from that of similar  properties without this designation as
the Company does not record  depreciation  or accrued rent on these  properties.
The properties held for sale are contemplated being sold within the next year.

         From  time  to  time,  certain   properties   classified  as  long-term
investments may be subsequently  re-designated to held for sale  classification.
The  company  has  re-designated  83  properties  with a net book value of $80.6
million during 2002.



<PAGE>


Mortgage Loans Held for Sale

         Mortgage loans held for sale are wholly or partially  collateralized by
first mortgages on the land and/or buildings of franchised restaurant businesses
and consist of  fixed-rate  loans at December 31, 2002.  The variable rate loans
held  by  the  Company  as  of  December  31,  2001  were  either  collected  or
reclassified to mortgage,  equipment and other notes receivable during 2002. The
loans carry a weighted average interest rate of 8.05 percent. The mortgage loans
are due in monthly  installments  with maturity dates ranging from 2003 to 2021.
The fixed-rate  mortgage loans generally prohibit prepayment for certain periods
or include prepayment penalties.

Mortgage, Equipment and Other Notes Receivable

         Mortgage,  equipment and other notes receivable are wholly or partially
collateralized by first mortgages on the land and/or buildings, the equipment or
other assets of franchised restaurant  businesses.  The loans are due in monthly
installments with maturity dates ranging from 2003 to 2022.

Available Information

         The Company makes  available  free of charge on or through its Internet
website  (http://www.cnlonline.com)  the  Company's  Annual Report on Form 10-K,
Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and, if applicable,
amendments  to those  reports  filed or furnished  pursuant to Section  13(a) or
15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act") as
soon as  reasonably  practicable  after the  Company  electronically  files such
material with, or furnishes it to, the SEC.

Competition

         The fast-food,  family-style and casual dining  restaurant  business is
characterized by intense  competition.  The operators of the restaurants located
on the  Company'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.

         Local  competition  may  enhance a  restaurant's  success  rather  than
detract  from it. Many  successful  fast-food,  family-style  and casual  dining
restaurants  are located in "eating  islands",  areas  within which a variety of
restaurants  operate.  This variety  allows diners an  opportunity  to diversify
their eating  habits,  giving them an  incentive  to return in the future.  As a
result,  fast  food,  family  style and  casual  dining  restaurants  frequently
experience  better  operating  results when there are other  restaurants  in the
area.

         The  Company  competes  with other  persons  and  entities  in locating
suitable  properties to acquire and in locating  purchasers for properties  held
for sale. The Company also competes with other financing  sources such as banks,
mortgage  lenders and  sale/leaseback  companies  for  suitable  tenants for its
properties and borrowers for its mortgage loans.

         The  recessionary  economy and historically low interest rates at which
mortgage financing can be obtained  contributed to a decline in net lease volume
in 2002  while the low  interest  rates  made debt  financing  more  attractive.
Management  believes that the Company's volume levels may increase in the future
due to the  projected  rebound  in the  economy  as  well  as the  opportunities
afforded by the continued consolidation in the financing arena and the Company's
ability to provide an array of financial products.  Competition in the financing
arena  continues  to be  significant  despite the exit of numerous  competitors.
Remaining competitors provide meaningful competition.

Employees

         As of December 31, 2002, the Company had 135 associates.


<PAGE>


Item 2.  Properties

         As of December 31, 2002,  the Company's  real estate  segment,  CNL-RP,
owned,  either directly or indirectly  through joint venture  arrangements,  584
properties,  located in 40 states.  Reference  is made to the  Schedule  of Real
Estate and Accumulated  Depreciation filed with this report for a listing of the
properties and their respective costs.

         As of December 31, 2002, the Company owned 505 of the 584 properties in
fee simple and ten properties through joint venture arrangements. As of December
31, 2002, 40 properties consisted of land only.

         As of December 31, 2002, 39 properties  consisted of building only. The
Company does not own the underlying  land. In connection with the acquisition of
each of these properties,  the Company entered into either a tri-party agreement
with the tenant and the owner of the land or an  assignment  of  interest in the
ground lease with the landlord, as described in Item 1. Business-Leases.

         As of December  31,  2002,  the Company had pledged 377  properties  as
collateral related to Bonds Payable.

Description of Properties

         Land. The Company's property lot sizes range from  approximately  6,000
to 199,000  square  feet  depending  upon  building  size and local  demographic
factors.  Land owned is zoned for  commercial use which,  prior to  acquisition,
were reviewed for traffic patterns and volume.

         The following table lists the properties  owned as of December 31, 2002
by state. More detailed information  regarding the location of the properties is
contained in the Schedule of Real Estate and Accumulated Depreciation filed with
this report.


<PAGE>





                                                        Total Number of
                    State                            Restaurant Properties

                 Alabama                                       16
                 Arizona                                       13
                 California                                    30
                 Colorado                                      13
                 Connecticut                                    1
                 Delaware                                       1
                 Florida                                       81
                 Georgia                                       22
                 Idaho                                          3
                 Illinois                                      24
                 Indiana                                        9
                 Iowa                                           7
                 Kansas                                         6
                 Kentucky                                       7
                 Louisiana                                     11
                 Maryland                                       5
                 Michigan                                      13
                 Minnesota                                      8
                 Mississippi                                    7
                 Missouri                                      29
                 Nebraska                                       3
                 Nevada                                         3
                 New Hampshire                                  2
                 New Jersey                                     6
                 New Mexico                                     3
                 New York                                       4
                 North Carolina                                22
                 Ohio                                          49
                 Oklahoma                                       8
                 Oregon                                         7
                 Pennsylvania                                  10
                 Rhode Island                                   1
                 South Carolina                                10
                 Tennessee                                     31
                 Texas                                         72
                 Utah                                           4
                 Virginia                                      17
                 Washington                                    13
                 West Virginia                                 10
                 Wisconsin                                      3
                                                            ------
                 TOTAL PROPERTIES                             584
                                                            ======

         Buildings.  The buildings generally are rectangular and are constructed
from various combinations of stucco, steel, wood, brick and tile. Building sizes
range from approximately  1,000 to 12,700 square feet.  Generally,  buildings on
properties  owned are  freestanding  and are  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.  Depreciation
expense is computed  for  buildings  and  improvements  using the  straight-line
method using a depreciable life of 39 years for federal income tax purposes.  As
of December 31, 2002,  the aggregate  depreciated  cost basis of the  properties
owned (including properties owned through joint ventures) for federal income tax
purposes was $657 million.



<PAGE>


         The following table lists the properties  owned as of December 31, 2002
by restaurant chain.

               Restaurant Chain                        Number of Properties

               Jack in the Box                                    55
               International House of Pancakes                    46
               Golden Corral                                      44
               Pizza Hut                                          44
               Arby's                                             35
               Bennigan's                                         26
               Chevy's Fresh Mex                                  25
               Burger King                                        24
               Ruby Tuesday                                       18
               Steak & Ale                                        18
               Baker's Square                                     17
               Denny's                                            17
               Applebee's                                         15
               Boston Market                                      14
               Darryl's                                           13
               Other                                             173
                                                                -----
               TOTAL:                                            584
                                                                =====

         Management   considers  the  properties  to  be  well   maintained  and
sufficient for the Company's operations and believes they are adequately covered
by insurance.  In addition,  the Company has obtained  contingent  liability and
property  coverage.  This insurance is intended to reduce the Company'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 Company  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  capital
expenditures 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 Company are
described in Item 1. Business - Leases.

         The  following  is a schedule of the average  rent per property for the
years ended December 31:
<TABLE>
<CAPTION>

                                    2002               2001               2000              1999               1998
                                --------------     --------------    ---------------    --------------     --------------

 <c>

Rental Revenues (1)             $     74,504,692       $84,775,244        $91,520,103        $61,907,812       $33,129,661
Properties (2)                               552               644                725                642               408
Average Rent Per Property       $        134,972         $ 131,639          $ 126,235          $  96,430         $  81,200
Occupancy                                    95%               92%                95%                97%               99%
</TABLE>

(1) Rental  income  includes  the  Company's  share of  rental  income  from the
    properties  owned through joint venture  arrangements.  Rental revenues have
    been  adjusted,  as  applicable,  for any  amounts for which the Company has
    established  an allowance  for doubtful  accounts.  Rental  revenues for all
    periods   presented   include  rental  revenues   relating  to  discontinued
    operations  for  properties  that  were  either  disposed  of or  that  were
    classified as held for sale during the year ended December 31, 2002.

(2) Excludes  properties  that  were  vacant  at  December  31 and  that did not
    generate rental revenues during the year.

         The following table lists  properties as of December 31, 2002 by tenant
and includes  average age of  buildings,  annualized  total  rental  revenue and
percent of total revenue.  To calculate  annualized  total rental  revenue,  the
monthly rental revenue for each restaurant property owned and leased at December
31, 2002 was  multiplied by 12 to present  annualized  rental  revenues for a 12
month  period.  Contingent  rental  income was  excluded in the  calculation  of
annualized total rental revenue.
<TABLE>
<CAPTION>

                                               Total Number
                                                    of            Average Age     Annualized         Percent of
                                                Restaurant       of Buildings     Total Rental      Total Rental
                                                Properties          (years)       Revenue (2)         Revenue
Tenant                                              (1)
------                                        --------------    --------------    -------------    --------------

 <c>
S&A Properties Corporation                            38              20.9         $  6,556,557             9.39%
Golden Corral Corporation                             38               4.2            6,072,500             8.70%
IHOP Properties, Inc.                                 46               5.4            5,426,195             7.78%
Rio Bravo Acquisitions, Inc.                          15               3.0            3,670,320             5.26%
Jack in the Box, Inc.                                 26               4.2            3,224,498             4.62%
Jack in the Box Eastern Division, L.P.                30               4.1            3,125,223             4.48%
Vicorp Restaurant, Inc.                               18              20.7            2,418,886             3.47%
Boston Market Corp.                                   13               5.8            1,530,207             2.19%
Pollo Operations, Inc.                                10               7.9            1,446,120             2.07%
Other                                                318               7.7           36,318,897            52.04%
                                                    -----                          -------------      ------------
Total                                                552                            $69,789,403           100.00%
                                                    -----                          -------------      ------------
</TABLE>

(1)  Excludes  properties that were vacant at December 31, 2002 and that did not
     generate rental revenues during the year.

(2)  The Company has straight-lined  the contractual  increases in rental income
     over the life of each of the leases in order to calculate rental revenue in
     accordance with generally accepted accounting principles.

         The following  table shows the aggregate  number of leases which expire
each  calendar year through the year 2017, as well as the number of leases which
expire after  December 31, 2017.  The table does not reflect the exercise of any
of the renewal options provided to the tenant under the terms of such leases.
<TABLE>
<CAPTION>

                                                                 Base Rent
                                                --------------------------------------------
         Year              Number (1)              Amount (2)                 Percent
         ----          ------------------      ------------------       -------------------

 <c>
          2003                    --                          --                     --
          2004                     1                     100,935                  0.14%
          2005                     4                     476,238                  0.68%
          2006                     4                     443,494                  0.64%
          2007                     1                     109,811                  0.16%
          2008                     1                     117,297                  0.17%
          2009                     1                      84,059                  0.12%
          2010                    13                   1,347,592                  1.93%
          2011                    17                   2,254,208                  3.23%
          2012                    30                   4,550,816                  6.53%
          2013                    29                   3,724,619                  5.34%
          2014                    87                  13,951,686                 20.02%
          2015                    36                   4,681,435                  6.72%
          2016                    65                   4,466,951                  6.41%
          2017                    53                   6,395,683                  9.18%
       Thereafter                206                  26,991,497                 38.73%
                            ---------             ---------------             ----------
         Total                   548                 $69,696,321                100.00%
                            =========             ===============             ==========
</TABLE>

(1)  Excludes  properties for which the leases have been terminated and excludes
     properties leased on a month to month basis.

(2)  The Company has straight-lined  the contractual  increases in rental income
     over the life of each of the leases in order to calculate rental revenue in
     accordance with generally accepted accounting principles.


Item 3.  Legal Proceedings

         As of December 31, 2002,  neither the Company nor any of its properties
was a party to or the subject of any material pending legal proceedings.


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

         None.

                                     PART II

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

         As of March 5, 2003, there were 32,398 stockholders of record of common
stock. There is no public trading market for the Company Shares, and even though
the Company intends to list the Company Shares on the New York Stock Exchange or
other  national  securities  exchange or  over-the-counter  market no later than
December 31, 2005,  there is no  assurance  that listing will occur.  If listing
occurs,  there is no assurance  that a public market for the Company Shares will
develop.  In October  1998,  the Board of  Directors  elected to  implement  the
Company's  redemption  plan.  Under the redemption  plan, the Company elected to
redeem Company Shares,  subject to certain  conditions and  limitations.  During
1999, the Company  terminated the redemption  plan. As of December 31, 2002, the
estimated fair value per share is $17.18.  (For Florida intangible tax purposes,
this is the  equivalent of the Just Value per share.) The Company  obtained this
valuation  from a third party firm,  which based its valuation on an analysis of
comparable  publicly traded real estate  investment trusts and a discounted cash
flow analysis. Because the Company Shares are not publicly traded, investors are
cautioned  that the estimated  fair value of the shares may not be realized upon
sale of the shares.

         Stockholders  of the Company sold and purchased  shares of common stock
subject  to  negotiation  by the  purchaser  and the  selling  stockholder.  The
following table reflects,  for each calendar quarter,  the high, low and average
sales prices for transfers of shares of common stock during 2002 and 2001, other
than pursuant to the plan, net of commissions.
<TABLE>
<CAPTION>

                                       2002 (1)                                   2001 (1)
                        ---------------------------------------    ---------------------------------------
                            High           Low          Average        High           Low          Average
                        ----------    ----------     ----------    ----------    ----------     ----------

 <c>
    First Quarter          $20.00        $11.20         $14.15        $20.00        $11.88         $13.93
    Second Quarter          19.00         12.94          14.54         20.00         10.00          13.73
    Third Quarter           19.00         11.88          15.00         17.92         12.65          13.50
    Fourth Quarter          19.00          7.00          12.87         19.40         10.62          13.91
</TABLE>

(1)  A total of 239,692 and 240,240 shares were  transferred for the years ended
     December 31, 2002 and 2001, respectively.

         The Company expects to make distributions to the stockholders  pursuant
to the provisions of the Articles of Incorporation. For the years ended December
31, 2002 and 2001, the Company declared cash  distributions of $68.0 million and
$66.5 million, respectively, to stockholders. For federal income tax purposes, 0
percent  and 20 percent of  distributions  paid in 2002 and 2001,  respectively,
were  considered  to  be  ordinary  income  and  100  percent  and  79  percent,
respectively, were considered to be a return of capital.



<PAGE>


         The following table presents total  distributions and distributions per
Company Share:
<TABLE>
<CAPTION>

                                  (In Thousands, except for per share data)
                            First          Second        Third     Fourth       Year
                         ----------      ----------    --------    ------      ------

 <c>
  2002 Quarter
  Total distributions
      declared              $16,803        $16,803     $17,134     $17,251    $67,991
  Distributions per
      Share                    0.38           0.38        0.38        0.38       1.52

  2001 Quarter
  Total distributions
      declared              $16,582        $16,582     $16,582     $16,720    $66,466
  Distributions per
      Share                    0.38           0.38        0.38        0.38       1.52
</TABLE>

         In March 2003, the Company  declared  distributions  to stockholders of
$17.251 million ($0.38124 per Share) payable in March 2003.

         The Company intends to continue to declare distributions of cash to the
stockholders.

Equity Compensation Plan Information

<TABLE>
<CAPTION>

                                                                                        Number of securities
                                Number of securities                                    remaining available for
                                to be issued upon                                       future issuance under
                                exercise of                 Weighted-average            equity compensation
                                outstanding options,        exercise price of           plans excluding
                                warrants and rights         outstanding options,        securities reflected in
  Plan Category                           (a)               warrants and rights         column (a)
  --------------------------    -----------------------     ------------------------    ------------------------

 <c>
  Equity compensation
  plans approved by
  security holders                             --              (1)                       $  4,500,000 (2)
  Equity compensation
  plans not approved
  by security holders                          (3)             (3)                                 (3)
                                -----------------------                                 ------------------------
          Total                                --                                        $  4,500,000
                                =======================                                 ========================
</TABLE>

  (1)  During 1999, the stockholders  approved a performance incentive plan (the
       "Plan")  which became  effective as of February 23, 1999.  As of December
       31, 2002, the Company has not granted any awards under the Plan.

  (2)  The  Plan  authorizes  the  issuance  of up to  4,500,000  shares  of the
       Company's common stock upon the exercise of stock options (both incentive
       and nonqualified),  stock appreciation rights and the award of restricted
       stock ("Stock  Award")  provided  that the aggregate  number of shares of
       Common Stock that may be issued pursuant to Options,  stock  appreciation
       rights  ("SARs"),  and Stock  Awards  granted  under  the Plan  increases
       automatically  to 9,000,000 shares and 12,000,000  shares,  respectively,
       when the  Company  has  issued  and  outstanding  150,000,000  shares and
       200,000,000 shares, respectively, of common stock. The Plan terminates on
       February  23,  2009.  Key  employees,  officers,  directors  and  persons
       performing  consulting  or  advisory  services  for  the  Company  or its
       affiliates,  as defined in the Plan,  who are designated by the committee
       administering  the Plan,  are eligible to receive  awards under the Plan.
       Awards  may be made in the form of stock  options,  stock  awards,  SARs,
       Phantom Stock Awards,  Performance  Awards and Leveraged  Stock  Purchase
       Awards as defined  further in the Plan.  As of  December  31,  2002,  the
       Company had not made any awards related to the Plan.


<PAGE>


  (3)  As of  December  31,  2002,  the  Company  does not  maintain  any equity
       compensation plans not approved by security holders.

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

                                                 (In Thousands, except for share and per share data)
                                   Year Ended       Year Ended      Year Ended       Year Ended       Year Ended
                                  December 31,     December 31,    December 31,     December 31,     December 31,
                                      2002             2001            2000             1999             1998
                                  --------------  ---------------  --------------  ---------------  ----------------

 <c>
Continuing Operations:
  Revenues (1)                       $  324,299     $    256,835      $  109,497      $    68,847       $    38,545
                                  ==============  ===============  ==============  ===============  ================

  Earnings/(loss) from
     continuing operations, net (1)  $   26,415     $    (14,370 )    $   (1,679 )   $    (52,228 )     $    31,109

Discontinued Operations:
  Earnings/(loss) and gains from
     discontinued operations,
     net (1)                              9,175           (6,241 )         4,606            2,391             1,043
                                  --------------  ---------------  --------------  ---------------  ----------------

Earnings/(loss) before
  cumulative
  effect of accounting change            35,590          (20,611 )         2,927          (49,837 )          32,152

Cumulative effect of accounting
  change                                     --           (3,841 )            --               --                --
                                  --------------  ---------------  --------------  ---------------  ----------------

Net income/(loss)                    $   35,590     $    (24,452 )    $    2,927     $    (49,837 )     $    32,152
                                  ==============  ===============  ==============  ===============  ================

Earnings/(loss) per share (1) (2):
  Continuing operations (1)           $    0.59      $     (0.33 )    $    (0.04 )    $     (1.32 )      $     1.17
  Discontinued operations (1)
                                           0.21            (0.14 )          0.11             0.06              0.04
  Cumulative effect of
    accounting change                        --            (0.09 )            --               --                --
                                  --------------  ---------------  --------------  ---------------  ----------------

Net income/(loss) per share           $     .80      $     (0.56 )     $    0.07      $     (1.26 )      $     1.21
                                  ==============  ===============  ==============  ===============  ================


Funds from operations (3)            $   59,896      $    22,374      $   20,825      $    37,586       $    37,191
                                  ==============  ===============  ==============  ===============  ================

Cash distributions declared          $   67,991      $    66,466      $   66,329      $    60,079       $    39,449
                                  ==============  ===============  ==============  ===============  ================


Cash distributions declared
  per share (2)                       $    1.52      $      1.52       $    1.52      $      1.52       $      1.52
                                  ==============  ===============  ==============  ===============  ================

Weighted average shares
  outstanding:
     Basic                           44,620,235       43,589,985      43,495,919       39,402,941        26,648,219
                                  ==============  ===============  ==============  ===============  ================
     Diluted                         44,620,235       43,589,985      43,495,919       39,402,941        26,648,219
                                  ==============  ===============  ==============  ===============  ================

At December 31:
     Total assets                   $ 1,384,058    $   1,559,114     $ 1,599,503     $   1,138,193     $    680,352
                                  ==============  ===============  ==============  ===============  ================

     Long-term obligations           $  468,258     $    484,815      $  312,484        $      --        $       --
                                  ==============  ===============  ==============  ===============  ================

     Total stockholders'equity(4)   $   494,151     $    526,182      $  607,738     $    672,214      $    660,810
                                  ==============  ===============  ==============  ===============  ================
</TABLE>

         For a discussion of material events affecting the  comparability of the
information  reflected  in the  selected  financial  data,  refer to the section
captioned  "Management's  Discussion  and  Analysis of Financial  Condition  and
Results of  Operations"  in Item 7.

(1)      The  results of  operations  relating  to  properties  that were either
         disposed  of or that were  classified  as held for sale during the year
         ended December 31, 2002 are reported as discontinued operations for all
         periods presented.

(2)      All Share and per Share  amounts have been  restated  herein to reflect
         the one-for-two reverse stock split.

(3)      Funds from operations ("FFO"),  based on the revised definition adopted
         by the Board of Governors of the  National  Association  of Real Estate
         Investment  Trusts  ("NAREIT")  and as used herein,  except for the add
         back of the advisor  acquisition  expense of $76.3 million during 1999,
         means  net  income/(loss)   determined  in  accordance  with  Generally
         Accepted Accounting Principles ("GAAP"), excluding gains or losses from
         sales of real estate assets,  plus  depreciation of real estate assets,
         plus impairment provisions for real estate assets, plus amortization of
         direct  financing  leases  and  after  adjustments  for  unconsolidated
         partnerships and joint ventures,  plus the advisor acquisition expense,
         plus  extraordinary   charges.  Funds  from  operations  are  generally
         considered by industry  analysts to be the most appropriate  measure of
         performance.  FFO (i) does not represent  cash generated from operating
         activities  determined  in  accordance  with GAAP  (which,  unlike FFO,
         generally  reflects all cash effects of  transactions  and other events
         that  enter  into  the  determination  of net  earnings),  (ii)  is not
         necessarily  indicative  of cash flow  available to fund cash needs and
         (iii)  should  not be  considered  as an  alternative  to net  earnings
         determined  in  accordance  with GAAP as an indication of the Company's
         operating  performance,  or to  cash  flow  from  operating  activities
         determined in accordance with GAAP as a measure of either  liquidity or
         the Company's ability to make distributions.  Accordingly,  the Company
         believes  that in  order to  facilitate  a clear  understanding  of the
         consolidated historical operating results of the Company, FFO should be
         considered  in  conjunction  with the  Company's  net earnings and cash
         flows as reported in the accompanying consolidated financial statements
         and notes  thereto.  However,  the Company's  measure of FFO may not be
         comparable  to similarly  titled  measures of other REITS because these
         REITS  may not apply the  definition  of FFO in the same  manner as the
         Company.

(4)      Includes   subscriptions   received  of  $0,  $0,  $0,   $210,736   and
         $385,523,966  net of stock issuance  costs of  $1,493,437,  $1,493,437,
         $1,493,436, $1,662,749 and $38,415,512 for the years ended December 31,
         2002, 2001, 2000, 1999 and 1998,  respectively,  and net of $50,891 and
         $639,528 of common  stock shares  retired for the years ended  December
         31,  1999 and 1998,  respectively.  Stock  issuance  costs  consist  of
         selling  commissions,  marketing  support  and  due  diligence  expense
         reimbursement fees, soliciting dealer servicing fees and organizational
         and offering expenses.



<PAGE>


The following is a reconciliation of net earnings to FFO:
<TABLE>
<CAPTION>

                                                                      (In Thousands)
                                            2002           2001            2000            1999           1998
                                        -------------  -------------   --------------  -------------  -------------

 <c>
Net income/(loss)                         $   35,590     $  (24,452 )     $    2,927     $  (49,837 )    $  32,152

Loss/(gain) on sale of property
    Continuing operations                        181          1,142              722            782             --
    Discontinued operations                   (3,294 )           --               --             --             --

Depreciation
    Continuing operations                     11,235         12,138           12,242          7,878          3,647
    Discontinued operations                      970          1,276              104            792            395

Impairment provisions
    Continuing operations                      7,959         15,744            2,214             --             --
    Discontinued operations                    5,377         10,274              362             --             --

Capital lease principal component
    Continuing operations                      1,520          1,739            2,083          1,137            533
    Discontinued operations                      332            645              159            492            457

Amortization of joint venture costs               26             27               12              9              7

Advisor acquisition expense                       --             --               --         76,333             --

Cumulative effect of accounting
       change                                     --          3,841               --             --             --
                                        -------------  -------------   --------------  -------------  -------------

FFO (*)                                   $   59,896     $   22,374      $    20,825     $   37,586      $  37,191
                                        =============  =============   ==============  =============  =============
</TABLE>


(*)    - The Company  restated FFO for the years ended  December 31, 2001,  2000
       and 1999 to  conform to 2002  presentation  that  conforms  to the NAREIT
       definition of FFO,  except for the add back by the Company of the advisor
       acquisition expense of $76.3 million during 1999.

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

The following information,  including,  without limitation, the Quantitative and
Qualitative  Disclosures About Market Risk that are not historical facts, may be
forward-looking  statements  within the meaning of Section 27A of the Securities
Act of 1933 and  Section  21E of the  Securities  Exchange  Act of  1934.  These
statements  generally are  characterized  by the use of terms such as "believe,"
"expect"  and  "may."  Although  the  Company  believes  that  the  expectations
reflected  in  such   forward-looking   statements  are  based  upon  reasonable
assumptions, the Company's actual results could differ materially from those set
forth  in the  forward-looking  statements.  Factors  that  might  cause  such a
difference  include:  changes in general  economic  conditions,  changes in real
estate  conditions,  availability of capital from borrowings under the Company's
credit  facilities,   the  availability  of  other  debt  and  equity  financing
alternatives,  changes in interest  rates  under the  Company's  current  credit
facilities and under any  additional  variable rate debt  arrangements  that the
company  may enter into in the future,  the ability of the Company to  refinance
amounts  outstanding  under its credit facilities at maturity on terms favorable
to the Company,  the ability of the Company to locate  suitable  tenants for its
restaurant  properties  and  borrowers  for its mortgage  loans,  the ability of
tenants and borrowers to make payments under their  respective  leases,  secured
equipment  leases or  mortgage  loans,  the  ability of the  Company to re-lease
properties  that are  currently  vacant or that become vacant and the ability of
the Company to securitize or sell  mortgage  loans or net lease  properties on a
favorable and timely basis. Given these uncertainties, readers are cautioned not
to place undue reliance on such statements.


<PAGE>


Organization and Business

CNL American  Properties Fund, Inc. ("CNL-APF" or the "Company") is the nation's
largest  self-advised  real  estate  investment  trust  ("REIT")  focused on the
restaurant  industry.  The Company operates as a holding company for two primary
subsidiary  operating  companies,  CNL  Restaurant  Properties,   Inc.  and  CNL
Franchise  Network  Corp.  The Company  was founded in 1994 and at December  31,
2002, has financial  interests in  approximately  1,050  properties  diversified
among more than 125 restaurant  concepts in 47 states.  The Company's total real
estate  holdings  subject  to  lease  includes  over  650  properties,  of which
approximately  145  properties  are classified as held for sale. At December 31,
2002, the servicing  portfolio of net lease  properties  and mortgages  includes
approximately  2,300 units,  of which over 1,200 are serviced on behalf of third
parties.

In June 2000 the Company divided its operations into two business segments, real
estate and specialty  finance,  in order to distinguish  between its real estate
segment,  an entity with a strong  capital  base and stable  cash  flows,  and a
specialty finance growth business  partnered with a large financial  institution
to provide an additional source of earnings and liquidity.

o          The real estate segment,  operated  principally through the Company's
           wholly owned subsidiary CNL Restaurant  Properties,  Inc.  ("CNL-RP")
           and its subsidiaries, is charged with overseeing and maximizing value
           on a portfolio of primarily  long-term  triple-net lease  properties.
           Those   responsibilities   include  portfolio  management,   property
           management   and   dispositions.    In   addition,   CNL-RP   manages
           approximately   $550  million  in  affiliate   portfolios  and  earns
           management fees related thereto.

o          The  specialty  finance  segment,   operated  through  the  Company's
           wholly-owned   subsidiary  CNL  Franchise  Network  Corp  ("CNL-FNC")
           partnered with Bank of America,  CNL Franchise Network, LP ("CNL-FN")
           and its subsidiaries,  delivers  financial  solutions in the forms of
           financing,  servicing,  advisory  and other  services to national and
           larger   regional   restaurant   operators   primarily  by  acquiring
           restaurant  real  estate  properties,  which  have been  subject to a
           triple-net  lease,   utilizing   short-term  debt  and  selling  such
           properties at a profit.

Effective  January 1,  2001,  CNL-FNC  elected  to be treated as a taxable  REIT
subsidiary  ("TRS") pursuant to the provisions of the REIT Modernization Act. As
a TRS, CNL-FNC engages in activities that would previously have caused income to
the Company from CNL-FN to be disqualified from being eligible REIT income under
the  federal  income tax rules.  Now CNL-FN  earnings  are  subject to tax,  but
management  can  control the timing of  distributions  to the  Company.  CNL-FNC
originates  triple-net  lease  properties for sale to third parties and, in some
cases,  securitization.  CNL-FNC also  performs net lease and loan  servicing on
behalf of third parties.  Also,  certain activities of CNL-RP are conducted in a
subsidiary that has made a similar TRS election.

When the  Company was  created in 1994,  the intent was to provide  stockholders
liquidity by December 31, 2005 through  either  listing on a national  exchange,
merging with another  public company or  liquidating  its assets.  The Company's
officers and directors  continue to monitor the public markets for opportunities
and the Company's board does not intend to liquidate the Company. To comply with
certain tax guidelines  governing the significance of taxable REIT subsidiaries,
the Company may pursue other alternatives relative to CNL-FNC that would provide
stockholder liquidity for all or a portion of the Company's investment.

Liquidity and Capital Resources

The Company is a self advised  real estate  investment  trust that  reflects the
earnings of its two primary segment  subsidiaries,  CNL-RP and CNL-FNC.  CNL-FNC
has not paid any  distributions  to the Company since it was formed in 2000. The
Company  elected to reinvest  the $12.6  million in  earnings  of the  specialty
finance  business  during  2002.  CNL-APF  has  continued  to  declare  and  pay
distributions  to its  stockholders  that are primarily  funded by distributions
from CNL-RP. The remainder of the distribution was funded by sales of its common
stock to the  Company's  Chairman  through  a  private  company  affiliate,  CNL
Financial  Group,  Inc. ("CNL  Financial  Group"),  and loans from CNL Financial
Group that the Company expects to convert into its common stock.


<PAGE>


The Company is pursuing a strategy built around CNL-RP's strong capital base and
stable cash flows coupled with CNL-FNC's specialty finance growth business.  The
Company's  ability to  internally  fund capital  needs is limited  since it must
distribute at least 90 percent of its net taxable income  (excluding net capital
gains) to  stockholders  to qualify as a REIT.  In 2002 the Company  distributed
$68.0 million,  or $1.52 per share,  to its  stockholders.  These  distributions
constituted a return of capital for tax purposes and were  generally not taxable
to the  shareholders,  but  did  reflect  the  tax  deductions  associated  with
impairments and loan loss reserves recorded by CNL-RP in 2001. Taxable income in
2002 did not include any of CNL-FNC's $12.6 million in earnings.  Taxable income
in 2002 also reflects differences in non-cash charges including depreciation and
amortization.

In  order  to  ensure  that  the  Company  maintains  its  historical  level  of
distributions to its stockholders, the Company's Chairman, through CNL Financial
Group,  received  1,173,354  shares of the Company's stock in exchange for $20.1
million in cash,  including  the  conversion  of amounts  previously  treated as
advances.  Also,  the Chairman  advanced to the Company $4.2 million in December
2002.  The  Company's  Chairman  was under no  obligation  to do so.  Should the
Company's  Chairman  determine  not  to  purchase   additional  shares  or  loan
additional funds to the Company, and the Company does not generate adequate cash
flow from other sources, the Company may have to reduce its distribution rate.

The Company's  management  expects to continue meeting  short-term and long-term
liquidity  requirements through distributions from CNL-RP,  issuance of debt and
sales of stock  comparable to the current  period.  In lieu of a distribution to
CNL-APF,  the holding  company,  CNL-FNC has  reinvested its earnings in ongoing
operations.  Management  expects  distributions from CNL-FNC to begin within the
next two years.

As a result,  the  Company  may sell  additional  shares of its common  stock or
borrow  additional funds in order to satisfy future  distribution  requirements.
The Company's  Chairman is under no obligation to purchase  additional shares of
the Company's  common stock or loan additional  funds to the Company in order to
guarantee  that the  Company  maintains  its  historical  distribution  level to
stockholders.

Selling  additional  shares of the  Company's  stock may dilute a  shareholder's
investment,  affecting its future value. However, selling stock to enable CNL-FN
to  reinvest  earnings  may be  accretive  to the  extent  that the value of the
specialty  finance  segment  increases.  The  Company was created in 1994 with a
requirement  to provide  stockholder  liquidity  by December  31, 2005 by either
listing  on  a  national  exchange,  merging  with  another  public  company  or
liquidating  its  assets.   In  connection   with   maintaining  its  historical
distribution  level, the Company may sell additional  shares of its common stock
to CNL Financial Group or to additional third party  purchasers.  Such sales may
reduce the value a shareholder  receives for his or her investment upon a future
liquidity event.

o        Specialty Finance Segment (CNL Franchise Network Corporation)

CNL-FN  originates  triple-net  leases and loans,  temporarily  financing  those
assets with warehouse credit facilities and periodically selling, refinancing or
securitizing those assets. CNL-FN generates income by earning a spread on assets
with a return  greater  than its cost of  borrowings,  and by selling  assets at
gains. A triple-net lease is a long-term lease with periodic rent increases that
requires the tenant to pay expenses on the property  insulating the Company from
making significant cash outflows for maintenance,  repair,  real estate taxes or
insurance. In a securitization the Company sells or transfers a pool of loans or
properties  with  triple-net  leases to a special purpose entity which, in turn,
issues to investors  securities backed by an interest in the revenue originating
from the loans or triple-net  leases.  These  transactions  serve to recycle and
diversify capital.


<PAGE>


CNL-FN has the  following  borrowing  sources as of December 31, 2002,  with the
stated total  capacity  and average  interest  rate based on the interest  rates
charged for the most recent twelve months:
<TABLE>
<CAPTION>

                                                              In Thousands
                                                     Amount Used        Capacity       Maturity      Average Rate
                                                   -----------------  -------------- -------------- ----------------

 <c>
       Note payable (medium term financing)             $   203,207       $ 203,207    June 2007              3.62%
       Mortgage warehouse facilities **                     145,758         385,000     Annual                4.07%
       Subordinated note payable                             43,750          43,750    June 2007              8.50%
       Series 2001-4 bonds payable*                          43,137          43,137  2009 - 2013              8.90%
       Mirror liquidity facility                                  -          10,000    Oct 2003               3.44%
                                                   -----------------  --------------
                                                        $   435,852       $ 685,094
                                                   =================  ==============
</TABLE>


       * includes $4,696 in bonds held by CNL-RP eliminated upon consolidation
         in Company financial statements
      ** capacity does not include $125 million available upon request

The Company and Bank of America entered into an alliance in June 2000 to provide
a broad product offering  primarily focused on origination of triple-net leases,
securitized  debt and  portfolio  loan  financing.  In forming the  alliance the
Company  invested  certain assets and operations into CNL-FN and Bank of America
provided  CNL-FN  with  a  $43.75  million   subordinated   debt  facility  (the
"Subordinated  Debt  Facility") and a warehouse  credit facility (the "Warehouse
Credit Facility") with an initial capacity of $500 million.

The securitization market experienced  considerable volatility in late 2000 as a
result of rising  delinquencies  in  securitized  loan pools,  falling  treasury
rates,  macroeconomic  uncertainties and sluggish  restaurant  sales.  Investors
demanded higher interest rates on the securities issued in securitizations while
ratings agencies  downgraded the quality of the loans underlying the securities.
While  many of the  Company's  competitors  experienced  downgrades  or  ratings
actions  on  bonds  previously   issued,  the  Company's  prior  loan  or  lease
securitizations to date have not been subject to any such ratings action.

In response to the market conditions,  management directed its focus during 2001
to use private  market  sales  channels  to either  refinance  or sell  existing
mortgage  loans,  and halted the  origination of new loans. In October 2001, the
Company renegotiated certain terms of its relationship with Bank of America with
the parties agreeing to:

o       Provisions requiring the removal of $187 million of loans held as
        collateral on the Bank of America Warehouse Credit Facility within a
        required timeframe with such removal tied to a $15 million guaranty by
        CNL-RP.

o       Provisions further requiring the successful attainment of an earnings
        and liquidity target within a required timeframe with such attainment
        tied to an additional $15 million guaranty by CNL-RP.

o       The extension of a $10 million unsecured credit facility to CNL-RP with
        CNL-RP then entering into a $10 million mirror credit facility with
        CNL-FN. CNL-FN utilizes this mirror facility for working capital as
        necessary to fund its equity in new properties substantially financed on
        the mortgage warehouse facilities and to meet margin calls on the
        mortgage warehouse facilities.

In June 2002, as a partial resolution to the requirement to remove or sell loans
held as collateral for Bank of America's Warehouse Credit Facility,  the Company
entered into a five-year term $207 million  financing  collateralized  with $225
million in mortgage loans  re-designated  to reflect the Company's  intention to
hold them to maturity. This five-year term financing carries a variable interest
rate tied to the  weighted  average rate of  commercial  paper plus 1.25 percent
with a  portion  of  such  interest  fixed  through  the  initiation  of a hedge
transaction.  Also,  Bank of America agreed to finance the remaining loans until
November 2003. The Company used a portion of the proceeds from this financing to
pay down the  mortgage  warehouse  facilities.  Management  is pleased  with the
favorable results from this refinancing because:

o        The loan removal guaranty by CNL-RP was substantially reduced, to $2
         million, but it remains tied to the removal of the $25 million
         restaurant loans remaining from the original removal obligation
         negotiated in October 2001.

o        The transaction provides CNL-FN ongoing earnings on the excess of
         interest income over interest expense, and management believes it
         allows more time for the franchise asset-backed markets to stabilize.

o        The guaranty by CNL-RP tied to the attainment of targeted earnings and
         liquidity was substantially reduced.
<page>
CNL-FN  management  is pleased to report that the full guaranty tied to earnings
and liquidity has since been  successfully  removed,  leaving only $2 million in
guaranty by CNL-RP for the removal of loans by CNL-FN.

The  uncertainty  in  the  franchise  asset-backed   securitization  market  led
management to focus the  originations  effort toward new  long-term,  triple-net
leases on real estate. In 2001, CNL-FN introduced its program to sell investment
properties to third parties (the  "Investment  Property Sales"  program).  These
leased  properties  can be sold  and may  qualify  the  buyer  for  special  tax
treatment  under  Section  1031 of the Internal  Revenue  Code (a "Section  1031
Exchange").  Generally,  Section 1031 Exchanges allow an investor who realizes a
gain from selling  appreciated real estate to defer paying taxes on such gain by
reinvesting  the sales  proceeds in like-kind  real  estate.  In addition to the
Investment Property Sales program, the Company formed a partnership with a third
party client to engage in a similar  Investment  Property Sales program.  CNL-FN
has sold $288 million of real estate properties in this program generating gains
to the Company of $23.4  million  throughout  2002  compared  with sales of $108
million and gains of $9.1 million  during  2001.  Management  expects  continued
strong demand for this product but continues to investigate other sales channels
in which to market net lease assets and to monitor the securitization market for
potential re-entry in the future.

During the year ended December 31, 2002,  CNL-FNC derived its primary cash flows
from lease and interest  income earned in excess of interest  expense paid ("net
spread"),  net gains from the  Investment  Property  Sales program and servicing
revenues.  Significant cash outflows  consist of operating  expenses and capital
enhancements   in  the  loan  portfolio   (excess  of  investment  over  related
borrowings).  CNL-FN  has  taken  steps to reduce  its  credit  capacity  in its
warehouse  credit  facilities.  CNL-FN had a warehouse  credit  capacity of $385
million at December  31, 2002 with an  additional  $125 million  available  upon
request.  Management  has and may continue to decrease  the  mortgage  warehouse
facility  capacity  from its present  level in order to  economize  on its cost,
provided that there continue to be costs associated with excess capacity. CNL-FN
may also be subject to margin calls on its warehouse credit facilities.  Bank of
America and the other third party lender  monitor  asset  securitization  market
assumptions,   assumptions  on  the  Company's   derivatives   and   delinquency
assumptions and based on changes in market conditions, may require a margin call
to reduce the level of warehouse  financing.  During the year ended December 31,
2002, CNL-FN paid approximately $17 million in net margin calls on its warehouse
credit  facilities.  Over the  course  of  2001,  CNL-FN  had  fully  drawn  its
subordinated  note  payable.   At  December  31,  2002  CNL-FN  has  no  amounts
outstanding  on the $10 million  mirror credit  facility that matures in October
2003.

In May 2001,  CNL-FN issued Asset Backed Bonds,  Series 2001-4.  The proceeds of
$42.1 million were applied to pay down  short-term  debt. The Company applied 62
mortgage  loans as  collateral  for the  bonds  which  had a  carrying  value of
approximately $57.9 million as of December 31, 2002. The offering resulted in an
initial weighted average life of approximately  7.8 years and a rate of interest
of  approximately  8.90 percent per annum.  The bond indenture  requires monthly
principal and interest  payments  received  from  borrowers to be applied to the
bonds. The bond indenture also provides for an optional  redemption of the bonds
at their remaining  principal  balance when the remaining  amounts due under the
loans  that  serve as  collateral  for the bonds are less than 15 percent of the
aggregate amounts due under the loans at the time of issuance.

Management is  contemplating  strong demand for net lease  financing in 2003 and
continues to view the triple-net lease financing product as its core offering to
restaurant  operators,  but continues to monitor the potential  reemergence of a
mortgage loan product through developments on the securitization front. CNL-FN's
warehouse  facilities  provide  advances for up to 97 percent of the real estate
purchase  value.  The Company is reinvesting  its operating  profits to fund the
amounts not advanced by the mortgage warehouse facilities.

For the year ended  December 31,  2002,  CNL-FN  originated  $204 million in net
leases as compared  with $182 million in the same period last year.  Included in
this  current  year  volume  is a  significant  portfolio  of  $117  million  in
properties.  CNL-FN acquired this portfolio by purchasing all of the limited and
general partnership interests of CNL Net Lease Investors,  L.P., an affiliate of
the Company's  Chairman of the Board and Vice Chairman of the Board,  that until
the acquisition, was a client of CNL-RP's property management group. Without the
volume created by this  transaction,  origination  volume would be substantially
down from the levels  experienced in 2001.  The decrease  reflects a slowdown in
demand for net lease  financing  given  available  low  interest  rate  mortgage
financing and aggressive lease rates offered by CNL-FN's competitors. Management
believes  that net lease  originations  are  important to CNL-FN as they provide
inventory  necessary to execute the Investment Property Sales program and CNL-FN
typically  profits from the leases while holding them.  Management has responded
to this slowdown by adjusting net lease rates,  identifying larger  transactions
like the portfolio  acquisition of $117 million in properties and by identifying
new areas to reduce costs. At December 31, 2002, CNL-FN was involved in numerous
opportunities for continued net lease originations with $42 million approved for
funding and $9 million with executed  commitment  letters.  Management  believes
that competitors will slow originations as they experience capital  constraints,
and that restaurant  operators will use net lease financing as other  lower-cost
alternatives diminish.
<page>
In September 2002, the Warehouse Credit Facility was used to finance the CNL Net
Lease Investors,  LP portfolio acquisition at an advance rate (the rate at which
purchases  are  financed) of 97 percent of the real estate  purchase  value.  In
negotiating  this  transaction,  CNL-FN agreed with the lender to apply the full
amount  of  proceeds  from  subsequent  sales of  properties  contained  in this
portfolio  to the  financing of the  remaining  portfolio in order to achieve an
average  advance  rate of 93 percent.  As a result of strong sales in the fourth
quarter,  CNL-FN has achieved the reduced advance rate, effectively lowering its
debt, and no longer is bound by this provision.

At December 31, 2002, CNL-FN had approximately $77 million in capital supporting
its loan and lease portfolio.  CNL-FN management  maintains regular contact with
its  mortgage  warehouse  facility  lenders  and  believes  that the  relatively
low-cost, high-advance rate financing they provide has been integral to CNL-FN's
success.  As is typical of revolving debt  facilities,  these facilities carry a
364-day  maturity and CNL-FN is  vulnerable to any changes in the terms of these
facilities,  such as the special terms relating to the CNL Net Lease  Investors,
LP  portfolio  that  increased  CNL-FN  capital  invested  in real  estate.  The
warehouse  facilities  currently  advance  an  average  of 90.7  percent  of the
original  real estate  value.  Management  believes that the advance rates could
continue  to decline in 2003.  A five  percent  decrease in advance  rates,  for
example,  would create a $7 million cash  requirement  for CNL-FN,  based on the
outstanding  net lease and loan volume in the  warehouse  credit  facilities  at
December 31, 2002. While management expects its mortgage warehouse facilities to
renew,  any  non-renewal  would  create  an  immediate  need to  find  alternate
borrowing sources.

Additional  liquidity  risks  within the  Company's  specialty  finance  segment
include the possible  occurrence  of economic  events that could have a negative
impact on the  franchise  asset-backed  securitization  market  and  affect  the
quality or perception of the loans or leases underlying CNL-FN's  securitization
transactions.   The  Company  conducted  its  previous   securitizations   using
bankruptcy  remote entities.  These entities exist  independent from the Company
and their  assets are not  available  to satisfy the claims of  creditors of the
Company,  any  subsidiary or its  affiliates.  To date, the ratings on the loans
underlying the securities issued in these transactions have been affirmed unlike
the  ratings of many  competitors'  pools which have been  downgraded.  Upon the
occurrence of a significant amount of delinquencies and/or defaults, one or more
of the three  rating  agencies  may  choose to place a specific  transaction  on
ratings  watch or even  downgrade  one or more classes of  securities to a lower
rating.  Should the loans underlying the securities default,  and the securities
undergo a negative  ratings action,  CNL-FN could  experience  material  adverse
consequences  impacting its ability to continue  earning  income as servicer and
its  ability  to engage in future  profitable  securitization  transactions.  To
potentially avoid those consequences,  CNL-FN could choose to contribute capital
to serve  as  additional  collateral  supporting  one or more of the  bankruptcy
remote entities used to facilitate a securitization.  CNL-FN was involved in the
following  securitizations,   the  assets  and  liabilities  of  which  are  not
consolidated in the Company financial statements:


<PAGE>
<TABLE>
<CAPTION>



                                                                                       (In Thousands)
                                                                           Mortgage loans in    Bonds outstanding
                                                                              pool at par         at face value
                                                                          -------------------- ---------------------

 <c>
         Loans and debt supporting 1998-1 Certificates issued by CNL
         Funding 1998-1, LP                                                     $     210,044         $     208,020
         Loans and debt supporting 1999-1 Certificates issued by CNL
         Funding 1999-1, LP                                                     $     239,500         $     239,500
                                                                          -------------------- ---------------------

                                                                                $     449,544         $     447,520
                                                                          ==================== =====================
</TABLE>

         Note:  Certain  bonds in both the 1998-1 and 1999-1  pools are owned by
         CNL-RP  and  CNL-FN  and  appear  as  investments  in the  consolidated
         financial statements of the Company.

Liquidity risk also exists from the possibility of borrower delinquencies on the
mortgage  loans  held for sale or held to  maturity.  In the event of a borrower
delinquency,  the Company could suffer not only shortfalls on scheduled payments
but also margin calls by the lenders that provide the warehouse  facilities  and
the five-year note,  subjecting the Company to unanticipated cash outflows.  The
Company is obligated  under the provisions of it mortgage  warehouse  facilities
and its five-year  refinancing to pay down certain debt associated with borrower
delinquencies or defaults within a required time frame. Most properties acquired
on the mortgage  warehouse  facilities  are required to be sold within a certain
time  frame.  Any  delinquency,  default  or delay in the  resale of  properties
financed  through one of these facilities would generally result in an immediate
pay-down of the related  debt and may  restrict  the  Company's  ability to find
alternative  financing.  The Company's debt, excluding bonds payable,  generally
provides for cross-default triggers. A default of a mortgage warehouse facility,
for example  from a failure to make a margin  call,  could result in many of the
Company's borrowings becoming immediately due and payable.

CNL-FN has developed a successful  Investment  Property Sales  program,  in part
because some buyers of CNL-FN's  properties  are motivated to defer the taxation
of gains on other  properties  they have sold. In recent years,  the taxation of
capital gains has become an issue spurring extensive political debate.  Proposed
legislation  regularly  surfaces  that would  eliminate  the taxation of capital
gains.  This  potential  change  could be either  negative  or  positive  to the
Company. Any such proposal, even if ultimately unsuccessful,  could cause buyers
of CNL-FN properties to delay sales of their own investment  properties that, in
turn,  would delay their purchase of CNL-FN  properties.  A successful  proposal
could  limit the  opportunities  to  continue  the  existing  CNL-FN  Investment
Property Sales program. However it is also possible that unfettered by a capital
gains tax and the  constraints of a Section 1031  Exchange,  more investors will
seek out investment  properties for the merits of the investment  itself.  While
difficult to assess the balance  between  positives and  negatives,  it is clear
that an elimination of the capital gains tax could impact CNL-FN.

Net lease  properties  acquired in  anticipation of sales through the Investment
Property Sales program can typically be leased to tenants at a rate that exceeds
the rate a Section  1031  Exchange  or other  buyer is  willing  to  accept.  An
increase in general levels of interest rates could result in buyers  requiring a
higher yield that would reduce the gain on CNL-FN's sale of existing properties.
Neither the rate of return on CNL-FN's leased  properties nor the rate of return
required by a buyer correlate directly with prevailing interest rates. CNL-FN is
therefore  at risk that any interest  rate  increases  causing  buyers to demand
higher  yields may not be matched  with higher  yields from  tenants.  This risk
could cause  CNL-FN to  experience  lower  average  gains on the future sales of
Investment Property Sales properties.

In  summary,  the  Company's  specialty  finance  segment  expects  to meet  its
liquidity  requirements  in  2003  with a  combination  of cash  from  operating
activities,  including  cash from its  Investment  Property  Sales  program  and
borrowings on its  warehouse  credit  facilities or its mirror credit  facility.
CNL-FN  renews its  warehouse  credit  facilities  annually and to date has been
successful in doing so at substantially  comparable terms.  CNL-FN's longer-term
liquidity  requirements  (beyond  one  year)  are  expected  to be  met  through
successful  renewal of its  warehouse  credit  facilities  and the mirror credit
facility,  successful  execution  of the  Company's  Investment  Property  Sales
program,  portfolio debt origination fees, asset securitizations,  and augmented
by  operating  cash flows  provided  by  servicing  and  advisory  services.  In
addition,  CNL-FN may seek to obtain  additional debt or equity  financing.  Any
decision to successfully pursue additional debt or equity capital will depend on
a number  of  factors,  such as  compliance  with the terms of  existing  credit
agreements,  the Company's financial performance,  industry or market trends and
the general availability of attractive financing  transactions.  However,  there
can be no assurance that future expansion will be successful due to competitive,
regulatory, market, economic and other factors.

o        Real Estate Segment (CNL Restaurant Properties, Inc.)

CNL-RP operates as a real estate company and its cash flows primarily consist of
rental income from tenants on restaurant  properties  owned,  interest income on
mortgage loans,  dispositions of properties and income from holding interests in
prior loan  securitizations.  CNL-RP's cash outflows are predominantly  interest
expense,   operating   expenses,   reinvestment  of  disposition   proceeds  and
distributions  to CNL-APF.  Borrowing  resources at December 31, 2002 for CNL-RP
include:

<TABLE>
<CAPTION>


                                                      (In Thousands)
                                             Amount Used      Capacity       Maturity      Average Rate
                                            --------------  -------------- -------------- ----------------

 <c>
         Revolver                               $  14,000       $  30,000    Oct 2003               3.92%
         Series 2000-A bonds payable              261,369         261,369   2009 - 2017             7.94%
         Series 2001 bonds payable                124,698         124,698    Oct 2006               2.28%
                                            --------------  --------------
                                               $  400,067      $  416,067
                                              ===========     ===========
</TABLE>


CNL-RP provides a guaranty of $2 million of CNL-FN's mortgage warehouse facility
debt and also provides a guaranty of CNL-FN's five year term financing.

CNL-RP's  short-term  debt during 2002 included the secured note payable entered
into in  October  1999  (the  "Secured  Credit  Facility")  and the $30  million
revolving line of credit (the "Revolver") entered into in October 2001.

o        The Secured Credit Facility matured on February 18, 2003 and throughout
         2002  CNL-RP  management   elected  to  sell  certain   performing  and
         non-performing  properties  to pay  down the note  rather  than  seek a
         source for  refinancing.  Throughout 2002, $50 million in proceeds were
         generated from these sales allowing for the repayment of the entire $49
         million  outstanding at the beginning of 2002. These properties  became
         designated as discontinued  operations,  as described in greater detail
         below. Management does not currently intend to similarly divest of real
         estate  in  2003.  In any  year  however,  in the  ordinary  course  of
         resolving  tenant  vacancies or defaults,  CNL-RP may sell the affected
         properties and reinvest the proceeds in quality, performing properties.

o        The  Company  utilizes  the  Revolver  from time to time to manage  the
         timing of inflows and outflows of cash from operating  activities.  The
         Company's  Revolver is a two-year  facility,  maturing in October 2003,
         and includes a one-year  renewal  option.  At December  31,  2002,  the
         Revolver had an outstanding balance of $14 million.

CNL-RP also had medium-term and long-term bond financing. Rental income received
on the 377 properties pledged as collateral on medium and long-term financing is
used to make scheduled reductions in bond principal and interest.

o        In August 2000,  CNL-RP issued $281 million in long-term bonds,  Series
         2000-A,  bearing an initial  weighted  average  fixed  interest rate of
         7.925 percent and maturing substantially between 2009 and 2017.

o        In October  2001,  CNL-RP  issued $131  million in  medium-term  bonds,
         Series 2001, bearing an interest rate of LIBOR plus 48 basis points and
         maturing in 2006.

Liquidity  risks within the real estate  business  include the potential  that a
tenant's financial condition could deteriorate,  rendering it unable to make its
rent payments and thereby  reducing  CNL-RP's income and cash flows.  Generally,
CNL-RP uses a  triple-net  lease to lease its  properties  to its  tenants.  The
triple-net  lease is a long-term lease with periodic rent increases and requires
the tenant to pay expenses on the property.  The lease somewhat insulates CNL-RP
from  significant cash outflows for  maintenance,  repair,  real estate taxes or
insurance.  However,  if  the  tenant  experiences  financial  problems,  rental
payments could be interrupted and in the event of tenant  bankruptcy the Company
may be required  to fund  certain  expenses  in order to retain  control or take
possession  of  the  property.  This  could  expose  the  Company  to  successor
liabilities and further affect  liquidity.  Such events may adversely affect the
Company's revenue and operating cash flow.

Management  is aware of  multi-unit  tenants  that  are  experiencing  financial
difficulties.  In the event the financial  difficulties  continue, the Company's
collection of rental  payments  could be  interrupted.  At present these tenants
continue to pay rent  substantially in accordance with lease terms and there are
no material  delinquencies.  However,  the  Company  continues  to monitor  each
tenant's  situation  carefully  and will  take  appropriate  action to place the
Company in a position to maximize the value of its  investment.  Management  has
estimated  the loss or impairment  on the related  properties  and included such
charge in earnings through December 31, 2002.

The Company has experienced tenant bankruptcies and may commit further resources
in  seeking   resolution  to  these  properties   including  funding  restaurant
businesses  directly or on behalf of successor tenants.  For example,  where the
value of the leased real estate is linked to the  financial  performance  of the
tenant, CNL-RP may allocate capital to invest in turnaround opportunities.

Certain net lease properties are pledged as collateral for the Series 2000-A and
Series 2001  triple-net  lease mortgage bonds payable.  In the event of a tenant
default  relating  to any such  pledged  properties,  the  Company  may elect to
substitute  properties into these  securitized pools from properties it owns not
otherwise  pledged  as  collateral.  In the event that the  Company  has no such
suitable substitute property,  the adverse performance of the pool might inhibit
the Company's future capital raising efforts, including the ability to refinance
the Series 2001 bonds maturing in 2006.

CNL-RP management believes the combination of availability on its line of credit
and  the  projected  disposition  volume  in 2003  will  permit  it to meet  its
short-term liquidity  objectives.  Long-term liquidity  requirements will be met
through a  combination  of  selectively  disposing  assets and  reinvesting  the
proceeds in higher-yielding investments and cash from operating activities.

Off-Balance Sheet Transactions

The Company holds a retained  interest in $450 million in loans  transferred  to
unconsolidated trusts that provide the collateral for long-term bonds. While the
Company is not  contractually  obligated to guarantee the repayment of the bonds
in the event  borrower  repayments of principal and interest are not adequate to
repay the  bondholders,  the  Company may elect to  contribute  funds into these
unconsolidated entities to supplement cash flows and maintain attractive ratings
on these pools.

Contractual Obligations, Contingent Liabilities and Commitments

The following  table presents the Company's  contractual  cash  obligations  and
related payment periods as of December 31, 2002:
<TABLE>
<CAPTION>

                                                                Payments due by period (In Millions)

                                                   Less
                                                 than one       2 to 3       4 to 5
Contractual cash obligations:                      year         years         years       Thereafter         Total
--------------------------------------------     ----------    ---------    ----------    ------------     ----------
<S> <C>
Borrowings (1)                                      $ 182.4      $ 54.6       $ 365.5        $  228.7        $ 831.2
Leased office space (2)                                 1.1         2.2           2.4             9.3           15.0
                                                 ----------    ---------    ----------    ------------     ----------
Total contractual cash obligations                  $ 183.5      $ 56.8       $ 367.9        $  238.0        $ 846.2
                                                 ==========    =========    ==========    ============     ==========

The  following  table  presents the  Company's  commitments,  contingencies  and
guarantees and related expiration periods as of December 31, 2002:

                                                          Estimated payments due by period (In Millions)
                                                          ----------------------------------------------

Commitments, contingencies and                Less than        2 to 3         4 to 5
    guarantees                                 one year        years          years         Thereafter       Total
-----------------------------------------     ----------     -----------    -----------    -------------    ---------

 Guaranty of unsecured promissory
     note (2)                                      $  --        $   1.3          $  --            $  --        $ 1.3
 Debt repayments acceleration
     resulting from CNL-FN
     distributions (3)                               1.0            2.0            2.0             (5.0 )         --
 Purchase commitments                                9.0             --             --               --          9.0
                                              ----------     -----------    -----------    -------------    ---------
 Total commitments, contingencies and
     guarantees                                  $  10.0        $   3.3        $   2.0         $   (5.0 )     $ 10.3
                                              ==========     ===========    ===========    =============    =========
</TABLE>


(1)      Contractual obligations relative to Company borrowings are described in
         the foregoing  discussion  of Liquidity  and Capital  Resources for the
         applicable segment. The maturities on outstanding  indebtedness assumes
         that loan repayments are made on the mortgage  warehouse  facilities in
         accordance  with the  contractual  obligation  and that  bonds  payable
         amortize in accordance with estimated payment amounts. In the event the
         mortgage   warehouse  lenders  continue  to  renew  the  facilities  as
         expected,  then over $145  million  of the 2003  amounts  would  likely
         mature in a later year.

(2)      In May 2002, the Company purchased a combined five percent  partnership
         interest in CNL Plaza,  Ltd. and CNL Plaza Venture,  Ltd. (the "Plaza")
         for $0.2 million.  Affiliates  of James M. Seneff,  Jr., an officer and
         director of the Company own the remaining  partnership  interests.  The
         Company has  severally  guaranteed  8.33  percent or $1.3  million of a
         $15.5 million  unsecured  promissory  note on behalf of the Plaza.  The
         guaranty  continues  through the loan maturity in November 2004.  Since
         November  1999, the Company has leased its office space from CNL Plaza,
         Ltd., an affiliate of a member of the Company's board of directors. The
         Company's  lease  expires  in 2014  and  provides  for  scheduled  rent
         increases  over the term of the  lease.  Rental and other  expenses  in
         connection  with the lease for the years ended December 31, 2002,  2001
         and  2000  totaled  $1.5  million,   $1.2  million  and  $1.0  million,
         respectively.

(3)      Certain  provisions of the  subordinated  notes  payable  requires that
         distributions  from CNL-FN to its  partners  be approved  and tied to a
         reduction in debt. As a result  distributions to the Company may create
         a  comparable  reduction in this debt.  For  purposes of the  foregoing
         table,  CNL-FN is assumed to  distribute  amounts that would  require a
         debt reduction of $1 million per year.  Actual  distributions,  if any,
         from CNL-FN will vary.

Interest Rate Risk

The Company  generally  invests in assets with a fixed return by financing  them
with variable rate debt.  Floating  interest  rates on variable rate debt expose
the Company to interest rate risk. As December 31, 2002, the Company's  variable
rate debt includes the following:

o        $14 million on its Revolver;

o        $146 million on its mortgage warehouse facilities;

o        $203 million on the June 2002 five-year financing; and

o        $125 million outstanding on the Series 2001 bonds.

Generally, the Company uses derivative financial instruments (primarily interest
rate swap  contracts) to hedge against  fluctuations  in interest rates from the
time it originates and holds  fixed-rate  mortgage loans until the time it sells
them.  Additionally,  the  Company  uses  interest  rate swaps to hedge  against
fluctuations  in interest  rates on its floating rate debt.  Under interest rate
swaps,  the  Company  agrees  with  other  parties  to  exchange,  at  specified
intervals,  the difference between fixed-rate and floating-rate interest amounts
calculated by reference to an agreed upon notional principal amount. The Company
will terminate  certain of these contracts and both the gain or loss on the sale
of the loans and the additional  gain or loss on the termination of the interest
rate  swap  contracts  will  be  measured  and  recognized  in the  consolidated
statement of operations.

The Company also invests in certain  financial  instruments  that are subject to
various forms of market risk such as interest rate fluctuations, credit risk and
prepayment risk.  Management  believes that the value of its mortgage loans held
for sale and  investments  could  potentially  change as a result of fluctuating
interest rates,  credit risk, market sentiment and other external forces,  which
could materially adversely affect the Company's liquidity and capital resources.

Management  estimates that a one-percentage point increase in long-term interest
rates as of  December  31,  2002 would have  resulted  in a decrease in the fair
value of its  fixed-rate  loans held for sale of $0.4  million.  This decline in
fair value  would have been  offset by an  increase in the fair value of certain
interest rate swap  positions of $1.4  million.  In addition,  a  one-percentage
point increase in short-term interest rates for the year ended December 31, 2002
would have resulted in additional  interest costs of approximately $4.2 million.
This sensitivity analysis contains certain simplifying assumptions (for example,
it does not consider the impact of changes in  prepayment  risk or credit spread
risk).  Therefore,  although it gives an indication of the Company's exposure to
interest  rate  change,  it is not  intended to predict  future  results and the
Company's actual results will likely vary.

Management  believes  inflation  has not  significantly  affected the  Company's
earnings  because the inflation rate has remained  moderate.  Additionally,  the
Company's earnings  primarily reflect long-term  investments with fixed rents or
interest rates. The Company mainly finances these investments with a combination
of equity,  senior notes and borrowings  under the revolving  lines of credit or
warehouse  facilities.   During  inflationary   periods,   which  generally  are
accompanied  by rising  interest  rates,  the  Company's  ability to grow may be
adversely affected because the yield on new investments may increase at a slower
rate than new borrowing  costs.  However,  sustained low inflation could lead to
net lease  pricing  pressure as  tenant's  request  decreasing  rates for longer
maturities.

Critical Accounting Policies

The Company  accounts  for many asset  categories  that  require  management  to
exercise  extensive  judgment  and make  estimates.  Listed  below  are the more
significant  accounting  policies that require management judgment and estimates
or are otherwise significant to the results of operations:

o        The Company records the acquisition of land, buildings and equipment at
         cost, including  acquisition,  closing and construction period interest
         costs. Land and buildings are leased to restaurant  operators generally
         on a triple-net  basis,  which means that the tenant is responsible for
         all operating  expenses  relating to the property,  including  property
         taxes,  insurance,  maintenance  and repairs.  The property and secured
         equipment leases held for investment are accounted for using either the
         direct  financing  or the  operating  method  unless  the  Company  has
         classified  these   properties   pursuant  to  their  intent  to  sell.
         Management   estimates   residual  values  and  collectable   rents  in
         determining whether a lease is accounted for as either direct financing
         or operating.

o        The Company's real estate accounting differs for assets held by its two
         operating  segments  based upon  managements  intention with respect to
         such asset's disposition.

            o  Real  estate held  within the real  estate  segment is  generally
               acquired with an intention to hold  long-term.  It is depreciated
               over  its  estimated  useful  life and  rent is  recorded  giving
               consideration  to contractual rent increases over the life of the
               lease. Some real estate held by this segment may be designated so
               as to reflect management's  intention to dispose of the asset. In
               such  case  all   operating   income   and   expense,   including
               depreciation and accrued rent associated with future  contractual
               increases, is reflected as a component of discontinued operations
               for all periods  presented,  even for periods prior to management
               having stated its intention to sell.

            o  Real  estate  held  within  the  specialty   finance  segment  is
               generally  acquired with an intention to sell within one year. It
               is  therefore  not  depreciated,   and  future  contractual  rent
               increases do not impact  earnings.  Because of a transition rule,
               the specialty  finance  properties are accounted for  differently
               depending on acquisition date. All such properties acquired after
               December  31, 2001 are treated as  discontinued  operations,  and
               operating  income and  expense is  reflected  as a  component  of
               discontinued operations.

o        "Mortgage  loans held for sale" are loans  originated  that the Company
         intends to sell or  securitize.  They are recorded at fair market value
         which is  estimated  using  quoted  prices,  the  present  value of the
         expected cash flows and the estimated  impact of any defaults,  and may
         therefore  be  recorded  at an amount  greater  than cost.  The Company
         utilizes  derivative  instruments  to  partially  offset  the effect of
         fluctuating  interest rates on the value of its mortgage loans held for
         sale. As long as the Company qualifies for hedge accounting  treatment,
         valuation  adjustments  relating to these  loans,  including  increases
         above cost,  and any gains or losses on related hedge  instruments  are
         reflected in the statement of operations.

o        "Mortgage notes receivable"  differ from "mortgage loans held for sale"
         primarily because of management's intention to hold the mortgage to its
         maturity.  These financial  assets are recorded at the lower of cost or
         market. Certain assets have been reclassified from "mortgage loans held
         for sale" into the "mortgage notes  receivable"  category when, in lieu
         of  selling  the  mortgages,  the  Company  elects  to  refinance  such
         mortgages  using  longer-term  debt.  In the case of such  reclassified
         mortgages,  the  Company  records  these at the value on the  refinance
         date.  The value at such date may differ from the par value of the loan
         with any such difference being amortized to earnings over the remaining
         life of the mortgage loans as a yield adjustment.

o        Certain loans originated by the Company were sold to independent trusts
         that, in turn,  issued  securities to investors backed by these assets.
         The Company  retains the servicing  rights and  participates in certain
         cash flows from the trusts. The present value of expected excess of net
         cash flows,  after  payment of principal  and interest to bond or other
         certificate  holders,  over the estimated cost of servicing is recorded
         at the  time of sale as a  retained  interest.  Retained  interests  in
         securitized  assets are included in other  investments.  Accounting for
         the retained  interests requires that the Company estimate values using
         market  trends and  historical  experience,  expected  prepayments  and
         defaults.  This  information  is  considered,   along  with  prevailing
         discount rates and the terms of the bonds and  certificates,  to arrive
         at an initial value and to  periodically  review the value for gains or
         losses.  Permanent  impairments,  representing  the excess of  carrying
         value over estimated current fair value, are recorded as an expense.

o        Management reviews its properties and loans for impairment or potential
         loss as events or  circumstances  indicate that the carrying  amount of
         the assets may not be  recoverable.  Management  compares the estimated
         future  undiscounted  cash flows,  including the residual  value of the
         property or collateral, with the carrying cost of the individual asset.
         If impairment  is  indicated,  the assets are adjusted to the estimated
         fair value.

o        The Company has also entered into certain derivative contracts in order
         to hedge its  exposure to  fluctuations  in interest  rates on variable
         rate debt  qualifying  for  treatment as cash flow  hedges.  As long as
         certain criteria for hedge accounting are met the changes in fair value
         of these  contracts is reflected in other  comprehensive  income (loss)
         and as a component of stockholders' equity. If the requirements are not
         met  changes  in the fair value of these  contracts  are  reflected  in
         earnings.

Results from Operations

The Company focused  predominantly on its core real estate operations until June
2000,  the date of its  strategic  alliance  with a bank,  after  which it began
differentiating its specialty finance segment from its other operations. Segment
results prior to June 2000 are not available.  Segment earnings are reflected in
the following table:
<TABLE>
<CAPTION>

Net income/(loss) by segment in millions                        For the year ended December 31,
                                                    2002                 2001                  2000
                                               -----------------   -----------------    ----------------
<S> <C>
Real estate segment                               $      23.1        $    (22.8)           $     11.9
Specialty finance segment                                12.6               0.4                 (16.7)

Other holding company results, results for
  periods prior to segment reporting  and
  consolidating eliminations                             (0.1)             (2.1)                  7.7
                                               -----------------   -----------------    ----------------
    Net income/(loss)                             $      35.6        $    (24.5)           $      2.9
                                               =================   =================    ================
</TABLE>

o        The real estate business  segment posted earnings in 2002 compared to a
         loss in 2001 that  resulted  when $28.2  million in loan  reserves  and
         $16.6  million in real estate  impairments  were recorded in connection
         with certain  borrower and tenant  delinquencies.  In 2000, the segment
         reported  earnings  after  real  estate  impairments  of $2.1  million.
         Exclusive of these charges in each year,  the improved  performance  of
         the real estate segment during the comparative  years reflects the 2002
         initiative to sell vacant and  under-performing  properties and use the
         proceeds  to  reduce  debt.  The sales  resulted  in a net gain of $3.3
         million and  generated  sales  proceeds that were applied to reduce the
         business segment's overall debt by $44.7 million.

o        The  specialty  finance  business  segment has expanded its  Investment
         Property Sales program  selling $288 million of real estate  properties
         generating  gains to the  Company  of  $23.4  million  throughout  2002
         compared  with sales of $108 million and gains of $9.1  million  during
         2001 or an  improvement  of $14.3  million  between  these years.  This
         program  did not exist in 2000,  when  CNL-FN  was  impacted  by a $6.9
         million charge related to loan valuation changes and by $5.3 million in
         losses and reserves in investments in loan pools.

o        The holding  Company  results in 2000 reflect  results  primarily  from
         prior to the date management began tracking results by segment.


<PAGE>


Revenues
<TABLE>
<CAPTION>

                                                                         For the year ended December 31,
Total revenues by segment in millions                              2002           2002              2000
                                                              -----------    -------------     -------------

 <c>
Real estate segment                                              $  92.5         $   92.3          $   44.9
Specialty finance segment                                          233.6            168.3              14.9
Other holding company results, results for periods prior
   to segment reporting and consolidating eliminations              (1.8)            (3.8)             49.7
                                                              -----------    -------------     -------------
       Total revenues                                            $ 324.3         $  256.8          $  109.5
                                                              ===========    =============     =============

Revenues are discussed based on the individual segment results:

                                                                       For the year ended December 31,
  Real estate segment revenues by line item in millions            2002            2001              2000
                                                                -----------    --------------    -------------

  Rental income from operating leases                              $  62.9          $   64.1         $   28.9
  Earned income from direct financing                                 12.1              12.9              6.0
  Interest income from mortgage equipment and other
      notes receivable                                                 4.2               4.3              3.7
  Investment and interest income                                       4.8               5.0              3.6
  Other income                                                         8.5               6.0              2.7
                                                                -----------    --------------    -------------
          Total segment revenues                                   $  92.5          $   92.3         $   44.9
                                                                ===========    ==============    =============
</TABLE>

During 2002,  CNL-RP divested of certain vacant and other real estate properties
and used the proceeds to decrease  the business  segment's  debt.  However,  the
rental  revenue  from these  properties  has been  classified  as a component of
discontinued  operations  for all periods  presented  and is not included in the
segment  revenues in the table above. The increase in revenues for 2001 compared
with 2000 is  attributed to having more  properties  under lease and the segment
tracking beginning mid-year.

The revenues of the  specialty  finance  segment are more variable than those of
the real estate  segment.  The following table provides  additional  information
relating to the revenues of this segment:
<TABLE>
<CAPTION>

                                                                         For the year ended December 31,
Specialty finance segment revenues by line item in millions      2002              2001            2000
                                                             ------------     -------------    -------------

 <c>
Sale of real estate                                              $ 189.4          $  105.6            $  --
Rental income from operating leases                                  8.1              13.7              1.7
Earned income from direct financing leases                            --               0.6              0.3
Interest income from mortgage equipment and other
     notes receivable                                               31.5              38.7             14.6
Investment and interest income                                       1.4               1.6              2.0
Net decrease in value of mortgage loans held for
     sale, net of related hedge                                     (5.4)             (5.1)            (6.9)
Gain on sale of mortgage loans                                        --               4.1               --
Other income                                                         8.6               9.1              3.2
                                                             ------------     -------------    -------------
         Total segment revenues                                  $ 233.6          $  168.3          $  14.9
                                                             ============     =============    =============
</TABLE>

CNL-FNC revenues are significantly  impacted by the method of accounting for its
sales of real estate.  Its sales are recorded pursuant to new guidance described
more fully below,  including  transition  rules that cause  certain  sales to be
recorded in revenues and others to be treated as discontinued  operations.  This
program was not started until 2001. The following  information  assembles select
financial   information,   presented  in  accordance  with  generally   accepted
accounting  principles,  so as to improve  comparability between periods of this
segment's Investment Property Sales program sales,  excluding sales conducted in
a joint venture program:
<TABLE>
<CAPTION>

Specialty finance segment Investment Property
     Sales program sales (excludes sales in                              For the year ended December 31,
     joint venture program) in millions                            2002            2001            2000
                                                             ------------    -------------     -----------

 <c>
Sale of real estate, as reported                                $  189.4         $  105.6           $  --
Cost of real estate sold, as reported                             (175.2)           (97.6)             --
Gain on disposal discontinued operations, net as
      reported                                                       7.8               --              --
                                                             ------------    -------------     -----------
Total gains from Investment Property Sales program
     sales (excluding sales in joint venture program)            $  22.0         $    8.0           $  --
                                                             ============    =============     ===========
</TABLE>

Other  matters  impacting  the  comparability  of the various  components of the
CNL-FNC revenues between the three years presented include:

o        The segment did not begin operations until June 2000.

o        Rental income from  operating  leases is shown to be  decreasing  after
         2001, but rental revenues  associated  with  properties  acquired after
         December   31,  2001  are  recorded  as  a  component  of  income  from
         discontinued operations.

o        Interest  income  from  mortgage  loans has  decreased  after 2001 as a
         result of the  significant  number of loans sold  throughout  2001. The
         Company  has not  originated  new  mortgage  loans  since  May of 2001,
         focusing  instead on the  opportunity to refer  potential  borrowers to
         Bank of  America.  This  segment  acquired  a large  number of loans in
         October 2000.

o        Investment and interest income  associated  with retained  interests in
         the off balance sheet loan pools has  decreased  across the three years
         presented as a result of certain pool defaults and prepayments.

o        Despite a hedging strategy designed to address market volatility in the
         value of loans held for sale, in both 2002 and 2001 the loan  valuation
         increases  associated  with  decreases in interest rates were more than
         offset by estimated potential default losses and valuation decreases in
         hedge  contracts.  In 2000,  prior to the  adoption  of new  accounting
         standards, hedge contract value changes were not reflected in earnings,
         but estimated potential defaults were recorded.

o        The sale of  mortgage  loans in 2001 led to the $4.1  million in gains;
         there were no such sales in either 2000 or 2002.

o        Other income reflects growth  associated with the advisory  service and
         consulting operations, servicing revenues and fees from loans and other
         referrals to Bank of America, however referral fees have decreased from
         2001 to 2002 as a result  of a  modification  of  certain  terms of the
         alliance agreement.

Expenses

Cost of real estate sold is associated solely with the Investment Property Sales
program of the  specialty  finance  segment and in 2002 relates to properties on
hand at the  beginning of the year that have since been sold.  Costs  associated
with  properties  acquired after 2001 are required to be included as a component
of the  gain  on  disposal  of  discontinued  operations.  A table  and  related
discussion of the comparative  three-year  results from this program is reported
above under the discussion of related revenues.


<PAGE>

<TABLE>
<CAPTION>

General operating and administrative                                   For the year ended December 31,
    expenses by segment in millions                              2002             2001            2000
                                                           -------------    ------------     -----------

 <c>
Real estate segment                                             $   12.3         $   9.0         $   6.1
Specialty finance segment                                           23.1            22.6            11.3
Other holding company results, results for periods
   prior to segment reporting and consolidating
   eliminations                                                     (1.0)           (1.2)            7.5
                                                           -------------    ------------     -----------
     Total general operating and administrative
         expenses                                               $   34.4         $  30.4         $  24.9
                                                           =============    ============     ===========
</TABLE>

o        Despite  cost  savings in several  CNL-RP  general  and  administrative
         categories  similar to CNL-FN,  certain costs relating to delinquencies
         have increased.

o        While reflecting a strong improvement in revenues and earnings,  CNL-FN
         has been  able to  maintain  fairly  constant  levels  of  general  and
         administrative  expenses across the three years presented since segment
         measurement began during 2000.



<PAGE>
<TABLE>
<CAPTION>


Interest expense by segment in millions                        For the year ended December 31,
                                                    2002                 2001                 2000
                                               -----------------   ----------------    ----------------

 <c>
Real estate segment                                $      30.5        $     36.7          $      18.6
Specialty finance segment                                 28.8              32.4                 12.8
Other holding company results and
   consolidating eliminations                             (0.5)             (0.7)                15.5
                                               -----------------   ----------------    ----------------
     Total interest expense                        $      58.8        $     68.4          $      46.9
                                               =================   ================    ================
</TABLE>

o        CNL-RP has decreased its level of debt  throughout most of 2002 through
         the sales of real  estate.  The  segment is  realizing a decrease of 17
         percent in interest  expense from 2001 to 2002 because of the decreased
         debt and  because it repaid a portion of the  Secured  Credit  Facility
         with  proceeds from the sale of its Series 2001 Bonds issued in October
         2001, which carry a lower rate of interest. The real estate segment had
         increased its debt levels prior to 2002.

o        CNL-FN has reduced its interest-bearing debt, in particular as a result
         of  sales of $288  million  in  Investment  Property  Sales  properties
         throughout  2002 while  acquiring only $204 million in new  properties.
         Conversely,  throughout  2001 CNL-FN  increased its level of properties
         financed.  Interest expense  associated with properties  acquired after
         December   31,  2001  are  recorded  as  a  component  of  income  from
         discontinued  operations.  The weighted average interest charged by the
         mortgage warehouse  facilities has decreased from 7.67 percent and 5.13
         percent in 2000 and 2001, respectively to 4.07 percent in 2002.

The Company has decreased  the length of time  necessary to re-lease a defaulted
tenant's  property.  However the overall number of defaulted  tenant  properties
increased as a result of several significant tenant bankruptcies during the past
eighteen  months  leading to $3.5 million in property  expenses  during the year
ended December 31, 2002 compared with $2.1 million and $2.4 million in the years
ended December 31, 2001 and 2000, respectively. Some expenses formerly presented
in this category  associated with properties treated as discontinued  operations
are  incorporated  in the income or loss from  discontinued  operations  for all
years presented.

Expense  categories  such as  state  taxes  and  depreciation  and  amortization
expenses  have  reflected  and will  continue  to  reflect,  the level of assets
invested in leased properties.  Certain of these expenses have been reflected as
a component  of  discontinued  operations.  The category  for  depreciation  and
amortization  expenses has also included amortization on intangible assets, such
as goodwill.  During 2001 and 2000, the Company  amortized $3.1 million and $2.7
million in  goodwill,  respectively.  In July  2001,  the  Financial  Accounting
Standards  Board  issued  Statement of Financial  Accounting  Standards  No. 142
"Goodwill and Other Intangible  Assets" ("FAS 142"). FAS 142 requires the use of
a  non-amortization  approach  to account  for  purchased  goodwill  and certain
intangibles. Under a non-amortization approach, goodwill and certain intangibles
will not be amortized,  but instead are reviewed for impairment and written down
and charged to results of  operations  only in the periods in which the recorded
value of goodwill  and  certain  intangibles  is more than its fair  value.  The
Company's  adoption of this accounting  standard has eliminated its amortization
of goodwill commencing January 1, 2002;  however,  impairment reviews may result
in future  periodic  write-downs.  During the year ended  December 31, 2002,  no
write-downs were considered necessary.

The Company  recorded $10.3 million in 2000 related to the  integration of debt,
net lease and other  financial  products  with Bank of America as a partner  and
related to a proposed merger transaction intended to be followed by a listing of
company shares. No transaction costs have been incurred in either 2002 or 2001.

The Company recorded a loss on investment in securities of $0.1 million and $5.3
million for the years ended 2001 and 2000, respectively, resulting from:

o        impairments and expenses associated with a residual interest investment
         in both years; and

o        losses  of  $3.1  million   specific  only  to  2000  relating  to  the
         liquidation of a securitization trust.

The  Company  recorded a loss of $8.1  million in 2001 upon the  termination  of
certain  hedges  initially  treated  as "cash  flow"  hedges.  Most of this loss
resulted when CNL-FN focused on its Investment Property Sales program in lieu of
its focus on securitizations.  This change in focus was the result of changes in
market conditions. No comparable loss relates to either 2002 or 2001.

The Company recorded a provision for loan losses of $3.1 million,  $28.2 million
and $1.8 million in 2002, 2001 and 2000, respectively. The provision in 2001 was
the result of the bankruptcy of a significant borrower.

The Company has recorded impairment  provisions of $8.6 million,  $16.9 million,
and $2.2 million for years ended December 31, 2002, 2001 and 2000,  respectively
excluding  impairments  on  properties  treated as  discontinued  operations  as
described below.  Impairment provisions are recorded when circumstances indicate
that  future  expected  cash  flows  do not  recover  the  carrying  cost of the
individual properties.  The amount in 2001 was associated with three significant
tenant  bankruptcies that have been resolved in 2002. The 2002 amounts relate to
tenants that are experiencing financial difficulties that could lead to defaults
and ultimately to losses on the underlying real estate.

Effective  January 1, 2002 the Company  accounts for certain of its revenues and
expenses as originating from  discontinued  operations  pursuant to Statement of
Financial Accounting Standard No. 144 "Accounting for the Impairment or Disposal
of Long-Lived  Assets" ("FAS 144").  FAS 144 requires that sales of real estate,
or the  designation  of a real  estate  asset as held for sale,  be  treated  as
discontinued operations. Any gain or loss from such disposition,  and any income
or expenses associated with these real estate assets, are included in the income
statement  as  discontinued  operations.   CNL-FN's  Investment  Property  Sales
program,  a vital piece of its ongoing  operating  strategy and a contributor of
over $32 million in gains beginning in 2001 is nonetheless  deemed to fall under
the new guidance.  Therefore,  gains from  properties  sold under the Investment
Property Sales program,  unless acquired before January 1, 2002, are included as
discontinued operations; income and expenses associated with Investment Property
Sales program  assets  designated  as held for sale after  December 31, 2001 are
also included in  discontinued  operations.  In addition,  CNL-RP has designated
certain  real estate  assets  since  December  31, 2001 as held for sale and has
included  income and expenses  associated with the assets as well as the gain or
loss from any  dispositions of these assets as  discontinued  operations for all
periods  presented.  The table below  illustrates the difference in treatment of
discontinued operations by segment:


<PAGE>


<TABLE>
<CAPTION>


Discontinued operations by segment in                        For the year ended December 31,
   millions                                          2002               2001                  2000
                                               -----------------   -----------------    ----------------

 <c>

Real estate segment discontinued operations:
     Operating income                             $        (5.1)        $    (6.2)         $      4.6
     Gains or losses                                        3.3                 --
Specialty finance segment discontinued
   operations:
     Operating income                                       3.2                 --                  --
     Gains or losses                                        7.8                 --                  --
                                               -----------------   -----------------    ----------------
        Total discontinued operations             $         9.2         $    (6.2)         $       4.6
                                               =================   =================    ================
</TABLE>

The Company adopted  Statement of Financial  Accounting  Standards No. 133 ("FAS
133"), as amended, on January 1, 2001, which requires all derivative instruments
to be recorded on the balance  sheet at fair value.  Effective  January 1, 2001,
the Company  recorded a cumulative  effect  adjustment  loss of $21.2 million to
recognize  at fair  value all  derivative  instruments  that are  designated  as
fair-value hedging  instruments.  The Company recorded an offsetting  cumulative
effect   adjustment   gain  of  $17.4  million  to  recognize   the   difference
(attributable  to the hedged risks) between the carrying  values and fair values
of  related  hedged  assets or  liabilities.  The  adoption  of FAS 133  thereby
resulted in a $3.8 million charge against Company earnings in 2001.

In April 2002, the FASB issued Statement of Financial  Accounting  Standards No.
145,  "Rescission  of FASB  Statements  No.  4, 44,  and 64,  Amendment  of FASB
Statement  No. 13, and  Technical  Corrections."  This  statement  rescinds FASB
Statement No. 4, "Reporting Gains and Losses from  Extinguishment  of Debt," and
an amendment of that Statement,  FASB Statement No. 64, "Extinguishments of Debt
Made to Satisfy  Sinking-Fund  Requirements."  This statement also rescinds FASB
Statement No. 44,  "Accounting  for  Intangible  Assets of Motor  Carriers," and
amends  FASB  Statement  No.  13,  "Accounting  for  Leases,"  to  eliminate  an
inconsistency  between the required  accounting for sale-leaseback  transactions
and the required  accounting for certain lease  modifications that have economic
effects that are similar to  sale-leaseback  transactions.  This  statement also
amends other existing  authoritative  pronouncements  to make various  technical
corrections,  clarify meanings,  or describe their  applicability  under changed
conditions.  The  provisions  of this  statement  related to the  rescission  of
Statement 4 are  applicable in fiscal years  beginning  after May 15, 2002.  The
provisions  of  this  statement  related  to  Statement  13  are  effective  for
transactions  occurring  after  May  15,  2002.  All  other  provisions  of this
statement  are effective  for  financial  statements  issued on or after May 15,
2002. The provisions of this statement,  to the extent already  applicable,  did
not have a significant impact on the financial position or results of operations
of the  Company.  Provisions  applicable  to future  reporting  periods  are not
expected to have a significant  impact on the  financial  position or results of
operations of the Company.

In July 2002, the FASB issued  Statement of Financial  Accounting  Standards No.
146,  "Accounting for Costs  Associated with Exit or Disposal  Activities."  The
statement requires companies to recognize costs associated with exit or disposal
activities  when they are incurred rather than at the date of a commitment to an
exit or disposal plan.  Examples of costs covered by the statement include lease
termination costs and certain employee  severance costs that are associated with
a  restructuring,  discontinued  operation,  plant  closing,  or  other  exit or
disposal  activity.  The  statement  is to be applied  prospectively  to exit or
disposal  activities  initiated  after  December 31, 2002.  The adoption of this
statement is not expected to have a significant impact on the financial position
or results of operations of the Company.

In  November  2002,  FASB  issued  FASB   Interpretation   No.  45  ("FIN  45"),
"Guarantor's  Accounting and Disclosure  Requirements for Guarantees,  Including
Indirect   Guarantees  of  Indebtedness   of  Others".   FIN  45  clarifies  the
requirements  relating to a guarantor's  accounting  for, and disclosure of, the
issuance of certain types of guarantees. FIN 45 requires that upon issuance of a
guarantee,  the guarantor  must  recognize a liability for the fair value of the
obligation  it assumes under that  guarantee.  FIN 45's  provisions  for initial
recognition  and  measurement  are  to be  applied  on a  prospective  basis  to
guarantees  issued or modified after  December 31, 2002. The Company's  previous
accounting for guarantees issued prior to January 1, 2003 are not required to be
revised or  restated to reflect the effect of the  recognition  and  measurement
provisions of FIN 45.

In  January  2003,   FASB  issued  FASB   Interpretation   No.  46  ("FIN  46"),
"Consolidation  of Variable  Interest  Entities"  to expand upon and  strengthen
existing  accounting  guidance that  addresses when a company should include the
assets,   liabilities   and  activities  of  another  entity  in  its  financial
statements.  To improve financial  reporting by companies involved with variable
interest  entities (more  commonly  referred to as  special-purpose  entities or
off-balance sheet  structures),  FIN 46 requires that a variable interest entity
be considered by a company if that company is subject to a majority risk of loss
from the variable interest entity's activities or entitled to receive a majority
of the entity's  residual returns or both. Prior to FIN 46, a company  generally
included  another entity in its  consolidated  financial  statements  only if it
controlled  the entity  through  voting  interests.  Consolidation  of  variable
interests  entities will provide more complete  information about the resources,
obligations,   risks  and  opportunities  of  the  consolidated   company.   The
consolidation  requirements  of FIN 46 apply  immediately  to variable  interest
entities  created  after  January 31, 2003,  and to older  entities in the first
fiscal year or interim period beginning after June 15, 2003. Management believes
that adoption of this standard will not change the accounting for its bankruptcy
remote  securitization  entities.  Management believes adoption of this standard
may result in either  consolidation or additional  disclosure  requirements with
respect   to  the   Company's   unconsolidated   subsidiaries,   however,   such
consolidation  is not expected to significantly  impact the Company's  financial
position or results of operations.


Item 7a.  Quantitative and Qualitative Disclosures About Market Risk

This  information  is described  above in Item 7.  Management's  Discussion  and
Analysis of Financial Condition and Results of Operations.


Item 8.  Financial Statements and Supplementary Data


<PAGE>











               Report of Independent Certified Public Accountants



To the Board of Directors and Stockholders of
CNL American Properties Fund, Inc.


In our opinion,  the  accompanying  consolidated  balance sheets and the related
consolidated statements of operations, of stockholders' equity and comprehensive
income/(loss),  and of cash flows present fairly, in all material respects,  the
financial position of CNL American Properties Fund, Inc. and its subsidiaries at
December 31, 2002 and 2001,  and the results of their  operations and their cash
flows for each of the three  years in the  period  ended  December  31,  2002 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  15(a)(2)  present  fairly,  in all material
respects,  the information  set forth therein when read in conjunction  with the
related  consolidated  financial  statements.  These  financial  statements  and
financial   statement   schedules  are  the   responsibility  of  the  Company'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.

As discussed in Note 1 to the consolidated  financial statements,  on January 1,
2001 the  Company  changed its method of  accounting  for  derivative  financial
instruments  and on January 1, 2002 the  Company  adopted  Financial  Accounting
Standards No. 142 "Goodwill and other Intangible Assets" and No. 144 "Accounting
for the Impairment or Disposal of Long-Lived Assets."



/s/ PricewaterhouseCoopers LLP

Orlando, Florida
February 5, 2003




<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEETS
                    (In Thousands except for per share data)
<TABLE>
<CAPTION>

                                                                                      December 31,
                                                                             2002                     2001
                                                                        ----------------         ----------------

 <c>
ASSETS

Real estate investment properties                                            $   580,520              $   589,119
Net investment in direct financing leases                                        112,441                  121,712
Real estate held for sale                                                        144,487                  251,439
Mortgage loans held for sale                                                      48,327                  315,835
Mortgage, equipment and other notes receivable                                   334,467                  103,962
Other investments                                                                 32,163                   32,797
Cash and cash equivalents                                                         15,531                   20,858
Restricted cash                                                                    4,574                   10,931
Receivables, less allowance for doubtful accounts
    of $1,182 and $4,315, respectively                                             3,281                    4,990
Accrued rental income                                                             22,332                   17,938
Goodwill                                                                          56,260                   56,260
Other assets                                                                      29,675                   33,273
                                                                       ------------------       ------------------
                                                                            $  1,384,058             $  1,559,114
                                                                       ==================       ==================

LIABILITIES AND STOCKHOLDERS' EQUITY

Revolver                                                                     $    14,000              $    10,000
Note payable                                                                     203,207                   48,731
Mortgage warehouse facilities                                                    145,758                  430,169
Subordinated note payable                                                         43,750                   43,750
Bonds payable                                                                    424,508                  441,065
Due to related parties                                                             5,124                    5,201
Other payables                                                                    35,138                   35,505
                                                                       ------------------       ------------------
       Total liabilities                                                         871,485                1,014,421
                                                                       ------------------       ------------------

Minority interests, including redeemable partnership interest                     18,422                   18,511
                                                                       ------------------       ------------------

Commitments and contingencies (Note 15)

Stockholders' equity:
    Preferred stock, without par value.  Authorized
       and unissued 3,000,000 shares                                                  --                       --
    Excess shares, $0.01 par value per share.
       Authorized and unissued 78,000,000 shares                                      --                       --
    Common stock, $0.01 par value per share.  Authorized
       62,500,000 shares, issued 45,285,972 and 44,112,943
       shares, respectively, outstanding 45,248,670 and
           44,075,641 shares, respectively                                           452                      441
    Capital in excess of par value                                               816,745                  798,154
    Accumulated other comprehensive (loss)/income                                (16,862 )                  1,370
    Accumulated distributions in excess of net earnings                         (306,184 )               (273,783 )
                                                                       ------------------       ------------------
       Total stockholders' equity                                                494,151                  526,182
                                                                       ------------------       ------------------

                                                                            $  1,384,058             $  1,559,114
                                                                       ==================       ==================
</TABLE>
          See accompanying notes to consolidated financial statements.

<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    (In Thousands, except for per share data)
<TABLE>
<CAPTION>


                                                                               Year Ended December 31,
                                                                    2002                 2001                 2000
                                                                --------------       -------------        -------------

 <c>
Revenues:
    Sale of real estate                                        $      189,426           $  105,645            $     --
    Rental income from operating leases                                71,029               76,592              64,596
    Earned income from direct financing leases                         12,102               12,930              14,034
    Interest income from mortgage, equipment and other
       notes receivables                                               35,539               42,855              21,589
    Investment and interest income                                      5,344                5,845               8,205
    Net decrease in value of mortgage loans
       held for sale, net of related hedge                             (5,368 )             (5,070 )            (6,855 )
    Gain on sale of mortgage loans                                         --                4,120                  --
    Other income                                                       16,227               13,918               7,928
                                                               ---------------      ---------------      --------------
                                                                      324,299              256,835             109,497
                                                               ---------------      ---------------      --------------
Expenses:
    Cost of real estate sold                                          175,185               97,587                  --
    General operating and administrative                               34,352               30,387              24,939
    Interest expense                                                   58,780               68,371              46,944
    Property expenses                                                   3,462                2,128               2,418
    State and other taxes                                                  74                  964               1,193
    Depreciation and amortization                                      13,733               18,213              16,401
    Transaction costs                                                      --                   --              10,315
    Loss on investment in securities                                       --                  122               5,348
    Loss on termination of cash flow hedges                                --                8,060                  --
    Provision for loss on loans                                         3,099               28,200               1,804
    Impairment provisions                                               8,639               16,900               2,214
                                                               ---------------      --------------       --------------
                                                                      297,324              270,932             111,576
                                                               ---------------      ---------------      --------------
Earnings/(loss) before minority interest in (income)/loss
    of consolidated joint ventures, equity in earnings of
    unconsolidated joint ventures and loss
    on sales of assets                                                 26,975              (14,097 )            (2,079 )

Minority interest in income/(loss) of
    consolidated joint ventures                                        (1,134 )               (242 )             1,024

Equity in earnings of unconsolidated joint ventures                       921                1,106                  97

Loss on sales of assets                                                  (347 )             (1,137 )              (721 )
                                                               ---------------      ---------------      --------------

Earnings/(loss) from continuing operations, net                        26,415              (14,370 )            (1,679 )
                                                               ---------------      ---------------      --------------

Discontinued operations
    Earnings/(loss) from discontinued operations, net                  (1,893 )             (6,241 )             4,606
    Gain on disposal of discontinued operations, net                   11,068                   --                  --
                                                               ---------------      ---------------      --------------
                                                                        9,175               (6,241 )             4,606
                                                               ---------------      ---------------      --------------
Earnings/(loss) before cumulative effect of accounting
    change                                                             35,590              (20,611 )             2,927
                                                               ---------------      ---------------      --------------

Cumulative effect of accounting change                                     --               (3,841 )                --
                                                               ---------------      ---------------      --------------

Net income/(loss)                                              $       35,590         $    (24,452 )        $    2,927
                                                               ===============      ===============      ==============
</TABLE>
          See accompanying notes to consolidated financial statements.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                    (In Thousands, except for per share data)
<TABLE>
<CAPTION>


                                                                               Year Ended December 31,
                                                                    2002                 2001                2000
                                                               ---------------      ---------------      --------------

 <c>
Earnings/(loss) per share of common stock (basic and diluted):

       From continuing operations                                  $     0.59          $     (0.33 )       $     (0.04 )

       From discontinued operations                                      0.21                (0.14 )              0.11
                                                               ---------------      ---------------      --------------

       Before cumulative effect of accounting change                     0.80                (0.47 )              0.07

       Cumulative effect of accounting change                              --                (0.09 )                --
                                                               ---------------      ---------------      --------------

Net income/(loss)                                                  $     0.80          $     (0.56 )        $     0.07
                                                               ===============      ===============      ==============

Weighted average number of shares
    of common stock outstanding                                    44,620,235           43,589,985          43,495,919
                                                               ===============      ===============      ==============
</TABLE>

          See accompanying notes to consolidated financial statements.

<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME/(LOSS)
                  Years Ended December 31, 2002, 2001 and 2000
             (In Thousands except for share data and per share data)

<TABLE>
<CAPTION>


                                                                         Accumulated     Accumulated
                                                                         distributions      other                          Compre-
                                    Common stock         Capital in       in excess        compre-                         hensive
                               -----------------------
                                 Number        Par        excess of         of net         hensive                         Income/
                               of Shares      value       par value        earnings      Income/(loss)       Total         (loss)
                               -----------  ----------  --------------   -------------   -------------    -------------   ----------

 <c>
Balance at December 31, 1999   43,495,919    $    435     $   791,419      $ (119,463)     $     (177)     $   672,214

Stock issuance costs                   --          --          (1,493 )            --              --           (1,493 )

Net income                             --          --              --           2,927              --            2,927        2,927

Other comprehensive income,
    market revaluation on
    available for sale
    securities                         --          --              --              --             419              419          419
                                                                                                                          ----------

Total comprehensive income             --          --              --              --              --               --    $   3,346
                                                                                                                          ==========

Distributions declared and
    paid ($1.52 per share)             --          --              --         (66,329 )            --          (66,329 )
                               -----------  ----------  --------------   -------------   -------------    -------------

Balance at December 31, 2000   43,495,919     $   435    $    789,926    $   (182,865 )    $      242     $    607,738    $

Shares issued                     579,722           6           9,722              --              --            9,728

Stock issuance costs                   --          --          (1,494 )            --              --           (1,494 )

Net loss                               --          --              --         (24,452 )            --          (24,452 )    (24,452)

Other comprehensive income,
    market revaluation on
    available for sale
    securities                         --          --              --              --             839              839          839

Cumulative effect adjustment
    to recognize fair value
    of cash flow hedges                --          --              --              --          (5,172 )         (5,172 )     (5,172)


Reclassification of cash
   flow hedge losses  to
   statement of operations             --          --              --              --           8,060            8,060        8,060


Current period adjustment to
    recognize  change in fair
    value of cash flow hedges          --          --              --              --          (2,599 )         (2,599 )     (2,599)

                                                                                                                          ----------

Total comprehensive loss               --          --              --              --              --               --    $ (23,324)
                                                                                                                          ==========

Distributions declared and
    paid ($1.52 per share)             --          --              --         (66,466 )            --          (66,466 )
                               -----------  ----------  --------------   -------------   -------------    -------------

Balance at December 31, 2001   44,075,641     $   441    $    798,154     $  (273,783 )    $    1,370      $   526,182
                               ===========  ==========  ==============   =============   =============    =============
</TABLE>

          See accompanying notes to consolidated financial statements.

<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
 CONSOLIDATED STATEMENTS OF STOCKHOLDERS'EQUITY AND COMPREHENSIVE INCOME/(LOSS)
                  Years Ended December 31, 2002, 2001 and 2000
             (In Thousands except for share data and per share data)
<TABLE>
<CAPTION>


                                                                         Accumulated     Accumulated
                                                                         distributions      other                           Compre-
                                    Common stock         Capital in       in excess        compre-                         hensive
                               -----------------------
                                 Number        Par        excess of         of net         hensive                         Income/
                               of Shares      value       par value        earnings      Income/(loss)       Total          (loss)
                               -----------  ----------  --------------   -------------   -------------    -------------   ----------

 <c>
Balance at December 31, 2001   44,075,641     $   441    $    798,154    $   (273,783 )   $     1,370     $    526,182    $

Shares issued                   1,173,354          11          20,088              --              --           20,099

Retirement of common stock           (325 )        --              (4 )            --              --               (4 )

Stock issuance costs                   --          --          (1,493 )            --              --           (1,493 )

Net income                             --          --              --          35,590              --           35,590       35,590

Other comprehensive loss,
    market revaluation on
    available for sale
    securities                         --          --              --              --            (775 )           (775 )       (775)

Current period adjustment to
    recognize  change in fair
    value of cash flow hedges,
    net of tax                         --          --              --              --         (17,457 )        (17,457 )    (17,457)

                                                                                                                          ----------

Total comprehensive income             --          --              --              --              --               --    $  17,358
                                                                                                                          ==========

Distributions declared and
    paid ($1.52 per share)             --          --              --         (67,991 )            --          (67,991 )
                               -----------  ----------  --------------   -------------   -------------    -------------

Balance at December 31, 2002   45,248,670   $     452    $    816,745     $  (306,184 )   $   (16,862 )    $   494,151
                               ===========  ==========  ==============   =============   =============    =============
</TABLE>


          See accompanying notes to consolidated financial statements.

<PAGE>

                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                                 (In Thousands)

<TABLE>
<CAPTION>

                                                                                     Year Ended December 31,
                                                                           2002               2001             2000
                                                                       --------------     -------------    -------------

 <c>
Cash flows from operating activities:
   Net income/(loss)                                                     $    35,590       $    (24,452 )     $    2,927
                                                                       ---------------     --------------   --------------
   Adjustments to reconcile net income/(loss) to net cash
      provided by (used in) operating activities:
         Depreciation and amortization                                        13,733             18,213           16,401
         Cumulative effect of accounting change                                   --              3,841               --
         Impairment provisions                                                 8,639             16,900            2,214
         Provision for loss on loans                                           3,099             28,200            1,804
         Loss on sales of assets                                                 347              1,137              721
         Loss on investment in securities                                         --                122            5,348
         Gain on sale of mortgage loans                                           --             (4,120)              --
         Decrease/(increase) in real estate held for sale                     40,037            (37,507)              --
         Net decrease in value of mortgage loans held for sale,
             net of related hedge                                              5,368              5,070            6,855
         Equity in earnings of joint venture, net of distributions               555               (397)               7
         Proceeds from sale of loans                                              --            105,975               --
         Investment in mortgage loans held for sale                          (14,440)          (116,995)        (205,584)
         Collection on mortgage loans held for sale                           36,281             37,267            6,981
         Changes in other operating assets and liabilities                   (17,716)            14,948            6,363
                                                                      ---------------     ---------------  ---------------
                   Total adjustments                                          75,903             72,654         (158,890)
                                                                      ---------------     ---------------  ---------------

Net cash provided by (used in) operating activities                          111,493             48,202         (155,963)
                                                                      ---------------     ---------------  ---------------

Cash flows from investing activities:
   Additions to real estate investment properties                             (7,212 )           (26,052 )       (160,901 )
   Investment in direct financing leases                                          --                  --          (15,369 )
   Proceeds from sale of assets                                               67,085              12,659           15,869
   Proceeds from sale or maturities of securities                                 --                 982            7,721
   Investment in mortgage, equipment and other notes receivable               (6,607 )           (11,458 )        (11,131 )
   Collection on mortgage, equipment and other notes receivable               14,968               9,325            8,335
   Investment in joint venture                                                  (665 )               (10 )             --
   Purchase of other investments                                                  --                  --           (2,832 )
   Decrease/(increase) in restricted cash                                      6,357              (9,055 )         (1,876 )
   Increase in intangibles and other assets                                       --                  --             (378 )
                                                                      ---------------     ---------------   --------------
      Net cash provided by (used in) investing activities                     73,926             (23,609 )       (160,562 )
                                                                      ---------------     ---------------   --------------
</TABLE>
          See accompanying notes to consolidated financial statements.

<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                CONSOLIDATED STATEMENTS OF CASH FLOWS - CONTINUED
                                 (In Thousands)

<TABLE>
<CAPTION>

                                                                                      Year Ended December 31,
                                                                           2002                 2001                 2000
                                                                      ---------------      ---------------      ---------------

 <c>
   Cash flows from financing activities:
      Proceeds  from  borrowings on credit facility, note
         payable and subordinated note payable                          $    249,334         $    63,949          $    397,538
      Payment on credit facility, note payable and
         subordinated note payable                                           (90,858 )          (159,590 )           (586,425 )
      Proceeds from borrowings on mortgage warehouse facilities              189,901             325,264              301,227
      Payments on mortgage warehouse facilities                             (474,312 )          (358,860 )             (7,719 )
      Contribution from minority interest of
         consolidated joint venture                                               --                  --                   40
      Proceeds from sale of shares                                             9,750               3,692                   --
      Retirement of shares of common stock                                        (4 )                --                   --
      Distributions to minority interest                                        (243 )              (234 )               (147 )
      Distributions to stockholders                                          (67,991 )           (66,466 )            (66,329 )
      Loan from stockholder                                                   11,750               8,708                   --
      Payment of stock issuance costs                                         (1,493 )            (1,493 )             (1,493 )
      Issuance of bonds                                                           --             177,223              280,906
      Payment on bonds                                                       (16,557 )           (10,066 )             (2,422 )
      Payment of loan costs and bond issuance costs                              (23 )            (9,634 )            (20,891 )
                                                                      ---------------      --------------       --------------
             Net cash provided by (used in)financing activities             (190,746 )           (27,507 )            294,285
                                                                      ---------------      --------------       --------------

Net decrease in cash and cash equivalents                                     (5,327 )            (2,914 )            (22,240 )

Cash and cash equivalents at beginning of year                                20,858              23,772               46,012
                                                                      ---------------      --------------       --------------

Cash and cash equivalents at end of year                                      15,531              20,858               23,772
                                                                      ===============      ==============       ==============

Supplemental disclosures of cash flow information:

   Interest paid                                                        $     56,915          $    64,608         $    39,023
                                                                      ===============      ==============       ==============

   Interest capitalized                                                 $        142          $       390         $     2,253
                                                                       ===============      ==============       ==============
</TABLE>
          See accompanying notes to consolidated financial statements.

<PAGE>
                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  Years Ended December 31, 2002, 2001 and 2000


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

         Organization   -   CNL   American    Properties   Fund,   Inc.   is   a
         self-administered  real estate  investment  trust  ("REIT") that offers
         financial,  development,  advisory  and other real  estate  services to
         operators of select national and regional fast food,  family-style  and
         casual dining restaurant  chains. The term "Company"  includes,  unless
         the context otherwise requires,  CNL American Properties Fund, Inc. and
         its majority  owned and  controlled  subsidiaries.  These  subsidiaries
         include CNL-APF Partners, LP and CNL Franchise Network, LP.

         On  June  1,  2000,  the  Company  formed  CNL  Franchise  Network,  LP
         ("CNL-FN")  and  transferred  certain  assets and  operations  to it in
         exchange  for a combined  general and limited  partnership  interest of
         84.39  percent.  A limited  partnership  interest  of 9.18  percent was
         issued  to Bank of  America  in  exchange  for  its  franchise  finance
         business  unit.  In addition,  a limited  partnership  interest of 6.43
         percent was issued to CNL  Financial  Group,  Inc.,  an  affiliate of a
         director of the Company,  in exchange for its merger,  acquisition  and
         advisory services  business.  The excess of the purchase price over the
         fair value of the net tangible  assets  acquired  from the new partners
         was recorded as goodwill.  This  partnership and the related  Strategic
         Alliance   Agreement  with  Bank  of  America  expanded  the  Company's
         financial  products and services.  The bank's interest is redeemable at
         their option under certain conditions after a specified date for a cash
         payment of $14.3 million.

         Principles of Consolidation - The consolidated  financial statements of
         the Company include its majority owned and controlled  affiliates.  All
         significant  intercompany  balances and transactions among consolidated
         affiliates  have been  eliminated.  The equity  method of accounting is
         applied to those  investments in joint ventures that are not subject to
         control by the Company due to the  significance of rights held by other
         parties.

         Use  of  Estimates  -  Preparation  of  the  financial   statements  in
         accordance  with  generally  accepted  accounting  principles  requires
         management to make estimates and assumptions  relating to the reporting
         of assets and liabilities  and the disclosure of contingent  assets and
         liabilities.  Significant  estimates included provisions for impairment
         of real  estate  and  loans,  valuation  of  loans  held  for  sale and
         valuation of other investments.  Actual results could differ from those
         estimates.

         Real Estate and Lease  Accounting - The Company  records its properties
         comprised of land, buildings and equipment at cost.  Management reviews
         its   properties  for   impairment   whenever   events  or  changes  in
         circumstances  indicate that the carrying  amount of the assets may not
         be  recoverable  through  operations  or  sale.  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
         impairment  is  indicated,  the assets are adjusted to  estimated  fair
         value.

         Properties leased to restaurant operators are generally on a triple-net
         basis, which means 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 method.

                  Direct financing method - The leases accounted for using the
                  direct financing method are recorded at the net investment
                  that, 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 net investment in the leases.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  Years Ended December 31, 2002, 2001 and 2000


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

                  Operating method - Land, building and secured equipment leases
                  are accounted for using the operating method. Revenue is
                  recognized as rentals are earned and depreciation is charged
                  to operations on a straight-line basis over the life of the
                  related assets. Rental income is recognized on a straight-line
                  basis over the lease term. Buildings and equipment are
                  depreciated on the straight-line method over their estimated
                  useful lives of 30 and seven years, respectively.

         Properties  acquired  that the  Company  intends to sell or  securitize
         within one year of acquisition  are recorded at cost.  Rental income is
         recognized  without  regard to potential  future rent increases and the
         asset  is  not  depreciated.  Revenue  from  sale  of  real  estate  is
         recognized  at the time of  closing  when  collectibility  of the sales
         price is reasonably  assured and the earnings  process is substantially
         complete.

         Loans - The Company has originated  loans to restaurant  operators that
         are generally secured by real estate or equipment. The Company accounts
         for loans depending on the following classification:

                  Mortgage loans held for sale - Loans originated that the
                  Company intends to sell or securitize generally within one
                  year of origination are recorded at fair market value. Quoted
                  prices for similar loans and the present value of the expected
                  cash flows net of the estimated impact of any defaults are
                  used to determine fair value.

                  Mortgage, equipment and other notes receivable - Loans
                  originated that are expected to be held until maturity are
                  recorded at the lower of cost or market value and are reduced
                  for any estimated future loss. Whenever it appears that future
                  collection on specific notes appears doubtful, a valuation
                  allowance is established. The allowance represents the
                  difference between the carrying amount and the amount
                  management expects to receive. Increases and decreases in the
                  allowance due to changes in the measurement of the impaired
                  loans are included in the provision for loss on loans. Loans
                  continue to be classified as impaired unless they are brought
                  fully current and the collection of scheduled interest and
                  principal is considered probable. When a loan or portion of a
                  loan, including an impaired loan, is determined to be
                  uncollectible, the portion deemed uncollectible is charged
                  against the allowance and subsequent recoveries, if any, are
                  credited to the allowance. Accrual of interest is discontinued
                  when management believes, after considering economic and
                  business conditions and collection efforts, that the
                  borrowers' financial condition is such that collection of
                  interest is doubtful. Subsequent interest is recorded as
                  income.

         Securitizations  - Certain  loans are  originated  and sold to entities
         that, in turn,  issue  securities to investors  backed by these assets.
         The Company retains the servicing rights and participates in cash flows
         from the retained  equity  positions  and lower rated  securities.  The
         present value of the expected  cash flows for each  retained  security,
         after  payment  of  principal  and  interest  to  third-party  bond  or
         certificate  holders,  over the estimated cost of servicing is recorded
         at the  time of sale as a  retained  interest.  Retained  interests  in
         securitized  assets are included in other  investments.  Accounting for
         the retained  interests  requires that the Company estimate their value
         using market trends and historical experience, expected prepayments and
         defaults.  This  information  is  considered,   along  with  prevailing
         discount rates and the terms of the bonds and  certificates,  to arrive
         at  current  fair  value  amounts  and  determine  whether a  permanent
         impairment in value has occurred.



<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  Years Ended December 31, 2002, 2001 and 2000


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

         Restricted   Cash  -  Restricted  cash  relates  to  cash  received  in
         connection  with assets  held as  collateral  for  certain  debt and is
         subject to certain restrictions until released by the trustee.

         Cash and Cash  Equivalents  - The Company  considers  all highly liquid
         investments  with a maturity of three months or less when  purchased to
         be cash equivalents. These amounts may exceed federally insured levels,
         however, the Company has not experienced any losses in such accounts.

         Derivative  Financial  Instruments  - The Company  utilizes  derivative
         instruments  to  partially  offset the effect of  fluctuating  interest
         rates on the  value of its  mortgage  loans  held for sale and the cash
         flows associated with a portion of its variable-rate  debt. The Company
         adopted  Statement  of  Financial  Accounting  Standards  No. 133 ("FAS
         133"),  as amended,  on January 1, 2001,  which requires all derivative
         instruments to be recorded on the balance sheet at fair value.  Changes
         in the value of  derivatives  associated  with hedge  transactions  are
         recorded either in current  earnings or in other  comprehensive  income
         depending on the type.

                  Fair-value hedge transactions - When the Company hedges
                  changes in the fair value of an asset or liability, the
                  effective changes in the value of the derivative instrument
                  are generally offset in the income statement by changes in the
                  value of the hedged item.

                  Cash-flow hedge transactions - When the Company hedges
                  variability of cash flows related to a variable-rate asset or
                  liability or a forecasted transaction, effective changes in
                  the value of the derivative instrument are reported in other
                  comprehensive income and subsequently recognized in operations
                  in the periods in which earnings are impacted by the
                  variability of the cash flows of the hedged item or forecasted
                  transaction.

         The ineffective portion of all hedges are reflected in earnings.

         Effective  January 1, 2001,  the Company  recorded a cumulative  effect
         adjustment  loss  of  $21.2  million  to  recognize  the  value  of all
         derivative  instruments  that were  designated  as  fair-value  hedging
         instruments  and an offsetting  cumulative  effect  adjustment of $17.4
         million to  recognize  the excess of the fair values of related  hedged
         assets over the carrying value. In addition,  effective January 1, 2001
         a cumulative effect  adjustment  through  stockholders'  equity of $5.2
         million  was  recorded  to  recognize  at  fair  value  all  derivative
         instruments that were designated as cash-flow hedging instruments.

         During 2001,  the Company  determined  that a forecasted  debt issuance
         would not occur and also terminated a cash flow hedge upon repayment of
         the  related  debt.  The  termination  of  the  hedges  and  the  hedge
         accounting for the related derivative  instruments  resulted in an $8.1
         million charge to the statement of operations.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  Years Ended December 31, 2002, 2001 and 2000


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

         Loan  Costs - Loan costs  incurred  in  connection  with debt have been
         capitalized  and are being  amortized over the term of the related debt
         using  the  effective  interest  method.  Loan  costs are  included  in
         intangibles  and  other  assets  in  the  financial  statements.  As of
         December 31, 2002 and 2001, the Company had  capitalized  loan costs of
         $25.2 million and $32.2 million,  respectively and recorded accumulated
         amortization  of $7.0  million  and $13.0  million,  respectively.  The
         balances  at  December  31,  2002  exclude   loans  costs  and  related
         accumulated amortization that were fully amortized and removed from the
         balance sheet as of December 31, 2002.

         Equity  Compensation  Plan - During 1999, the  stockholders  approved a
         performance  incentive plan (the "Plan"),  which became effective as of
         February 23, 1999. The Plan  authorized the issuance of up to 4,500,000
         shares of the Company's common stock upon the exercise of stock options
         (both incentive and nonqualified),  stock  appreciation  rights and the
         award of restricted  stock ("Stock Award")  provided that the aggregate
         number  of  shares  of Common  Stock  that may be  issued  pursuant  to
         Options,  stock appreciation rights ("SARs"),  and Stock Awards granted
         under the Plan would  increase  automatically  to 9,000,000  shares and
         12,000,000  shares  respectively,  when  the  Company  had  issued  and
         outstanding 150,000,000 shares and 200,000,000 shares, respectively, of
         common stock.  The Plan terminates on February 23, 2009. Key employees,
         officers,  directors  and  persons  performing  consulting  or advisory
         services for the Company or its affiliates, as defined in the Plan, who
         are designated by the committee administering the Plan, are eligible to
         receive awards under the Plan.  Awards may be made in the form of stock
         options,  stock awards, SARs, Phantom Stock Awards,  Performance Awards
         and Leveraged  Stock Purchase Awards as defined further in the Plan. As
         of December  31, 2002,  the Company had not made any awards  related to
         the Plan.

         Income  Taxes - The  Company has made an election to be taxed as a REIT
         for federal  income tax  purposes.  The Company  generally  will not be
         subject to federal  corporate  income taxes on amounts  distributed  to
         stockholders,  providing  it  distributes  at least 90  percent  of its
         taxable income and meets certain other requirements for qualifying as a
         REIT. Earnings and profits, which determine the taxability of dividends
         to  stockholders,  differ  from  reported  net  income  as a result  of
         differing  treatment  of  items  for  financial  reporting  versus  tax
         purposes,  such as  different  lives  and  methods  used to  depreciate
         investment properties.  Notwithstanding qualification as a REIT for tax
         purposes,  the Company is subject to certain  state taxes on its income
         and property.

         Effective  January 1, 2001,  the  Company's  subsidiary,  CNL Franchise
         Network  Corp.  ("CNL-FNC"),  elected to be  treated as a taxable  REIT
         subsidiary ("TRS") pursuant to the provisions of the REIT Modernization
         Act. As a TRS, its operating Partnership,  CNL-FN, is able to engage in
         activities   resulting  in  income  that  previously  would  have  been
         disqualified  from being  eligible REIT income under the federal income
         tax  regulations.  Certain  activities  reside within  CNL-FNC that are
         therefore subject to federal income taxes.  Also,  effective January 1,
         2001, a subsidiary of CNL Restaurant Properties, Inc. (CNL-RP), elected
         to be  treated  as a TRS.  Operations  commenced  during  2002  and are
         subject to federal income taxes.

         Earnings Per Share - Basic earnings per share are calculated based upon
         net earnings (income available to common  stockholders)  divided by the
         weighted  average number of shares of common stock  outstanding  during
         the reporting period.  The Company's  subsidiary,  CNL-FN,  has entered
         into a subordinated note payable with a conversion  feature that allows
         one of the  partners to convert the note into  additional  ownership of
         the  subsidiary.  For the years ended  December 31, 2002 and 2001,  the
         impact of this conversion feature was not dilutive.



<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  Years Ended December 31, 2002, 2001 and 2000


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

         Consolidated  Statement  of Cash Flows -  Supplemental  Disclosure - In
         June 2002,  the Company  redesignated  approximately  $225 million from
         mortgage loans held for sale to held for investment. The loans serve as
         collateral for a new five year borrowing facility.

         During the year ended  December  31, 2002, a tenant and borrower of the
         Company  assigned  loans in the amount of $7.5 million to an affiliate.
         The Company  agreed to the  assignment in exchange for an interest in a
         participating loan from the affiliate (see Note 12).

         During the year ended December 31, 2002, the Company foreclosed on four
         loans  held  for sale  from a  borrower  and  accepted  the  underlying
         collateral  as  settlement  for  the  mortgage  loans.  The  collateral
         received had a net  realizable  value of $3.7 million and  consisted of
         real estate and other restaurant assets.

         During  the  years  ended  December  31,  2002 and  2001,  the  Company
         converted $10.3 million and $6.0 million,  respectively, of outstanding
         loans plus accrued  interest  under the loans into  604,177  shares and
         359,722 shares, respectively, of Company stock (see Note 12).

         From  time  to  time,  certain   properties   classified  as  long-term
         investments  may be  identified  as  held  for  sale  and  subsequently
         re-designated to held for sale  classification.  The Company identified
         83 such  properties  with a net book value of $80.6 million during 2002
         as held for sale.

         In May 2001, the Company reclassified $60.9 million from mortgage loans
         held for sale to  investments  in mortgage,  equipment  and other notes
         receivable.

         During  the year  ended  December  31,  2000,  the  Company  formed CNL
         Franchise Network, LP ("CNL-FN").  CNL-FN issued partnership  interests
         to Bank of America and CNL  Financial  Group,  Inc. in exchange for the
         following:

                  Bank of America contributed $14.3 million for the operations
                  of its franchise finance business which was recorded as
                  goodwill.

                  CNL Financial Group, Inc. contributed its merger,  acquisition
                  and advisory services group consisting of the following:

                                                                  (In Thousands)
                          Cash                                        $    40
                          Receivables                                      25
                          Due from related parties                        409
                          Other assets                                    363
                          Goodwill                                      2,725
                                                                 ---------------

                          Total assets                                  3,562
                                                                 ---------------

                          Accounts payable and accrued expenses           123
                          Due to related parties                           40
                          Other payables                                  199
                                                                 ---------------

                          Total liabilities                               362
                                                                 ---------------

                          Net equity                                 $  3,200
                                                                 ===============

<page>

                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                  Years Ended December 31, 2002, 2001 and 2000


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

         In October 2000, a trust  liquidated and distributed  $170.3 million in
         mortgage  loans and $139.5 million in related  mortgage  warehouse debt
         facilities to satisfy the Company's investment.

         Other New Accounting Standards - Effective January 1, 2002, the Company
         adopted 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 statement also
         requires  that the results of  operations  of a component  of an entity
         that either has been  disposed of or is  classified as held for sale be
         reported as a discontinued  operation,  for components designated on or
         after the effective date.

         In July 2001,  the Financial  Accounting  Standards  Board (the "FASB")
         issued Statement of Financial  Accounting  Standards No. 142, "Goodwill
         and Other Intangible Assets" ("FAS 142"). FAS 142 requires the use of a
         nonamortization  approach to account for purchased goodwill and certain
         intangibles.  Under a  nonamortization  approach,  goodwill and certain
         intangibles  will not be  amortized  into  results of  operations,  but
         instead are  reviewed  for  impairment  and written down and charged to
         results of operations  only in the periods in which the recorded  value
         is more than its fair value. The Company adopted the provisions of this
         statement on January 1, 2002.  The  Company's  goodwill  relates to its
         specialty finance segment. The adoption of this accounting standard had
         the impact of reducing  the  Company's  amortization  of  goodwill  and
         intangibles  commencing  January  1, 2002.  The  Company  reviewed  the
         goodwill for impairment  and is currently  unaware of any impairment in
         its recorded value.

         In April  2002,  the FASB  issued  Statement  of  Financial  Accounting
         Standards No. 145,  "Rescission  of FASB  Statements No. 4, 44, and 64,
         Amendment of FASB Statement No. 13, and Technical  Corrections."  ("FAS
         145").  This statement  rescinds FASB Statement No. 4, "Reporting Gains
         and  Losses  from  Extinguishment  of Debt," and an  amendment  of that
         Statement,  FASB  Statement  No. 64,  "Extinguishments  of Debt Made to
         Satisfy  Sinking-Fund  Requirements." This statement also rescinds FASB
         Statement No. 44, "Accounting for Intangible Assets of Motor Carriers."
         This statement  amends FASB Statement No. 13,  "Accounting for Leases,"
         to  eliminate an  inconsistency  between the  required  accounting  for
         sale-leaseback  transactions  and the required  accounting  for certain
         lease  modifications  that have  economic  effects  that are similar to
         sale-leaseback transactions.  This statement also amends other existing
         authoritative  pronouncements  to make various  technical  corrections,
         clarify  meanings,   or  describe  their  applicability  under  changed
         conditions.  The provisions of this statement related to the rescission
         of Statement 4 are applicable in fiscal years  beginning  after May 15,
         2002.  The  provisions  of this  statement  related to Statement 13 are
         effective  for  transactions  occurring  after May 15, 2002.  All other
         provisions of this  statement  are  effective for financial  statements
         issued on or after May 15, 2002. The provisions of this  statement,  to
         the extent already applicable, did not have a significant impact on the
         financial position or results of operations of the Company.  Provisions
         applicable  to future  reporting  periods  are not  expected  to have a
         significant  impact on the financial  position or results of operations
         of the Company.



<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


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

         In July  2002,  the  FASB  issued  Statement  of  Financial  Accounting
         Standards  No.  146,  "Accounting  for  Costs  Associated  with Exit or
         Disposal  Activities" ("FAS 146"). The statement  requires companies to
         recognize costs  associated with exit or disposal  activities when they
         are  incurred  rather  than at the date of a  commitment  to an exit or
         disposal plan. Examples of costs covered by the statement include lease
         termination  costs  and  certain  employee  severance  costs  that  are
         associated with a restructuring, discontinued operation, plant closing,
         or other exit or  disposal  activity.  The  statement  is to be applied
         prospectively to exit or disposal  activities  initiated after December
         31,  2002.  The  adoption of this  statement  is not expected to have a
         significant  impact on the financial  position or results of operations
         of the Company.

         In November 2002,  FASB issued FASB  Interpretation  No. 45 ("FIN 45"),
         "Guarantor's  Accounting and Disclosure  Requirements  for  Guarantees,
         Including  Indirect  Guarantees  of  Indebtedness  of  Others".  FIN 45
         clarifies the  requirements  relating to a guarantor's  accounting for,
         and disclosure of, the issuance of certain types of guarantees.  FIN 45
         requires  that  upon  issuance  of  a  guarantee,  the  guarantor  must
         recognize a liability  for the fair value of the  obligation it assumes
         under that guarantee.  FIN 45's provisions for initial  recognition and
         measurement  are to be applied  on a  prospective  basis to  guarantees
         issued or modified  after  December 31, 2002.  The  Company's  previous
         accounting  for  guarantees  issued  prior to  January  1, 2003 are not
         required  to be  revised  or  restated  to  reflect  the  effect of the
         recognition and measurement provisions of FIN 45.

         In January  2003,  FASB issued FASB  Interpretation  No. 46 ("FIN 46"),
         "Consolidation  of  Variable  Interest  Entities"  to  expand  upon and
         strengthen  existing  accounting guidance that addresses when a company
         should include the assets, liabilities and activities of another entity
         in  its  financial  statements.   To  improve  financial  reporting  by
         companies  involved  with variable  interest  entities  (more  commonly
         referred  to  as   special-purpose   entities  or   off-balance   sheet
         structures),  FIN  46  requires  that a  variable  interest  entity  be
         considered  by a company if that company is subject to a majority  risk
         of loss from the variable interest  entity's  activities or entitled to
         receive a majority of the entity's  residual  returns or both. Prior to
         FIN 46, a company generally included another entity in its consolidated
         financial  statements  only if it controlled  the entity through voting
         interests.  Consolidation of variable  interests  entities will provide
         more complete information about the resources,  obligations,  risks and
         opportunities   of  the   consolidated   company.   The   consolidation
         requirements of FIN 46 apply  immediately to variable interest entities
         created  after  January 31,  2003,  and to older  entities in the first
         fiscal year or interim period beginning after June 15, 2003. Management
         believes that adoption of this standard will not change the  accounting
         for its bankruptcy remote securitization entities.  Management believes
         that  adoption of this standard may result in either  consolidation  or
         additional  disclosure  requirements  with  respect  to  the  Company's
         unconsolidated   subsidiaries,   however,  such  consolidation  is  not
         expected to significantly  impact the Company's  financial  position or
         results of operations.

         Reclassification   -  Certain  items  in  the  prior  years'  financial
         statements have been reclassified to conform to the 2002  presentation.
         These  reclassifications  had no effect on stockholders'  equity or net
         income.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


2.       Real Estate Investment Properties:
         ---------------------------------

         Real estate investment  properties consist of the following at December
         31:
<TABLE>
<CAPTION>

                                                                  (In Thousands)
                                                           2002                     2001
                                                     ------------------       -----------------

 <c>
                Land                                        $  298,038              $  295,653
                Buildings                                      324,462                 322,963
                Equipment                                        2,556                   2,143
                                                     ------------------       -----------------
                                                               625,056                 620,759
                Less accumulated depreciation                  (44,536 )               (33,356 )
                                                     ------------------       -----------------
                                                               580,520                 587,403
                Construction in progress                            --                   1,716
                                                     ------------------       -----------------

                                                            $  580,520              $  589,119
                                                     ==================       =================
</TABLE>

         During 2002,  2001,  and 2000 the Company sold several  properties  and
         equipment  that were  subject  to  operating  leases and  received  net
         proceeds  of  $0.9   million,   $11.2   million   and  $12.2   million,
         respectively, and recorded net losses of $0.3 million, $1.1 million and
         $0.7 million, respectively.

         In 2002, 2001, and 2000 the Company recorded  provisions for impairment
         of $7.7  million,  $14.5 million and $1.2  million,  respectively.  The
         tenants of these properties  experienced financial  difficulties and/or
         ceased payment of rents under the terms of their lease agreements.  The
         provisions  represent the amount necessary to reduce the carrying value
         to the  estimated  net  realizable  values of the  properties  based on
         discounted cash flows of sale or re-lease terms.

         During the years ended  December 31, 2002,  2001, and 2000 tenants paid
         directly to real estate taxing authorities $9.0 million,  $10.8 million
         and $10.5  million,  respectively,  in real estate taxes in  accordance
         with the terms of their triple-net leases with the Company.

         Substantially  all property leases have initial terms of 13 to 25 years
         (most  expiring  between 2006 and 2024) and provide for scheduled  rent
         increases,  and in some cases,  contingent  rent. The leases  generally
         allow  the  tenant to  purchase  the  property  at the  greater  of the
         Company's  purchase  price plus a specified  percentage  or fair market
         value at specified  times.  Fixed and  determinable  lease revenues are
         recognized on a straight-line  basis over the terms of the leases.  For
         the  years  ended  December  31,  2002,  2001  and  2000,  the  Company
         recognized $6.5 million,  $6.9 million and $9.4 million,  respectively,
         of such accrued rental income.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


2.       Real Estate Investment Properties - Continued:
         ---------------------------------------------

         Future  minimum   contractual  lease  payments  to  be  received  under
         noncancellable operating leases at December 31, 2002 are as follows:

                                                             (In Thousands)
                                                           --------------------

                     2003                                          $    57,915
                     2004                                               59,878
                     2005                                               61,087
                     2006                                               61,118
                     2007                                               61,739
                     Thereafter                                        560,950
                                                           --------------------

                                                                   $   862,687
                                                           ====================

3.       Net Investment in Direct Financing Leases:
         -----------------------------------------

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

                                                                               (In Thousands)
                                                                        2002                    2001
                                                                  ------------------      ------------------

 <c>
                   Minimum lease payments
                       receivable                                        $  219,352              $  246,618
                   Estimated residual values                                 27,288                  28,403
                   Interest receivable from
                       secured equipment leases                                  15                      26
                   Less unearned income                                    (134,214 )              (153,335 )
                                                                  ------------------      ------------------

                   Net investment in direct financing
                        leases                                           $  112,441              $  121,712
                                                                  ==================      ==================
</TABLE>

         The  following  is a schedule of future  minimum  lease  payments to be
         received on direct financing leases at December 31, 2002:

                                                               (In Thousands)
                                                             ------------------

                      2003                                         $    13,686
                      2004                                              13,824
                      2005                                              13,745
                      2006                                              13,656
                      2007                                              13,509
                      Thereafter                                       150,932
                                                             ------------------

                                                                   $   219,352
                                                             ==================



<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


3.       Net Investment in Direct Financing Leases - Continued:
         -----------------------------------------------------

         The Company's  real estate  segment  recorded  provisions for losses on
         direct financing leases totaling $0.9 million,  $2.4 million,  and $1.0
         million  respectively,  during the years ended December 31, 2002, 2001,
         and 2000,  respectively.  The tenants of these  properties  experienced
         financial  difficulties  and ceased payment of rents under the terms of
         their lease agreements.  The provisions  represent the amount necessary
         to reduce the carrying values of the direct  financing  leases to their
         estimated net realizable  values based on discounted cash flows of sale
         or re-lease terms.

4.       Real Estate Held for Sale:
         --------------------------

         Real estate held for sale consisted of the following at December 31:

                                                        (In Thousands)
                                                     2002             2001
                                                  ---------        ---------

                     Land and buildings           $144,487         $ 251,439
                                                  =========        =========


         The Company's  specialty finance  subsidiary  CNL-FNC actively acquires
         real  estate  assets  subject  to  leases  with the  intent  to sell or
         securitize them. Assets acquired after December 31, 2001 are subject to
         FAS 144, and the operating  results and gains or losses are recorded as
         discontinued operations.

         The Company's real estate investment  subsidiary,  CNL-RP,  will divest
         properties  from  time to time when such  action  is  strategic  to its
         longer-term  goals.  When  CNL-RP  establishes  its  intent  to  sell a
         property,  all  operating  results  and the  ultimate  gain or loss are
         treated as  discontinued  operations for all periods  presented.  These
         statements reflect certain  reclassifications of rental related income,
         interest  expense  and  other  categories  so as to  conform  with  the
         requirements of FAS 144.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


4.       Real Estate Held for Sale - Continued:
         -------------------------------------

         The operating  results of the  discontinued  operations were as follows
         for the years ended December 31:
<TABLE>
<CAPTION>

                                                                                 (In Thousands)
                                                                  2002                2001               2000
                                                             ---------------     ---------------    ----------------

 <c>
         Rental income                                           $    7,991          $    7,979          $    7,135

         Interest expense                                            (2,252 )            (1,877 )            (1,877 )

         Impairment provisions                                       (5,377 )           (10,274 )              (362 )

         Other expenses                                              (2,255 )            (2,069 )              (290 )
                                                              ---------------     ---------------    ----------------

         Earnings/(loss) before gain on disposal of
            discontinued operations, net                             (1,893 )            (6,241 )             4,606
                                                             ---------------     ---------------    ----------------

         Sales of real estate                                       145,871                  --                  --

         Cost of real estate sold                                  (134,803 )                --                  --
                                                             ---------------     ---------------    ----------------

         Gain on  disposal of discontinued
            operations, net                                          11,068                  --                  --
                                                              ---------------     ---------------    ----------------

         Earnings/(loss)from discontinued
            operations, net                                      $    9,175      $       (6,241 )         $    4,606
                                                              ===============     ===============    ================
</TABLE>


5.       Mortgage Loans Held for Sale:
         ----------------------------

         Mortgage loans held for sale are wholly or partially  collateralized by
         first  mortgages  on land and/or  buildings  of  franchised  restaurant
         businesses  and consist of  approximately  $54.3  million in fixed-rate
         loans at December 31, 2002. The loans carry a weighted average interest
         rate  of  8.05  percent.   The  mortgage   loans  are  due  in  monthly
         installments  with  maturity  dates  ranging  from  2004 to  2021.  The
         mortgage loans  generally  prohibit  prepayment for certain  periods or
         include prepayment penalties.

         Mortgage loans held for sale consist of the following at December 31:

                                                        (In Thousands)
                                                     2002            2001
                                              ---------------   ---------------

              Outstanding principal             $     54,280      $   306,887
              Accrued interest income                    981            2,059
              Deferred financing income                 (330)          (1,640)
              Valuation adjustment                    (6,604)           8,529
                                              ---------------   ---------------
                                                $     48,327      $   315,835
                                              ===============   ===============

         The  valuation  adjustment  at December 31, 2002  includes a decline in
         value associated with borrower delinquencies.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


6.       Mortgage, Equipment and Other Notes Receivable:
         ----------------------------------------------

         Mortgage, equipment and other notes receivable consist of the following
         at December 31:

                                                       (In Thousands)
                                                 2002              2001
                                              --------------    --------------

          Outstanding principal                 $   340,833       $   133,007
          Accrued interest income                     2,966               694
          Deferred financing income                  (1,676 )            (893 )
          Unamortized deferred costs                    709               785
          Allowance for uncollectible notes          (8,365 )         (29,631 )
                                              --------------    --------------
                                               $    334,467       $   103,962
                                              ==============    ==============

         Approximately  $318  million  and  $87.5  million  of  the  outstanding
         principal  balance as of December 31, 2002 and 2001,  respectively,  is
         secured by mortgages.  The remaining principal is secured by franchised
         restaurant equipment and other collateral.  As of December 31, 2002 and
         2001,  approximately  $14 million  and $40 million in notes  receivable
         were considered impaired and approximately $5 million and $38.5 million
         were on non-accrual status with regard to recognition of interest.  The
         Company  recognized $.75 million and $1.0 million of interest income as
         of December 31, 2002 and 2001, respectively, on impaired loans.

         Changes  in the  allowance  for  loan  losses  for  2002  and  2001 are
         summarized as follows:

                                                   (In Thousands)
                                                2002             2001
                                            --------------    ------------

          Balance at beginning of year          $  29,631        $  3,108
          Provision for loan losses                 3,099          28,200
          Loans charged off                       (24,365 )        (1,677 )
                                            --------------    ------------
          Balance at end of year                $   8,365        $ 29,631
                                            ==============    ============

         Management  believes the net carrying  value of the notes  approximates
         fair value based on current  rates at which similar loans would be made
         to borrowers with similar credit and for similar maturities.

7.       Other Investments:
         -----------------

         The Company holds the following franchise loan investments arising from
         securitization transactions which were either purchased from affiliates
         (the 1998 Series) or retained in connection with a transaction executed
         by the  Company  (the  1999  Series).  The  carrying  amounts  of these
         investments,  including accrued  interest,  consist of the following at
         December 31:


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


7.       Other Investments - Continued:
         -----------------------------

                                                           (In Thousands)
                                                        2002             2001
                                                    ---------        ---------

          1998-1 Fixed Rate Certificates            $   9,605         $  9,605
          1998-1 Floating Rate Certificates             6,582            6,582
          1998-1 Interest Only Certificate                346              386
          1998-1 Residual Interest                      4,358            4,952
          1999-1 Fixed Rate Certificates               11,272           11,272
                                                    ---------         --------
                                                    $  32,163         $ 32,797
                                                    =========         ========



         The 1998-1 and 1999-1  Fixed Rate  Certificates  bear  interest at pass
         through  rates of 8.40  percent and 8.5  percent,  respectively.  As of
         December 31, 2002 and 2001 the pass  through rate on the 1998  Floating
         Rate Certificates were 3.67 percent and 4.16 percent, respectively.

         The key assumptions used in calculating the value of these  investments
         at the time of securitization are based on normal market assumptions as
         follows:

         o    five  percent   prepayment  penalty  computed  after  taking  into
              consideration  the period of time  covered by a yield  maintenance
              and lockout  prepayment  penalties;

         o    a cumulative  default  ratio (CDR) of zero;

         o    prevailing  market  discount  rates at the time of  securitization
              generally ranging from 8.36 percent to 65.1 percent; and

         o    weighted  average  lives  ranging  from 5.17 to 16.81 years on the
              certificated traunches.

         Subsequently,  the values of the retained securities are measured using
         updated  prepayment and CDR assumptions  with adjustments to prevailing
         market discount rates based on consultations  with investment  bankers.
         If the resulting  change in fair value is considered to be permanent in
         nature,  the  carrying  value of the  investment  is  adjusted  through
         earnings.

         During the year  ended  December  31,  2001 the  Company  wrote off the
         outstanding  balance of its 1999-1  residual  interest of $2.3  million
         based on its  determination  that a permanent  impairment  in value had
         occurred as a result of certain borrower  delinquencies.  In October of
         2000 the Company recorded a loss of  approximately  $3.1 million on the
         liquidation of a residual interest in a securitization trust.





<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


7.       Other Investment - Continued:
         ----------------------------

         The following  table shows the effects on an individual  key assumption
         affecting the fair value of the retained  interests  under two negative
         scenarios.   Prepayment  assumptions,   after  consideration  of  yield
         maintenance  and lockout,  would not have a further  material impact on
         these scenarios.
<TABLE>
<CAPTION>

                                                                            1998-1                  1999-1
                                                                         Certificates            Certificates
                                                                       ($ in millions)         ($ in millions)
                                                                       -----------------       -----------------
<S> <C>
           Fair value of retained interests                                  $20.8                   $11.1

           Weighted-average life (in years) of
               certificated traunches.                                        11.6                    16.2

           Residual cash flows discount rate (annual):

           Impact on fair value of 100 bp adverse change                     $(0.6)                  $(0.7)
           Impact on fair value of 200 bp adverse change                     $(1.2)                  $(1.3)

           Expected Credit Losses (annual rate):

           Impact on fair value of 2 percent adverse change                  $(2.8)                  $(1.4)
           Impact on fair value of 3 percent adverse change                  $(4.1)                  $(2.0)
</TABLE>

         These  sensitivities  are hypothetical and should be used with caution.
         Changes in fair value based on a percentage  variation  in  assumptions
         generally cannot be extrapolated because the relationship of the change
         in assumption to the change in fair value may not be linear.  Also, the
         effect of a variation in a particular assumption on their fair value of
         the  retained  interest  is  calculated   without  changing  any  other
         assumption;  in reality, changes in one factor may result in changes in
         another (for example,  increases in market interest rates may result in
         lower prepayments and increased credit losses),  which might magnify or
         counteract the sensitivities.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


7.       Other Investment - Continued:
         ----------------------------

         The  following  table  represents  the  securitized  portfolio  and all
         managed loans as of December 31:
<TABLE>
<CAPTION>

                                                                                      Principal Amount > 60 Days
                                                         Total Principal Amount                Past Due
                                                             (In Thousands)                 (In Thousands)
                                                      -----------------------------  ------------------------------
                                                          2002            2001           2002            2001
                                                      -------------   -------------  -------------  ---------------

 <c>
         Mortgage loans                                   $ 818,551       $ 870,805     $  35,226       $   38,757
         Equipment and other loans                           26,106          44,993         1,713           31,164
                                                      -------------   -------------  -------------  ---------------

         Total loans managed or securitized                 844,657         915,798        36,939           69,921

         Less:
              Loans securitized                            (449,544)       (475,904)      (11,557 )        (10,139 )
              Loans held for sale or securitization         (54,280)       (306,887)      (10,271 )        (18,617 )
                                                      -------------   -------------  -------------  ---------------

         Loans held in portfolio (Note 6)                 $ 340,833       $ 133,007     $  15,111       $   41,165
                                                      =============   =============  =============  ===============
</TABLE>

         The Company had net  charge-offs  during the years ended  December  31,
         2002 and 2001 of $24.9 million and $3.4 million, respectively.

         The following  table  summarizes  cash flows  received from and paid to
         securitization trusts for the years ended December 31:
<TABLE>
<CAPTION>


                                                                               (In Thousands)
                                                                          2002                 2001
                                                                    -----------------    -----------------

 <c>
          Servicing fees received                                         $    1,625          $    1,730
          Other cash flows received on retained interests                 $    5,272          $    6,978
          Servicing advances                                              $   (6,253 )        $   (5,746 )
          Collection of servicing advances                                $    6,907          $    3,796
</TABLE>

8.       Goodwill:
         --------

         Goodwill  represents the excess of the purchase price and related costs
         over the fair  value  assigned  to the net assets  and  liabilities  of
         acquired  operations.  On September 1, 1999,  the Company  acquired CNL
         Fund Advisors, Inc. (the "Advisor"),  CNL Financial Corporation and CNL
         Financial Services, Inc. ("CNL Restaurant Financial Services Group") by
         issuing 6.15 million shares. Prior to the acquisition,  the Advisor and
         CNL Restaurant  Financial  Services Group had been  affiliated with the
         Company.  The acquisitions were accounted for under the purchase method
         of  accounting.  The Company  expensed the $76.3 million  excess of the
         purchase  price of the Advisor  over the fair value of the net acquired
         assets. The Company recognized $45.7 million as goodwill,  representing
         the excess purchase price of CNL Restaurant  Financial  Services Group.
         In  June  2000,  the  Company  recorded  goodwill  related  to  Bank of
         America's franchise  originations group and CNL Financial Group, Inc.'s
         advisory  services  operations  that  were  acquired  as  part  of  the
         formation  of CNL-FN as more  fully  described  in Note 1. The  Company
         evaluated its goodwill  balance of $56.3 million and did not record any
         amortization  expense or any  impairments  to goodwill  during the year
         ended December 31, 2002.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


8.       Goodwill - Continued:
         --------------------

         The following  table  summarizes  the effect of adopting FAS 142 during
         2002 on reported earnings before cumulative effect of accounting change
         and on net earnings:
<TABLE>
<CAPTION>

                                                                             (In Thousands)
                                                                 2002            2001              2000
                                                             -------------    ------------     -------------

 <c>
         Reported earnings/(loss) before cumulative
             effect of accounting change                        $  35,590        $(20,611  )       $  2,927
         Add back: Goodwill amortization                               --           3,142             2,748
                                                             -------------    ------------     -------------

         Adjusted earnings/(loss) before cumulative
             effect of accounting change                        $  35,590        $(17,469  )       $  5,675
                                                             =============    ============     =============


         Reported net income/(loss)                             $  35,590        $(24,452  )       $  2,927
         Add back: Goodwill amortization                               --           3,142             2,748
                                                             -------------    ------------     -------------

         Adjusted net income/(loss)                             $  35,590        $(21,310  )       $  5,675
                                                             =============    ============     =============

         The following  table  summarizes  the effect of adopting FAS 142 during
         2002 on earnings/(loss) per share of common stock (basic and diluted):

                                                                 2002            2001               2000
                                                             -------------    ------------      -------------

         Reported earnings/(loss) before cumulative
             effect of accounting change                        $    0.80       $   (0.47)         $    0.07
         Add back: Goodwill amortization                               --            0.07               0.06
                                                             -------------    ------------      -------------

         Adjusted earnings/(loss) before cumulative
             effect of accounting change                        $    0.80       $   (0.40)         $    0.13
                                                             =============    ============      =============

         Reported net income/(loss)                             $    0.80       $   (0.56)         $    0.07
         Add back: Goodwill amortization                               --            0.07               0.06
                                                             -------------    ------------      -------------

         Adjusted net income/(loss)                             $    0.80       $   (0.49)         $    0.13
                                                             =============    ============      =============

</TABLE>

<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


9.       Borrowings:
         ----------

         Borrowings consist of the following at December 31:

<TABLE>
<CAPTION>
                                                                 2002                            2001
                                                     -----------------------------  -------------------------------
                                                          Amount       Average           Amount        Average
                                                      (In Thousands)     Rate        (In Thousands)      Rate
                                                     -----------------------------  -------------------------------

 <c>
           Revolver                                    $    14,000       3.92%        $    10,000         6.55%
           Note payable                                    203,207       3.62%             48,731         6.98%
           Mortgage warehouse facilities                   145,758       4.07%            430,169         5.13%
           Subordinated note payable                        43,750       8.50%             43,750         8.50%
           Series 2000-A bonds payable                     261,369       7.94%            270,392         7.93%
           Series 2001-4 bonds payable                      38,441       8.90%             40,311         8.90%
           Series 2001 bonds payable                       124,698       2.28%            130,362         2.82%
                                                   ----------------              -----------------

                                                       $   831,223                    $   973,715
                                                   ================              =================



         Borrowing resources at December 31, 2002 include:

                                                                       (In Thousands)
                                                              ---------------------------------
                                                                 Balance
                                                               Outstanding          Capacity          Maturity
                                                              --------------      -------------    ----------------

           Liquidity facility                                     $      --           $ 10,000      October 2003
           Revolver                                                  14,000             30,000      October 2003
           Note payable                                             203,207            203,207        June 2007
           Mortgage warehouse facilities                            145,758            385,000         Annual
           Subordinated note payable                                 43,750             43,750        June 2007
           Series 2000-A bonds payable                              261,369            261,369        2009-2017
           Series 2001-4 bonds payable                               38,441             38,441        2009-2013
           Series 2001 bonds payable                                124,698            124,698      October 2006
                                                              --------------      -------------

                                                                  $ 831,223         $1,096,465
                                                              ==============      =============
</TABLE>




<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


9.       Borrowings - Continued:
         ----------------------

         CNL-RP entered into a note payable (the "Note  Payable") in 1999 in the
         amount of $147.0 million. During 2001 and 2000, CNL-RP applied proceeds
         received  from the  issuance of bonds to pay down the note.  Borrowings
         under the note bore  interest  at the rate of the  lender's  commercial
         paper plus 56 basis  points per annum.  During  2002,  CNL-RP  used net
         sales  proceeds  from the sales of  properties  and paid off the entire
         outstanding  principal  balance  relating to the Note Payable.  In June
         2002, the Company entered into a loan and security agreement with Nieuw
         Amsterdam  Receivables  Corporation with an initial borrowing amount of
         $207  million  that  bears  interest  at a  rate  of  weighted  average
         commercial  paper plus 1.25  percent  per annum  (the "Note  Payable").
         Collateral for the Note Payable consists of 181 mortgage loans that had
         a carrying  value of $236.1  million at December 31, 2002.  The Company
         used  the  proceeds  from  the  new  facility  to  refinance  a pool of
         franchise   loans  formerly  held  on  its  other  mortgage   warehouse
         facilities. The loan agreement has an initial term of five years with a
         renewal  provision  based on the  Company's  request  and the  lender's
         consent.

         Collateral and covenants:

         The  Revolver  bears  interest at a rate of LIBOR plus 225 basis points
         per  annum  and  includes  financial  covenants  that  provide  for the
         maintenance of certain financial ratios.  The Company was in compliance
         with all covenants as of December 31, 2002.

         CNL-FN  maintains  mortgage  warehouse  facilities  which  have a total
         borrowing  capacity  of $385.0  million at  December  31, 2002 and bear
         interest at a weighted  average rate of 4.07 percent.  In October 2001,
         the Company  entered into a guaranty  related to removal or disposition
         of  approximately  $187.0 million of mortgage loans by October 2002 and
         CNL-RP  provided  a $15  million  guaranty  related  to the  removal or
         disposition.  In June 2002,  the bank agreed to reduce the total amount
         of loans to be removed from the mortgage  warehouse  facilities to $162
         million.  As  of  December  31,  2002,  the  Company  had  successfully
         refinanced the $162 million in loans,  the guaranty had been reduced to
         $2 million and the bank had agreed to finance the remaining loans until
         November 2003.

         In June 2000, CNL-FN entered into a $43.75 million senior  subordinated
         note payable with Bank of America that bears interest at a rate of 8.50
         percent per annum. The principal  balance together with unpaid interest
         is due in full in 2007.  In October 2001,  the Company  agreed to a $15
         million guaranty by CNL-RP for a portion of the subordinated note. As a
         result of the  removal of certain  loans  from the  mortgage  warehouse
         facility  in June  of 2002  and the  achievement  of  certain  earnings
         targets,  the guaranty was removed in October of 2002. The subordinated
         note  payable  has a  conversion  feature  to  allow  Bank of  America,
         subsequent to a specified conversion date, to have the outstanding note
         converted into 13.1 percent of additional limited partnership interests
         in CFN LP. As of December 31, 2002,  Bank of America had not  exercised
         its conversion option.

         The Company is obligated under the provisions of its mortgage warehouse
         facilities  and its Note Payable to pay down  certain  debt  associated
         with borrower  delinquencies  or defaults within a required time frame.
         Most  properties  acquired on the  mortgage  warehouse  facilities  are
         required  to be sold  within a certain  time  frame.  Any  delinquency,
         default or delay in the resale of  properties  financed  through one of
         these facilities would generally result in an immediate pay-down of the
         related debt.



<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


9.       Borrowings - Continued:
         ----------------------

         Collateral for the Series 2000-A bonds consist of 258  commercial  real
         estate  properties  operated as restaurants  leased to tenants,  with a
         carrying  value of $341.3  million at  December  31,  2002.  The Series
         2000-A  bonds bear  interest at a weighted  average  fixed rate of 7.94
         percent  per  annum.  The  bond  indenture  provides  for  an  optional
         redemption at their  remaining  principal  balance when remaining rents
         due under the leases that serve as collateral are less than ten percent
         of the aggregate initial rents due under the leases.

         Collateral  for the Series 2001-4 bonds  consists of 62 mortgage  loans
         that had a carrying value of approximately $57.9 million as of December
         31,  2002.  The Series  2001-4  bonds bear  interest  at a rate of 8.90
         percent per annum. The bond indenture  requires  monthly  principal and
         interest  payments  received from borrowers to be applied to the bonds.
         The bond  indenture  also  provides for an optional  redemption  of the
         bonds at their remaining  principal  balance when the remaining amounts
         due under the loans  that  serve as  collateral  for the bonds are less
         than ten  percent of the  aggregate  amounts due under the loans at the
         time of issuance.

         Collateral  for the Series 2001 bonds  consist of 119  commercial  real
         estate  properties  operated as restaurant  units which have a carrying
         value of  approximately  $187.4  million as of December 31,  2002.  The
         bonds are scheduled to amortize over a 15-year period,  but mature over
         five  years.  The 2001 bonds bear  interest  at a rate of LIBOR plus 48
         basis points per annum.  The Company  entered into an interest rate cap
         agreement  with a strike rate of 4.5 percent to protect  against future
         increases in LIBOR.

         The following  schedule of maturities on outstanding  indebtedness does
         not reflect  the annual  extensions  on the  warehouse  facilities  but
         assumes  that bonds  payable  amortize  in  accordance  with  estimated
         payment amounts:

                                                          (In Thousands)
                                                        --------------------

                     2003                                      $    182,353
                     2004                                            25,654
                     2005                                            28,962
                     2006                                           134,474
                     2007                                           231,039
                     Thereafter                                     228,741
                                                        --------------------

                                                               $    831,223
                                                        ====================

         In  the  event  the  mortgage   warehouse   lenders  grant  extensions,
         outstanding  indebtedness  of  approximately  $36.4  million and $109.4
         million  currently  reflected  as due in March  and in  November  2003,
         respectively,  will be renewed and extended to March and November 2004,
         respectively. As of February 5, 2003, management of the Company had not
         completed the  negotiations  for the renewal of the mortgage  warehouse
         facility maturing on March 25, 2003. Management of the Company believes
         that the mortgage  warehouse  lender will grant a one year extension to
         the Company.

         Management  believes that net carrying  value of the debt  approximates
         fair value based on current  rates at which similar loans would be made
         to the Company at similar credit levels and similar maturities.



<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


10.      Income Tax:
         -----------

         The Company  elected to be taxed as a REIT under the  Internal  Revenue
         Code.  To  qualify  as a  REIT,  the  Company  must  meet a  number  of
         organizational  and  operational  requirements,   including  a  current
         requirement  that it  distribute  at least 90  percent  of its  taxable
         income to its stockholders. As a REIT the Company generally will not be
         subject  to  corporate  level  federal  income  tax  on net  income  it
         distributes to its stockholders, except taxes applicable to its taxable
         REIT  subsidiaries  ("TRSs") as described  below.  This benefit  allows
         earnings  from  a  REIT  to be  subject  to  federal  taxation  at  the
         stockholder level, and avoids the typical double taxation applicable to
         most  corporations.  If the  Company  fails to qualify as a REIT in any
         taxable  year,  it will be subject to federal  income  taxes at regular
         corporate rates (including any alternative  minimum tax) and may not be
         able to qualify as a REIT for four  subsequent  tax years.  Even if the
         Company qualifies for taxation as a REIT, the Company may be subject to
         state and local taxes on its income and property, and to federal income
         and excise taxes on its undistributed taxable income.

         The Company has  continued  to maintain a stable  level of  stockholder
         distributions  despite  reserves for real estate  impairments  and loan
         losses that were  recorded in each of the three years  presented,  with
         the most  significant  amounts  recorded in 2001.  These losses in some
         cases also qualified for an income tax deduction,  although generally a
         deduction  is only allowed  when a loss is actually  realized  upon the
         sale of the related  asset.  Some of the reserves  established in 2001,
         for example, led to tax deductions in 2002.

         Further,  earnings that result from operations  within a REIT's TRS are
         not included in the REIT's  taxable income until the TRS actually makes
         a  distribution  to the REIT.  The earnings of CNL-FNC in 2002 of $12.6
         million for example do not  increase  the REIT's  2002  taxable  income
         because CNL-FNC has not made a distribution of its earnings.

         These real estate  impairment and loan losses,  when  considered  along
         with the fact that CNL-FNC has not distributed its earnings, contribute
         to declining levels of REIT taxable income over the periods  presented.
         REIT taxable  income also  reflects  differences  in non-cash  charges,
         including depreciation and amortization.  The stockholder distributions
         in the three years presented therefore consists of return of capital in
         addition to ordinary income as follows:

<TABLE>
<CAPTION>
                                         2002                       2001                      2000
                                 ----------------------     ----------------------    ----------------------
                                   Amount        Rate         Amount        Rate        Amount        Rate
                                 ----------   ---------     ----------   ---------    ----------   ---------

 <c>
         Ordinary income            $   --          --         $0.318       20.9%        $0.606       39.7%
         Return of capital           1.525      100.0%          1.207       79.1%         0.919       60.3%
                                 ----------   ---------     ----------   ---------    ----------   ---------
                                    $1.525      100.0%         $1.525      100.0%        $1.525      100.0%
                                 ==========   =========     ==========   =========    ==========   =========
</TABLE>





<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


10.      Income Tax - Continued:
         ----------------------

         Stockholder  distributions  that are characterized as return of capital
         are generally non-taxable to the stockholder and the amount reduces the
         stockholder's basis in Company stock. Since distributions  commenced in
         1995 a portion of each year's  distribution has been characterized as a
         return of capital. To illustrate,  a stockholder's tax basis in a share
         of stock  purchased  in 1995 would have been  reduced by  approximately
         $4.42 in aggregate  amounts of return of capital  through  December 31,
         2002.  Each  stockholder  must maintain  records of the purchase price,
         distributions  received,  and  the  applicable  tax  treatment  of such
         distributions  in order to  determine  the  gain or loss  upon  sale of
         Company stock.

         For income tax purposes  the Company has two taxable REIT  subsidiaries
         (TRSs) in which activities of the specialty  finance segment and select
         activities of the real estate segment are  conducted.  Prior to January
         1, 2001, Company subsidiaries were not subject to federal income tax.

         Loan valuation adjustments, loss reserves, loan fees, and depreciation,
         among other items,  are treated  differently for tax than for financial
         reporting purposes. In the aggregate, the Company's TRSs have an excess
         of available  future  deductible items over future taxable items and as
         such  may  more  fully  benefit  from  these  items  when  the  related
         subsidiaries   produce  a  greater   level  of  taxable   income.   The
         subsidiaries  involved do not have  sufficient  historical  earnings on
         which to  expect  a full  potential  future  benefit  of  these  future
         deductions.  Therefore the Company has recorded an allowance  against a
         portion of the deferred tax asset associated with the future deductible
         items.

         The  consolidated  provision for federal  income taxes differs from the
         amount  computed by applying the statutory  federal  income tax rate to
         the earnings of the CNL-FNC segment and the earnings of the real estate
         sector TRS as follows:
<TABLE>
<CAPTION>

                                                           2002                             2001
                                               -----------------------------    ------------------------------
                                                    Amount                           Amount
                                                (In Thousands)       Rate        (In Thousands)        Rate
                                               -----------------    --------    -----------------    ---------

 <c>
         Expected tax at US statutory rate            $    4,012         34%          $     136           34 %
         Adjustments:
            Goodwill amortization                             --         --                 902          226
            Unconsolidated affiliates                      1,560         13              (1,228)        (308)
            Other                                             74          1                  --           --
         Change in valuation allowances                   (5,646)       (48)                190           48
                                               -----------------    --------    -----------------    ---------
         Provision for income taxes                     $    --          -- %         $      --           -- %
                                                =================    ========    =================    =========
</TABLE>






<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


10.      Income Tax - Continued:
         ----------------------

         The  components  of the net  deferred tax asset  effective  for periods
         after December 31, 2000 are as follows:
<TABLE>
<CAPTION>

                                                                              (In Thousands)
                                                                          2002              2001
                                                                     -------------    ---------------

 <c>
         Deferred tax asset:
                Cash flow hedge related difference                       $   5,789    $           --
                Loan valuation and related hedge differences                 1,899             5,808
                Loan origination fees                                          619               590
                Real estate loss reserves                                      300                85
                Reserve for investment losses                                  736               736
                Net operating losses                                           250               270
                Other                                                          (19)              214
                                                                     -------------    ---------------
                Total                                                        9,574             7,703
         Valuation allowance                                                (7,846)           (7,703)
                                                                     -------------    ---------------
                      Net recorded deferred tax asset                    $   1,728    $           --
                                                                     =============    ===============
</TABLE>

         The income tax provision consists of the following components:

                                                        (In Thousands)
                                                    2002              2001*
                                                -------------    ---------------
         Current:
                Federal                             $   1,487           $    --
                State                                     241                --
                                                -------------    ---------------
                                                        1,728                --
                                                -------------    ---------------
         Deferred:
                Federal                                (1,487)               --
                State                                    (241)               --
                                                -------------    ---------------
                                                       (1,728)               --
                                                -------------    ---------------
         Total Provision                        $         --            $    --
                                                =============    ===============

         * The TRS returns filed for the year ended  December 31, 2001 reflected
         a net  operating  loss  therefore  no  current  taxes  were  payable at
         December  31,  2001 and for  reasons  stated  above,  there  was no tax
         benefit recorded for the loss or other future deductible items.

11.      Distributions:
         -------------

         For the years ended December 31, 2002,  2001 and 2000,  approximately 0
         percent, 21 percent and 40 percent,  respectively, of the distributions
         received by  stockholders  were  considered  to be ordinary  income and
         approximately  100  percent,  79 percent and 60 percent,  respectively,
         were  considered a return of capital for federal  income tax  purposes.
         The  Company has  continued  to declare  and pay  distributions  to its
         stockholders  that are primarily funded by  distributions  from CNL-RP.
         The Company  elected to reinvest the earnings of the specialty  finance
         segment during 2002. The remainder of the distributions  were funded by
         sales of its common stock to the Company's  Chairman  through a private
         company  affiliate,  CNL Financial Group, Inc. ("CNL Financial Group"),
         and loans from CNL Financial  Group that the Company expects to convert
         into its common stock.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


12.      Related Party Transactions:
         --------------------------

         The following table and disclosures  that follow  summarize the related
         party  transactions  with  affiliated  entities  for  the  years  ended
         December 31:

<TABLE>
<CAPTION>
                                                                              (In Thousands)
                                                               ---------------------------------------------
               Amounts received (paid):                            2002            2001           2000
                                                               -------------- --------------- --------------

 <c>
               Services purchased from affiliates (1)              $  (3,954)      $  (4,564)     $  (4,492)

               Rental and other expenses to affiliates for         $  (1,479)      $  (1,237)     $    (986)
                  office space (2)

               Servicing fees from affiliates (3)                  $   2,255       $   2,173      $   1,560

               Interest income from an affiliated joint
                  venture (4)                                      $     998       $   2,024      $     150

               Sale  of properties to an  affiliate (5)            $  25,857       $  13,430      $      --

               Sale of equipment leases to an affiliate (6)        $      --       $   1,100      $      --
</TABLE>


         (1)   Services purchased from affiliates  include human resources,  tax
               planning  and  compliance,  computer  systems  support,  investor
               relations and other services.

         (2)   In May 2002,  the  Company  purchased  a  combined  five  percent
               partnership  interest in CNL Plaza,  Ltd. and CNL Plaza  Venture,
               Ltd.  (the  "Plaza")  for $0.2  million.  Affiliates  of James M.
               Seneff,  Jr.,  an officer  and  director  of the  Company own the
               remaining  partnership  interests.   The  Company  has  severally
               guaranteed  8.33  percent  or $1.3  million  of a  $15.5  million
               unsecured  promissory  note on behalf of the Plaza.  The guaranty
               continues through the loan maturity in November 2004. The Company
               received  distributions  of $0.1  million  during  the year ended
               December  31,  2002 from the  Plaza.  Since  November  1999,  the
               Company  has  leased its office  space from CNL Plaza,  Ltd.,  an
               affiliate of a member of the Company's  board of  directors.  The
               Company's  lease expires in 2014 and provides for scheduled  rent
               increases  over the term of the lease.  Rental and other expenses
               for the years ended  December  31,  2002,  2001 and 2000  include
               accrued rental  expense (the  additional  rent expense  resulting
               from the  straight-lining  of scheduled  rent  increases over the
               term of the lease) and executory  costs.  Future  commitments due
               under the office space operating lease are as follows:

                                                     (In Thousands)
                                                   -------------------


                2003                                $       1,074
                2004                                        1,106
                2005                                        1,139
                2006                                        1,173
                2007                                        1,209
                Thereafter                                  9,257
                                                   -------------------
                                                    $      14,958
                                                   ===================
<page>

                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


12.      Related Party Transactions - Continued:
         --------------------------------------

         (3)   Property management and other administrative services provided to
               affiliates  investing  in  restaurant  net lease  properties  and
               loans.

         (4)   Interest  income  ranging from 9.1 to 10.0 percent  received from
               loans made to an affiliated  unconsolidated  joint  venture.  The
               outstanding  loan balance at December 31, 2002, 2001 and 2000 was
               $11.1 million, $16.7 million and $6.9 million, respectively.

         (5)   Proceeds  received from affiliates from the sale of 22 properties
               and 11 properties during 2002 and 2001,  respectively,  for which
               the  Company  recorded  losses of $0.9  million and gains of $0.1
               million, respectively.

         (6)   Proceeds   received   from  an  affiliate  for  the  purchase  of
               collection  rights of the  current and future cash flows of three
               equipment leases, for which no gain or loss was recognized.

         During the year ended  December  31,  2001 CNL  Financial  Group,  Inc.
         (CFG),  an affiliate,  advanced $6.0 million to the Company in the form
         of a demand balloon  promissory  note. The loan bore interest at a rate
         of LIBOR plus 2.5 percent. During the year ended December 31, 2001, the
         Company  converted  the  outstanding  principal  balance  plus  accrued
         interest  under the  advances  into  359,722  shares of Company  stock.
         During 2001,  the Company also issued 220,000 shares to CFG in exchange
         for $3.7 million paid to the Company in cash.  As of December 31, 2001,
         CFG had advanced an additional $2.7 million under the same terms as the
         previous advances. During 2002, CFG advanced an additional $7.5 million
         to the Company under the same terms of the previous  advances.  In June
         2002, the Company converted the $10.3 million of outstanding  principal
         plus accrued interest under the advances, into 604,177 shares of stock.
         During September 2002 the Company also issued 569,177 additional shares
         to CFG in exchange for $9.75 million paid to the Company in cash. As of
         December 31, 2002, CFG had advanced an additional  $4.25 million to the
         Company under the same terms of the previous advances.

         During the year ended December 31, 2002 CNL-FN  acquired a portfolio of
         109 real  estate  properties,  which have been  classified  as held for
         sale,  for  approximately  $117 million by acquiring all of the limited
         partner and general partners interests in CNL Net Lease Investors,  LP,
         ("NLI"). Eight of the properties acquired were vacant and the remaining
         101 properties  were leased to restaurant  operators  under  triple-net
         leases,  meaning  that the  tenant is  responsible  for  costs  such as
         repairs,  maintenance,  property  taxes,  utilities and insurance.  The
         Chairman of the Board and Vice  Chairman of the Board of  Directors  of
         the  Company,  through  an  affiliate,  owned the .01  percent  general
         partner  interest in NLI prior to the  acquisition by CNL-FN and agreed
         to waive their rights to benefit from the transaction.

         During the year ended  December  31, 2002, a tenant and borrower of the
         Company  assigned  loans in the amount of $7.5  million to  Restaurants
         Acquisitions I, LLC, an affiliate of the Company. The Company agreed to
         the assignment and advanced an additional $3.6 million to the affiliate
         in exchange for an $11.1  million  participating  note.  The note bears
         interest at a rate of ten percent per annum and matures on May 1, 2014.
         The participating  note entitles the Company to receive a percentage of
         all cash flows generated by the borrower on a quarterly basis until the
         note matures.  The Company earned $0.7 million in interest  income from
         the affiliate during 2002.

         During  the  year  ended  December  31,  2001,  an  affiliate  advanced
         approximately  $5.8 million to Phoenix  Restaurant  Group, Inc. and its
         subsidiaries (collectively referred to as "PRG"), a tenant and borrower
         of the Company. PRG used these proceeds to pay outstanding obligations,
         including obligations to the Company.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


13.      Concentration of Credit Risk:
         ----------------------------

         No individual  lessee or borrower (or  affiliated  groups of lessees or
         borrowers) or restaurant  chains  represented  more than ten percent of
         the Company's  revenues  relating to its properties,  loans and secured
         equipment  leases  during the years ended  December 31,  2002,  2001 or
         2000.

         Although the Company's properties are geographically diverse throughout
         the  United  States  and  lessees  and  borrowers  operate a variety of
         restaurant concepts,  17 restaurant chains constitute 74 percent of the
         Company's properties.  Failure of any one of these restaurant chains or
         any significant lessees or borrowers could significantly impact results
         of  operations  if the  Company  is not  able  to  timely  protect  its
         interest.

14.      Segment Information:
         -------------------

         In June 1, 2000, the Company created separate legal entities to operate
         and measure two distinct  lines of business.  These entities are CNL-RP
         and CNL-FNC.  CNL-RP is the parent company of CNL-APF Partners LP which
         is a real estate  company  that  oversees  real  estate,  mortgage  and
         equipment loans generally until maturity.  CNL-FNC is the parent of CNL
         Franchise  Network,  LP which is a specialty finance company focused on
         delivering  financial  solutions in the forms of financing,  servicing,
         advisory and other services to restaurant  operators.  CNL-FNC delivers
         these   solutions   primarily  by  acquiring   restaurant  real  estate
         properties  which have been  subject to a triple-net  lease,  utilizing
         short-term  debt and  selling  such  properties  at a profit  generally
         within one year.


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


14.      Segment Information - Continued:
         -------------------------------

         The following tables summarize the results for the years 2002, 2001 and
         2000 for  CNL-RP  and  CNL-FNC.  Consolidating  eliminations  and other
         results  of the  parent of CNL-RP  and  CNL-FNC  are  reflected  in the
         "other" column.
<TABLE>
<CAPTION>

                                                                     Year Ended December 31, 2002
                                                                            (In Thousands)
                                                     --------------------------------------------------------------
                                                                                                    Consolidated
                                                       CNL-RP        CNL-FNC          Other            Totals
                                                     ------------  ------------   --------------  -----------------

 <c>
          Revenues                                      $ 92,505     $ 233,605       $   (1,811 )      $   324,299
                                                     ------------  ------------   --------------  -----------------

          Cost of real estate sold                            --       175,185               --            175,185
          General operating and administrative            12,254        23,083             (985 )           34,352
          Interest expense                                30,546        28,792             (558 )           58,780
          Property expenses, state and other
                taxes                                      3,221           315               --              3,536
          Depreciation and amortization                   12,611         1,243             (121 )           13,733
          Provision for loss on loans                         --         3,099               --              3,099
          Impairment provisions                            7,959           680               --              8,639
          Loss on sale of assets                             330            17               --                347
          Minority interest and equity in
                 Earnings                                    582          (369 )             --                213
                                                     ------------  ------------   --------------  -----------------
                                                          67,503       232,045           (1,664 )          297,884
                                                     ------------  ------------   --------------  -----------------

          Discontinued operations:
              Earnings/(loss) from discontinued
                 operations, net                          (5,126 )       3,233               --             (1,893 )
              Gain on disposal of discontinued
                 operations, net                           3,294         7,774               --             11,068
                                                     ------------  ------------   --------------  -----------------
                                                          (1,832 )      11,007               --              9,175
                                                     ------------  ------------   --------------  -----------------

          Net income/(loss)                             $ 23,170      $ 12,567        $    (147 )      $    35,590
                                                     ============  ============   ==============  =================


          Assets at December 31, 2002                  $ 833,350     $ 554,721       $   (4,013 )     $  1,384,058
                                                     ============  ============   ==============  =================
          Investments accounted for under
               the equity method at
               December 31, 2002                        $  1,156       $   440          $    --         $    1,596
                                                     ============  ============   ==============  =================
          Additions to long-lived assets:
               Real estate                              $  7,212        $   --          $    --         $    7,212
                                                     ============  ============   ==============  =================

</TABLE>


<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


14.      Segment Information - Continued:
<TABLE>
<CAPTION>

                                                                     Year Ended December 31, 2001
                                                                            (In Thousands)
                                                     -------------------------------------------------------------
                                                                                                    Consolidated
                                                       CNL-RP        CNL-FNC          Other            Totals
                                                     ------------  ------------   --------------   ----------------

 <c>
          Revenues                                      $ 92,339     $ 168,317       $   (3,821 )       $  256,835
                                                     ------------  ------------   --------------   ----------------

          Cost of real estate sold                            --        97,587               --             97,587
          General operating and
               administrative                              8,991        22,595           (1,199 )           30,387
          Interest expense                                36,652        32,446             (727 )           68,371
          Property expenses, state and other
               taxes                                       2,702           176              214              3,092
          Depreciation and amortization                   12,850         5,438              (75 )           18,213
          Loss on investment in securities                    --           122               --                122
          Loss on termination of cash flow
               hedge                                       1,643         6,417               --              8,060
          Provision for loss on loans                     28,200            --               --             28,200
          Impairment provisions                           16,632           268               --             16,900
          Loss on sale of assets                           1,116            21               --              1,137
          Minority interest and equity in
               earnings                                      132          (996 )             --               (864 )
          Cumulative effect of accounting
               change                                         --         3,841               --              3,841
                                                     ------------  ------------   --------------   ----------------
                                                         108,918       167,915           (1,787 )          275,046
                                                     ------------  ------------   --------------   ----------------
          Discontinued operations:
              Loss from discontinued
                 operations, net                          (6,241 )          --               --             (6,241 )
                                                     ------------  ------------   --------------   ----------------

          Net income/(loss)                            $ (22,820 )     $   402       $   (2,034 )      $   (24,452 )
                                                     ============  ============   ==============   ================


          Assets at December 31, 2001                  $ 920,421     $ 642,641       $   (3,948 )      $ 1,559,114
                                                     ============  ============   ==============   ================
          Investments accounted for under
               the equity method at
               December 31, 2001                        $  1,058       $   751          $    --         $    1,809
                                                     ============  ============   ==============   ================
          Additions to long-lived assets:
               Real estate                              $  3,769      $ 22,283          $    --         $   26,052
                                                     ============  ============   ==============   ================

</TABLE>




<PAGE>

                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


14.      Segment Information - Continued:
         -------------------------------
<TABLE>
<CAPTION>

                                                                 Year Ended December 31, 2000
                                                                        (In Thousands)
                                             ----------------------------------------------------------------------
                                                                                                     Consolidated
                                               CNL-RP (a)       CNL-FNC (a)         Other (b)           Totals
                                             ---------------  ----------------   ----------------   ----------------

 <c>
        Revenues                                 $   44,900        $   14,884        $    49,713       $   109,497
                                             ---------------  ----------------   ----------------   ---------------
        General operating and
             administrative                           6,127            11,297              7,515            24,939
        Interest expense                             18,626            12,789             15,529            46,944
        Property expenses, state and
        other taxes                                   2,882                --                729             3,611
        Depreciation and amortization                 5,529             2,570              8,302            16,401
        Transaction costs                             7,094               701              2,520            10,315
        Loss on investment in
             securities                                  --             5,348                 --             5,348
        Provision for loss on loans                      --                --              1,804             1,804
        Impairment provisions                         2,147                --                 67             2,214
        Loss on sale of assets                          498                --                223               721
        Minority interest and equity in
             earnings                                (5,324 )          (1,171 )            5,374            (1,121 )
                                             ---------------  ----------------   ----------------   ---------------
                                                     37,579            31,534             42,063           111,176
                                             ---------------  ----------------   ----------------   ---------------
        Discontinued operations:
            Earnings from discontinued
               operations, net                        4,606                --                 --             4,606
                                             ---------------  ----------------   ----------------   ---------------

        Net income/(loss)                        $   11,927       $   (16,650 )       $    7,650        $    2,927
                                             ===============  ================   ================   ===============


        Assets at December 31, 2000              $  991,236       $   606,522         $    1,745      $  1,599,503
                                             ===============  ================   ================   ===============
        Investments accounted for
             under the equity method at
             December 31, 2000                   $    1,067          $     --           $     --        $    1,067
                                             ===============  ================   ================   ===============
        Additions to long-lived assets:
             Real estate                         $   15,792       $   109,897        $    50,581       $   176,270
                                             ===============  ================   ================   ===============
</TABLE>

         (a)   Represents  the  period  from  June 1,  2000  (the  date that the
               separate segments were created) through December 31, 2000.

         (b)   Represents  the period from January 1, 2000 through May 31, 2000,
               prior to the formation of the separate segments. This column also
               reflects  consolidating  eliminations  and other  results  of the
               parent of CNL-RP and  CNL-FNC  for the  period  from June 1, 2000
               through December 31, 2000.





<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


15.      Commitments and Contingencies:
         -----------------------------

         In the  ordinary  course  of  business,  the  Company  has  outstanding
         commitments  to qualified  borrowers  and tenants.  These  commitments,
         including  development   agreements,   if  accepted  by  the  potential
         borrowers,  obligate  the Company to provide  funding.  At December 31,
         2002,  the  Company  had  committed  to fund $9  million  to  qualified
         tenants.


16.      Selected Quarterly Financial Data:
         ---------------------------------

         The following table presents  selected  unaudited  quarterly  financial
         data for each fiscal  quarter  during the years ended December 31, 2002
         and 2001:
<TABLE>
<CAPTION>

                                                          (In Thousands except for per share data)

                  2002 Quarter                 First        Second          Third        Fourth          Year
        ---------------------------------    ----------   ------------    ----------    ----------    -----------

 <c>
        Continuing operations:
            Revenues (1)                        $70,233      $ 136,133       $63,049      $ 54,884      $ 324,299
                                             ==========   ============    ==========    ==========    ===========

            Earnings/(loss) from
               continuing operations,
               net (1)                           $7,075       $ 14,346       $ 8,198       $(3,204  )    $ 26,415

        Discontinued operations:
            Earnings/(loss) and gains
              from discontinued
              operations, net (1)                  (643 )          696         3,045         6,077          9,175
                                             ----------   ------------    ----------    ----------    -----------

        Net Income                               $6,432       $ 15,042       $11,243       $ 2,873       $ 35,590
                                             ==========   ============    ==========    ==========    ===========

        Earnings/(loss) per share:

            Continuing operations (1)            $ 0.16        $  0.32       $  0.18       $ (0.07  )     $  0.59
                                             ==========   ============    ==========    ==========    ===========

            Discontinued operations (1)         $ (0.01   )    $  0.02       $  0.07        $ 0.13        $  0.21
                                             ==========   ============    ==========    ==========    ===========

</TABLE>



<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS - CONTINUED
                  Years Ended December 31, 2002, 2001 and 2000


16.      Selected Quarterly Financial Data - Continued:
         ---------------------------------------------
<TABLE>
<CAPTION>


                                                            (In Thousands except for per share data)

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

 <c>
        Continuing operations:
            Revenues (1)                       $ 43,800       $ 39,086       $38,006      $ 135,943        $ 256,835
                                             ==========     ==========    ==========    ===========    =============

            Earnings/(loss) from
              continuing operations,
              net (1)                           $ 9,751        $ 4,339    $ (25,941    )  $ (2,519 )   $   (14,370  )

        Discontinued operations:
            Earnings/(loss) from
              discontinued
              operations, net (1)                 2,264            856        (1,703 )      (7,658 )         (6,241 )
                                             ----------     ----------    ----------    -----------    -------------

        Earnings/(loss) before
            cumulative effect of
            accounting change                    12,015          5,195       (27,644   )   (10,177)         (20,611 )

        Cumulative effect of
            accounting change                    (3,841 )           --            --             --          (3,841 )
                                             ----------     ----------    ----------    -----------    -------------

        Net income/(loss)                       $ 8,174     $   5,195       $(27,644 )  $  (10,177 )    $   (24,452 )
                                             ==========     ==========    ==========    ===========    =============


        Earnings/(loss) per share:

        Continuing operations (1)                $ 0.22         $ 0.10       $ (0.59 )  $   (0.06  )          (0.33 )
                                             ==========     ==========    ==========    ===========    =============

        Discontinued operations (1)              $ 0.05         $ 0.02       $ (0.04 )  $   (0.17  )   $       (0.14 )
                                             ==========     ==========    ==========    ===========    =============

        Cumulative effect of
            accounting change                   $ (0.09 )       $   --       $    --    $      --       $      (0.09 )
                                             ==========     ==========    ==========    ===========    =============
</TABLE>


         (1)   The results of operations relating to properties that were either
               disposed of or that were  classified  as held for sale during the
               year  ended  December  31,  2002  are  reported  as  discontinued
               operations.


<PAGE>


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

         None.


                                    PART III


Item 10. Directors and Executive Officers of the Registrant

         The  information  required by this Item is incorporated by reference to
the  Company's  Definitive  Proxy  Statement to be filed with the  Commission no
later than April 30, 2003.

Item 11. Executive Compensation

         The  information  required by this Item is incorporated by reference to
the  Company's  Definitive  Proxy  Statement to be filed with the  Commission no
later than April 30, 2003.

Item 12. Security Ownership of Certain Beneficial Owners and Management

         The information required by this Item is incorporated by reference to
the Company's Definitive Proxy Statement to be filed with the Commission no
later than April 30, 2003.

Item 13. Certain Relationships and Related Transactions

         The  information  required by this Item is incorporated by reference to
the  Company's  Definitive  Proxy  Statement to be filed with the  Commission no
later than April 30, 2003.

Item 14.  Controls and Procedures

         The  Company  maintains a set of  disclosure  controls  and  procedures
designed to ensure that  information  required to be disclosed in the  Company's
filings  under  the  Securities  Exchange  Act of 1934 is  recorded,  processed,
summarized and reported within the time periods  specified in the Securities and
Exchange  Commission's  rules and forms.  The principal  executive and financial
officers of the Company have  evaluated  the Company's  disclosure  controls and
procedures within 90 days prior to the filing of this Annual Report on Form 10-K
and have determined that such disclosure controls and procedures are effective.

         Subsequent  to the date of the  above  evaluation,  there  have been no
significant  changes in the Company's internal controls or in other factors that
could significantly affect these controls, including any corrective actions with
regard to significant deficiencies and material weaknesses.


                                     PART IV


Item 15.  Exhibits, Financial Statement Schedules and Reports on Form 8-K

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

         1.  Consolidated Financial Statements

                  Report of Independent Certified Public Accountants.

                  Consolidated Balance Sheets at December 31, 2002 and 2001.

                  Consolidated Statements of Operations for the years ended
                  December 31, 2002, 2001 and 2000.

                  Consolidated Statements of Stockholders' Equity and
                  Comprehensive Income/(Loss) for the years ended December 31,
                  2002, 2001 and 2000.

                  Consolidated Statements of Cash Flows for the years ended
                  December 31, 2002, 2001 and 2000.

                  Notes to Consolidated Financial Statements.

         2.  Financial Statement Schedules

                  Schedule II - Valuation and Qualifying Accounts for the years
                  ended December 31, 2002, 2001 and 2000.

                  Schedule III - Real Estate and Accumulated Depreciation at
                  December 31, 2002.

                  Notes to Schedule III - Real Estate and Accumulated
                  Depreciation at December 31, 2002.

                  Schedule IV - Mortgage Loans on Real Estate at December 31,
                  2002.

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

         3.  Exhibits

                  2.1      Agreement  and  Plan  of  Merger,  by and  among  the
                           Registrant, CFA Acquisition Corp., CNL Fund Advisors,
                           Inc.  and CNL  Group,  Inc.,  dated  March  11,  1999
                           (included  as  Exhibit  10.38  to  the   Registrant's
                           Registration Statement No. 333-74329 on Form S-4 (the
                           "Form  S-4") as  originally  filed  and  incorporated
                           herein by reference).

                  2.2      Agreement  and  Plan  of  Merger,  by and  among  the
                           Registrant,  CFC Acquisition  Corp.,  CFS Acquisition
                           Corp., CNL Financial  Corp., CNL Financial  Services,
                           Inc., CNL Group,  Inc., Five Arrows Realty Securities
                           L.L.C.,  Robert A. Bourne,  Curtis B.  McWilliams and
                           Brian  Fluck,  dated  March  11,  1999  (included  as
                           Exhibit 10.39 to the Form S-4 as originally filed and
                           incorporated herein by reference).

                  3.1      CNL  American   Properties  Fund,  Inc.  Amended  and
                           Restated  Articles  of   Incorporation,   as  amended
                           (included  as Exhibit  3.1 to the  Registrant's  Form
                           10-Q  for  the  quarter   ended  June  30,  1999  and
                           incorporated herein by reference).

                  3.2      CNL  American   Properties  Fund,  Inc.  Amended  and
                           Restated  Bylaws  (included  as  Exhibit  3.2  to the
                           Registrant's  Registration Statement No. 333-37657 on
                           Form S-11 and incorporated herein by reference).

                  3.3      CNL American Properties Fund, Inc. Second Amended and
                           Restated  Articles  of  Incorporation   (included  as
                           Exhibit  3.3 to the  Registrant's  Form  10-Q for the
                           quarter ended June 30, 2000 and  incorporated  herein
                           by reference).

                  3.4      Articles of Amendment to Second  Amended and Restated
                           Articles of Incorporation of CNL American  Properties
                           Fund,   Inc.   (included   as  Exhibit   3.4  to  the
                           Registrant's Form 10-Q for the quarter ended June 30,
                           2002 and incorporated herein by reference).

                  4.1      Form of Stock Certificate (included as Exhibit 4.5 to
                           the Registrant's  Registration Statement No. 33-78790
                           on Form S-11 and incorporated herein by reference).


<PAGE>


                  10.1     Form of  Indemnification  Agreement dated as of April
                           18, 1995, between the Registrant and each of James M.
                           Seneff,  Jr., Robert A. Bourne, G. Richard Hostetter,
                           J. Joseph Kruse, Richard C. Huseman,  John T. Walker,
                           Jeanne A. Wall,  Lynn E. Rose and Edgar J. McDougall,
                           dated as of January 27, 1997,  between the Registrant
                           and Steven D.  Shackelford,  dated as of February 18,
                           1998,   between   the   Registrant   and   Curtis  B.
                           McWilliams,  and  dated  as  of  September  1,  1999,
                           between the  Registrant and each of Howard J. Singer,
                           John L. Farren,  Timothy J. Neville,  Michael I. Wood
                           and Barry L. Goff  (included  as Exhibit  10.9 to the
                           Registrant's  Registration Statement No. 333-15411 on
                           Form S-11 and incorporated herein by reference).

                  10.2     Amended and Restated Agreement of Limited Partnership
                           of CNL APF Partners, LP (included as Exhibit 10.50 to
                           Amendment  No.  2 to the  Form  S-4 and  incorporated
                           herein by reference).

                  10.3     Amended and  Restated  Credit  Agreement by and among
                           CNL  APF  Partners,   LP,  Registrant,   First  Union
                           National  Bank,  First Union Capital  Markets  Group,
                           Banc of America  Securities LLC,  NationsBank,  N.A.,
                           The  Chase   Manhattan   Bank  and  other   financial
                           institutions, dated June 9, 1999 (included as Exhibit
                           10.51  to  Amendment  No.  1  to  the  Form  S-4  and
                           incorporated herein by reference).

                  10.4     First   Amendment  to  Amended  and  Restated  Credit
                           Agreement  dated as of December  31, 1999 between CNL
                           APF Partners,  LP and First Union  National  Bank, as
                           Agent  (included as Exhibit 10.4 to the  Registrant's
                           Form 10-K for the year ended  December  31,  1999 and
                           incorporated herein by reference).

                  10.5     Franchise  Receivable Funding and servicing Agreement
                           dated  as  of  October  14,  1999   between  CNL  APF
                           Partners,   LP  and   Neptune   Funding   Corporation
                           (included  as Exhibit 10.5 to the  Registrant's  Form
                           10-K  for  the  year  ended  December  31,  1999  and
                           incorporated herein by reference).

                  10.6     Interim  Wholesale  Mortgage  Warehouse  and Security
                           Agreement dated as of September 18, 1998, and Amended
                           Agreement dated as of August 30, 1999 between CNL APF
                           Partners,   LP  and  Prudential   Securities   Credit
                           Corporation   (included   as  Exhibit   10.6  to  the
                           Registrant's  Form 10-K for the year  ended  December
                           31, 1999 and incorporated herein by reference).

                  10.7     1999 Performance  Incentive Plan (included as Exhibit
                           10.1  to  Amendment   No.  1  to  the  Form  S-4  and
                           incorporated herein by reference).

                  10.8     Registration   Rights  Agreement  by  and  among  the
                           Registrant,  Robert A. Bourne,  Curtis B. McWilliams,
                           John T. Walker,  Howard Singer, Steven D. Shackelford
                           and CNL  Group,  Inc.,  dated  as of March  11,  1999
                           (included as Exhibit  10.40 to Amendment No. 1 to the
                           Form S-4 and incorporated herein by reference).

                  10.9     Registration   Rights  Agreement  by  and  among  the
                           Registrant,  Five Arrows  Realty  Securities  L.L.C.,
                           James M. Seneff,  Jr.,  Robert A.  Bourne,  Curtis B.
                           McWilliams and CNL Group, Inc., dated as of March 11,
                           1999 (included as Exhibit 10.41 to Amendment No. 1 to
                           the Form S-4 and incorporated herein by reference).

                  10.10    Employment   Agreement  by  and  between   Curtis  B.
                           McWilliams and the  Registrant,  dated  September 15,
                           1999 (included as Exhibit 10.42 to Amendment No. 2 to
                           the Form S-4 and incorporated herein by reference).

                  10.11    Employment   Agreement  by  and  between   Steven  D.
                           Shackelford and the  Registrant,  dated September 15,
                           1999 (included as Exhibit 10.43 to Amendment No. 2 to
                           the Form S-4 and incorporated herein by reference).

                  10.12    Employment  Agreement  by and between  John T. Walker
                           and  the   Registrant,   dated   September  15,  1999
                           (included as Exhibit  10.44 to Amendment No. 2 to the
                           Form S-4 and incorporated herein by reference).

                  10.13    Employment  Agreement by and between Howard J. Singer
                           and  the   Registrant,   dated   September  15,  1999
                           (included as Exhibit  10.45 to Amendment No. 2 to the
                           Form S-4 and incorporated herein by reference).

                  10.14    Employment Agreement by and between Barry L. Goff and
                           the Registrant, dated September 15, 1999 (included as
                           Exhibit  10.46 to Amendment No. 2 to the Form S-4 and
                           incorporated herein by reference).

                  10.15    Employment  Agreement by and between Robert W. Chapin
                           and  the   Registrant,   dated   September  15,  1999
                           (included as Exhibit  10.47 to Amendment No. 2 to the
                           Form S-4 and incorporated herein by reference).

                  10.16    Employment   Agreement  by  and  between  Timothy  J.
                           Neville and the Registrant,  dated September 15, 1999
                           (included as Exhibit  10.48 to Amendment No. 2 to the
                           Form S-4 and incorporated herein by reference).

                  10.17    Holdback  Agreement by and among the  Registrant  and
                           Stockholders,  dated  August 31,  1999  (included  as
                           Exhibit  10.56 to Amendment No. 2 to the Form S-4 and
                           incorporated herein by reference).

                  10.18    Amended  and   Restated   Credit  and   Reimbursement
                           Agreement by and among CNL APF Partners,  LP, CNL APF
                           LP Corp., CNL APF GP Corp., Bank of America, N.A. and
                           Bank of America  Securities LLC, dated as of June 15,
                           2000  (included as Exhibit 10.18 to the  Registrant's
                           Form 10-Q for the  quarter  ended  June 30,  2000 and
                           incorporated herein by reference).

                  10.19    Employment  Agreement by and between Michael Wood and
                           the  Registrant,  dated August 31, 1999  (included as
                           Exhibit 10.19 to the  Registrant's  Form 10-Q for the
                           quarter ended March 31, 2001 and incorporated  herein
                           by reference).

                  10.20    Employment  Agreement by and between Brent Heaton and
                           the Registrant, dated September 29, 1999 (included as
                           Exhibit 10.20 to the  Registrant's  Form 10-Q for the
                           quarter ended March 31, 2001 and incorporated  herein
                           by reference).

                  10.21    Addendum to Employment Agreement dated as of November
                           1, 1999, between the Registrant and Curtis McWilliams
                           (included as Exhibit 10.21 to the  Registrant's  Form
                           10-Q  for  the  quarter  ended  March  31,  2001  and
                           incorporated  herein  by  reference).  The  following
                           persons   have  signed  a   substantially   identical
                           Addendum  relating  to  their  respective  employment
                           agreements;  Steve  Shackelford  (dated  November  1,
                           1999),  John Walker (dated  November 3, 1999),  Barry
                           Goff  (dated  November  1,  1999),  and Brent  Heaton
                           (dated November 3, 1999).

                  10.22    Addendum to Employment Agreement dated as of November
                           1, 1999,  between the  Registrant  and Robert  Chapin
                           (included as Exhibit 10.22 to the  Registrant's  Form
                           10-Q  for  the  quarter  ended  March  31,  2001  and
                           incorporated  herein  by  reference).  The  following
                           persons   have  signed  a   substantially   identical
                           Addendum  relating  to  their  respective  employment
                           agreements:  Howard Singer (dated  November 1, 1999),
                           Michael  Wood  (dated  November  8, 1999) and Timothy
                           Neville (dated November 24, 1999).


<PAGE>


                  10.23    Second  Addendum to Employment  Agreement dated as of
                           June 16,  2000,  between  the  Registrant  and Curtis
                           McWilliams   (included   as  Exhibit   10.23  to  the
                           Registrant's  Form 10-Q for the  quarter  ended March
                           31, 2001 and incorporated  herein by reference).  The
                           following   persons   have  signed  a   substantially
                           identical   Second   Addendum   relating   to   their
                           respective  employment   agreements:   Howard  Singer
                           (dated June 19, 2000),  Robert Chapin (dated June 20,
                           2000) and Brent Heaton (dated October 30, 2000).

                  10.24    Second  Addendum to Employment  Agreement dated as of
                           August 20,  2000,  between the  Registrant  and Barry
                           Goff  (included as Exhibit 10.24 to the  Registrant's
                           Form 10-Q for the  quarter  ended  March 31, 2001 and
                           incorporated herein by reference).

                  10.25    Second  Addendum to Employment  Agreement dated as of
                           September 1, 2000,  between the  Registrant and Steve
                           Shackelford   (included  as  Exhibit   10.25  to  the
                           Registrant's  Form 10-Q for the  quarter  ended March
                           31, 2001 and incorporated herein by reference).

                  10.26    Second  Addendum to Employment  Agreement dated as of
                           2000,  between the  Registrant  and  Timothy  Neville
                           (included as Exhibit 10.26 to the  Registrant's  Form
                           10-Q  for  the  quarter  ended  March  31,  2001  and
                           incorporated herein by reference).

                  10.27    Second  Addendum to Employment  Agreement dated as of
                           October 24, 2000,  between the Registrant and Michael
                           Wood  (included as Exhibit 10.27 to the  Registrant's
                           Form 10-Q for the  quarter  ended  March 31, 2001 and
                           incorporated herein by reference).

                  10.28    Second  Addendum to Employment  Agreement dated as of
                           October 25,  2000,  between the  Registrant  and John
                           Walker (included as Exhibit 10.28 to the Registrant's
                           Form 10-Q for the  quarter  ended  March 31, 2001 and
                           incorporated herein by reference).

                  10.29    Amended and Restated Master Purchase  Agreement dated
                           as of October 11, 2001, among Bank of America,  N.A.,
                           CNL  Financial  VII,  LP and CNL  Franchise  Network,
                           (included as Exhibit 10.29 to the  Registrant's  Form
                           10-K  for  the  year  ended  December  31,  2001  and
                           incorporated herein by reference).

                  10.30    Third  Amended and  Restated  Side Letter dated as of
                           October 11, 2001,  among Bank of America,  N.A.,  CNL
                           Financial  VII,  LP and  CNL  Franchise  Network,  LP
                           (included as Exhibit 10.30 to the  Registrant's  Form
                           10-K  for  the  year  ended  December  31,  2001  and
                           incorporated herein by reference).

                  10.31    Loan and Security Agreement dated as of June 14, 2002
                           between  CNL  Financial  IX, LP and  Nieuw  Amsterdam
                           Receivables Corporation (included as Exhibit 10.31 to
                           the Registrant's Form 10-Q for the quarter ended June
                           30, 2002 and incorporated herein by reference).

                  21       Subsidiaries of the Registrant (filed herewith).

                  99.1     Certification of Co-Chief  Executive Officer Pursuant
                           to 18 U.S.C.  Section  1350 as  adopted  pursuant  to
                           Section 906 of the  Sarbanes-Oxley Act of 2002 (filed
                           herewith).

                  99.2     Certification of Co-Chief  Executive Officer Pursuant
                           to 18 U.S.C.  Section  1350 as  adopted  pursuant  to
                           Section 906 of the  Sarbanes-Oxley Act of 2002 (filed
                           herewith).

                  99.3     Certification of Chief Financial  Officer Pursuant to
                           18 U.S.C. Section 1350 as adopted pursuant to Section
                           906  of  the   Sarbanes-Oxley   Act  of  2002  (filed
                           herewith).

         (b)      The Registrant  filed no reports on Form 8-K during the period
                  October 1, 2002 through December 31, 2002.


<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 14th day of
March, 2003.

                                     CNL AMERICAN PROPERTIES FUND, INC.

                                     By:

                                        /s/ JAMES M. SENEFF, JR.
                                        ---------------------------------
                                        James M. Seneff, Jr.
                                        co-Chief Executive Officer


                                        /s/ CURTIS B. McWILLIAMS
                                        ---------------------------------
                                        Curtis B. McWilliams
                                        co-Chief Executive Officer

































<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
<S> <C>

/s/ JAMES M. SENEFF, JR.                         Director, Chairman of the Board and            March 14, 2003
---------------------------------------------
James M. Seneff, Jr.                             co-Chief Executive Officer
                                                 (Principal Executive Officer)


/s/ CURTIS B. McWILLIAMS                         co-Chief Executive Officer                     March 14, 2003
---------------------------------------------
Curtis B. McWilliams                             (Principal Executive Officer)



/s/ STEVEN D. SHACKELFORD                        Executive Vice President,                      March 14, 2003
---------------------------------------------
Steven D. Shackelford                            Chief Administrative Officer,
                                                 Chief Financial Officer,
                                                 Secretary and Treasurer

/s/ ROBERT A. BOURNE                             Director                                       March 14, 2003
---------------------------------------------
Robert A. Bourne



/s/ G. RICHARD HOSTETTER                         Director                                       March 14, 2003
---------------------------------------------
G. Richard Hostetter



/s/ J. JOSEPH KRUSE                              Director                                       March 14, 2003
---------------------------------------------
J. Joseph Kruse



/s/ RICHARD C. HUSEMAN                           Director                                       March 14, 2003
---------------------------------------------
Richard C. Huseman



</TABLE>



<PAGE>




                   CERTIFICATION OF CO-CHIEF EXECUTIVE OFFICER

                 PURSUANT TO RULE 13a-14 AS ADOPTED PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002


         I, James M. Seneff, Jr., the Co-Chief Executive Officer of CNL American
Properties Fund, Inc. certify that:

            1.  I have  reviewed this annual report on Form 10-K of CNL American
                Properties Fund, Inc.;

            2.  Based on my  knowledge,  this annual report does not contain any
                untrue  statement of a material fact or omit to state a material
                fact  necessary  to make the  statements  made,  in light of the
                circumstances   under  which  such  statements  were  made,  not
                misleading  with  respect to the period  covered by this  annual
                report;

            3.  Based on my  knowledge,  the  financial  statements,  and  other
                financial  information  included  in this annual  report  fairly
                present  in  all  material  respects  the  financial  condition,
                results of  operations  and cash flows of the  registrant as of,
                and for, the periods presented in this annual report;

            4.  The registrant's other certifying officers and I are responsible
                for  establishing  and  maintaining   disclosure   controls  and
                procedures  (as defined in Exchange Act Rules 13a-14 and 15d-14)
                for the registrant and we have:

                    a.  Designed  such  disclosure  controls and  procedures  to
                        ensure  that  material   information   relating  to  the
                        registrant,  including its consolidated subsidiaries, is
                        made  known  to  us by  others  within  those  entities,
                        particularly  during  the  period in which  this  annual
                        report is being prepared;

                    b.  Evaluated   the   effectiveness   of  the   registrant's
                        disclosure  controls and  procedures as of a date within
                        90 days prior to the filing date of this  annual  report
                        (the "Evaluation Date"); and

                    c.  Presented in this annual  report our  conclusions  about
                        the   effectiveness  of  the  disclosure   controls  and
                        procedures  based on our evaluation as of the Evaluation
                        Date;

            5.  The registrant's other certifying officers and I have disclosed,
                based  on  our  most  recent  evaluation,  to  the  registrant's
                auditors  and the  audit  committee  of  registrant's  board  of
                directors (or persons performing the equivalent function):

                    a. All  significant  deficiencies in the design or operation
                       of internal  controls  which could  adversely  affect the
                       registrant's  ability to record,  process,  summarize and
                       report   financial  data  and  have  identified  for  the
                       registrant's auditors any material weaknesses in internal
                       controls; and

                    b. Any  fraud,  whether  or  not  material,   that  involves
                       management or other employees who have a significant role
                       in the registrant's internal controls; and

            6.  The registrant's other certifying  officers and I have indicated
                in this  annual  report  whether or not there  were  significant
                changes in  internal  controls  or in other  factors  that could
                significantly affect internal controls subsequent to the date of
                our most recent  evaluation,  including any  corrective  actions
                with regard to significant deficiencies and material weaknesses.



Date:  March 14, 2003


/s/ James M. Seneff, Jr.
---------------------------
James M. Seneff, Jr.
Co-Chief Executive Officer


<PAGE>




                   CERTIFICATION OF CO-CHIEF EXECUTIVE OFFICER

                 PURSUANT TO RULE 13a-14 AS ADOPTED PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

         I, Curtis B. McWilliams, the Co-Chief Executive Officer of CNL American
Properties Fund, Inc. certify that:

            1.  I have  reviewed this annual report on Form 10-K of CNL American
                Properties Fund, Inc.;

            2.  Based on my  knowledge,  this annual report does not contain any
                untrue  statement of a material fact or omit to state a material
                fact  necessary  to make the  statements  made,  in light of the
                circumstances   under  which  such  statements  were  made,  not
                misleading  with  respect to the period  covered by this  annual
                report;

            3.  Based on my  knowledge,  the  financial  statements,  and  other
                financial  information  included in this annual  report,  fairly
                present  in  all  material  respects  the  financial  condition,
                results of  operations  and cash flows of the  registrant as of,
                and for, the periods presented in this annual report;

            4.  The registrant's other certifying officers and I are responsible
                for  establishing  and  maintaining   disclosure   controls  and
                procedures  (as defined in Exchange Act Rules 13a-14 and 15d-14)
                for the registrant and we have:

                  a.  Designed such disclosure controls and procedures to ensure
                      that  material  information  relating  to the  registrant,
                      including its consolidated subsidiaries,  is made known to
                      us by others within those  entities,  particularly  during
                      the period in which this annual report is being prepared;

                  b.  Evaluated the effectiveness of the registrant's disclosure
                      controls and  procedures as of a date within 90 days prior
                      to the filing date of this annual report (the  "Evaluation
                      Date"); and

                  c.  Presented in this annual report our conclusions  about the
                      effectiveness  of the  disclosure  controls and procedures
                      based on our evaluation as of the Evaluation Date;

            5.  The registrant's other certifying officers and I have disclosed,
                based  on  our  most  recent  evaluation,  to  the  registrant's
                auditors  and the  audit  committee  of  registrant's  board  of
                directors (or persons performing the equivalent function):

                  a.  All significant deficiencies in the design or operation of
                      internal   controls  which  could  adversely   affect  the
                      registrant's  ability to record,  process,  summarize  and
                      report   financial  data  and  have   identified  for  the
                      registrant's  auditors any material weaknesses in internal
                      controls; and

                  b.  Any  fraud,   whether  or  not  material,   that  involves
                      management or other employees who have a significant  role
                      in the registrant's internal controls; and

            6.  The registrant's other certifying  officers and I have indicated
                in this  annual  report  whether or not there  were  significant
                changes in  internal  controls  or in other  factors  that could
                significantly affect internal controls subsequent to the date of
                our most recent  evaluation,  including any  corrective  actions
                with regard to significant deficiencies and material weaknesses.



Date:  March 14, 2003


/s/ Curtis B. McWilliams
Curtis B. McWilliams
Co-Chief Executive Officer


<PAGE>




                    CERTIFICATION OF CHIEF FINANCIAL OFFICER

                 PURSUANT TO RULE 13a-14 AS ADOPTED PURSUANT TO
                  SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

         I,  Steven D.  Shackelford,  Chief  Financial  Officer of CNL  American
Properties Fund, Inc. certify that:

           1.  I have  reviewed  this annual report on Form 10-K of CNL American
               Properties Fund, Inc.;

           2.  Based on my  knowledge,  this annual  report does not contain any
               untrue  statement of a material  fact or omit to state a material
               fact  necessary  to make  the  statements  made,  in light of the
               circumstances   under  which  such   statements  were  made,  not
               misleading  with  respect  to the period  covered by this  annual
               report;

           3.  Based  on my  knowledge,  the  financial  statements,  and  other
               financial  information  included  in this annual  report,  fairly
               present in all material respects the financial condition, results
               of  operations  and cash flows of the  registrant as of, and for,
               the periods presented in this annual report;

           4.  The registrant's other certifying  officers and I are responsible
               for   establishing  and  maintaining   disclosure   controls  and
               procedures  (as defined in Exchange  Act Rules 13a-14 and 15d-14)
               for the registrant and we have:

                  a.   Designed  such  disclosure  controls  and  procedures  to
                       ensure  that   material   information   relating  to  the
                       registrant,  including its consolidated subsidiaries,  is
                       made  known  to  us  by  others  within  those  entities,
                       particularly  during  the  period  in which  this  annual
                       report is being prepared;

                  b.   Evaluated   the   effectiveness   of   the   registrant's
                       disclosure controls and procedures as of a date within 90
                       days prior to the filing date of this annual  report (the
                       "Evaluation Date"); and

                  c.   Presented in this annual report our conclusions about the
                       effectiveness  of the disclosure  controls and procedures
                       based on our evaluation as of the Evaluation Date;

           5.  The registrant's other certifying  officers and I have disclosed,
               based on our most recent evaluation, to the registrant's auditors
               and the audit  committee of  registrant's  board of directors (or
               persons performing the equivalent function):

                  a.   All  significant  deficiencies in the design or operation
                       of internal  controls  which could  adversely  affect the
                       registrant's  ability to record,  process,  summarize and
                       report   financial  data  and  have  identified  for  the
                       registrant's auditors any material weaknesses in internal
                       controls; and

                  b.   Any  fraud,  whether  or  not  material,   that  involves
                       management or other employees who have a significant role
                       in the registrant's internal controls; and

           6.  The registrant's  other certifying  officers and I have indicated
               in this  annual  report  whether  or not there  were  significant
               changes  in  internal  controls  or in other  factors  that could
               significantly  affect internal controls subsequent to the date of
               our most recent evaluation, including any corrective actions with
               regard to significant deficiencies and material weaknesses.



Date:  March 14, 2003


/s/ Steven D. Shackelford
Steven D. Shackelford
Executive Vice President, Chief Administrative Officer,
Chief Financial Officer, Secretary and Treasurer


<PAGE>




                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
                 SCHEDULE II - VALUATION AND QUALIFYING ACCOUNTS
                  Years Ended December 31, 2002, 2001 and 2000

<TABLE>
<CAPTION>


                                                       Additions                        Deductions
                                              -----------------------------    ------------------------------

                                Balance at     Charged to     Charged to         Deemed                            Balance
                                Beginning      Costs and        Other           Uncollec-                          at End
  Year        Description        of Year        Expenses       Accounts           tible          Collected         of Year
---------   -----------------  -------------  -------------  --------------    -------------    -------------  ---------------

 <c>
  2000      Allowance for
                doubtful
                accounts (a)     $5,189,216    $1,678,144     $ 5,414,580  (b)   $ 543,173  (c)   $1,069,187      $ 10,669,580
                               =============  =============  ==============    =============    =============  ===============

  2001      Allowance for
                doubtful
                accounts (a)    $10,669,580     $ 452,276     $ 1,371,314  (b)  $2,557,461  (c)   $4,119,549       $ 5,816,160
                               =============  =============  ==============    =============    =============  ===============

  2002      Allowance for
                doubtful
                accounts (a)     $5,816,160     $ 627,288     $ 2,767,324  (b)  $4,407,755  (c)   $1,205,821       $ 3,597,196
                               =============  =============  ==============    =============    =============  ===============
</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 AMERICAN PROPERTIES FUND, INC. AND SUBSIDIARIES
             SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
                                December 31, 2002
<TABLE>
<CAPTION>



                                                                                      Costs Capitalized
                                                                    Initial Cost   Subsequent to Acquisition
                                                               ---------------------  -------------------
                                         Impair-     Encum-            Buildings and  Improve-   Carrying
                                          ment      brances    Land    Improvements     ments     Costs
                                          ----     --------    -----   ------------     ------    ------

 <c>
Properties the Company
     has invested in Under
     Operating Leases:


Applebee's Restaurants:
     Antioch, Tennessee                     -         (i)      609,696      770,331            -     -
     Clarksville, Tennessee                 -         (i)      556,070      983,010            -     -
     Columbia, Tennessee                    -         (i)      625,868      936,068            -     -
     Cookeville, Tennessee                  -         (i)      489,867    1,003,630            -     -
     Hendersonville, Tennessee              -         (i)      549,651      966,628            -     -
     Hermitage, Tennessee                   -         (i)      735,272      827,474            -     -
     Hopkinsville, Kentucky                 -         (i)      390,058      943,019            -     -
     Lebanon, Tennessee                     -         (i)      568,168      925,046            -     -
     Madison, Tennessee                     -         (i)      740,165      835,996            -     -
     Montclair, California                  -           -      874,094            -      880,494     -
     Moscow, Idaho                          -           -      537,410    1,193,850            -     -
     Rockford, Illinois                     -         (i)      603,828            -            -     -
     Salem, Oregon                          -           -      778,321            -    1,153,535     -

Arby's Restaurants:
     Allen, Texas                           -         (i)      508,994            -            -     -
     Arab, Alabama                          -         (i)      230,720      455,946            -     -
     Atlanta, Georgia                       -         (i)      648,459            -      655,353     -
     Auburndale, Florida                    -         (i)      326,788      391,270            -     -
     Avon, Indiana                          -         (i)      338,486      497,282            -     -
     Bartow, Florida                        -         (i)      226,428      414,175            -     -
     Brooksville, Florida                   -         (i)      266,606      421,780            -     -
     Brooksville, Florida                   -         (i)      248,277      368,959            -     -
     Canton, Georgia                        -         (i)      586,476            -      606,850     -
     Columbus, Ohio                         -         (i)      441,770            -      594,458     -
     Columbus, Ohio                         -         (i)      483,868            -      576,483     -
     Douglasville, Georgia                  -         (i)      708,710            -      546,363     -
     Flower Mound, Texas                    -         (i)      434,130            -      618,352     -
     Grand Rapids, Michigan                 -         (i)      312,670            -            -     -
     Greensboro, North Carolina             -         (i)      363,478      404,650            -     -
     Greenville, North Carolina             -         (i)      277,986      490,143            -     -
     Hudson, Florida                        -         (i)      270,539      488,818            -     -
     Indianapolis, Indiana                  -         (i)      439,935            -      677,335     -
     Jonesville, North Carolina             -         (i)      228,364      539,764            -     -
     Kernersville, North Carolina           -         (i)      273,325      413,077            -     -
     Kinston, North Carolina                -         (i)      268,545      485,160            -     -
     Lakeland, Florida                      -         (i)      235,996      452,008            -     -
     Lexington, North Carolina              -         (i)      320,924      463,347            -     -
     Myrtle Beach, South Carolina           -         (i)      421,481            -      633,406     -
     New Port Richey, Florida               -         (i)      242,777      398,029            -     -
     Orange Park, Florida                   -         (i)      463,047            -      592,539     -
     Plant City, Florida                    -         (i)      196,251      443,976            -     -
     Redford , Michigan                     -         (i)      412,516            -      673,289     -
     Tampa, Florida                         -         (i)      322,412      371,694            -     -
     The Colony, Texas                      -         (i)      504,327            -            -     -
     Vancouver, Washington                  -         (i)      733,180            -      665,895     -
     Walker, Michigan                       -         (i)      498,403            -      701,467     -
     Whitehall, Ohio                        -         (i)      522,786            -      289,350     -

Bakers Square Restaurants:
     Alsip, Illinois                        -         (i)      449,010      728,259            -     -
     Burbank, Illinois                      -         (i)      679,830    1,041,258            -     -
     Cherry Valley, Illinois                -         (i)      419,238      848,874            -     -
     Coon Rapids, Minnesota                 -         (i)      543,966    1,131,838            -     -
     Deerfield, Illinois                    -         (i)      573,069      468,307            -     -
     Downers Grove, Illinois                -         (i)      537,805      778,410            -     -
     Homewood, Illinois                     -         (i)      601,418      760,181            -     -
     LaGrange, Illinois                     -         (i)      591,206      770,392            -     -
     Lansing, Illinois                      -         (i)      647,562      869,687            -     -
     Mankato, Minnesota                     -         (i)      488,663    1,141,844            -     -
     Matteson, Illinois                     -         (i)      664,403      852,845            -     -
     Merrillville, Indiana                  -         (i)      567,083    1,176,715            -     -
     Palatine, Illinois                     -         (i)      686,927      674,672            -     -
     Palos Heights, Illinois                -         (i)      375,257      734,314            -     -
     Saint Charles, Illinois                -         (i)      614,512      630,952            -     -
     Westmont, Illinois                     -         (i)      518,276      591,047            -     -
     Willowbrook, Illinois                  -         (i)      586,045      718,306            -     -

Bandana's Bar-B-Q Restaurants:
     Arnold, Missouri                     (j)         (i)      373,239            -      873,481     -
     Collinsville, Illinois               (j)         (i)      346,699      829,363            -     -
     Columbia, Missouri                   (j)         (i)      501,566            -      920,312     -
     Crystal City, Missouri               (j)           -      273,460      903,170            -     -
     Fenton, Missouri                     (j)           -      624,303            -    1,027,724     -

Bennigan's Restaurants:
     Arvada, Colorado                       -         (i)      714,194    1,302,733            -     -
     Bedford, Texas                         -         (i)      768,333            -            -     -
     Canton, Ohio                           -         (i)    1,433,543            -      835,463     -
     Clearwater, Florida                    -         (i)      900,038            -            -     -
     Colorado Springs, Colorado             -         (i)      794,255            -            -     -
     Copley, Ohio                           -         (i)    1,433,543            -      835,463     -
     Englewood, Colorado                    -         (i)      665,141            -            -     -
     Englewood, New Jersey                  -         (i)    1,460,179      901,042            -     -
     Florham Park, New Jersey               -         (i)    1,077,645            -            -     -
     Glenview, Illinois                     -         (i)    1,019,248            -    1,789,742     -
     Grapevine, Texas                       -         (i)    1,038,598            -    1,523,346     -
     Houston, Texas                         -         (i)      908,502            -            -     -
     Jacksonville, Florida                  -         (i)      832,557            -            -     -
     Jacksonville, Florida                  -         (i)      779,387            -            -     -
     Lone Tree, Colorado                    -         (i)    1,075,230            -    1,502,305     -
     Mount Laurel, New Jersey               -         (i)    1,305,939    1,030,685            -     -
     North Richland Hills, Texas            -         (i)      886,048            -            -     -
     Ocala, Florida                         -         (i)      693,453            -    1,072,916     -
     Oklahoma City, Oklahoma                -           -      756,750            -            -     -
     Orlando, Florida                       -         (i)    1,585,461      874,143            -     -
     Pensacola, Florida                     -         (i)      692,093            -            -     -
     Saint Louis Park, Minnesota            -         (i)      885,111            -            -     -
     Tampa, Florida                         -           -      741,286            -            -     -
     Woodridge, Illinois                    -         (i)      789,680            -            -     -

Black Angus Restaurants:
     Dublin, California                     -         (i)    1,023,054            -    1,275,135     -
     Orem, Utah                             -         (i)      799,092            -    1,233,091     -

Black-eyed Pea Restaurants:
     Fort Worth, Texas                    (j)           -      679,384            -    1,028,766     -
     Glendale, Arizona                    (j)           -      744,764            -    1,082,896     -
     Grapevine, Texas                     (j)           -      411,977            -    1,804,357     -
     Hillsboro, Texas                       -           -      404,881            -            -     -

Boston Market Restaurants:
     Atlanta, Georgia                       -         (i)      774,448            -      507,587     -
     Cary, North Carolina                   -           -      532,814      801,222            -     -
     Chandler, Arizona                      -           -      440,026      475,931            -     -
     Columbus, Ohio                         -         (i)      353,608      606,470            -     -
     Gambrills, Maryland                    -         (i)      667,992            -      661,776     -
     Glendale, Arizona                      -         (i)      566,562      403,730            -     -
     Indianapolis, Indiana                  -         (i)      885,567            -      648,755     -
     Lake Worth, Florida                    -           -      570,003      900,291            -     -
     Lansing, Michigan                      -         (i)      515,827            -      572,706     -
     Newport News, Virginia               (j)           -      473,596      586,377            -     -
     Riverdale, Maryland                    -         (i)      526,092            -      504,483     -
     Scottsdale, Arizona                    -           -      521,918      410,245            -     -
     Waldorf, Maryland                      -         (i)      651,867            -      775,634     -
     Warwick, Rhode Island                  -         (i)      234,685      589,367            -     -

Burger King Restaurants:
     Burbank, Illinois                      -         (i)      543,095            -      552,491     -
     Chadbourn, North Carolina              -           -      217,079            -      858,549     -
     Chattanooga, Tennessee                 -         (i)      680,192            -      526,711     -
     Chattanooga, Tennessee                 -         (i)      769,842            -      376,964     -
     Chicago, Illinois                      -         (i)      917,717            -      713,170     -
     Clinton, North Carolina                -           -      349,582            -            -     -
     Cut Off, Louisiana                     -           -      323,106    1,219,165            -     -
     Highland, Indiana                      -         (i)      650,112            -      600,335     -
     Kent, Ohio                             -         (i)      233,468      689,696            -     -
     Lacey, Washington                      -           -      308,272            -            -     -
     Lake Charles, Louisiana                -           -      360,438    1,062,531            -     -
     Lynnwood, Washington                 (j)           -      448,745      626,866            -     -
     Manchester, New Hampshire              -           -      775,925      458,838            -     -
     Natchez, Mississippi                   -           -      273,353      718,493            -     -
     Oak Lawn, Illinois                     -         (i)    1,211,346            -      741,406     -
     Ooltewah, Tennessee                    -         (i)      546,261            -      658,946     -
     Opelousas, Louisiana                   -           -      625,123      958,670            -     -
     Portland, Oregon                       -           -      500,000            -            -     -
     Shelton, Washington                    -           -      424,416      822,399            -     -
     Spanaway, Washington                   -           -      416,548      762,244            -     -
     Warren, Michigan                       -           -      375,952      820,967            -     -
     Wilmington, North Carolina             -           -      348,663            -      701,825     -

Chevy's Fresh Mex Restaurants:
     Altamonte Springs, Florida             -         (i)    1,259,828    1,623,073            -     -
     Annapolis, Maryland                    -           -    1,372,280            -            -     -
     Arapahoe, Colorado                     -         (i)      986,426    1,680,312            -     -
     Atlanta, Georgia                     (j)         (i)    1,463,644    1,874,198            -     -
     Auburn Hills, Michigan               (j)         (i)    1,122,087    2,017,496            -     -
     Beaverton, Oregon                      -         (i)      938,162    1,681,670            -     -
     Bloomington, Minnesota                 -         (i)      869,178    1,309,759            -     -
     Brandon, Florida                     (j)         (i)      844,185    1,425,740            -     -
     Clearwater, Florida                  (j)         (i)      984,259    1,103,690            -     -
     Greenbelt, Maryland                    -         (i)      945,234    1,475,339            -     -
     Independence, Missouri               (j)         (i)    1,239,264    1,490,392            -     -
     Jacksonville, Florida                (j)         (i)    1,725,325    1,574,207            -     -
     Kissimmee, Florida                     -         (i)      570,815    1,536,290            -     -
     Lake Mary, Florida                     -         (i)       88,077    2,019,028            -     -
     Lake Oswego, Oregon                    -         (i)      963,047    1,505,671            -     -
     Las Vegas, Nevada                      -         (i)    1,156,847    1,188,272            -     -
     Merriam, Kansas                      (j)         (i)    1,032,271    1,074,834            -     -
     Naperville, Illinois                   -         (i)      960,779    1,365,563            -     -
     Nashville, Tennessee                   -         (i)      956,799    2,692,320            -     -
     Olathe, Kansas                       (j)         (i)      470,047    1,541,280            -     -
     Orlando, Florida                     (j)         (i)    1,495,716    1,674,517            -     -
     Tampa, Florida                         -         (i)      869,408    1,548,972            -     -
     Tampa, Florida                       (j)         (i)      878,358    1,449,034            -     -
     Taylor, Michigan                       -         (i)      844,918    1,712,340            -     -

Chick-Fil-A Restaurant:
     Rockwall, Texas                        -         (i)      528,118            -      340,297     -

Chipotle Mexican Grill Restaurant:
     Upland, California                     -         (i)      788,248            -      209,449     -

Culpepper Restaurant:
     Bridgeton, Missouri                  (j)           -            -      595,741            -     -

Darryl's Restaurants:
     Mobile, Alabama                        -           -      495,195      937,060            -     -
     Montgomery, Alabama                  (j)           -      346,380      869,587            -     -
     Orlando, Florida                       -           -    1,485,631      772,853            -     -
     Pensacola, Florida                     -           -      389,394      676,711            -     -
     Raleigh, North Carolina              (j)           -    1,131,164      719,865            -     -
     Raleigh, North Carolina              (j)           -      840,525      465,154            -     -
     Richmond, Virginia                   (j)           -      311,196      606,403            -     -
     Richmond, Virginia                     -           -      618,125            -            -     -
     Winston-Salem, North Carolina        (j)           -      436,867      757,874            -     -

Del Taco Restaurant:
     Mesa, Arizona                          -         (i)      642,483            -      581,759     -

Denny's Restaurants:
     Duncan, South Carolina                 -         (i)      219,702            -            -     -
     Greensboro, North Carolina             -         (i)      361,025      572,098            -     -
     Greenville, South Carolina             -         (i)      457,851      454,566            -     -
     Houston, Texas                         -         (i)      392,818      664,851            -     -
     Kansas City, Missouri                  -           -      400,847            -      901,367     -
     Landrum, South Carolina                -         (i)      155,398            -            -     -
     Lee's Summit, Missouri               (j)           -      539,650            -      670,448     -
     Merriam, Kansas                      (j)           -      644,889            -      991,991     -
     Mooresville, North Carolina            -         (i)      307,292            -            -     -
     North Kansas City, Missouri          (j)           -      450,010            -      760,630     -
     Pasadena, Texas                        -           -      466,555            -      506,094     -
     Sedalia, Missouri                    (j)           -      318,979            -    1,013,110     -
     Shawnee, Oklahoma                    (j)           -      528,090            -      625,653     -
     Tampa, Florida                       (j)           -      397,302      665,948            -     -
     Topeka, Kansas                         -         (i)      414,731            -            -     -
     Winter Springs, Florida                -         (i)      555,232            -            -     -

Einstein Brothers' Bagels Restaurants:
     Dearborn, Michigan                     -           -      464,957            -      178,078     -
     Springfield, Virginia                  -           -      633,691            -            -     -

Fazoli's Restaurant:
     Southaven, Mississippi                 -         (i)      485,013      586,758            -     -

Golden Corral Family Steakhouse Restaura
     Bellevue, Nebraska                     -           -      440,812            -    1,039,283     -
     Brunswick, Georgia                     -           -      456,629            -    1,170,630     -
     Carlsbad, New Mexico                   -           -      384,221            -      643,854     -
     Cleburne, Texas                        -           -      359,455            -      653,853     -
     Clovis, New Mexico                     -           -      426,349      805,517            -     -
     Columbia, Missouri                     -         (i)      848,133            -    1,008,678     -
     Columbus, Ohio                         -           -    1,031,098            -    1,092,939     -
     Cookeville, Tennessee                  -           -      806,377            -    1,086,502     -
     Corpus Christi, Texas                  -           -      576,548            -      934,918     -
     Corsicana, Texas                       -           -      349,227            -      699,756     -
     Council Bluffs, Iowa                   -           -      546,078            -      993,149     -
     Davenport, Iowa                        -           -      601,296    1,344,016            -     -
     Dover, Delaware                        -           -    1,043,108            -      977,508     -
     Dubuque, Iowa                          -           -      564,242            -    1,056,315     -
     Duncan, Oklahoma                       -           -      161,390            -    1,028,945     -
     Edmond, Oklahoma                       -           -      569,664            -    1,017,781     -
     Enid, Oklahoma                         -           -      364,536            -      865,147     -
     Evansville, Indiana                    -           -      601,394            -    1,194,533     -
     Evansville, Indiana                    -         (i)      587,601            -    1,393,436     -
     Flowood, Mississippi                   -         (i)      595,717            -    1,094,345     -
     Fort Dodge, Iowa                       -           -      320,880            -    1,155,880     -
     Fort Walton Beach, Florida             -           -      590,538            -    1,176,436     -
     Fort Wayne, Indiana                    -           -      743,544            -    1,276,290     -
     Henderson, Kentucky                    -           -      377,108            -    1,116,904     -
     Jacksonville, Florida                  -         (i)      615,554            -    1,184,073     -
     Jacksonville, Florida                  -           -      541,264            -    1,173,738     -
     Jacksonville, Florida                  -         (i)      684,351            -    1,258,835     -
     Kansas City, Missouri                  -           -      409,153            -      943,712     -
     Lufkin, Texas                          -           -      479,197            -      954,051     -
     Moberly, Missouri                      -           -      374,230            -      838,342     -
     Mobile, Alabama                        -         (i)      428,841            -    1,031,457     -
     Muskogee, Oklahoma                     -         (i)      395,839            -      887,540     -
     Omaha, Nebraska                        -           -      570,004            -    1,271,666     -
     Orlando, Florida                       -           -       67,157            -            -     -
     Palatka, Florida                       -           -      322,433            -      987,385     -
     Pensacola, Florida                     -         (i)      657,606            -    1,347,285     -
     Port Richey, Florida                   -           -      626,999            -    1,130,692     -
     Rock Hill, South Carolina              -         (i)      718,003            -    1,202,177     -
     Tampa, Florida                         -           -      825,650            -    1,161,192     -
     Texarkana, Texas                       -         (i)      665,172            -    1,080,114     -
     Tulsa , Oklahoma                       -         (i)      705,094            -    1,305,383     -
     Winchester, Kentucky                   -         (i)      303,633            -      970,489     -

Ground Round Restaurants:
     Allentown, Pennsylvania                -         (i)      405,631      884,954            -     -
     Cincinnati, Ohio                       -         (i)      282,099      534,632            -     -
     Dubuque, Iowa                          -         (i)      693,733      810,458            -     -
     Ewing Township, New Jersey             -         (i)      371,254      685,847            -     -
     Janesville, Wisconsin                  -         (i)      451,235      548,178            -     -
     Kalamazoo, Michigan                    -         (i)      287,331      712,081            -     -
     Parma, Ohio                            -         (i)      388,699      793,475            -     -
     Reading, Pennsylvania                  -         (i)      728,574      793,410            -     -
     Waterloo, Iowa                         -         (i)      436,471      659,089            -     -
     Wauwatosa, Wisconsin                   -         (i)      627,680      804,399            -     -

Guthrie's Restaurant:
     Hoover, Alabama                        -         (i)      493,536      619,786            -     -

Hardee's Restaurants:
     Johnson City, Tennessee                -           -      215,567            -            -     -
     Mobile, Alabama                        -           -      336,696            -            -     -
     Petal, Mississippi                   (j)         (i)      324,298      420,017            -     -
     Rock Hill, South Carolina              -           -      256,050      476,149            -     -
     West Point, Mississippi                -         (i)      173,386            -            -     -

Houlihan's Restaurants:
     Bethel Park, Pennsylvania              -           -      846,183      595,601            -     -
     Langhorne, Pennsylvania              (j)           -      817,039      648,765            -     -
     Plymouth Meeting, Pennsylvania         -           -    1,181,460      908,880            -     -

International House Of Pancakes Restaura
     Auburn, Washington                     -         (i)      632,811    1,135,312            -     -
     Castle Rock, Colorado                  -         (i)      540,896            -    1,196,239     -
     Clarksville, Tennessee                 -         (i)      375,987      964,430            -     -
     Corpus Christi, Texas                  -         (i)      567,462            -            -     -
     Fort Worth, Texas                      -         (i)      501,388      746,474            -     -
     Fort Worth, Texas                      -         (i)      565,639      923,669            -     -
     Greeley, Colorado                      -         (i)      416,279            -      867,972     -
     Greenville, South Carolina             -         (i)      476,847      961,606            -     -
     Hollywood, California                  -         (i)    1,407,002            -            -     -
     Homewood, Alabama                      -         (i)      545,112    1,029,900            -     -
     Houston, Texas                         -         (i)      645,365      790,258            -     -
     Kansas City, Missouri                  -         (i)      512,481      831,202            -     -
     Killeen, Texas                         -         (i)      380,687      775,713            -     -
     Lake Jackson, Texas                    -         (i)      460,167      744,128            -     -
     Leesburg, Virginia                     -         (i)      665,015      580,798            -     -
     Leon Valley, Texas                     -         (i)      593,624      918,024            -     -
     Loveland, Colorado                     -         (i)      488,259            -            -     -
     Murfreesboro, Tennessee                -         (i)      647,414      871,268            -     -
     Phoenix, Arizona                       -         (i)      668,112      941,796            -     -
     Port Arthur, Texas                     -         (i)      382,950      957,912            -     -
     Poughkeepsie, New York                 -         (i)      504,533      806,624            -     -
     Pueblo, Colorado                       -         (i)      387,562      891,943            -     -
     Roseville, Michigan                    -         (i)      282,868      843,648            -     -
     Southaven, Mississippi                 -         (i)      579,175    1,176,434            -     -
     Stockbridge, Georgia                   -         (i)      765,743      652,671            -     -
     Victoria, Texas                        -         (i)      319,237            -            -     -

J. Gilbert's Restaurant:
     McLean, Virginia                       -           -      944,585      689,363            -     -

Jack in the Box Restaurants:
     Allen, Texas                           -         (i)      711,642            -      726,339     -
     Avondale, Arizona                      -         (i)      605,063            -      623,222     -
     Bacliff, Texas                         -         (i)      419,488            -      697,861     -
     Carson, California                     -         (i)      457,821            -      708,581     -
     Chandler, Arizona                      -         (i)      481,456            -      636,588     -
     Chandler, Arizona                      -         (i)      604,724            -      600,686     -
     Channelview, Texas                     -           -      361,238            -      711,595     -
     Corinth, Texas                         -         (i)      396,864            -      576,370     -
     Dallas, Texas                          -         (i)      369,886            -      467,819     -
     Enumclaw, Washington                   -         (i)      124,468            -      773,506     -
     Florissant, Missouri                   -         (i)      389,265            -      779,211     -
     Folsom, California                     -         (i)      635,343            -      652,472     -
     Fort Worth, Texas                      -         (i)      482,309      716,199            -     -
     Fresno, California                     -         (i)      286,850            -      606,547     -
     Georgetown, Texas                      -         (i)      499,875            -      866,353     -
     Granbury, Texas                        -         (i)      404,270            -      831,716     -
     Gun Barrel City, Texas                 -         (i)      284,046            -      549,495     -
     Hillsboro, Oregon                      -         (i)      699,776            -      864,724     -
     Hollister, California                  -         (i)      537,223            -      592,536     -
     Houston, Texas                         -         (i)      545,485            -      527,020     -
     Houston, Texas                         -         (i)      375,776            -      643,445     -
     Houston, Texas                         -         (i)      403,002            -      610,815     -
     Houston, Texas                         -         (i)      370,342            -      548,107     -
     Houston, Texas                         -         (i)      420,521            -      543,338     -
     Humble, Texas                          -         (i)      437,667            -      591,877     -
     Hutchins, Texas                        -         (i)      272,937            -      653,792     -
     Irvine, California                     -         (i)      899,898            -      733,701     -
     Kent, Washington                       -         (i)      737,038            -      553,688     -
     Las Vegas, Nevada                      -         (i)      730,674            -      547,445     -
     Los Angeles, California                -         (i)      740,616            -      678,189     -
     Los Angeles, California                -         (i)      911,754            -      531,018     -
     Los Angeles, California                -         (i)      853,821            -      602,301     -
     Lufkin, Texas                          -         (i)      418,351            -      651,064     -
     Lufkin, Texas                          -         (i)      363,967            -      776,605     -
     Moscow, Idaho                          -         (i)      217,851            -      751,664     -
     Nacogdoches, Texas                     -         (i)      383,591            -      643,055     -
     Ontario, California                    -         (i)      771,241            -      793,229     -
     Orange, Texas                          -         (i)      387,533            -      787,843     -
     Oxnard, California                     -         (i)      681,663            -      642,924     -
     Palmdale, California                   -         (i)      631,275            -      567,912     -
     Peoria, Arizona                        -         (i)      496,689            -      721,614     -
     Pflugerville, Texas                    -         (i)      717,246            -      657,685     -
     Saint Louis, Missouri                  -         (i)      474,296            -      727,491     -
     Salem, Oregon                          -         (i)      501,168            -      699,067     -
     San Antonio, Texas                     -         (i)      274,362            -      781,797     -
     San Antonio, Texas                     -         (i)      311,466            -      700,979     -
     Spring, Texas                          -         (i)      475,748            -      719,239     -
     Tacoma, Washington                     -         (i)      495,529            -      759,800     -
     Tigard, Oregon                         -         (i)      353,396            -      904,688     -
     Tyler, Texas                           -         (i)      289,257            -      699,525     -
     Waxahachie, Texas                      -         (i)      477,580            -      538,255     -
     Weatherford, Texas                     -         (i)      464,986            -      785,149     -
     West Sacramento, California            -         (i)      523,089            -      617,131     -
     Woodland, California                   -         (i)      358,130            -      668,383     -

Jack in the Box/Arco Gas Station-Conveni
     Benicia, California                    -         (i)      745,752    1,551,697            -     -
     Coachella, California                  -         (i)      370,963    1,406,532            -     -

Joe's Crab Shack Restaurant:
     Lilburn, Georgia                       -         (i)    1,089,268      931,637            -     -

Jose Pepper's Restaurant:
     Blue Springs, Missouri               (j)           -      251,187            -      737,672     -

KFC Restaurants:
     Baton Rouge, Louisiana                 -           -      181,290      463,414            -     -
     New Orleans, Louisiana                 -         (i)      158,829            -      491,957     -
     New Orleans, Louisiana                 -         (i)      310,574            -      532,557     -
     New Orleans, Louisiana                 -         (i)      205,795            -      564,058     -
     New Orleans, Louisiana                 -         (i)      315,037            -      541,553     -
     Putnam, Connecticut                    -           -      301,723            -            -     -

Krystal Restaurants:
     Brandon, Mississippi                   -         (i)      340,115      687,423            -     -
     Chattanooga, Tennessee                 -         (i)      445,493      594,649            -     -
     Greenville, Alabama                    -         (i)      190,146      614,193            -     -
     Montgomery, Alabama                    -         (i)      311,103      506,943            -     -
     Scottsboro, Alabama                    -         (i)      255,500      561,315            -     -

Leeann Chin Chinese Cuisine Restaurants:
     Chanhassen, Minnesota                  -         (i)      376,929      639,875            -     -
     Golden Valley, Minnesota               -         (i)      665,422            -      481,311     -

Little Lake Bryan Land:
     Orlando, Florida                       -           -    6,288,001            -            -     -
     Orlando, Florida                       -           -      360,878            -            -     -

McDonalds:
     Palm Bay, Florida                      -           -      615,498            -            -     -

Pizza Hut Restaurants:
     Adrian, Michigan                       -           -      242,239            -            -     -
     Beaver, West Virginia                  -           -      212,053            -            -     -
     Beckley, West Virginia                 -           -      209,432            -            -     -
     Bedford, Ohio                          -           -      174,721            -            -     -
     Bluefield, West Virginia               -           -      120,449            -            -     -
     Bolivar, Ohio                          -           -      190,009      410,096            -     -
     Bowling Green, Ohio                    -           -      200,442            -            -     -
     Bowling Green, Ohio                    -           -      135,831      191,595            -     -
     Carrollton, Ohio                       -           -      187,082      533,487            -     -
     Cleveland, Ohio                        -           -      226,163            -            -     -
     Cleveland, Ohio                        -           -      116,849            -            -     -
     Cleveland, Ohio                        -           -      126,494            -            -     -
     Cooper City, Florida                   -         (i)      267,703      128,483            -     -
     Cross Lanes, West Virginia             -           -      215,881            -            -     -
     Defiance, Ohio                         -           -      242,239            -            -     -
     East Cleveland, Ohio                   -           -      194,012            -            -     -
     Euclid, Ohio                           -           -      202,050            -            -     -
     Huntington, West Virginia              -           -      212,093            -            -     -
     Hurricane, West Virginia               -           -      180,803            -            -     -
     Lambertville, Michigan                 -           -       99,166            -            -     -
     Marathon, Florida                      -         (i)      161,249      234,940            -     -
     Marietta, Ohio                         -           -      169,454            -            -     -
     Mayfield Heights, Ohio                 -           -      202,552            -            -     -
     Middleburg Heights, Ohio               -           -      216,518            -            -     -
     Millersburg, Ohio                      -           -      213,090      635,104            -     -
     Milton, West Virginia                  -           -       99,815            -            -     -
     Monroe, Michigan                       -           -      152,215            -            -     -
     New Philadelphia, Ohio                 -           -      223,981      442,758            -     -
     New Philadelphia, Ohio                 -           -      149,206            -      388,321     -
     North Olmsted, Ohio                    -           -      259,922            -            -     -
     Norwalk, Ohio                          -           -      261,529            -            -     -
     Rocky River, Ohio                      -           -      142,570            -            -     -
     Ronceverte, West Virginia              -           -       99,733            -            -     -
     Sandusky, Ohio                         -           -      259,922            -            -     -
     Seven Hills, Ohio                      -           -      239,023            -            -     -
     Steubenville, Ohio                     -           -      228,199      475,421            -     -
     Strongsville, Ohio                     -           -      186,476            -            -     -
     Toledo, Ohio                           -           -      197,227            -            -     -
     Toledo, Ohio                           -           -      208,480            -            -     -
     Toledo, Ohio                           -           -      176,170            -            -     -
     Toledo, Ohio                           -           -      128,604            -            -     -
     Uhrichsville, Ohio                     -           -      279,779      562,521            -     -
     Weirton, West Virginia               (j)           -            -      178,187            -     -
     Wellsburg, West Virginia               -           -      167,170      168,363            -     -

Pollo Tropical Restaurants:
     Coral Springs, Florida                 -         (i)      852,746    1,108,491            -     -
     Davie, Florida                         -         (i)      712,865      873,395            -     -
     Fort Lauderdale, Florida               -         (i)      397,878      923,975            -     -
     Lake Worth, Florida                    -         (i)      435,465      915,232            -     -
     Miami, Florida                         -         (i)      654,766    1,195,901            -     -
     Miami, Florida                         -         (i)      911,013    1,011,766            -     -
     Miami, Florida                         -         (i)    1,244,893      918,257            -     -
     North Miami, Florida                   -         (i)      918,258      764,150            -     -

Ponderosa Restuarants:
     Appleton, Wisconsin                    -           -      181,153      561,582            -     -
     Blue Springs, Missouri                 -         (i)      691,797            -    1,136,902     -
     Eureka, Missouri                       -           -      379,675      604,449            -     -
     Indiana, Pennsylvania                  -           -      714,789            -    1,317,317     -
     Johnstown, Pennsylvania                -         (i)      599,391            -    1,159,989     -
     Kissimmee, Florida                     -           -      637,984      824,276            -     -
     Massena, New York                      -           -      129,816      659,340            -     -
     Middletown, New York                   -           -      214,177      853,505            -     -
     Oneonta, New York                      -           -      366,941      524,341            -     -

Popeye's Famous Fried Chicken Restaurant
     Thomasville, Georgia                   -         (i)      113,780      407,429            -     -
     Valdosta, Georgia                      -         (i)      158,880      378,057            -     -

Randy's Steak and Seafood Restaurant:
     Murfreesboro, Tennessee                -           -      514,900            -      936,376     -

Red Robin Restaurant:
     Columbus, Ohio                         -           -      721,887            -            -     -

Rio Bravo Fresh Mexican Cantina Restaura
     Morrow, Georgia                      (j)         (i)      934,922    1,842,623            -     -

Roadhouse Grill Restaurants:
     Brandon, Florida                       -         (i)      914,103            -      691,171     -
     Centerville, Ohio                    (j)           -    1,227,973            -      761,806     -
     Clearwater, Florida                    -         (i)    1,370,391            -      946,608     -
     Columbus, Ohio                       (j)           -      894,077            -    1,038,617     -
     Fairfield, Ohio                        -         (i)    1,151,865            -      910,321     -
     Grove City, Ohio                       -           -      649,962            -      978,307     -
     Jacksonville, Florida                  -         (i)      394,026            -    1,442,752     -
     Jacksonville, Florida                  -           -    1,313,730            -      887,733     -
     Pensacola, Florida                   (j)         (i)      927,463            -      691,228     -
     Pineville, North Carolina              -           -    1,207,143            -    1,091,507     -
     Rock Hill, South Carolina            (j)           -      608,698            -      903,887     -
     Roswell, Georgia                     (j)           -      908,635            -    1,084,536     -
     Union Township, Ohio                   -           -      703,734            -    1,053,632     -

Rubio's Baja Grill Restaurant:
     Taylorsville, Utah                     -         (i)      889,562            -      487,475     -

Ruby Tuesday's Restaurants:
     Bartow, Florida                        -         (i)      416,311            -      963,488     -
     Champlin, Minnesota                    -         (i)      505,639            -            -     -
     Colorado Springs, Colorado             -         (i)      696,078            -    1,005,509     -
     Coral Springs, Florida                 -         (i)      715,220            -    1,012,777     -
     Dillon, Colorado                       -         (i)      556,515            -    1,132,988     -
     Draper, Utah                           -         (i)      518,832            -            -     -
     Independence, Missouri                 -           -      980,703            -            -     -
     Kansas City, Missouri                  -           -      633,404            -            -     -
     Lakeland, Florida                      -         (i)      574,441      742,781            -     -
     Lakewood, Washington                   -         (i)      430,741            -            -     -
     London, Kentucky                       -         (i)      354,415            -            -     -
     Orange City, Florida                   -         (i)      719,563            -            -     -
     Somerset, Kentucky                     -         (i)      545,612            -      868,606     -
     Vero Beach, Florida                    -         (i)      536,564            -    1,267,552     -

Ruth's Chris Steak House Restaurants:
     King of Prussia, Pennsylvania          -         (i)      965,223      549,565            -     -
     Tampa, Florida                         -         (i)    1,076,442    1,062,751            -     -

Ryan's Family Steak House Restaurant:
     Spring Hill, Florida                   -         (i)      591,371            -    1,175,273     -

Saint Louis Bread Company Restaurant:
     Florissant, Missouri                   -         (i)      705,522            -      626,845     -

Shoney's Restaurant
     Cocoa Beach, Florida                 (j)           -    1,200,000            -            -     -
     Debary, Florida                      (j)           -      900,000            -            -     -

Sonny's Real Pit Bar-B-Q Restaurants:
     Athens, Georgia                        -         (i)      628,688      962,524            -     -
     Conyers, Georgia                       -           -      371,021      593,171            -     -
     Doraville, Georgia                     -         (i)      585,461      812,822            -     -
     Marietta, Georgia                      -         (i)      527,572      870,710            -     -
     Norcross, Georgia                      -         (i)      734,105      961,287            -     -
     Smyrna, Georgia                        -         (i)      634,379      643,323            -     -
     Thomasville, Georgia                   -         (i)      263,022            -            -     -
     Venice, Florida                        -           -      498,746            -            -     -

Sprint PCS Retail Store:
     Saint Joseph, Missouri               (j)           -      378,786            -      388,489     -

Steak & Ale Restaurants:
     Altamonte Springs, Florida             -         (i)    1,006,396      690,731            -     -
     Birmingham, Alabama                    -           -      715,432            -            -     -
     College Park, Georgia                  -         (i)      802,361            -            -     -
     Conroe, Texas                          -         (i)      590,733            -            -     -
     Greenville, South Carolina             -         (i)      670,594            -            -     -
     Houston, Texas                         -         (i)      964,354            -            -     -
     Houston, Texas                         -         (i)      776,694            -            -     -
     Huntsville, Alabama                    -         (i)      641,125            -            -     -
     Jacksonville, Florida                  -           -      670,491            -            -     -
     Maitland, Florida                      -         (i)      684,164            -            -     -
     Memphis, Tennessee                     -         (i)      810,316      798,412            -     -
     Mesquite, Texas                        -         (i)      592,342            -            -     -
     Miami, Florida                         -         (i)      594,142            -            -     -
     Middletown, New Jersey                 -         (i)      933,759      763,368            -     -
     Norcross, Georgia                      -         (i)      740,132            -            -     -
     Orlando, Florida                       -         (i)      922,679      725,256            -     -
     Pensacola, Florida                     -         (i)      354,419            -            -     -
     Tulsa, Oklahoma                        -         (i)      433,713            -            -     -

Super Smokers BBQ Restaurant:
     Saint Peters, Missouri                 -           -      376,905      692,124            -     -

Taco Bell Restaurants:
     Colonial Heights, Virginia             -         (i)      447,458      383,785            -     -
     Hayes, Virginia                        -         (i)      299,870            -            -     -
     Livingston, Tennessee                  -         (i)      212,438            -            -     -
     Richmond, Virginia                     -         (i)      402,947            -            -     -
     Richmond, Virginia                     -         (i)      404,578      451,129            -     -
     Richmond, Virginia                     -         (i)      474,588      478,974            -     -
     Saint Louis, Missouri                  -         (i)      349,637            -            -     -
     Saint Louis, Missouri                  -         (i)      308,915      351,160            -     -
     Wentzville, Missouri                   -         (i)      339,250      490,895            -     -
     Williamsburg, Virginia                 -         (i)      343,906            -            -     -

Taco Bell/Pizza Hut Restaurants:
     Arlington, Texas                       -           -      276,949            -      550,355     -
     Dallas, Texas                          -         (i)      335,174      694,862            -     -
     Dallas, Texas                          -           -      355,763            -      496,898     -

Texas Roadhouse Restaurants:
     Ammon, Idaho                           -         (i)      505,551            -      806,059     -
     Arvada, Colorado                       -         (i)      538,204            -    1,149,066     -
     Aurora, Colorado                       -         (i)      656,917            -    1,208,688     -
     Cedar Rapids, Iowa                     -         (i)      582,062            -    1,085,290     -
     College Station, Texas                 -         (i)      520,037            -    1,074,176     -
     Concord, North Carolina                -         (i)      664,266            -      987,133     -
     Dickson City, Pennsylvania             -         (i)      596,439            -    1,078,721     -
     Gastonia, North Carolina               -         (i)      235,195            -    1,115,831     -
     Hickory, North Carolina                -         (i)      560,423            -    1,032,294     -
     Shively, Kentucky                      -         (i)      713,534      995,529            -     -

TGI Friday's Restaurants:
     Goodyear, Arizona                      -         (i)      967,242            -    1,726,827     -
     Henderson, Nevada                      -         (i)    1,385,425            -            -     -
     Independence, Missouri                 -         (i)      856,278            -            -     -
     Leawood, Kansas                        -         (i)    2,459,048            -            -     -
     Mesa, Arizona                          -         (i)      914,342            -            -     -
     Shawnee, Kansas                        -         (i)      884,743            -            -     -
     Temecula, California                   -         (i)    1,239,565            -            -     -
     Union City, California                 -         (i)    1,213,121            -            -     -

Tiffany's Restaurant:
     Woodson Terrace, Missouri            (j)           -      744,126            -    1,221,749     -

Tin Alley Grill Restaurants:
     Crystal, Minnesota                     -         (i)      370,667      431,642            -     -
     Gloucester, New Jersey                 -         (i)      422,489      528,849            -     -

TropiGrill Restaurants:
     Altamonte Springs, Florida             -         (i)      548,886      700,855            -     -
     Orlando, Florida                       -         (i)      618,372      631,369            -     -

Village Inn Restaurant:
     Omaha, Nebraska                        -         (i)      511,811      756,304            -     -

Wendy's Old Fashioned Hamburgers Restaur
     Atascadero, California                 -         (i)      485,625            -      705,993     -
     Camarillo, California                  -         (i)      640,066            -      688,918     -
     Knoxville, Tennessee                   -         (i)      358,027            -      444,622     -
     Knoxville, Tennessee                   -         (i)      555,813            -      442,025     -
     Paso Robles, California                -         (i)      489,097            -      735,631     -
     Westlake Village, California           -         (i)      841,374            -      699,082     -
                                                          -----------------------------------------------
     TOTAL:                                                298,631,152  171,511,335  168,893,741     -
                                                          ===============================================


Property of Joint Venture in Which
     the Company has a 59.22% Interest
     and has Invested in Under
     an Operating Lease:

Bennigan's Restaurant:
     Orlando, Florida                       -           -      708,297            -    1,008,108     -
                                                          ===============================================


Properties the Company
     has invested in Under
     Direct Financing Leases:

Applebee's Restaurants:
     Freeport, Illinois                     -         (i)      197,631    1,008,908            -     -
     Rockford, Illinois                     -         (i)            -    1,096,139            -     -
     Tullahoma, Tennessee                   -         (i)      324,362    1,009,364            -     -

Arby's Restaurants:
     Allen, Texas                           -         (i)            -            -      609,272     -
     Grand Rapids, Michigan                 -         (i)            -      938,296            -     -
     Huntsville, Alabama                    -           -            -            -      595,801     -
     Newark, Ohio                           -           -            -            -      339,772     -
     The Colony, Texas                      -         (i)            -            -      593,454     -

Bennigan's Restaurants:
     Bedford, Texas                         -         (i)            -      954,774            -     -
     Clearwater, Florida                    -         (i)            -    1,043,049            -     -
     Colorado Springs, Colorado             -         (i)            -      902,872            -     -
     Englewood, Colorado                    -         (i)            -    1,131,082            -     -
     Florham Park, New Jersey               -         (i)            -    1,092,401            -     -
     Houston, Texas                         -         (i)            -      985,394            -     -
     Jacksonville, Florida                  -         (i)            -    1,061,339            -     -
     Jacksonville, Florida                  -         (i)            -      819,356            -     -
     North Richland Hills, Texas            -         (i)            -      983,252            -     -
     Oklahoma City, Oklahoma                -           -            -    1,015,084            -     -
     Pensacola, Florida                     -         (i)            -      980,438            -     -
     Saint Louis Park, Minnesota            -         (i)            -    1,280,033            -     -
     Tampa, Florida                         -           -            -    1,324,729            -     -
     Winston-Salem, North Carolina          -         (i)      247,828      992,551            -     -
     Woodridge, Illinois                    -         (i)            -      991,688            -     -

Black-eyed Pea Restaurants:
     Dallas, Texas                          -           -            -      685,977            -     -
     Fort Worth, Texas                      -           -            -      655,014            -     -
     Hendersonville, Tennessee              -           -            -      735,005            -     -
     Hillsboro, Texas                       -           -            -            -      716,364     -

Burger King Restaurants:
     Clinton, North Carolina                -           -            -            -      696,507     -
     Lacey, Washington                      -           -            -      840,711            -     -
     Olympia, Washington                    -           -            -      920,058            -     -
     Port Angeles, Washington               -           -            -      696,026            -     -

Chevys Fresh Mex Restaurant:
     Annapolis, Maryland                    -           -            -            -    1,540,332     -

Clay Pit
     Addison, Texas                         -           -            -      568,390            -     -

Darryl's Restaurants:
     Richmond, Virginia                     -           -            -      775,617            -     -
     Akron, Ohio                            -         (i)      137,424      938,202            -     -
     Duncan, South Carolina                 -         (i)            -      826,770            -     -
     Landrum, South Carolina                -         (i)            -      492,869            -     -
     Mooresville, North Carolina            -         (i)            -      736,649            -     -
     Topeka, Kansas                         -         (i)            -      700,166            -     -
     Winter Springs, Florida                -         (i)            -            -      886,915     -

Fresh Choice
     Dallas, Texas                          -           -            -      381,971            -     -

Hardee's Restaurants:
     Johnson City, Tennessee                -           -            -      618,318            -     -
     Mobile, Alabama                        -           -            -      540,173            -     -
     West Point, Mississippi                -         (i)            -      569,388            -     -

International House Of Pancakes Restaura
     Alexandria, Virginia                   -         (i)            -      852,645            -     -
     Anderson, South Carolina               -         (i)            -      957,414            -     -
     Blue Bell, Pennsylvania                -         (i)            -      829,834            -     -
     Chesapeake, Virginia                   -         (i)            -    1,059,499            -     -
     Christiansburg, Virginia               -         (i)            -      918,143            -     -
     Corpus Christi, Texas                  -         (i)            -      864,457            -     -
     Crestwood, Illinois                    -         (i)            -      935,262            -     -
     Flagstaff, Arizona                     -         (i)      293,762    1,121,276            -     -
     Fredericksburg, Virginia               -         (i)            -      972,595            -     -
     Hickory, North Carolina                -         (i)            -    1,202,183            -     -
     Hollywood, California                  -         (i)            -      994,845            -     -
     Houston, Texas                         -         (i)            -    1,017,365            -     -
     Houston, Texas                         -         (i)            -      764,708            -     -
     Loveland, Colorado                     -         (i)            -      963,597            -     -
     Maryville, Tennessee                   -         (i)      243,825      963,231            -     -
     Montgomery, Alabama                    -         (i)            -      843,378            -     -
     Pittsburg, California                  -         (i)            -    1,014,264            -     -
     Plano, Texas                           -         (i)            -      982,443            -     -
     Salem, New Hampshire                   -         (i)            -      779,153            -     -
     San Antonio, Texas                     -         (i)            -    1,081,335            -     -
     Tuscaloosa, Alabama                    -         (i)            -      930,720            -     -
     Victoria, Texas                        -         (i)            -      814,015            -     -
     Virginia Beach, Virginia               -         (i)            -    1,013,830            -     -
     Warner Robins, Georgia                 -         (i)            -      833,493            -     -

KFC Restaurants:
     Baton Rouge, Louisiana                 -           -       84,809      609,399            -     -
     Port Allen, Louisiana                  -         (i)            -      952,737            -     -
     Putnam, Connecticut                    -           -            -      530,846            -     -

NI's International Buffet Restaurant:
     Eastlake, Ohio                         -           -      256,332    1,473,307            -     -

Popeye's Famous Fried Chicken Restaurant
     Starke, Florida                        -         (i)      208,910      427,067            -     -

Red Robin Restaurant:
     Columbus, Ohio                         -           -            -            -    1,397,822     -

Ruby Tuesday's Restaurants:
     Champlin, Minnesota                    -         (i)            -            -    1,151,835     -
     Draper, Utah                           -         (i)            -            -    1,036,077     -
     Independence, Missouri                 -           -            -            -      554,092     -
     Kansas City, Missouri                  -           -            -            -    1,115,425     -
     Lakewood, Washington                   -         (i)            -            -    1,127,476     -
     London, Kentucky                       -         (i)            -            -      845,249     -
     Louisville, Kentucky                   -         (i)            -            -    1,051,574     -
     Orange City, Florida                   -         (i)            -            -    1,047,180     -
     Puyallup, Washington                   -           -            -            -      934,118     -
     Saint George, Utah                     -           -            -            -      895,583     -
     Sebring, Florida                       -         (i)      230,901            -      775,843     -

Sonny's Real Pit Bar-B-Q Restaurants:
     Thomasville, Georgia                   -         (i)            -            -      988,618     -
     Venice, Florida                        -           -            -    1,004,407            -     -

Steak & Ale Restaurants:
     Birmingham, Alabama                    -           -            -      681,623            -     -
     College Park, Georgia                  -         (i)            -      909,525            -     -
     Conroe, Texas                          -         (i)            -    1,032,606            -     -
     Greenville, South Carolina             -         (i)            -    1,180,342            -     -
     Houston, Texas                         -         (i)            -      978,733            -     -
     Houston, Texas                         -         (i)            -    1,092,606            -     -
     Huntsville, Alabama                    -         (i)            -      810,041            -     -
     Jacksonville, Florida                  -           -            -      879,060            -     -
     Maitland, Florida                      -         (i)            -      791,599            -     -
     Mesquite, Texas                        -         (i)            -      908,017            -     -
     Miami, Florida                         -         (i)            -    1,176,774            -     -
     Norcross, Georgia                      -         (i)            -      966,814            -     -
     Pensacola, Florida                     -         (i)            -      826,191            -     -
     Tulsa, Oklahoma                        -         (i)            -    1,067,543            -     -

Taco Bell Restaurants:
     Hayes, Virginia                        -         (i)            -      443,302            -     -
     Livingston, Tennessee                  -         (i)            -            -      436,198     -
     Richmond, Virginia                     -         (i)            -      575,079            -     -
     Saint Louis, Missouri                  -         (i)            -      471,686            -     -
     Williamsburg, Virginia                 -         (i)            -      438,410            -     -

Texas Roadhouse Restaurant:
     Fayetteville, North Carolina           -           -            -      944,114            -     -

TGI Friday's Restaurants:
     Henderson, Nevada                      -         (i)            -            -    1,973,551     -
     Independence, Missouri                 -         (i)            -            -    1,664,913     -
     Leawood, Kansas                        -         (i)            -            -    1,430,005     -
     Mesa, Arizona                          -         (i)            -            -    1,440,217     -
     Shawnee, Kansas                        -         (i)            -            -    1,748,685     -
     Temecula, California                   -         (i)            -            -    1,476,765     -
     Union City, California                 -         (i)            -            -    1,984,765     -

TGI Friday's/Redfish Looziana Roadhouse
     San Diego, California                  -         (i)    2,399,895            -    3,646,084     -

Wendy's Old Fashioned Hamburgers Restaur
     Carmel Mountain, California            -         (i)            -      594,856            -     -
     Knoxville, Tennessee                   -         (i)            -            -      463,995     -
     San Diego, California                  -         (i)            -            -      590,058     -
     Santa Maria, California                -         (i)            -            -      699,815     -
     Sevierville, Tennessee                 -         (i)            -            -      531,726     -
     Seymour, Tennessee                     -         (i)            -            -      472,670     -
                                                          -----------------------------------------------
     TOTAL:                                                  4,625,679   75,768,422   37,458,757     -
                                                          ===============================================



                                                          -----------------------------------------------
                                                    Total  303,965,128  247,279,757  207,360,606     -
                                                          ===============================================



        Gross Amount at Which                                                    Life on Which
      Carried at Close of Period                                                Depreciation in
 ---------------------------------                        Date                   Latest Income
          Building and                 Accumulated       of Con-        Date      Statement is
 Land     Improvements     Total       Depreciation     struction     Acquired     Computed
 ----     ------------     -----       ------------     ---------     --------     --------










     609,696      770,331    1,380,027           111,804      1991         8/98         (c)
     556,070      983,010    1,539,080           142,671      1995         8/98         (c)
     625,868      936,068    1,561,936           135,858      1996         8/98         (c)
     489,867    1,003,630    1,493,497           145,664      1993         8/98         (c)
     549,651      966,628    1,516,279           140,294      1994         8/98         (c)
     735,272      827,474    1,562,746           120,097      1992         8/98         (c)
     390,058      943,019    1,333,077           136,867      1997         8/98         (c)
     568,168      925,046    1,493,214           134,258      1998         8/98         (c)
     740,165      835,996    1,576,161           121,334      1995         8/98         (c)
     874,094      880,494    1,754,588           123,157      1997        12/96         (c)
     537,410    1,193,850    1,731,260             18553      1999         8/99         (c)
     603,828           (e)     603,828               (f)      1996         1/99         (f)
     778,321    1,153,535    1,931,856           123,827      1999        10/99         (c)


     508,994           (e)     508,994               (f)      1999        12/99         (f)
     230,720      455,946      686,666            68,500      1988         5/98         (c)
     648,459      655,353    1,303,812            69,314      1998         8/98         (c)
     326,788      391,270      718,058            51,481      1995         1/99         (c)
     338,486      497,282      835,768           104,913      1996         9/96         (c)
     226,428      414,175      640,603            33,364      1995         1/99         (c)
     266,606      421,780      688,386            33,977      1994         1/99         (c)
     248,277      368,959      617,235            29,722      1984         1/99         (c)
     586,476      606,850    1,193,326            81,855      1998        12/98         (c)
     441,770      594,458    1,036,228            62,873      1998         7/98         (c)
     483,868      576,483    1,060,351            77,658      1999        12/98         (c)
     708,710      546,363    1,255,074            53,426      1999        12/99         (c)
     434,130      618,352    1,052,482            60,100      2000         1/00         (c)
     312,670           (e)     312,670               (f)      1995         8/95         (f)
     363,478      404,650      768,128            73,008      1990         8/97         (c)
     277,986      490,143      768,128            88,433      1995         8/97         (c)
     270,539      488,818      759,357            39,377      1993         1/99         (c)
     439,935      677,335    1,117,269            71,515      2000        12/99         (c)
     228,364      539,764      768,128            97,385      1995         8/97         (c)
     273,325      413,077      686,402            74,528      1994         8/97         (c)
     268,545      485,160      753,705            87,534      1995         8/97         (c)
     235,996      452,008      688,004            36,412      1990         1/99         (c)
     320,924      463,347      784,271            84,883      1992         7/97         (c)
     421,481      633,406    1,054,887            70,966      1999         7/99         (c)
     242,777      398,029      640,806            32,064      1992         1/99         (c)
     463,047      592,539    1,055,586            64,330      1998         5/98         (c)
     196,251      443,976      640,226            36,998      1991         1/99         (c)
     412,516      673,289    1,085,805            86,288      1998         1/99         (c)
     322,412      371,694      694,106            48,906      1992         1/99         (c)
     504,327           (e)     504,327               (f)      1999        12/99         (f)
     733,180      665,895    1,399,075            84,149      1999         3/99         (c)
     498,403      701,467    1,199,871            75,992      1999         9/99         (c)
     522,786      289,350      812,136            39,400      1998        12/98         (c)


     449,010      728,259    1,177,269            75,126      1978        10/99         (c)
     679,830    1,041,258    1,721,088           107,414      1987        10/99         (c)
     419,238      848,874    1,268,112            87,568      1979        10/99         (c)
     543,966    1,131,838    1,675,804           116,758      1991        10/99         (c)
     573,069      468,307    1,041,376            48,310      1980        10/99         (c)
     537,805      778,410    1,316,215            62,705      1978        10/99         (c)
     601,418      760,181    1,361,599            61,237      1978        10/99         (c)
     591,206      770,392    1,361,599            62,059      1977        10/99         (c)
     647,562      869,687    1,517,248            89,715      1977        10/99         (c)
     488,663    1,141,844    1,630,506           117,791      1992        10/99         (c)
     664,403      852,845    1,517,248            87,978      1970        10/99         (c)
     567,083    1,176,715    1,743,798           121,388      1978        10/99         (c)
     686,927      674,672    1,361,599            54,349      1999        10/99         (c)
     375,257      734,314    1,109,571            75,751      1977        10/99         (c)
     614,512      630,952    1,245,464            65,088      1977        10/99         (c)
     518,276      591,047    1,109,323            60,971      1980        10/99         (c)
     586,045      718,306    1,304,351            74,099      1977        10/99         (c)


     373,239      873,481    1,246,720            93,055      1999         6/99         (c)
     346,699      829,363    1,176,062           100,215      1987         3/99         (c)
     501,566      920,312    1,421,878            56,661      1985         1/99         (c)
     273,460      903,170    1,176,630            92,947      1999         8/99         (c)
     624,303    1,027,724    1,652,027           126,389      1986         3/99         (c)


     714,194    1,302,733    2,016,927           249,516      1997         4/97         (c)
     768,333           (e)     768,333               (f)      1986         6/98         (f)
   1,433,543      835,463    2,269,006            69,622      2000         5/00         (c)
     900,038           (e)     900,038               (f)      1979         6/98         (f)
     794,255           (e)     794,255               (f)      1979         6/98         (f)
   1,433,543      835,463    2,269,006            69,622      2000         5/00         (c)
     665,141           (e)     665,141               (f)      1984         6/98         (f)
   1,460,179      901,042    2,361,220           136,452      1982         6/98         (c)
   1,077,645           (e)   1,077,645               (f)      1983         6/98         (f)
   1,019,248    1,789,742    2,808,991           129,259      2000        11/00         (c)
   1,038,598    1,523,346    2,561,944           156,284      1999        11/99         (c)
     908,502           (e)     908,502               (f)      1979         6/98         (f)
     832,557           (e)     832,557               (f)      1981         6/98         (f)
     779,387           (e)     779,387               (f)      1983         6/98         (f)
   1,075,230    1,502,305    2,577,535           129,347      1999         6/00         (c)
   1,305,939    1,030,685    2,336,624           156,085      1982         6/98         (c)
     886,048           (e)     886,048               (f)      1979         6/98         (f)
     693,453    1,072,916    1,766,369           116,233      1998        12/98         (c)
     756,750           (e)     756,750               (f)      1986         6/98         (f)
   1,585,461      874,143    2,459,604           132,379      1978         6/98         (c)
     692,093           (e)     692,093               (f)      1983         6/98         (f)
     885,111           (e)     885,111               (f)      1976         6/98         (f)
     741,286           (e)     741,286               (f)      1980         6/98         (f)
     789,680           (e)     789,680               (f)      1987        12/98         (f)




   1,023,054    1,275,135    2,298,188           138,140      1999         9/99         (c)
     799,092    1,233,091    2,032,183           132,282      1999        10/99         (c)


     679,384    1,028,766    1,708,150           108,281      1999        11/99         (c)
     744,764    1,082,896    1,827,660           133,341      1998         4/99         (c)
     411,977    1,804,357    2,216,334           140,870      1999         9/99         (c)
     404,881           (e)     404,881               (f)      1996        10/97         (f)


     774,448      507,587    1,282,034            97,283      1997         4/97         (c)
     532,814      801,222    1,334,035            11,269      1995         9/02         (c)
     440,026      475,931      915,957             6,827      1995         9/02         (c)
     353,608      606,470      960,078            98,461      1997         5/98         (c)
     667,992      661,776    1,329,768           119,482      1997         8/97         (c)
     566,562      403,730      970,292            66,874      1997         4/98         (c)
     885,567      648,755    1,534,322           115,329      1997         9/97         (c)
     570,003      900,291    1,470,294            12,608      1995         9/02         (c)
     515,827      572,706    1,088,532           100,218      1997        10/97         (c)
     473,596      586,377    1,059,974           107,497      1997         7/97         (c)
     526,092      504,483    1,030,575            88,280      1997        10/97         (c)
     521,918      410,245      932,163             5,884      1996         9/02         (c)
     651,867      775,634    1,427,501           142,193      1997         7/97         (c)
     234,685      589,367      824,052            97,476      1994         4/98         (c)


     543,095      552,491    1,095,586            56,852      1996         8/96         (c)
     217,079      858,549    1,075,628            97,975      1999         4/99         (c)
     680,192      526,711    1,206,903            54,200      1997         5/97         (c)
     769,842      376,964    1,146,806            38,790      1997         5/97         (c)
     917,717      713,170    1,630,887            73,387      1996         2/97         (c)
     349,582           (e)     349,582               (f)      1999         2/00         (f)
     323,106    1,219,165    1,542,270           154,177      1991         3/99         (c)
     650,112      600,335    1,250,447           137,879      1996         8/96         (c)
     233,468      689,696      923,164           135,931      1970        12/96         (c)
     308,272           (e)     308,272               (f)      1993         1/99         (f)
     360,438    1,062,531    1,422,969           134,369      1988         3/99         (c)
     448,745      626,866    1,075,610            80,223      1988         1/99         (c)
     775,925      458,838    1,234,763            58,025      1971         3/99         (c)
     273,353      718,493      991,846            90,862      1973         3/99         (c)
   1,211,346      741,406    1,952,753            76,292      1996         9/96         (c)
     546,261      658,946    1,205,207            67,807      1997         7/97         (c)
     625,123      958,670    1,583,793           121,234      1974         3/99         (c)
     500,000            -      500,000               (d)      2001        10/01         (d)
     424,416      822,399    1,246,814           105,247      1995         1/99         (c)
     416,548      762,244    1,178,792            48,502      1998         2/01         (c)
     375,952      820,967    1,196,919           103,820      1987         3/99         (c)
     348,663      701,825    1,050,488            81,202      1999         4/99         (c)


   1,259,828    1,623,073    2,882,901           201,217      1999         4/99         (c)
   1,372,280           (e)   1,372,280               (f)      1999        12/99         (f)
     986,426    1,680,312    2,666,738           284,706      1994        12/97         (c)
   1,463,644    1,874,198    3,337,842           232,349      1999         4/99         (c)
   1,122,087    2,017,496    3,139,583           250,114      1999         4/99         (c)
     938,162    1,681,670    2,619,832           284,718      1995        12/97         (c)
     869,178    1,309,759    2,178,937           162,374      1999         4/99         (c)
     844,185    1,425,740    2,269,926           176,753      1999         4/99         (c)
     984,259    1,103,690    2,087,949           136,827      1999         4/99         (c)
     945,234    1,475,339    2,420,573           249,785      1994        12/97         (c)
   1,239,264    1,490,392    2,729,656           184,768      1999         4/99         (c)
   1,725,325    1,574,207    3,299,532           195,159      1999         4/99         (c)
     570,815    1,536,290    2,107,105           190,458      1999         4/99         (c)
      88,077    2,019,028    2,107,105           250,304      1999         4/99         (c)
     963,047    1,505,671    2,468,718           254,920      1995        12/97         (c)
   1,156,847    1,188,272    2,345,119           155,461      1997        12/98         (c)
   1,032,271    1,074,834    2,107,105           133,250      1999         4/99         (c)
     960,779    1,365,563    2,326,342           212,410      1990         5/98         (c)
     956,799    2,692,320    3,649,119           333,774      1999         4/99         (c)
     470,047    1,541,280    2,011,327           191,076      1999         4/99         (c)
   1,495,716    1,674,517    3,170,232           207,594      1999         4/99         (c)
     869,408    1,548,972    2,418,380           192,030      1999         4/99         (c)
     878,358    1,449,034    2,327,392           179,641      1999         4/99         (c)
     844,918    1,712,340    2,557,257           212,283      1999         4/99         (c)


     528,118      340,297      868,415            73,131      1996        10/96         (c)


     788,248      209,449      997,697            45,379      1996         7/96         (c)


           -      595,741      595,741            41,430      1989         3/99         (c)


     495,195      937,060    1,432,255            18,833      1983         6/97         (c)
     346,380      869,587    1,215,967            34,266      1984         6/97         (c)
   1,485,631      772,853    2,258,484           144,815      1983         6/97         (c)
     389,394      676,711    1,066,105            26,683      1983         6/97         (c)
   1,131,164      719,865    1,851,029           127,970      1972         6/97         (c)
     840,525      465,154    1,305,679            48,821      1980         6/97         (c)
     311,196      606,403      917,599            23,911      1982         6/97         (c)
     618,125           (e)     618,125               (f)      1982         6/97         (f)
     436,867      757,874    1,194,740            29,883      1978         6/97         (c)


     642,483      581,759    1,224,242            61,693      1999        10/99         (c)


     219,702           (e)     219,702               (f)      1992         3/99         (f)
     361,025      572,098      933,123            72,348      1992         3/99         (c)
     457,851      454,566      912,417            57,485      1985         3/99         (c)
     392,818      664,851    1,057,669            84,078      1985         3/99         (c)
     400,847      901,367    1,302,214            95,010      1997         6/99         (c)
     155,398           (e)     155,398               (f)      1992         3/99         (f)
     539,650      670,448    1,210,098            76,890      1979         5/99         (c)
     644,889      991,991    1,636,880           119,643      1981         5/99         (c)
     307,292           (e)     307,292               (f)      1992         3/99         (f)
     450,010      760,630    1,210,640            91,552      1979         5/99         (c)
     466,555      506,094      972,649           123,707      1981         9/95         (c)
     318,979    1,013,110    1,332,089           122,822      1999         5/99         (c)
     528,090      625,653    1,153,743           152,932      1987         9/95         (c)
     397,302      665,948    1,063,250            15,368      1997         8/97         (c)
     414,731           (e)     414,731               (f)      1989         3/99         (f)
     555,232           (e)     555,232               (f)      1994         3/99         (f)


     464,957      178,078      643,035            32,646      1997         7/97         (c)
     633,691            -      633,691               (d)      1997         7/97         (d)


     485,013      586,758    1,071,771            21,620      1999         2/99         (c)


     440,812    1,039,283    1,480,095           128,843      1999         4/99         (c)
     456,629    1,170,630    1,627,259           166,801      1998         9/98         (c)
     384,221      643,854    1,028,074           157,381      1995         9/95         (c)
     359,455      653,853    1,013,308           158,008      1995        10/95         (c)
     426,349      805,517    1,231,866           119,853      1997         7/98         (c)
     848,133    1,008,678    1,856,811           134,271      1999         1/99         (c)
   1,031,098    1,092,939    2,124,037           261,081      1995        11/95         (c)
     806,377    1,086,502    1,892,879           124,779      1999         7/99         (c)
     576,548      934,918    1,511,466           166,200      1997         9/97         (c)
     349,227      699,756    1,048,983           172,989      1995         8/95         (c)
     546,078      993,149    1,539,227           146,205      1998         8/98         (c)
     601,296    1,344,016    1,945,312           166,253      1998         4/99         (c)
   1,043,108      977,508    2,020,616           230,792      1995        12/95         (c)
     564,242    1,056,315    1,620,557           155,504      1998         8/98         (c)
     161,390    1,028,945    1,190,335           174,341      1997        11/97         (c)
     569,664    1,017,781    1,587,445           152,658      1998         7/98         (c)
     364,536      865,147    1,229,683           148,990      1997        11/97         (c)
     601,394    1,194,533    1,795,926           126,224      1999         7/99         (c)
     587,601    1,393,436    1,981,038           147,370      1999        12/99         (c)
     595,717    1,094,345    1,690,062           109,733      1999        12/99         (c)
     320,880    1,155,880    1,476,760           152,149      1999         1/99         (c)
     590,538    1,176,436    1,766,974           196,062      1997         1/98         (c)
     743,544    1,276,290    2,019,835           132,587      1999        12/99         (c)
     377,108    1,116,904    1,494,012           134,948      1999         4/99         (c)
     615,554    1,184,073    1,799,628           210,492      1997         9/97         (c)
     541,264    1,173,738    1,715,002           208,655      1997         9/97         (c)
     684,351    1,258,835    1,943,186           131,507      1999        12/99         (c)
     409,153      943,712    1,352,865           165,141      1997        10/97         (c)
     479,197      954,051    1,433,248           193,452      1997         1/97         (c)
     374,230      838,342    1,212,572           158,346      1997         5/97         (c)
     428,841    1,031,457    1,460,298           174,766      1997        12/97         (c)
     395,839      887,540    1,283,379           140,519      1997         4/98         (c)
     570,004    1,271,666    1,841,669           166,301      1998        12/98         (c)
      67,157            -       67,157               (d)      2001         5/00         (d)
     322,433      987,385    1,309,818           168,558      1997        12/97         (c)
     657,606    1,347,285    2,004,890           177,378      1999         3/99         (c)
     626,999    1,130,692    1,757,691           240,121      1996         9/96         (c)
     718,003    1,202,177    1,920,181           129,827      1999        10/99         (c)
     825,650    1,161,192    1,986,842           266,995      1995         2/96         (c)
     665,172    1,080,114    1,745,285            91,272      2000         7/00         (c)
     705,094    1,305,383    2,010,477           141,794      1999         9/99         (c)
     303,633      970,489    1,274,123           180,611      1997         6/97         (c)


     405,631      884,954    1,290,585           154,745      1983        10/97         (c)
     282,099      534,632      816,731            93,487      1981        10/97         (c)
     693,733      810,458    1,504,190           141,719      1982        10/97         (c)
     371,254      685,847    1,057,101           118,024      1979        11/97         (c)
     451,235      548,178      999,412            95,856      1982        10/97         (c)
     287,331      712,081      999,412           124,516      1980        10/97         (c)
     388,699      793,475    1,182,173           138,749      1977        10/97         (c)
     728,574      793,410    1,521,984           138,738      1982        10/97         (c)
     436,471      659,089    1,095,560           115,250      1982        10/97         (c)
     627,680      804,399    1,432,079           140,659      1977        10/97         (c)


     493,536      619,786    1,113,322           110,179      1997         9/97         (c)


     215,567           (e)     215,567               (f)      1993         3/99         (f)
     336,696           (e)     336,696               (f)      1993         3/99         (f)
     324,298      420,017      744,315            53,116      1993         3/99         (c)
     256,050      476,149      732,198            60,214      1993         3/99         (c)
     173,386           (e)      173,38                (f)      1993         3/99         (f)


     846,183      595,601    1,441,783           110,843      1972         6/97         (c)
     817,039      648,765    1,465,804           115,331      1976         6/97         (c)
   1,181,460      908,880    2,090,340           169,145      1974         6/97         (c)


     632,811    1,135,312    1,768,123           135,831      1997         4/99         (c)
     540,896    1,196,239    1,737,135           123,293      1999        10/99         (c)
     375,987      964,430    1,340,417           129,824      1997        12/98         (c)
     567,462           (e)     567,462               (f)      1997         8/99         (f)
     501,388      746,474    1,247,862           111,757      1997         9/98         (c)
     565,639      923,669    1,489,308           113,666      1998         4/99         (c)
     416,279      867,972    1,284,251           117,077      1998        12/98         (c)
     476,847      961,606    1,438,453           125,806      1998        12/98         (c)
   1,407,002           (e)   1,407,002               (f)      1996         6/97         (f)
     545,112    1,029,900    1,575,012           138,637      1996        12/98         (c)
     645,365      790,258    1,435,624            83,582      1996         7/97         (c)
     512,481      831,202    1,343,683           118,285      1998         9/98         (c)
     380,687      775,713    1,156,399           110,389      1997         9/98         (c)
     460,167      744,128    1,204,295            78,703      1997         8/97         (c)
     665,015      580,798    1,245,813           109,626      1994         5/97         (c)
     593,624      918,024    1,511,648           120,189      1997        12/98         (c)
     488,259           (e)     488,259               (f)      1997         8/97         (f)
     647,414      871,268    1,518,683           116,885      1998        12/98         (c)
     668,112      941,796    1,609,907           115,897      1998         4/99         (c)
     382,950      957,912    1,340,862           125,323      1997        12/98         (c)
     504,533      806,624    1,311,157           119,649      1996         7/98         (c)
     387,562      891,943    1,279,505           120,148      1997        12/98         (c)
     282,868      843,648    1,126,517           113,180      1997        12/98         (c)
     579,175    1,176,434    1,755,609           153,912      1997        12/98         (c)
     765,743      652,671    1,418,413            69,030      1997         7/97         (c)
     319,237           (e)     319,237               (f)      1997         8/97         (f)


     944,585      689,363    1,633,948           128,292      1971         6/97         (c)


     711,642      726,339    1,437,981            92,384      1999         3/99         (c)
     605,063      623,222    1,228,286            65,915      1998         8/98         (c)
     419,488      697,861    1,117,349           125,910      1997         8/97         (c)
     457,821      708,581    1,166,402            73,290      1999        10/99         (c)
     481,456      636,588    1,118,043            88,648      1998         9/98         (c)
     604,724      600,686    1,205,411            73,582      1999         4/99         (c)
     361,238      711,595    1,072,833           126,500      1997         9/97         (c)
     396,864      576,370      973,234            60,542      1997         9/97         (c)
     369,886      467,819      837,706            49,479      1997         3/97         (c)
     124,468      773,506      897,973           141,703      1997         7/97         (c)
     389,265      779,211    1,168,476           127,597      1997         2/98         (c)
     635,343      652,472    1,287,815            67,100      1997         9/97         (c)
     482,309      716,199    1,198,508            77,953      1999         8/99         (c)
     286,850      606,547      893,397           109,432      1997         8/97         (c)
     499,875      866,353    1,366,228            89,078      1999        12/99         (c)
     404,270      831,716    1,235,986            81,681      1999        12/99         (c)
     284,046      549,495      833,541            58,118      1998         5/98         (c)
     699,776      864,724    1,564,500            90,967      1999         9/99         (c)
     537,223      592,536    1,129,759           113,490      1997         4/97         (c)
     545,485      527,020    1,072,504           120,039      1996         3/96         (c)
     375,776      643,445    1,019,221           135,750      1996         9/96         (c)
     403,002      610,815    1,013,817           128,945      1996         9/96         (c)
     370,342      548,107      918,449           103,456      1997         5/97         (c)
     420,521      543,338      963,859           101,049      1997         6/97         (c)
     437,667      591,877    1,029,544           124,947      1996         9/96         (c)
     272,937      653,792      926,729            69,149      1998         4/98         (c)
     899,898      733,701    1,633,599            91,227      1999         4/99         (c)
     737,038      553,688    1,290,725            58,561      1997         4/97         (c)
     730,674      547,445    1,278,120            57,901      1997         4/97         (c)
     740,616      678,189    1,418,805           114,822      1997         9/97         (c)
     911,754      531,018    1,442,772            54,610      1997         5/97         (c)
     853,821      602,301    1,456,122            61,941      1998         5/98         (c)
     418,351      651,064    1,069,415            90,663      1998         9/98         (c)
     363,967      776,605    1,140,572            99,984      1999         2/99         (c)
     217,851      751,664      969,515           143,968      1992         4/97         (c)
     383,591      643,055    1,026,645            67,683      1998         5/98         (c)
     771,241      793,229    1,564,471            99,063      1999         4/99         (c)
     387,533      787,843    1,175,376            97,959      1999         4/99         (c)
     681,663      642,924    1,324,587           117,783      1997         7/97         (c)
     631,275      567,912    1,199,187           107,194      1997         5/97         (c)
     496,689      721,614    1,218,303            89,526      1999         4/99         (c)
     717,246      657,685    1,374,931            69,560      1998         6/98         (c)
     474,296      727,491    1,201,787            74,815      1998         9/98         (c)
     501,168      699,067    1,200,235            73,790      1999         6/99         (c)
     274,362      781,797    1,056,159            99,438      1999         3/99         (c)
     311,466      700,979    1,012,445            86,966      1999         4/99         (c)
     475,748      719,239    1,194,987            75,985      1999         9/99         (c)
     495,529      759,800    1,255,329            93,709      1999         4/99         (c)
     353,396      904,688    1,258,084           121,678      1999        12/98         (c)
     289,257      699,525      988,782            85,317      1999         5/99         (c)
     477,580      538,255    1,015,835            56,929      1998         4/98         (c)
     464,986      785,149    1,250,136            96,465      1999         3/99         (c)
     523,089      617,131    1,140,221           109,627      1997         9/97         (c)
     358,130      668,383    1,026,513           116,878      1997        10/97         (c)


     745,752    1,551,697    2,297,449           146,549      1999         1/00         (c)
     370,963    1,406,532    1,777,495           135,770      1999         2/00         (c)


   1,089,268      931,637    2,020,905           115,497      1999         4/99         (c)


     251,187      737,672      988,859            87,348      1982         6/99         (c)


     181,290      463,414      644,705            18,996      2000         8/00         (c)
     158,829      491,957      650,785            47,669      1991         5/99         (c)
     310,574      532,557      843,132            51,240      1992         5/99         (c)
     205,795      564,058      769,853            54,666      1995         5/99         (c)
     315,037      541,553      856,591            52,113      1991         5/99         (c)
     301,723           (e)     301,723               (f)      1997         7/97         (f)


     340,115      687,423    1,027,537            72,561      2000        12/99         (c)
     445,493      594,649    1,040,141            72,734      1994         3/99         (c)
     190,146      614,193      804,339            52,889      2000         5/00         (c)
     311,103      506,943      818,045            53,511      2000        12/99         (c)
     255,500      561,315      816,815            54,572      1999        12/99         (c)


     376,929      639,875    1,016,804           152,773      1995        11/95         (c)
     665,422      481,311    1,146,733           101,544      1996         9/96         (c)


   6,288,001            -    6,288,001               (f)      2001         9/98         (f)
     360,878            -      360,878               (f)      2001         9/98         (f)


     615,498            -      615,498                 -      1986         9/02         (c)


     242,239            -      242,239               (d)      1989         1/96         (d)
     212,053            -      212,053               (d)      1986         5/96         (d)
     209,432            -      209,432               (d)      1978         5/96         (d)
     174,721            -      174,721               (d)      1975         1/96         (d)
     120,449            -      120,449               (d)      1986         5/96         (d)
     190,009      410,096      600,105            40,390      1996         3/97         (c)
     200,442            -      200,442               (d)      1985         1/96         (d)
     135,831      191,595      327,426            18,871      1992         2/97         (c)
     187,082      533,487      720,569            52,543      1990         3/97         (c)
     226,163            -      226,163               (d)      1987         1/96         (d)
     116,849            -      116,849               (d)      1978         1/96         (d)
     126,494            -      126,494               (d)      1986         1/96         (d)
     267,703      128,483      396,187             9,636      1998        10/00         (c)
     215,881            -      215,881               (d)      1990         5/96         (d)
     242,239            -      242,239               (d)      1977         1/96         (d)
     194,012            -      194,012               (d)      1986         1/96         (d)
     202,050            -      202,050               (d)      1983         1/96         (d)
     212,093            -      212,093               (d)      1978         5/96         (d)
     180,803            -      180,803               (d)      1978         5/96         (d)
      99,166            -       99,166               (d)      1994         1/96         (d)
     161,249      234,940      396,188            17,620      1980        10/00         (c)
     169,454            -      169,454               (d)      1986         5/96         (d)
     202,552            -      202,552               (d)      1980         4/96         (d)
     216,518            -      216,518               (d)      1975         1/96         (d)
     213,090      635,104      848,194            62,552      1989         3/97         (c)
      99,815            -       99,815               (d)      1986         5/96         (d)
     152,215            -      152,215               (d)      1994         1/96         (d)
     223,981      442,758      666,739            43,607      1983         3/97         (c)
     149,206      388,321      537,527            38,246      1975         3/97         (c)
     259,922            -      259,922               (d)      1976         1/96         (d)
     261,529            -      261,529               (d)      1993         1/96         (d)
     142,570            -      142,570               (d)      1977         1/96         (d)
      99,733            -       99,733               (d)      1991         5/96         (d)
     259,922            -      259,922               (d)      1978         1/96         (d)
     239,023            -      239,023               (d)      1983         1/96         (d)
     228,199      475,421      703,620            46,824      1983         3/97         (c)
     186,476            -      186,476               (d)      1976         4/96         (d)
     197,227            -      197,227               (d)      1978         1/96         (d)
     208,480            -      208,480               (d)      1975         1/96         (d)
     176,170            -      176,170               (d)      1985         1/96         (d)
     128,604            -      128,604               (d)      1988         4/96         (d)
     279,779      562,521      842,300            55,403      1983         3/97         (c)
           -      178,187      178,187            34,873      1979         3/97         (c)
     167,170      168,363      335,533            32,950      1980         3/97         (c)


     852,746    1,108,491    1,961,237           154,058      1994         9/98         (c)
     712,865      873,395    1,586,260           121,385      1993         9/98         (c)
     397,878      923,975    1,321,852           128,414      1996         9/98         (c)
     435,465      915,232    1,350,697           127,199      1994         9/98         (c)
     654,766    1,195,901    1,850,667           170,402      1994         9/98         (c)
     911,013    1,011,766    1,922,779           144,165      1993         9/98         (c)
   1,244,893      918,257    2,163,149           123,189      1994        12/98         (c)
     918,258      764,150    1,682,408           108,883      1995         9/98         (c)


     181,153      561,582      742,735            60,159      1980        10/99         (c)
     691,797    1,136,902    1,828,699           169,263      1997         4/98         (c)
     379,675      604,449      984,124            64,750      1999        10/99         (c)
     714,789    1,317,317    2,032,106           117,095      2000         5/00         (c)
     599,391    1,159,989    1,759,380           158,797      1998        11/98         (c)
     637,984      824,276    1,462,260            88,299      1980        10/99         (c)
     129,816      659,340      789,156            70,631      1988        10/99         (c)
     214,177      853,505    1,067,682            91,430      1979        10/99         (c)
     366,941      524,341      891,282            56,169      1999        10/99         (c)


     113,780      407,429      521,209            56,625      1998         9/98         (c)
     158,880      378,057      536,937            54,111      1998         9/98         (c)


     514,900      936,376    1,451,276            70,419      1995         8/97         (c)


     721,887           (e)     721,887               (f)      1999         1/00         (f)


     934,922    1,842,623    2,777,545           228,435      1999         4/99         (c)


     914,103      691,171    1,605,274            86,875      1999         2/99         (c)
   1,227,973      761,806    1,989,779            63,484      2000         3/00         (c)
   1,370,391      946,608    2,317,000           113,953      1999         4/99         (c)
     894,077    1,038,617    1,932,694            78,602      1999        11/99         (c)
   1,151,865      910,321    2,062,187            98,265      1999        10/99         (c)
     649,962      978,307    1,628,269           104,978      1999        10/99         (c)
     394,026    1,442,752    1,836,779           195,397      1998        12/98         (c)
   1,313,730      887,733    2,201,463            86,292      1999         2/00         (c)
     927,463      691,228    1,618,691            63,778      1978         2/99         (c)
   1,207,143    1,091,507    2,298,651           107,973      1999         1/00         (c)
     608,698      903,887    1,512,584            75,324      1998         7/00         (c)
     908,635    1,084,536    1,993,171            78,328      2000        11/00         (c)
     703,734    1,053,632    1,757,366            70,242      2000         4/00         (c)


     889,562      487,475    1,377,037            90,720      1997         6/97         (c)


     416,311      963,488    1,379,799           101,540      1999        11/99         (c)
     505,639           (e)     505,639               (f)      1999         3/00         (f)
     696,078    1,005,509    1,701,587           112,285      1999         7/99         (c)
     715,220    1,012,777    1,727,997           117,579      1999         7/99         (c)
     556,515    1,132,988    1,689,503           118,775      1999        11/99         (c)
     518,832           (e)     518,832               (f)      1999         5/99         (f)
     980,703           (e)     980,703               (f)      1999         3/99         (f)
     633,404           (e)     633,404               (f)      1999         2/00         (f)
     574,441      742,781    1,317,222           102,022      1998        11/98         (c)
     430,741           (e)     430,741               (f)      1999         1/00         (f)
     354,415           (e)     354,415               (f)      1997        11/97         (f)
     719,563           (e)     719,563               (f)      1999         4/99         (f)
     545,612      868,606    1,414,218           130,175      1998         7/98         (c)
     536,564    1,267,552    1,804,116           119,713      1999         1/00         (c)


     965,223      549,565    1,514,788           102,276      1977         6/97         (c)
   1,076,442    1,062,751    2,139,194           199,136      1996         6/97         (c)


     591,371    1,175,273    1,766,643           236,542      1996         1/97         (c)


     705,522      626,845    1,332,367           127,105      1996        12/96         (c)


   1,200,000            -    1,200,000                 -      1992         2/02         (c)
     900,000            -      900,000                 -      1991         2/02         (c)


     628,688      962,524    1,591,211           146,928      1981         6/98         (c)
     371,021      593,171      964,191            90,547      1994         6/98         (c)
     585,461      812,822    1,398,282           124,076      1990         6/98         (c)
     527,572      870,710    1,398,282           132,913      1988         6/98         (c)
     734,105      961,287    1,695,392           146,739      1986         6/98         (c)
     634,379      643,323    1,277,701            98,202      1981         6/98         (c)
     263,022           (e)     263,022               (f)      1999        12/99         (f)
     498,746           (e)     498,746               (f)      1978         7/99         (f)


     378,786      388,489      767,275            78,774      1996         9/96         (c)


   1,006,396      690,731    1,697,127           104,603      1979         6/98         (c)
     715,432           (e)     715,432               (f)      1993         6/98         (f)
     802,361           (e)     802,361               (f)      1973         6/98         (f)
     590,733           (e)     590,733               (f)      1993         6/98         (f)
     670,594           (e)     670,594               (f)      1976         6/98         (f)
     964,354           (e)     964,354               (f)      1973         6/98         (f)
     776,694           (e)     776,694               (f)      1972         6/98         (f)
     641,125           (e)     641,125               (f)      1974         6/98         (f)
     670,491           (e)     670,491               (f)      1977         6/98         (f)
     684,164           (e)     684,164               (f)      1969         6/98         (f)
     810,316      798,412    1,608,728           107,476      1979        12/98         (c)
     592,342           (e)     592,342               (f)      1988         6/98         (f)
     594,142           (e)     594,142               (f)      1974         6/98         (f)
     933,759      763,368    1,697,127           115,603      1985         6/98         (c)
     740,132           (e)     740,132               (f)      1984        12/98         (f)
     922,679      725,256    1,647,936           109,832      1978         6/98         (c)
     354,419           (e)     354,419               (f)      1978         6/98         (f)
     433,713           (e)     433,713               (f)      1969         6/98         (f)


     376,905      692,124    1,069,028            84,063      1981         3/99         (c)


     447,458      383,785      831,243            48,204      1994         2/99         (c)
     299,870           (e)     299,870               (f)      1994         2/99         (f)
     212,438           (e)     212,438               (f)      1998        10/98         (f)
     402,947           (e)     402,947               (f)      1994         2/99         (f)
     404,578      451,129      855,707            56,662      1994         2/99         (c)
     474,588      478,974      953,562            60,160      1994         2/99         (c)
     349,637           (e)     349,637               (f)      1991        10/98         (f)
     308,915      351,160      660,075            49,162      1991        10/98         (c)
     339,250      490,895      830,145            11,684      2000         5/00         (c)
     343,906           (e)     343,906               (f)      1994         2/99         (f)


     276,949      550,355      827,305            44,927      2000         8/00         (c)
     335,174      694,862    1,030,036            77,852      1997         7/99         (c)
     355,763      496,898      852,661            44,169      2000         4/00         (c)


     505,551      806,059    1,311,610            83,855      1999        12/99         (c)
     538,204    1,149,066    1,687,270            86,883      2000         9/00         (c)
     656,917    1,208,688    1,865,605           113,344      1999         3/00         (c)
     582,062    1,085,290    1,667,352            99,818      2000         5/00         (c)
     520,037    1,074,176    1,594,213            89,515      2000         6/00         (c)
     664,266      987,133    1,651,400            85,067      2000         5/00         (c)
     596,439    1,078,721    1,675,160            45,267      2000        11/00         (c)
     235,195    1,115,831    1,351,026           113,523      1999        12/99         (c)
     560,423    1,032,294    1,592,717           108,698      1999         9/99         (c)
     713,534      995,529    1,709,064           104,281      1998        11/99         (c)


     967,242    1,726,827    2,694,069           165,453      1999         2/00         (c)
   1,385,425           (e)   1,385,425               (f)      1999        10/99         (f)
     856,278           (e)     856,278               (f)      1999         3/99         (f)
   2,459,048           (e)   2,459,048               (f)      2000         6/00         (f)
     914,342           (e)     914,342               (f)      1997         5/98         (f)
     884,743           (e)     884,743               (f)      1999         3/00         (f)
   1,239,565           (e)   1,239,565               (f)      1999        12/99         (f)
   1,213,121           (e)   1,213,121            13,552      1999         4/00         (c)


     744,126    1,221,749    1,965,875           101,812      1994         5/99         (c)


     370,667      431,642      802,309            75,478      1981        10/97         (c)
     422,489      528,849      951,338            92,476      1981        10/97         (c)


     548,886      700,855    1,249,741            97,405      1994         9/98         (c)
     618,372      631,369    1,249,741            87,748      1994         9/98         (c)


     511,811      756,304    1,268,115            78,019      1989        10/99         (c)


     485,625      705,993    1,191,618            57,958      2000         7/00         (c)
     640,066      688,918    1,328,984           149,171      1996         7/96         (c)
     358,027      444,622      802,649            96,275      1996         5/96         (c)
     555,813      442,025      997,838            64,155      1998         8/98         (c)
     489,097      735,631    1,224,728            77,516      1999         9/99         (c)
     841,374      699,082    1,540,456           108,740      1998         5/98         (c)
---------------------------------------------------------
 298,631,152  340,405,076  639,036,228 43,688,187
=========================================================








     708,297    1,008,108    1,716,405    139,294             1998        11/98         (c)
=========================================================







        (e)          (e)          (e)         (g)             1996         2/99         (g)
        (e)          (e)          (e)         (f)             1996         1/99         (f)
        (e)          (e)          (e)         (g)             1995         8/98         (g)


        (e)          (e)          (e)         (f)             1999        12/99         (f)
        (e)          (e)          (e)         (f)             1995         8/95         (f)
        (h)          (e)          (e)         (f)             1978        12/99         (f)
        (h)          (e)          (e)         (f)             1999        12/99         (f)
        (e)          (e)          (e)         (f)             1999        12/99         (f)


        (e)          (e)          (e)         (f)             1986         6/98         (f)
        (e)          (e)          (e)         (f)             1979         6/98         (f)
        (e)          (e)          (e)         (f)             1979         6/98         (f)
        (e)          (e)          (e)         (f)             1984         6/98         (f)
        (e)          (e)          (e)         (f)             1983         6/98         (f)
        (e)          (e)          (e)         (f)             1979         6/98         (f)
        (e)          (e)          (e)         (f)             1981         6/98         (f)
        (e)          (e)          (e)         (f)             1983         6/98         (f)
        (e)          (e)          (e)         (f)             1979         6/98         (f)
        (e)          (e)          (e)         (f)             1986         6/98         (f)
        (e)          (e)          (e)         (f)             1983         6/98         (f)
        (e)          (e)          (e)         (f)             1976         6/98         (f)
        (e)          (e)          (e)         (f)             1980         6/98         (f)
        (e)          (e)          (e)         (g)             1982         6/98         (g)
        (e)          (e)          (e)         (f)             1987        12/98         (f)


        (h)          (e)          (e)         (f)             1994         8/99         (f)
        (h)          (e)          (e)         (f)             1991         3/97         (f)
        (h)          (e)          (e)         (f)             1974         8/97         (f)
        (e)          (e)          (e)         (f)             1996        10/97         (f)


        (e)          (e)          (e)         (f)             1999         2/00         (f)
        (e)          (e)          (e)         (f)             1993         1/99         (f)
        (h)          (e)          (e)         (f)             1996         1/99         (f)
        (h)          (e)          (e)         (f)             1985         1/99         (f)


        (e)          (e)          (e)         (f)             1999        12/99         (f)


        (h)          (e)          (e)         (f)             1991        10/97         (f)


        (e)          (e)          (e)         (f)             1982         6/97         (f)
        (e)          (e)          (e)         (g)             1992         3/99         (g)
        (e)          (e)          (e)         (f)             1992         3/99         (f)
        (e)          (e)          (e)         (f)             1992         3/99         (f)
        (e)          (e)          (e)         (f)             1992         3/99         (f)
        (e)          (e)          (e)         (f)             1989         3/99         (f)
        (e)          (e)          (e)         (f)             1994         3/99         (f)


        (h)          (e)          (e)         (f)             1996         3/97         (f)


        (e)          (e)          (e)         (f)             1993         3/99         (f)
        (e)          (e)          (e)         (f)             1993         3/99         (f)
        (e)          (e)          (e)         (f)             1993         3/99         (f)


        (h)          (e)          (e)         (f)             1972         5/99         (f)
        (h)          (e)          (e)         (f)             1997        10/98         (f)
        (h)          (e)          (e)         (f)             1997        10/99         (f)
        (h)          (e)          (e)         (f)             1998        12/99         (f)
        (h)          (e)          (e)         (f)             1998         1/00         (f)
        (h)          (e)          (e)         (f)             1997         8/99         (f)
        (h)          (e)          (e)         (f)             1996        11/98         (f)
        (e)          (e)          (e)         (g)             1997         5/99         (g)
        (h)          (e)          (e)         (f)             1997         9/99         (f)
        (h)          (e)          (e)         (f)             1997         3/99         (f)
        (e)          (e)          (e)         (f)             1996         6/97         (f)
        (h)          (e)          (e)         (f)             1997         7/99         (f)
        (h)          (e)          (e)         (f)             1998         1/00         (f)
        (e)          (e)          (e)         (f)             1997         8/97         (f)
        (e)          (e)          (e)         (g)             1997        12/98         (g)
        (h)          (e)          (e)         (f)             1998        11/99         (f)
        (h)          (e)          (e)         (f)             1998         4/99         (f)
        (h)          (e)          (e)         (f)             1997         9/99         (f)
        (h)          (e)          (e)         (f)             1997         4/99         (f)
        (h)          (e)          (e)         (f)             1997         6/99         (f)
        (h)          (e)          (e)         (f)             1998         8/99         (f)
        (e)          (e)          (e)         (f)             1997         8/97         (f)
        (h)          (e)          (e)         (f)             1997         4/99         (f)
        (h)          (e)          (e)         (f)             1997         8/99         (f)


        (e)          (e)          (e)         (g)             1987         6/99         (i)
        (e)          (e)          (e)         (f)             1996         5/99         (f)
        (e)          (e)          (e)         (f)             1997         7/97         (f)


        (e)          (e)          (e)         (g)             1996        12/96         (g)


        (e)          (e)          (e)         (g)             1997         9/97         (g)


        (e)          (e)          (e)         (f)             1999         1/00         (f)


        (e)          (e)          (e)         (f)             1999         3/00         (f)
        (e)          (e)          (e)         (f)             1999         5/99         (f)
        (e)          (e)          (e)         (f)             1999         3/99         (f)
        (e)          (e)          (e)         (f)             1999         2/00         (f)
        (e)          (e)          (e)         (f)             1999         1/00         (f)
        (e)          (e)          (e)         (f)             1997        11/97         (f)
        (h)          (e)          (e)         (f)             1999        10/99         (f)
        (e)          (e)          (e)         (f)             1999         4/99         (f)
        (h)          (e)          (e)         (f)             1999         6/99         (f)
        (h)          (e)          (e)         (f)             1999         9/99         (f)
        (e)          (e)          (e)         (g)             1999         7/99         (g)


        (e)          (e)          (e)         (f)             1999        12/99         (f)
        (e)          (e)          (e)         (f)             1978         7/99         (f)


        (e)          (e)          (e)         (f)             1993         6/98         (f)
        (e)          (e)          (e)         (f)             1973         6/98         (f)
        (e)          (e)          (e)         (f)             1993         6/98         (f)
        (e)          (e)          (e)         (f)             1976         6/98         (f)
        (e)          (e)          (e)         (f)             1973         6/98         (f)
        (e)          (e)          (e)         (f)             1972         6/98         (f)
        (e)          (e)          (e)         (f)             1974         6/98         (f)
        (e)          (e)          (e)         (f)             1977         6/98         (f)
        (e)          (e)          (e)         (f)             1969         6/98         (f)
        (e)          (e)          (e)         (f)             1988         6/98         (f)
        (e)          (e)          (e)         (f)             1974         6/98         (f)
        (e)          (e)          (e)         (f)             1984        12/98         (f)
        (e)          (e)          (e)         (f)             1978         6/98         (f)
        (e)          (e)          (e)         (f)             1969         6/98         (f)


        (e)          (e)          (e)         (f)             1994         2/99         (f)
        (e)          (e)          (e)         (f)             1998        10/98         (f)
        (e)          (e)          (e)         (f)             1994         2/99         (f)
        (e)          (e)          (e)         (f)             1991        10/98         (f)
        (e)          (e)          (e)         (f)             1994         2/99         (f)


        (h)          (e)          (e)         (f)             1998         2/99         (f)


        (e)          (e)          (e)         (f)             1999        10/99         (f)
        (e)          (e)          (e)         (f)             1999         3/99         (f)
        (e)          (e)          (e)         (f)             2000         6/00         (f)
        (e)          (e)          (e)         (f)             1997         5/98         (f)
        (e)          (e)          (e)         (f)             1999         3/00         (f)
        (e)          (e)          (e)         (f)             1999        12/99         (f)
        (e)          (e)          (e)         (f)             1999         4/00         (f)


        (e)          (e)          (e)         (g)             1998         3/99         (g)


        (h)          (e)          (e)         (f)             1997        10/98         (f)
        (h)          (e)          (e)         (f)             1998         9/98         (f)
        (h)          (e)          (e)         (f)             1996        12/96         (f)
        (h)          (e)          (e)         (f)             2000         4/00         (f)
        (h)          (e)          (e)         (f)             1996         6/96         (f)
        (h)          (e)          (e)         (f)             1998        10/98         (f)
-

=



---------------------------------------------------------
 299,339,449  341,413,184  640,752,633 43,827,481
=========================================================

</TABLE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
        NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED DEPRECIATION
                                December 31, 2002


(a)      Transactions in real estate and accumulated  depreciation  during 2002,
         2001 and 2000 are summarized below. The balances in 2001, 2000 and 1999
         have been  adjusted  to  reflect  the  reclassification  of  properties
         accounted for as discontinued operations.
<TABLE>
<CAPTION>



                                                                      Cost           Accumulated
                                                                     (b)(j)          Depreciation
                                                                -----------------   ----------------

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

                   Balance, December 31, 1999                      $ 600,074,313      $  9,775,814
                   Acquisitions                                       61,797,816                --
                   Dispositions                                      (20,170,059 )        (963,447  )
                   Depreciation expense (c)                                   --        12,242,000
                                                                -----------------   ----------------

                   Balance, December 31, 2000                        641,702,070        21,054,367
                   Acquisitions                                        1,678,792                --
                   Dispositions                                      (12,663,443 )        (642,041  )
                   Depreciation expense (c)                                   --        12,138,000
                                                                -----------------   ----------------

                   Balance, December 31, 2001                        630,717,419        32,550,326
                   Acquisitions                                        7,089,952                --
                   Dispositions                                       (2,425,640 )         (97,139  )
                   Reclassifications from direct financing
                      leases                                           3,654,497                --
                   Depreciation expense (c)                                   --        11,235,000
                                                                -----------------   ----------------
                   Balance December 31, 2002                       $ 639,036,228      $ 43,688,187
                                                                =================   ================

              Property of Joint Venture in Which the Company has a 59.22%
                Interest and has Invested in Under an Operating Lease:

                   Balance, December 31, 1999                       $  1,716,405       $    38,483
                   Depreciation expense                                       --            33,604
                                                                -----------------   ----------------

                   Balance, December 31, 2000                          1,716,405            72,087
                   Depreciation expense                                       --            33,603
                                                                -----------------   ----------------

                   Balance, December 31, 2001                          1,716,405           105,690
                   Depreciation Expense                                       --            33,604
                                                                -----------------   ----------------
                   Balance, December 31, 2002                       $  1,716,405       $   139,294
                                                                =================   ================

</TABLE>

(b)      As of December  31,  2002,  2001 and 2000,  the  aggregate  cost of the
         properties owned by the Company and its subsidiaries for federal income
         tax purposes was $657.3  million,  $745.3  million and $870.9  million,
         respectively. Substantially, all of the leases are treated as operating
         leases for federal income tax purposes.

(c)      Depreciation  expense is computed for buildings and improvements  based
         upon estimated lives of 30 years.






<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED
                                December 31, 2002


(d)      The  building  portion  of  this  property  is  owned  by  the  tenant;
         therefore, depreciation is not applicable.

(e)      For  financial  reporting  purposes,  certain  components  of the lease
         relating  to land  and/or  building  have  been  recorded  as a  direct
         financing  lease.  Accordingly,  costs relating to these  components of
         this lease are not shown.

(f)      For financial reporting purposes, the portion of this lease relating to
         the building has been recorded as direct  financing  lease. The cost of
         the building has been included in net  investment  in direct  financing
         leases; therefore, depreciation is not applicable.

(g)      For financial reporting  purposes,  the lease for the land and building
         has been recorded as 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.

(h)      The Company  owns the building  only  relating to this  property.  This
         property  is  subject  to a ground  lease  between  the  tenant  and an
         unaffiliated third party. In connection therewith,  the Company entered
         into either a tri-party  agreement with the tenant and the owner of the
         land or an assignment of interest in the ground lease with the landlord
         of the land.  The  tri-party  agreement or  assignment of interest each
         provide that the tenant is responsible  for all  obligations  under the
         ground lease and provide  certain rights to the Company to help protect
         its  interest  in the  building in the event of a default by the tenant
         under the terms of the ground lease.

(i)      The property is encumbered at December 31, 2002.

(j)      For  financial  reporting  purposes,  the  undepreciated  cost  of  the
         following  properties was written down to its net realizable  value due
         to an  anticipated  impairment  in value.  The Company  recognized  the
         impairments  by recording an  allowance  for loss on land,  building or
         investment in direct  financing  lease in the amounts  listed below for
         each property as of December 31, 2002. The  impairments at December 31,
         2002 represent the difference  between the properties'  carrying values
         and the property  manager's estimate of the net realizable value of the
         properties  based upon  anticipated  sales prices to  interested  third
         parties.  The cost of the properties  presented on this schedule is the
         gross amount at which the properties were carried at December 31, 2002,
         excluding the allowances for loss.



<PAGE>


                       CNL AMERICAN PROPERTIES FUND, INC.
                                AND SUBSIDIARIES
               NOTES TO SCHEDULE III - REAL ESTATE AND ACCUMULATED
                            DEPRECIATION - CONTINUED
                                December 31, 2002

(j)      (continued)

         The following are a list of  properties  and the related  impairment at
         December 31, 2002:

                                                                 Total
                                                            -----------------

             Denny's - Shawnee , OK                              $   326,661
             Boston Market - St. Joseph , MO                         143,132
             Denny's - Tampa , FL                                    287,043
             Pizza Hut - Weirton , WV                                108,163
             Darryl's - Richmond , VA                                193,688
             Houlihan's - Langhorne , PA                             616,693
             Darryl's - Winston-Salem , NC                           564,857
             Darryl's - Raleigh , NC                                 641,056
             Boston Market - Newport News , VA                       202,476
             Darryl's - Montgomery , AL                              436,392
             Darryl's - Huntsville , AL                               13,230
             Darryl's - Raleigh , NC                                 172,363
             Darryl's - Nashville , TN                                35,935
             Roadhouse Grill - Pensacola , FL                        804,913
             Black-eyed Pea - Glendale , AZ                          380,415
             Black-eyed Pea - Grapevine , TX                         873,196
             Black-eyed Pea - Fort Worth , TX                        312,735
             Big Boy - Woodson Terrace , MO                          190,000
             Big Boy - Fenton , MO                                   150,000
             Big Boy - Columbia , MO                                 133,333
             Big Boy - Collinsville , IL                             150,000
             Big Boy - Sedalia , MO                                  189,914
             Big Boy - Bridgeton , MO                                150,000
             Big Boy - N. Kansas City , MO                           190,000
             Big Boy - Lee's Summit , MO                             189,769
             Big Boy - Blue Springs , MO                             160,588
             Big Boy - Merriam , KS                                  183,425
             Hardee's - Petal , MS                                    98,457
             Big Boy - Crystal City , MO                             133,333
             Big Boy - Arnold , MO                                   190,000
             Chevys Fresh Mex - Brandon , FL                         159,755
             Chevys Fresh Mex - Olathe , KS                          276,466
             Rio Bravo Fresh Mex - Morrow , GA                       475,017
             Chevys Fresh Mex - Auburn Hills , MI                    748,387
             Chevys Fresh Mex - Tampa , FL                           324,884
             Chevys Fresh Mex - Taylor , MI                          315,551
             Chevys Fresh Mex - Clearwater , FL                       87,746
             Chevys Fresh Mex - Orlando , FL                         141,790
             Chevys  - Independence , MO                             502,672
             Rio Bravo Fresh Mex - Atlanta , GA                      784,297
             Chevys Fresh Mex - Merriam , KS                         790,061
             Rio Bravo Fresh Mex - Jacksonville , FL                 393,374
             Roadhouse Grill - Centerville , OH                      795,340
             Roadhouse Grill - Rock Hill , SC                        522,390
             Roadhouse Grill - Columbus , OH                         588,712
             Roadhouse Grill - Roswell, GA                         1,005,994
             Shoney's-Cocoa Beach, FL                                375,500
             Shoney's-Debary, FL                                      27,000
                                                            -----------------
                                                               $  16,536,703
                                                            =================

<page>





                       CNL AMERICAN PROPERTIES FUND, INC.
                   SCHEDULE IV - Mortgage Loans on Real Estate

                               December 31, 2002

<TABLE>
<CAPTION>


                                                      Interest                    Final           Periodic    Prior  Face Amount
 Description                                            Rate                  Maturity Date     Payment Term  Liens  of Mortgages

<S> <C>

 29 loans held for sale with original amounts
    ranging from $330,000 to $17,924,000          6.51% to 10.58%        02/01/2003 to 01/01/2021      N/A    N/A     N/A

 265 loans as mortgage notes receivable with
    original amounts ranging from $69,000
    to $8,475,000                                 3.09 % to 11.37%       05/01/2003 to 03/01/2022      N/A    N/A     N/A






                    Principal Amount of Loans
  Carrying Amount     Subject to Delinquent
    of Mortgages      Principal or Interest




  $ 48,326,541            $ 33,235,376



  $314,122,172            $ 22,993,717

--------------            ------------
  $362,448,713            $ 56,229,093
===============           ============







                                                        2002              2001            2000             1999
 Balance at beginning of period                      403,700,839      419,903,472       63,466,474     19,631,693
 New mortgage loans                                   14,492,417       86,630,251      370,029,447     46,738,038
 Accrued interest                                      1,066,391         (833,527)       2,906,089        346,101
 Collection of principal                             (37,344,708)    (116,950,540)      (7,946,989)    (2,466,072)
 Deferred financing income                               205,417         (439,759)      (2,227,842)       (11,336)
 Unamortized loan costs                                 (146,601)         311,300         (376,164)        91,007
 Valuation loan costs                                (15,838,755)      15,823,041       (6,854,932)      (551,011)
 Provision for uncollectible mortgage notes           (3,686,287)        (743,399)         907,389       (311,946)
                                                 -------------------------------------------------------------------
 Balance at end of period                            362,448,713      403,700,839      419,903,472     63,466,474
                                                 ===================================================================
</TABLE>
<page>
                                    EXHIBITS




<PAGE>


                                  EXHIBIT INDEX


         Exhibit Number

                  2.1      Agreement  and  Plan  of  Merger,  by and  among  the
                           Registrant, CFA Acquisition Corp., CNL Fund Advisors,
                           Inc.  and CNL  Group,  Inc.,  dated  March  11,  1999
                           (included  as  Exhibit  10.38  to  the   Registrant's
                           Registration Statement No. 333-74329 on Form S-4 (the
                           "Form  S-4") as  originally  filed  and  incorporated
                           herein by reference).

                  2.2      Agreement  and  Plan  of  Merger,  by and  among  the
                           Registrant,  CFC Acquisition  Corp.,  CFS Acquisition
                           Corp., CNL Financial  Corp., CNL Financial  Services,
                           Inc., CNL Group,  Inc., Five Arrows Realty Securities
                           L.L.C.,  Robert A. Bourne,  Curtis B.  McWilliams and
                           Brian  Fluck,  dated  March  11,  1999  (included  as
                           Exhibit 10.39 to the Form S-4 as originally filed and
                           incorporated herein by reference).

                  3.1      CNL  American   Properties  Fund,  Inc.  Amended  and
                           Restated  Articles  of   Incorporation,   as  amended
                           (included  as Exhibit  3.1 to the  Registrant's  Form
                           10-Q  for  the  quarter   ended  June  30,  1999  and
                           incorporated herein by reference).

                  3.2      CNL  American   Properties  Fund,  Inc.  Amended  and
                           Restated  Bylaws  (included  as  Exhibit  3.2  to the
                           Registrant's  Registration Statement No. 333-37657 on
                           Form S-11 and incorporated herein by reference).

                  3.3      CNL American Properties Fund, Inc. Second Amended and
                           Restated  Articles  of  Incorporation   (included  as
                           Exhibit  3.3 to the  Registrant's  Form  10-Q for the
                           quarter ended June 30, 2000 and  incorporated  herein
                           by reference).

                  3.4      Articles of Amendment to Second  Amended and Restated
                           Articles of Incorporation of CNL American  Properties
                           Fund,   Inc.   (included   as  Exhibit   3.4  to  the
                           Registrant's Form 10-Q for the quarter ended June 30,
                           2002 and incorporated herein by reference).

                  4.1      Form of Stock Certificate (included as Exhibit 4.5 to
                           the Registrant's  Registration Statement No. 33-78790
                           on Form S-11 and incorporated herein by reference).

                  10.1     Form of  Indemnification  Agreement dated as of April
                           18, 1995, between the Registrant and each of James M.
                           Seneff,  Jr., Robert A. Bourne, G. Richard Hostetter,
                           J. Joseph Kruse, Richard C. Huseman,  John T. Walker,
                           Jeanne A. Wall,  Lynn E. Rose and Edgar J. McDougall,
                           dated as of January 27, 1997,  between the Registrant
                           and Steven D.  Shackelford,  dated as of February 18,
                           1998,   between   the   Registrant   and   Curtis  B.
                           McWilliams,  and  dated  as  of  September  1,  1999,
                           between the  Registrant and each of Howard J. Singer,
                           John L. Farren,  Timothy J. Neville,  Michael I. Wood
                           and Barry L. Goff  (included  as Exhibit  10.9 to the
                           Registrant's  Registration Statement No. 333-15411 on
                           Form S-11 and incorporated herein by reference).

                  10.2     Amended and Restated Agreement of Limited Partnership
                           of CNL APF Partners, LP (included as Exhibit 10.50 to
                           Amendment  No.  2 to the  Form  S-4 and  incorporated
                           herein by reference).

                  10.3     Amended and  Restated  Credit  Agreement by and among
                           CNL  APF  Partners,   LP,  Registrant,   First  Union
                           National  Bank,  First Union Capital  Markets  Group,
                           Banc of America  Securities LLC,  NationsBank,  N.A.,
                           The  Chase   Manhattan   Bank  and  other   financial
                           institutions, dated June 9, 1999 (included as Exhibit
                           10.51  to  Amendment  No.  1  to  the  Form  S-4  and
                           incorporated herein by reference).


<PAGE>


                  10.4     First   Amendment  to  Amended  and  Restated  Credit
                           Agreement  dated as of December  31, 1999 between CNL
                           APF Partners,  LP and First Union  National  Bank, as
                           Agent  (included as Exhibit 10.4 to the  Registrant's
                           Form 10-K for the year ended  December  31,  1999 and
                           incorporated herein by reference).

                  10.5     Franchise  Receivable Funding and servicing Agreement
                           dated  as  of  October  14,  1999   between  CNL  APF
                           Partners,   LP  and   Neptune   Funding   Corporation
                           (included  as Exhibit 10.5 to the  Registrant's  Form
                           10-K  for  the  year  ended  December  31,  1999  and
                           incorporated herein by reference).

                  10.6     Interim  Wholesale  Mortgage  Warehouse  and Security
                           Agreement dated as of September 18, 1998, and Amended
                           Agreement dated as of August 30, 1999 between CNL APF
                           Partners,   LP  and  Prudential   Securities   Credit
                           Corporation   (included   as  Exhibit   10.6  to  the
                           Registrant's  Form 10-K for the year  ended  December
                           31, 1999 and incorporated herein by reference).

                  10.7     1999 Performance  Incentive Plan (included as Exhibit
                           10.1  to  Amendment   No.  1  to  the  Form  S-4  and
                           incorporated herein by reference).

                  10.8     Registration   Rights  Agreement  by  and  among  the
                           Registrant,  Robert A. Bourne,  Curtis B. McWilliams,
                           John T. Walker,  Howard Singer, Steven D. Shackelford
                           and CNL  Group,  Inc.,  dated  as of March  11,  1999
                           (included as Exhibit  10.40 to Amendment No. 1 to the
                           Form S-4 and incorporated herein by reference).

                  10.9     Registration   Rights  Agreement  by  and  among  the
                           Registrant,  Five Arrows  Realty  Securities  L.L.C.,
                           James M. Seneff,  Jr.,  Robert A.  Bourne,  Curtis B.
                           McWilliams and CNL Group, Inc., dated as of March 11,
                           1999 (included as Exhibit 10.41 to Amendment No. 1 to
                           the Form S-4 and incorporated herein by reference).

                  10.10    Employment   Agreement  by  and  between   Curtis  B.
                           McWilliams and the  Registrant,  dated  September 15,
                           1999 (included as Exhibit 10.42 to Amendment No. 2 to
                           the Form S-4 and incorporated herein by reference).

                  10.11    Employment   Agreement  by  and  between   Steven  D.
                           Shackelford and the  Registrant,  dated September 15,
                           1999 (included as Exhibit 10.43 to Amendment No. 2 to
                           the Form S-4 and incorporated herein by reference).

                  10.12    Employment  Agreement  by and between  John T. Walker
                           and  the   Registrant,   dated   September  15,  1999
                           (included as Exhibit  10.44 to Amendment No. 2 to the
                           Form S-4 and incorporated herein by reference).

                  10.13    Employment  Agreement by and between Howard J. Singer
                           and  the   Registrant,   dated   September  15,  1999
                           (included as Exhibit  10.45 to Amendment No. 2 to the
                           Form S-4 and incorporated herein by reference).

                  10.14    Employment Agreement by and between Barry L. Goff and
                           the Registrant, dated September 15, 1999 (included as
                           Exhibit  10.46 to Amendment No. 2 to the Form S-4 and
                           incorporated herein by reference).

                  10.15    Employment  Agreement by and between Robert W. Chapin
                           and  the   Registrant,   dated   September  15,  1999
                           (included as Exhibit  10.47 to Amendment No. 2 to the
                           Form S-4 and incorporated herein by reference).

                  10.16    Employment   Agreement  by  and  between  Timothy  J.
                           Neville and the Registrant,  dated September 15, 1999
                           (included as Exhibit  10.48 to Amendment No. 2 to the
                           Form S-4 and incorporated herein by reference).

                  10.17    Holdback  Agreement by and among the  Registrant  and
                           Stockholders,  dated  August 31,  1999  (included  as
                           Exhibit  10.56 to Amendment No. 2 to the Form S-4 and
                           incorporated herein by reference).

                  10.18    Amended  and   Restated   Credit  and   Reimbursement
                           Agreement by and among CNL APF Partners,  LP, CNL APF
                           LP Corp., CNL APF GP Corp., Bank of America, N.A. and
                           Bank of America  Securities LLC, dated as of June 15,
                           2000  (included as Exhibit 10.18 to the  Registrant's
                           Form 10-Q for the  quarter  ended  June 30,  2000 and
                           incorporated herein by reference).

                  10.19    Employment  Agreement by and between Michael Wood and
                           the  Registrant,  dated August 31, 1999  (included as
                           Exhibit 10.19 to the  Registrant's  Form 10-Q for the
                           quarter ended March 31, 2001 and incorporated  herein
                           by reference).

                  10.20    Employment  Agreement by and between Brent Heaton and
                           the Registrant, dated September 29, 1999 (included as
                           Exhibit 10.20 to the  Registrant's  Form 10-Q for the
                           quarter ended March 31, 2001 and incorporated  herein
                           by reference).

                  10.21    Addendum to Employment Agreement dated as of November
                           1, 1999, between the Registrant and Curtis McWilliams
                           (included as Exhibit 10.21 to the  Registrant's  Form
                           10-Q  for  the  quarter  ended  March  31,  2001  and
                           incorporated  herein  by  reference).  The  following
                           persons   have  signed  a   substantially   identical
                           Addendum  relating  to  their  respective  employment
                           agreements;  Steve  Shackelford  (dated  November  1,
                           1999),  John Walker (dated  November 3, 1999),  Barry
                           Goff  (dated  November  1,  1999),  and Brent  Heaton
                           (dated November 3, 1999).

                  10.22    Addendum to Employment Agreement dated as of November
                           1, 1999,  between the  Registrant  and Robert  Chapin
                           (included as Exhibit 10.22 to the  Registrant's  Form
                           10-Q  for  the  quarter  ended  March  31,  2001  and
                           incorporated  herein  by  reference).  The  following
                           persons   have  signed  a   substantially   identical
                           Addendum  relating  to  their  respective  employment
                           agreements:  Howard Singer (dated  November 1, 1999),
                           Michael  Wood  (dated  November  8, 1999) and Timothy
                           Neville (dated November 24, 1999).

                  10.23    Second  Addendum to Employment  Agreement dated as of
                           June 16,  2000,  between  the  Registrant  and Curtis
                           McWilliams   (included   as  Exhibit   10.23  to  the
                           Registrant's  Form 10-Q for the  quarter  ended March
                           31, 2001 and incorporated  herein by reference).  The
                           following   persons   have  signed  a   substantially
                           identical   Second   Addendum   relating   to   their
                           respective  employment   agreements:   Howard  Singer
                           (dated June 19, 2000),  Robert Chapin (dated June 20,
                           2000) and Brent Heaton (dated October 30, 2000).

                  10.24    Second  Addendum to Employment  Agreement dated as of
                           August 20,  2000,  between the  Registrant  and Barry
                           Goff  (included as Exhibit 10.24 to the  Registrant's
                           Form 10-Q for the  quarter  ended  March 31, 2001 and
                           incorporated herein by reference).

                  10.25    Second  Addendum to Employment  Agreement dated as of
                           September 1, 2000,  between the  Registrant and Steve
                           Shackelford   (included  as  Exhibit   10.25  to  the
                           Registrant's  Form 10-Q for the  quarter  ended March
                           31, 2001 and incorporated herein by reference).

                  10.26    Second  Addendum to Employment  Agreement dated as of
                           2000,  between the  Registrant  and  Timothy  Neville
                           (included as Exhibit 10.26 to the  Registrant's  Form
                           10-Q  for  the  quarter  ended  March  31,  2001  and
                           incorporated herein by reference).

                  10.27    Second  Addendum to Employment  Agreement dated as of
                           October 24, 2000,  between the Registrant and Michael
                           Wood  (included as Exhibit 10.27 to the  Registrant's
                           Form 10-Q for the  quarter  ended  March 31, 2001 and
                           incorporated herein by reference).

                  10.28    Second  Addendum to Employment  Agreement dated as of
                           October 25,  2000,  between the  Registrant  and John
                           Walker (included as Exhibit 10.28 to the Registrant's
                           Form 10-Q for the  quarter  ended  March 31, 2001 and
                           incorporated herein by reference).

                  10.29    Amended and Restated Master Purchase  Agreement dated
                           as of October 11, 2001, among Bank of America,  N.A.,
                           CNL  Financial  VII,  LP and CNL  Franchise  Network,
                           (included as Exhibit 10.29 to the  Registrant's  Form
                           10-K  for  the  year  ended  December  31,  2001  and
                           incorporated herein by reference).

                  10.30    Third  Amended and  Restated  Side Letter dated as of
                           October 11, 2001,  among Bank of America,  N.A.,  CNL
                           Financial  VII,  LP and  CNL  Franchise  Network,  LP
                           (included as Exhibit 10.30 to the  Registrant's  Form
                           10-K  for  the  year  ended  December  31,  2001  and
                           incorporated herein by reference).

                  10.31    Loan and Security Agreement dated as of June 14, 2002
                           between  CNL  Financial  IX, LP and  Nieuw  Amsterdam
                           Receivables Corporation (included as Exhibit 10.31 to
                           the Registrant's Form 10-Q for the quarter ended June
                           30, 2002 and incorporated herein by reference).

                  21       Subsidiaries of the Registrant (filed herewith).

                  99.1     Certification of Co-Chief  Executive Officer Pursuant
                           to 18 U.S.C.  Section  1350 as  adopted  pursuant  to
                           Section 906 of the  Sarbanes-Oxley Act of 2002 (filed
                           herewith).

                  99.2     Certification of Co-Chief  Executive Officer Pursuant
                           to 18 U.S.C.  Section  1350 as  adopted  pursuant  to
                           Section 906 of the  Sarbanes-Oxley Act of 2002 (filed
                           herewith).

                  99.3     Certification of Chief Financial  Officer Pursuant to
                           18 U.S.C. Section 1350 as adopted pursuant to Section
                           906  of  the   Sarbanes-Oxley   Act  of  2002  (filed
                           herewith).


<PAGE>










                                   EXHIBIT 21
                         SUBSIDIARIES OF THE REGISTRAINT



<PAGE>





                                  EXHIBIT 99.1
                   CERTIFICATION OF CO-CHIEF EXECUTIVE OFFICER




<PAGE>




                                  EXHIBIT 99.2
                   CERTIFICATION OF CO-CHIEF EXECUTIVE OFFICER




<PAGE>










                                  EXHIBIT 99.3
                    CERTIFICATION OF CHIEF FINANCIAL OFFICER



<PAGE>