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FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT of 1934
For the quarterly period ended September 30, 2002
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OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT of 1934
For the transition period from ____________________ to _____________________
Commission file number
0-20017
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CNL Income Fund IX, Ltd.
- ----------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Florida 59-3004138
- --------------------------------- -----------------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
450 South Orange Avenue
Orlando, Florida 32801
- --------------------------------- ------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number
(including area code) (407) 540-2000
------------------------------
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Sections 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes X No _________
CONTENTS
Part I Page
Item 1. Financial Statements:
Condensed Balance Sheets 1
Condensed Statements of Income 2
Condensed Statements of Partners' Capital 3
Condensed Statements of Cash Flows 4
Notes to Condensed Financial Statements 5-9
Item 2. Management's Discussion and Analysis of Financial
Condition and Results of Operations 10-14
Item 3. Quantitative and Qualitative Disclosures About
Market Risk 14
Item 4. Controls and Procedures 14
Part II
Other Information 15-16
CNL INCOME FUND IX, LTD.
(A Florida Limited Partnership)
CONDENSED BALANCE SHEETS
September 30, December 31,
2002 2001
------------------- -------------------
ASSETS
Land and buildings on operating leases, net $ 13,581,472 $ 13,452,519
Net investment in direct financing leases 2,745,524 2,807,303
Real estate held for sale 700,668 712,211
Investment in joint ventures 7,401,647 7,324,599
Mortgage notes receivable 468,932 482,406
Cash and cash equivalents 1,280,851 1,247,551
Receivables, less allowance for doubtful accounts
of $15,296 in 2001 -- 32,171
Due from related parties 1,366 4,872
Accrued rental income 581,541 785,025
Other assets 18,323 10,520
------------------- -------------------
$ 26,780,324 $ 26,859,177
=================== ===================
LIABILITIES AND PARTNERS' CAPITAL
Accounts payable $ 7,123 $ 7,190
Real estate taxes payable 24,157 7,853
Distributions payable 787,501 787,501
Due to related parties 157,900 5,878
Rents paid in advance and deposits 24,635 59,096
------------------- -------------------
Total liabilities 1,001,316 867,518
Commitment (Note 7)
Partners' capital 25,779,008 25,991,659
------------------- -------------------
$ 26,780,324 $ 26,859,177
=================== ===================
See accompanying notes to condensed financial statements.
CNL INCOME FUND IX, LTD.
(A Florida Limited Partnership)
CONDENSED STATEMENTS OF INCOME
Quarter Ended Nine Months Ended
September 30, September 30,
2002 2001 2002 2001
------------- -------------- -------------- ---------------
Revenues:
Rental income from operating leases $ 399,677 $ 375,361 $ 1,156,527 $ 1,157,826
Earned income from direct financing leases 81,175 85,401 245,373 293,308
Interest and other income 51,135 28,798 76,864 138,137
------------- -------------- -------------- ---------------
531,987 489,560 1,478,764 1,589,271
------------- -------------- -------------- ---------------
Expenses:
General operating and administrative 60,392 45,391 201,015 254,191
Property expenses 34,669 21,300 75,729 90,926
State and other taxes -- -- 43,438 35,750
Depreciation and amortization 74,926 83,435 230,150 228,793
Provision for write-down of assets -- 62,125 321,609 462,925
------------- -------------- -------------- ---------------
169,987 212,251 871,941 1,072,585
------------- -------------- -------------- ---------------
Income Before Gain on Sale of Assets and Equity in
Earnings of Joint Ventures 362,000 277,309 606,823 516,686
Gain on Sale of Assets 231,731 12,107 456,143 12,107
Equity in Earnings of Joint Ventures 258,544 180,658 1,025,261 570,290
-------------- -------------- --------------- ---------------
Income from Continuing Operations 852,275 470,074 2,088,227 1,099,083
Discontinued Operations (Note 5):
Income from discontinued operations, net 22,740 19,444 61,625 58,331
------------- -------------- -------------- ---------------
Net Income $ 875,015 $ 489,518 $ 2,149,852 $ 1,157,414
============= ============== ============== ===============
Income Per Limited Partner Unit:
Continuing Operations $ 0.24 $ 0.13 $ 0.59 $ 0.31
Discontinued Operations 0.01 0.01 0.02 0.02
------------- -------------- -------------- ---------------
Total $ 0.25 $ 0.14 $ 0.61 $ 0.33
============= ============== ============== ===============
Weighted Average Number of Limited Partner
Units Outstanding 3,500,000 3,500,000 3,500,000 3,500,000
============= ============== ============== ===============
See accompanying notes to condensed financial statements.
CNL INCOME FUND IX, LTD.
(A Florida Limited Partnership)
CONDENSED STATEMENTS OF PARTNERS' CAPITAL
Nine Months Ended Year Ended
September 30, December 31,
2002 2001
--------------------- ------------------
General partners:
Beginning balance $ 238,417 $ 238,417
Net income -- --
--------------------- ------------------
238,417 238,417
--------------------- ------------------
Limited partners:
Beginning balance 25,753,242 26,911,340
Net income 2,149,852 1,991,906
Distributions ($0.68 and $0.90 per limited partner
unit, respectively) (2,362,503 ) (3,150,004 )
--------------------- ------------------
25,540,591 25,753,242
--------------------- ------------------
Total partners' capital $ 25,779,008 $ 25,991,659
===================== ==================
See accompanying notes to condensed financial statements.
CNL INCOME FUND IX, LTD.
(A Florida Limited Partnership)
CONDENSED STATEMENTS OF CASH FLOWS
Nine Months Ended
September 30,
2002 2001
---------------- ----------------
Increase (Decrease) in Cash and Cash Equivalents
Net Cash Provided by Operating Activities $ 2,141,909 $ 2,159,834
---------------- ----------------
Cash Flows from Investing Activities:
Increase in restricted cash -- (900,110 )
Collections on mortgage note receivable 13,255 17,047
Proceeds from sale of assets 1,928,325 900,110
Additions to land and buildings (1,992,232 ) --
Return of capital from joint venture 929,590 --
Liquidating distribution from joint venture 540,191 424,600
Investment in joint venture (1,165,235 ) (341,942 )
---------------- ----------------
Net cash provided by investing activities 253,894 99,705
---------------- ----------------
Cash Flows from Financing Activities:
Distributions to limited partners (2,362,503 ) (2,362,503 )
---------------- ----------------
Net cash used in financing activities (2,362,503 ) (2,362,503 )
---------------- ----------------
Net Increase (Decrease) in Cash and Cash Equivalents 33,300 (102,964 )
Cash and Cash Equivalents at Beginning of Period 1,247,551 829,338
---------------- ----------------
Cash and Cash Equivalents at End of Period $ 1,280,851 $ 726,374
================ ================
Supplemental Schedule of Non-Cash Financing
Activities:
Distributions declared and unpaid at end of
period $ 787,501 $ 787,501
================ ================
See accompanying notes to condensed financial statements.
CNL INCOME FUND IX, LTD.
(A Florida Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS
Quarters and Nine Months Ended September 30, 2002 and 2001
1. Basis of Presentation:
The accompanying unaudited condensed financial statements have been
prepared in accordance with the instructions to Form 10-Q and do not
include all of the information and note disclosures required by
generally accepted accounting principles. The financial statements
reflect all adjustments, consisting of normal recurring adjustments,
which are, in the opinion of management, necessary to a fair statement
of the results for the interim periods presented. Operating results for
the quarter and nine months ended September 30, 2002, may not be
indicative of the results that may be expected for the year ending
December 31, 2002. Amounts as of December 31, 2001, included in the
financial statements, have been derived from audited financial
statements as of that date.
These unaudited financial statements should be read in conjunction with
the financial statements and notes thereto included in Form 10-K of CNL
Income Fund IX, Ltd. (the "Partnership") for the year ended December
31, 2001.
Effective January 1, 2002, the Partnership adopted Statement of
Financial Accounting Standards No. 144 "Accounting for the Impairment
or Disposal of Long-Lived Assets." This statement requires that a
long-lived asset be tested for recoverability whenever events or
changes in circumstances indicate that its carrying amount may not be
recoverable. The carrying amount of a long-lived asset is not
recoverable if it exceeds the sum of the undiscounted cash flows
expected to result from the use and eventual disposition of the asset.
The assessment is based on the carrying amount of the asset at the date
it is tested for recoverability. An impairment loss is recognized when
the carrying amount of a long-lived asset exceeds its fair value. If an
impairment is recognized, the adjusted carrying amount of a long-lived
asset is its new cost basis. The 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 if the disposal activity was initiated
subsequent to the adoption of the Standard.
2. Reclassification:
Certain items in the prior year's financial statements have been
reclassified to conform to 2002 presentation. These reclassifications
had no effect on total partners' capital or net income.
3. Land and Buildings on Operating Leases:
In May 2002, the Partnership sold its property in Greenville, South
Carolina, to an unrelated third party for approximately $997,800 and
received net sales proceeds of approximately $976,800, resulting in a
gain of approximately $224,400. This property had been identified for
sale as of December 31, 2001. In June 2002, the Partnership reinvested
these net sales proceeds in a property in Dallas, Texas at an
approximate cost of $1,030,800. The Partnership acquired this property
from CNL Funding 2001-A, LP, an affiliate of the general partners (see
Note 6).
In August 2002, the Partnership sold its property in Huntsville,
Alabama, to an unrelated third party for approximately $961,300 and
received net sales proceeds of approximately $951,500, resulting in a
gain of approximately $231,700. This property had been identified for
sale as of December 31, 2001. In September 2002, the Partnership
reinvested these net sales proceeds in a property in Jackson, Michigan
at an approximate cost of $961,400. The Partnership acquired this
property from CNL Net Lease Investors, L.P, an affiliate of the general
partners (see Note 6).
CNL INCOME FUND IX, LTD.
(A Florida Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS
Quarters and Nine Months Ended September 30, 2002 and 2001
3. Land and Buildings on Operating Leases - Continued:
During the nine months ended September 30, 2002, the Partnership
established a provision for write-down of assets of $321,609 relating
to its property in Wildwood, Florida. During 2001, the Partnership and
the tenant terminated the lease relating to this property. The
provision represented the difference between the carrying value of the
property and its estimated fair value.
4. Investment in Joint Ventures:
In May 2002, CNL Restaurant Investments III Joint Venture, in which the
Partnership owns a 50% interest, sold its Burger King property in
Greensboro, North Carolina, to the tenant for approximately $1,145,500
and received net sales proceeds of approximately $1,143,500, resulting
in a gain to the joint venture of approximately $371,500. The
Partnership received approximately $571,700 as a return of capital from
the joint venture. In June 2002, the Partnership reinvested the
majority of these net sales proceeds in a joint venture arrangement,
Katy Joint Venture, with CNL Income Fund XVII, Ltd., an affiliate of
the general partners. Katy Joint Venture acquired a property in Katy,
Texas from CNL Funding 2001-A, LP, an affiliate of the general partners
at an approximate cost of $1,041,700 (see Note 6). The Partnership and
CNL Income Fund XVII, Ltd. entered into an agreement whereby each
co-venturer will share in the profits and losses of the property in
proportion to its applicable percentage interest. As of September 30,
2002, the Partnership had contributed approximately $625,000 for a 60%
interest in this joint venture.
In June 2002, Ashland Joint Venture, in which the Partnership owns a
27.33% interest, sold its Burger King property in Ashland, New
Hampshire to the tenant for approximately $1,477,500 and received net
sales proceeds of approximately $1,472,900, resulting in a gain to the
joint venture of approximately $500,900. In June 2002, the joint
venture reinvested the majority of the net sales proceeds from the sale
of this property in a property in San Antonio, Texas. The joint venture
acquired the property from CNL Funding 2001-A, LP, an affiliate of the
general partners for an approximate cost of $1,343,000 (see Note 6).
The Partnership received approximately $6,000 as a return of capital
from the remaining net sales proceeds.
In June 2002, CNL Restaurant Investments II Joint Venture, in which the
Partnership owns a 45.2% interest, sold its property in Columbus, Ohio
to the tenant for approximately $1,219,600 and received net sales
proceeds of approximately $1,215,700 resulting in a gain to the joint
venture of approximately $448,300. The joint venture used the majority
of the net sales proceeds from this sale to acquire a property in
Dallas, Texas at an approximate cost of $1,147,400. The joint venture
acquired this property from CNL Funding 2001-A, LP, an affiliate of the
general partners (see Note 6). The Partnership received approximately
$27,600 as a return of capital from the remaining net sales proceeds.
In addition, in June 2002, CNL Restaurant Investments II Joint Venture
sold its property in Pontiac, Michigan to the tenant for approximately
$725,000 and received net sales proceeds of approximately $722,600
resulting in a loss to the joint venture of approximately $189,800. The
Partnership received approximately $326,200 as a return of capital from
the net sales proceeds.
In June 2002, the Partnership and CNL Income Fund VIII, Ltd. ("CNL
VIII"), as tenants-in-common, entered into an agreement with an
unrelated third party to sell the Baker's Square property in
Libertyville, Illinois. The Partnership owned a 34% interest in this
property. CNL Income Fund VIII, Ltd. is an affiliate of the general
partners. In September 2002, the Partnership and CNL VIII sold this
property to an unrelated third party for $1,675,000 and received net
sales proceeds of approximately $1,630,400, resulting in a gain of
approximately $199,300 to the tenancy in common. In September 2002, the
Partnership and CNL VIII used these proceeds to acquire a property in
Buffalo Grove, Illinois at an approximate cost of $1,588,800. The
Partnership owns a 34% interest in this property. The property was
acquired from CNL Net Lease Investors, L.P., an affiliate of the
general partners (see Note 6).
CNL INCOME FUND IX, LTD.
(A Florida Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS
Quarters and Nine Months Ended September 30, 2002 and 2001
4. Investment in Joint Ventures - Continued:
The financial results relating to the properties in Greensboro, North
Carolina; Ashland, New Hampshire; Columbus, Ohio; Pontiac, Michigan;
and Libertyville, Illinois are reflected as Discontinued Operations in
the condensed financial information below.
CNL Restaurant Investments II Joint Venture and CNL Restaurant
Investments III Joint Venture each own and lease five properties to
operators of national fast-food and family-style restaurants. Ashland
Joint Venture and Katy Joint Venture each own and lease one property to
operators of national fast-food and family-style restaurants. The
Partnership and affiliates, as tenants-in-common, own and lease four
properties to operators of national fast-food and family-style
restaurants. The following presents the combined, condensed financial
information for the joint ventures and the properties held as
tenants-in-common with affiliates at:
September 30, December 31,
2002 2001
---------------- ----------------
Land and buildings on
operating leases, net $ 14,565,053 $ 10,649,307
Net investment in direct
financing lease 2,822,931 1,856,650
Real estate held for sale -- 4,986,544
Cash 60,016 50,255
Restricted cash 31,144 --
Receivables, less allowance
for doubtful accounts -- 12,385
Accrued rental income 254,974 85,477
Other assets 20,539 24,302
Liabilities 7,008 2,033
Partners' capital 17,747,649 17,662,887
Quarter Ended Nine Months Ended
September 30, September 30,
2002 2001 2002 2001
------------ ---------------- ------------- ----------------
Revenues $ 500,570 $ 395,840 $ 1,258,199 $ 1,117,626
Expenses (78,240 ) (76,055 ) (252,683 ) (220,886 )
Gain on sale of assets -- -- -- 158,119
------------ ---------------- ------------- ----------------
Income from continuing
operations 422,330 319,785 1,005,516 1,054,859
------------ ---------------- ------------- ----------------
Discontinued operations:
Revenues 33,772 142,179 292,527 440,580
Expenses (1,106 ) (26,368 ) (50,042 ) (103,007 )
Gain on disposal of
assets 199,282 -- 1,330,172 --
------------ ---------------- ------------- ----------------
231,948 115,811 1,572,657 337,573
------------ ---------------- ------------- ----------------
Net Income $ 654,278 $ 435,596 $ 2,578,173 $ 1,392,432
============ ================ ============= ================
CNL INCOME FUND IX, LTD.
(A Florida Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS
Quarters and Nine Months Ended September 30, 2002 and 2001
4. Investment in Joint Ventures - Continued:
The Partnership recognized income of $1,025,261 and $570,290 during the
nine months ended September 30, 2002 and 2001, respectively, of which
$258,544 and $180,658 were earned during the quarters ended September
30, 2002 and 2001, respectively, from these joint ventures and
tenants-in-common.
5. Discontinued Operations:
In August 2002, the Partnership entered into an agreement with an
unrelated third party to sell the Hardee's property in Farragut,
Tennessee. As a result, the Partnership reclassified the asset from
land and building on operating leases to real estate held for sale. The
reclassified asset was recorded at the lower of its carrying amount or
fair value, less cost to sell. In addition, the Partnership stopped
recording depreciation once the property was placed up for sale. The
financial results for this property are reflected as Discontinued
Operations in the accompanying financial statements.
The operating results of the discontinued operations for the above
property are as follows:
Quarter Ended September 30, Nine Months Ended September 30,
2002 2001 2002 2001
------------ --------------- --------------- ------------------
Rental revenues $ 24,005 $ 23,239 $ 70,479 $ 69,716
Expenses (1,265 ) (3,795 ) (8,854 ) (11,385 )
------------ --------------- --------------- ------------------
Income from discontinued
operations $ 22,740 $ 19,444 $ 61,625 $ 58,331
============ =============== =============== ==================
6. Related Party Transactions:
In June 2002, the Partnership, Ashland Joint Venture, CNL Restaurants
II Joint Venture, and Katy Joint Venture each acquired a property from
CNL Funding 2001-A, LP (see Notes 3 and 4). CNL Funding 2001-A, LP is
an affiliate of the general partners. CNL Funding 2001-A, LP had
purchased and temporarily held title to the properties in order to
facilitate the acquisition of the properties by the Partnership and the
joint ventures. The purchase price paid by the Partnership and the
joint ventures represented the costs incurred by CNL Funding 2001-A, LP
to acquire the properties.
In September 2002, the Partnership acquired a property in Jackson,
Michigan from CNL Net Lease Investors, L.P. ("NLI"), at an approximate
cost of $961,400. In addition, in September 2002, the Partnership and
CNL VIII acquired a property in Buffalo Grove, Illinois from NLI at an
approximate cost of $1,588,800. During 2002, and prior to the
Partnership's acquisition of these properties, CNL Financial LP
Holding, LP ("CFN") and CNL Net Lease Investors GP Corp. ("GP Corp")
purchased the limited partner's interest and general partner's
interest, respectively, of NLI. Prior to this transaction, an affiliate
of the Partnership's general partners owned a 0.1% interest in NLI and
served as a general partner of NLI. The original general partners of
NLI waived their rights to benefit from this transaction. The
acquisition price paid by CFN for the limited partner's interest was
based on the portfolio acquisition price. The Partnership acquired the
properties in Jackson, Michigan and Buffalo Grove, Illinois at CFN's
cost and did not pay any additional compensation to CFN for the
acquisition of the properties. Each CNL entity is an affiliate of the
Partnership's general partners.
CNL INCOME FUND IX, LTD.
(A Florida Limited Partnership)
NOTES TO CONDENSED FINANCIAL STATEMENTS
Quarters and Nine Months Ended September 30, 2002 and 2001
7. Commitment:
In August 2002, the Partnership entered into an agreement with an
unrelated third party to sell the Hardee's property in Farragut,
Tennessee.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
CNL Income Fund IX, Ltd. (the "Partnership") is a Florida limited
partnership that was organized on April 16, 1990, to acquire for cash, either
directly or through joint venture arrangements, both newly constructed and
existing restaurants, as well as land upon which restaurants were to be
constructed (the "Properties"), which are leased primarily to operators of
national and regional fast-food and family-style restaurant chains. The leases
generally are triple-net leases, with the lessees responsible for all repairs
and maintenance, property taxes, insurance and utilities. As of September 30,
2001, the Partnership owned 22 Properties directly and 17 Properties indirectly
through joint venture and tenancy in common arrangements. As of September 30,
2002, the Partnership owned 21 Properties directly and 16 Properties indirectly
through joint venture or tenancy in common arrangements.
Capital Resources
Cash from operating activities (which includes cash received from
tenants, distributions from joint ventures, and interest and other income
received, less cash paid for expenses) was $2,141,909 and $2,159,834, for the
nine months ended September 30, 2002 and 2001, respectively. The decrease in
cash from operating activities for the nine months ended September 30, 2002, as
compared to the same period of 2001, was primarily a result of changes in the
Partnership's working capital.
Other sources and uses of capital included the following during the
nine months ended September 30, 2002.
In May 2002, the Partnership sold its Property in Greenville, South
Carolina, to an unrelated third party for approximately $997,800 and received
net sales proceeds of approximately $976,800, resulting in a gain of
approximately $224,400. This Property had been identified for sale as of
December 31, 2001. In June 2002, the Partnership reinvested these net sales
proceeds in a Taco Cabana Property in Dallas, Texas at an approximate cost of
$1,030,800.
In May 2002, CNL Restaurant Investments III Joint Venture, in which the
Partnership owns a 50% interest, sold its Property in Greensboro, North
Carolina, to the tenant for approximately $1,145,500 and received net sales
proceeds of approximately $1,143,500, resulting in a gain to the joint venture
of approximately $371,500. The Partnership received approximately $569,800 as a
return of capital from the joint venture. In June 2002, the Partnership
reinvested the majority of these net sales proceeds in a joint venture
arrangement, Katy Joint Venture, with CNL Income Fund XVII, Ltd., a Florida
limited partnership and an affiliate of the general partners. Katy Joint Venture
acquired a Taco Cabana Property in Katy, Texas at an approximate cost of
$1,041,700. As of September 30, 2002, the Partnership had contributed
approximately $625,000 for a 60% interest in this joint venture.
In June 2002, Ashland Joint Venture, in which the Partnership owns a
27.33% interest, sold its Property in Ashland, New Hampshire to the tenant for
approximately $1,477,500 and received net sales proceeds of approximately
$1,472,900, resulting in a gain to the joint venture of approximately $500,900.
In June 2002, the joint venture reinvested the majority of the net sales
proceeds from the sale of this Property in a Taco Cabana Property in San
Antonio, Texas at an approximate cost of $1,343,000. The Partnership received
approximately $6,000 as a return of capital from the remaining net sales
proceeds.
In June 2002, CNL Restaurant Investments II Joint Venture, in which the
Partnership owns a 45.2% interest, sold its Property in Columbus, Ohio to the
tenant for approximately $1,219,600 and received net sales proceeds of
approximately $1,215,700 resulting in a gain to the joint venture of
approximately $448,300. The joint venture used the majority of the net sales
proceeds from this sale to acquire a Taco Cabana Property in Dallas, Texas at an
approximate cost of $1,147,400. The Partnership received approximately $27,600
as a return of capital from the remaining net sales proceeds. In addition, in
June 2002, CNL Restaurant Investments II Joint Venture sold its Property in
Pontiac, Michigan to the tenant for approximately $725,000 and received net
sales proceeds of approximately $722,600 resulting in a loss to the joint
venture of approximately $189,800. The Partnership received approximately
$326,200 as a return of capital from the net sales proceeds.
Each of the Taco Cabana Properties was acquired from CNL Funding
2001-A, LP, a Delaware limited partnership and an affiliate of the general
partners. CNL Funding 2001-A, LP had purchased and temporarily held title to the
Properties in order to facilitate the acquisition of the Properties by the
Partnership and the joint ventures. The purchase prices paid by the Partnership
and the joint ventures represented the costs incurred by CNL Funding 2001-A, LP
to acquire the Properties. The Partnership anticipates that its distributions
will be sufficient to enable the limited partners to pay federal and state
income taxes, if any (at a level reasonably assumed by the general partners),
resulting from the above transactions.
In August 2002, the Partnership sold its Property in Huntsville,
Alabama, to an unrelated third party for approximately $961,300 and received net
sales proceeds of approximately $951,500, resulting in a gain of approximately
$231,700. This Property had been identified for sale as of December 31, 2001. In
September 2002, the Partnership reinvested these net sales proceeds in a Burger
King Property in Jackson, Michigan at an approximate cost of $961,400.
In June 2002, the Partnership and CNL Income Fund VIII, Ltd. ("CNL
VIII"), as tenants-in-common, entered into an agreement with an unrelated third
party to sell the Baker's Square Property in Libertyville, Illinois. The
Partnership owned a 34% interest in this Property. CNL VIII is a Florida limited
partnership and an affiliate of the general partners. In September 2002, the
Partnership and CNL VIII sold this Property to an unrelated third party for
$1,675,000 and received net sales proceeds of approximately $1,630,400,
resulting in a gain of approximately $199,300 to the tenancy in common. In
September 2002, the Partnership and CNL VIII used these proceeds to acquire an
IHOP Property in Buffalo Grove, Illinois at an approximate cost of $1,588,800.
The Partnership owns a 34% interest in this Property. The Partnership
anticipates that its distributions will be sufficient to enable the limited
partners to pay federal and state income taxes, if any, (at a level reasonably
assumed by the general partners), resulting from the sales of the Properties in
Huntsville, Alabama and Libertyville, Illinois and the subsequent reinvestment
of sales proceeds.
The Burger King and IHOP Properties were acquired from CNL Net Lease
Investor, L.P. ("NLI"), a California Limited Partnership. During 2002, and prior
to the Partnership's acquisition of these Properties, CNL Financial LP Holding,
LP ("CFN"), a Delaware limited partnership, and CNL Net Lease Investors GP Corp.
("GP Corp"), a Delaware corporation, purchased the limited partner's interest
and general partner's interest, respectively, of NLI. Prior to this transaction,
an affiliate of the Partnership's general partners owned a 0.1% interest in NLI
and served as a general partner of NLI. The original general partners of NLI
waived their rights to benefit from this transaction. The acquisition price paid
by CFN for the limited partner's interest was based on the portfolio acquisition
price. The Partnership acquired the Properties in Jackson, Michigan and Buffalo
Grove, Illinois at CFN's cost and did not pay any additional compensation to CFN
for the acquisition of the Property. Each CNL entity is an affiliate of the
Partnership's general partners.
In August 2002, the Partnership entered into an agreement with an
unrelated third party to sell the Hardee's Property in Farragut, Tennessee. As
of November 6, 2002, the sale had not occurred.
Currently, rental income from the Partnership's Properties is invested
in money market accounts or other short-term, highly liquid investments such as
demand deposit accounts at commercial banks, money market accounts and
certificates of deposit with less than a 90-day maturity date, pending the
Partnership's use of such funds to pay Partnership expenses or to make
distributions to the partners. At September 30, 2002, the Partnership had
$1,280,851 invested in such short-term investments, as compared to $1,247,551 at
December 31, 2001. The funds remaining at September 30, 2002, after payment of
distributions and other liabilities, will be used to meet the Partnership's
working capital needs.
Short-Term Liquidity
The Partnership's investment strategy of acquiring Properties for cash
and leasing them under triple-net leases to operators who meet specified
financial standards minimizes the Partnership's operating expenses. The general
partners believe that the leases will generate net cash flow in excess of
operating expenses.
The Partnership's short-term liquidity requirements consist primarily
of the operating expenses of the Partnership.
The general partners have the right, but not the obligation, to make
additional capital contributions if they deem it appropriate in connection with
the operations of the Partnership.
Total liabilities of the Partnership, including distributions payable,
were $1,001,316 at September 30, 2002, as compared to $867,518 at December 31,
2001. The increase in liabilities was primarily a result of an increase in
amounts due to related parties at September 30, 2002, as compared to December
31, 2001. The general partners believe that the Partnership has sufficient cash
on hand to meet its current working capital needs.
The Partnership generally distributes cash from operations remaining
after the payment of operating expenses of the Partnership, to the extent that
the general partners determine that such funds are available for distribution.
Based on current cash from operations, the Partnership declared distributions to
the limited partners of $2,362,503 for each of the nine months ended September
30, 2002 and 2001 ($787,501 for each of the quarters end September 30, 2002 and
2001). This represents distributions of $0.68 per unit for each of the nine
months ended September 30, 2002 and 2001, ($0.23 per unit for each applicable
quarter). No distributions were made to the general partners for the quarters
and nine months ended September 30, 2002 and 2001. No amounts distributed to the
limited partners for the nine months ended September 30, 2002 and 2001 are
required to be or have been treated by the Partnership as a return of capital
for purposes of calculating the limited partners' return on their adjusted
capital contributions. The Partnership intends to continue to make distributions
of cash available for distribution to the limited partners on a quarterly basis.
Long-Term Liquidity
The Partnership has no long-term debt or other long-term liquidity
requirements.
Results of Operations
Total rental revenues were $1,401,900 for the nine months ended
September 30, 2002, as compared to $1,451,134 in the same period of 2001, of
which $480,852 and $460,762 were earned during the third quarter of 2002 and
2001, respectively. The decrease in rental revenues during the nine months ended
September 30, 2002, as compared to the same periods of 2001, was partially due
to the 2001 and 2002 sales of several Properties. The decrease was partially
offset by the fact that between December 2001 and September 2002 the Partnership
reinvested a portion of these sales proceeds in three additional Properties.
In addition, the decrease in rental revenues during the nine months
ended September 30, 2002, as compared to the same period of 2001, was partially
due to the fact that in April 2001, the tenant of the Property in Wildwood,
Florida, ceased making rental payments and vacated the Property. In July 2001,
the Partnership and the tenant terminated the lease relating to this Property.
As a result, the Partnership stopped recording rental revenue. In addition, in
2001, Phoenix Restaurant Group, Inc. ("PRG"), the tenant of the Property in
Grand Prairie, Texas, experienced financial difficulties and ceased making
rental payments to the Partnership. As a result, during 2001, the Partnership
stopped recording rental revenues relating to this Property. In October 2001,
PRG filed for bankruptcy and rejected the lease relating to this Property. The
Partnership will not recognize any rental revenues from these two Properties
until the Properties are re-leased or sold and the proceeds are reinvested in
additional Properties. The general partners are currently seeking replacement
tenants for these Properties. The lost revenues resulting from the vacant
Properties will have an adverse effect on the results of operations of the
Partnership, if the Partnership is not able to re-lease or sell them in a timely
manner.
During the nine months ended September 30, 2002 and 2001, the
Partnership earned $1,025,261 and $570,290, respectively, attributable to net
income earned by joint ventures, $258,544 and $180,658 of which was earned
during the quarters ended September 30, 2002 and 2001, respectively. The
increase in net income earned by joint ventures during the quarter and nine
months ended September 30, 2002, as compared to the same periods of 2001, was
partially due to the fact that CNL Restaurant Investments III Joint Venture, in
which the Partnership owns a 50% interest, Ashland Joint Venture, in which the
Partnership owns a 27.33% interest, and the Partnership and CNL VIII, as
tenants-in-common, in which the Partnership owns a 34% interest, each sold one
Property, as described below, and CNL Restaurant Investments II Joint Venture,
in which the Partnership owns a 45.2% interest, sold two Properties. These sales
resulted in a net gain of $1,330,172 to the joint ventures, as described above
in "Capital Resources." In June and September 2002, the Partnership reinvested a
portion of these net sales proceeds and received the remaining portion as a
return of capital from the joint ventures.
In June 2001, the Partnership and CNL Income Fund VI, Ltd., as
tenants-in-common, sold the Property in Dublin, California, in which the
Partnership owned a 25% interest. The Partnership received its pro-rata share of
the net sales proceeds from the sale as a liquidating distribution. In July
2001, the Partnership reinvested a portion of the liquidating distribution in an
additional Property, as tenants-in-common with CNL Income Fund VI, Ltd. and CNL
Income Fund XVII, Ltd. Each of the CNL Income Funds is a Florida limited
partnership and an affiliate of the general partners.
During the nine months ended September 30, 2002 and 2001, the
Partnership earned $76,864 and $138,137, respectively, in interest and other
income, $51,135 and $28,798 of which were earned during the quarters ended
September 30, 2002 and 2001, respectively. Interest and other income was higher
during the nine months ended September 30, 2001 as compared to the same period
of 2002, primarily due to the fact that during the nine months ended September
30, 2001, the Partnership collected and recognized as income approximately
$63,500 from the tenant of two Properties that were sold during 2000, in
consideration for the Partnership releasing the tenant from its obligations
under the terms of its lease. Interest and other income was higher during the
quarter ended September 30, 2002 as compared to the same period of 2001,
primarily due to the fact that during the quarter and nine months ended
September 30, 2002, the Partnership collected and recognized as income
approximately $20,000 of a non-refundable earnest money deposit when a potential
purchaser defaulted under the terms of the sales contract. In addition, during
the quarter and nine months ended September 30, 2002, the Partnership collected
and recognized as income approximately $16,800 relating to a right-of-way taking
for a parcel of land on the Millbrook, Alabama Property.
Operating expenses, including depreciation and amortization expense and
provision for write-down of assets, were $871,941 and $1,072,585 for the nine
months ended September 30, 2002 and 2001, respectively, of which $169,987 and
$212,251 were incurred during the quarters ended September 30, 2002 and 2001,
respectively. The decrease in operating expenses during the quarter and nine
months ended September 30, 2002, as compared to the same periods of 2001, was
partially due to the fact that during the quarter and nine months ended
September 30, 2001, the Partnership recorded a provision for write-down of
assets of $62,125 and $462,925, respectively, relating to the vacant Properties
in Wildwood, Florida and Grand Prairie, Texas. The decrease was partially offset
by the fact that during the nine months ended September 30, 2002, the
Partnership recorded an additional provision for write-down of assets of
$321,609 relating to the Property in Wildwood, Florida. In 2001, the tenants
vacated the Properties and ceased payment of rents under the terms of their
lease agreements, as described above. The provisions represented the difference
between the carrying value of each Property and its estimated fair value.
The decrease in operating expenses during the nine months ended
September 30, 2002, as compared to the same period of 2001, was also partially
attributable to a decrease in the costs incurred for administrative expenses for
servicing the Partnership and its Properties. In addition, during the quarters
and nine months ended September 30, 2002 and 2001, the Partnership incurred
Property expenses such as real estate taxes, insurance and repairs and
maintenance relating to the vacant Properties in Wildwood, Florida and Grand
Prairie, Texas, as described above. The Partnership will continue to incur these
expenses until the Properties are re-leased or the Properties are sold and the
proceeds from such sales are reinvested in additional Properties.
Effective January 1, 2002, the Partnership adopted Statement of
Financial Accounting Standards No. 144 "Accounting for the Impairment or
Disposal of Long-Lived Assets." This statement requires that a long-lived asset
be tested for recoverability whenever events or changes in circumstances
indicate that its carrying amount may not be recoverable. The carrying amount of
a long-lived asset is not recoverable if it exceeds the sum of the undiscounted
cash flows expected to result from the use and eventual disposition of the
asset. The assessment is based on the carrying amount of the asset at the date
it is tested for recoverability. An impairment loss is recognized when the
carrying amount of a long-lived asset exceeds its fair value. If an impairment
is recognized, the adjusted carrying amount of a long-lived asset is its new
cost basis. The 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 if the disposal activity was
initiated subsequent to the adoption of the Standard.
During the nine months ended September 30, 2002, the Partnership
identified one Property that met the criteria of this standard and was
classified as Discontinued Operations in the accompanying financial statements.
As of November 6, 2002, the sale had not occurred. During the nine months ended
September 30, 2002, three of the joint ventures in which the Partnership is a
co-venturer identified and sold four Properties that met the criteria of this
standard. In addition, the Partnership identified and sold one Property, held as
tenants-in-common with CNL VIII, that met the criteria of this standard. The
financial results of these five Properties were classified as Discontinued
Operations in the condensed joint venture financial information presented in the
footnotes to the accompanying financial statements. The Partnership's pro-rata
share of these amounts is included in equity in earnings of joint ventures in
the accompanying financial statements. The majority of the net sales proceeds
from the above sales were reinvested in additional Properties and the remainder
of the proceeds was returned to the Partnership as a return of capital, as
described above in "Capital Resources."
As a result of the sale of the Property in Huntsville, Alabama, as
described above in "Capital Resources," the Partnership recognized a gain of
$231,731 during the quarter and nine months ended September 30, 2002. As a
result of the sale of the Property in Greenville, South Carolina, as described
above in "Capital Resources," the Partnership recognized a gain of $224,412
during the nine months ended September 30, 2002. These Properties were
identified for sale as of December 31, 2001. As a result of the sale of the
Property in Bedford, Illinois, the Partnership recognized a gain of $12,107
during the quarter and nine months ended September 30, 2001.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
No material changes in the Partnership's market risk occurred from
December 31, 2001 through September 30, 2002. Information regarding the
Partnership's market risk at December 31, 2001 is included in its Annual Report
on Form 10-K for the year ended December 31, 2001.
ITEM 4. CONTROLS AND PROCEDURES
The general partners maintain a set of disclosure controls and
procedures designed to ensure that information required to be disclosed in the
Partnership'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 corporate general partner have evaluated the
Partnership's disclosure controls and procedures within 90 days prior to the
filing of this Quarterly Report on Form 10-Q and have determined that such
disclosure controls and procedures are effective.
Subsequent to the above evaluation, there were no significant changes
in internal controls or other factors that could significantly affect these
controls, including any corrective actions with regard to significant
deficiencies and material weaknesses.
PART II. OTHER INFORMATION
Item 1. Legal Proceedings. Inapplicable.
Item 2. Changes in Securities. Inapplicable.
Item 3. Default upon Senior Securities. Inapplicable.
Item 4. Submission of Matters to a Vote of Security Holders. Inapplicable.
Item 5. Other Information. Inapplicable.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits
3.1 Affidavit and Certificate of Limited Partnership of CNL
Income Fund IX, Ltd. (Included as Exhibit 3.1 to
Registration Statement No. 33-35049 on Form S-11 and
incorporated herein by reference.)
4.1 Affidavit and Certificate of Limited Partnership of CNL
Income Fund IX, Ltd. (Included as Exhibit 3.1 to
Registration Statement No. 33-35049 on Form S-11 and
incorporated herein by reference.)
4.2 Amended and Restated Agreement of Limited Partnership of
CNL Income Fund IX, Ltd. (Included as Exhibit 4.6 to
Post-Effective Amendment No. 1 to Registration Statement
No. 33-35049 on Form S-11 and incorporated herein by
reference.)
10.1 Management Agreement between CNL Income Fund IX, Ltd. and
CNL Investment Company (Included as Exhibit 10.1 to Form
10-K filed with the Securities and Exchange Commission on
March 17, 1998, and incorporated herein by reference.)
10.2 Assignment of Management Agreement from CNL Investment
Company to CNL Income Fund Advisors, Inc. (Included as
Exhibit 10.2 to Form 10-K filed with the Securities and
Exchange Commission on March 30, 1995, and incorporated
herein by reference.)
10.3 Assignment of Management Agreement from CNL Income Fund
Advisors, Inc. to CNL Fund Advisors, Inc. (Included as
Exhibit 10.3 to Form 10-K filed with the Securities and
Exchange Commission on April 1, 1996, and incorporated
herein by reference.)
10.4 Assignment of Management Agreement from CNL Fund
Advisors, Inc. to CNL APF Partners, LP. (Included as
Exhibit 10.4 to Form 10-Q filed with the Securities
Exchange Commission on August 9, 2001, and incorporated
herein by reference.)
10.5 Assignment of Management Agreement from CNL APF Partners,
LP to CNL Restaurants XVIII, Inc. (Included as Exhibit
10.5 to Form 10-Q filed with the Securities and Exchange
Commission on August 14, 2002, and incorporated herein by
reference.)
99.1 Certification of Chief Executive Officer of Corporate
General Partner 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 Chief Financial Officer of Corporate
General Partner Pursuant to 18 U.S.C. Section 1350 as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002. (Filed herewith.)
(b) Reports on Form 8-K
No reports on Form 8-K were filed during the quarter
ended September 30, 2002.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned, thereunto duly authorized.
DATED this 6th day of November, 2002.
CNL INCOME FUND IX, LTD.
By: CNL REALTY CORPORATION
General Partner
By:/s/ James M. Seneff, Jr.
---------------------------
JAMES M. SENEFF, JR.
Chief Executive Officer
(Principal Executive Officer)
By:/s/ Robert A. Bourne
---------------------------
ROBERT A. BOURNE
President and Treasurer
(Principal Financial and
Accounting Officer)
CERTIFICATION OF CHIEF EXECUTIVE OFFICER
OF CORPORATE GENERAL PARTNER
PURSUANT TO RULE 13a-14 AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, James M. Seneff, Jr., the Chief Executive Officer of CNL Realty
Corporation, the corporate general partner of CNL Income Fund IX, Ltd. (the
"registrant"), certify that:
1. I have reviewed this quarterly report on Form 10-Q of the
registrant;
2. Based on my knowledge, this quarterly 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 quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly 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 quarterly report;
4. The registrant's other certifying officer 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 quarterly 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 quarterly report (the "Evaluation
Date"); and
c. presented in this quarterly 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 officer 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 officer and I have indicated in
this quarterly 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: November 6, 2002
/s/ James M. Seneff, Jr.
- -------------------------
James M. Seneff, Jr.
Chief Executive Officer
CERTIFICATION OF CHIEF FINANCIAL OFFICER
OF CORPORATE GENERAL PARTNER
PURSUANT TO RULE 13a-14 AS ADOPTED PURSUANT TO
SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002
I, Robert A. Bourne, President and Treasurer of CNL Realty Corporation,
the corporate general partner of CNL Income Fund IX, Ltd. (the "registrant")
certify that:
1. I have reviewed this quarterly report on Form 10-Q of the
registrant;
2. Based on my knowledge, this quarterly 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 quarterly report;
3. Based on my knowledge, the financial statements, and other financial
information included in this quarterly 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 quarterly report;
4. The registrant's other certifying officer 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 quarterly 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 quarterly report (the "Evaluation
Date"); and
c. presented in this quarterly 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 officer 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 officer and I have indicated in
this quarterly 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: November 6, 2002
/s/ Robert A. Bourne
- --------------------------
Robert A. Bourne
President and Treasurer
EXHIBIT INDEX
Exhibit Number
(c) Exhibits
3.1 Affidavit and Certificate of Limited Partnership of CNL
Income Fund IX, Ltd. (Included as Exhibit 3.1 to
Registration Statement No. 33-35049 on Form S-11 and
incorporated herein by reference.)
4.1 Affidavit and Certificate of Limited Partnership of CNL
Income Fund IX, Ltd. (Included as Exhibit 3.1 to
Registration Statement No. 33-35049 on Form S-11 and
incorporated herein by reference.)
4.2 Amended and Restated Agreement of Limited Partnership of
CNL Income Fund IX, Ltd. (Included as Exhibit 4.6 to
Post-Effective Amendment No. 1 to Registration Statement
No. 33-35049 on Form S-11 and incorporated herein by
reference.)
10.1 Management Agreement between CNL Income Fund IX, Ltd. and
CNL Investment Company (Included as Exhibit 10.1 to Form
10-K filed with the Securities and Exchange Commission on
March 17, 1998, and incorporated herein by reference.)
10.2 Assignment of Management Agreement from CNL Investment
Company to CNL Income Fund Advisors, Inc. (Included as
Exhibit 10.2 to Form 10-K filed with the Securities and
Exchange Commission on March 30, 1995, and incorporated
herein by reference.)
10.3 Assignment of Management Agreement from CNL Income Fund
Advisors, Inc. to CNL Fund Advisors, Inc. (Included as
Exhibit 10.3 to Form 10-K filed with the Securities and
Exchange Commission on April 1, 1996, and incorporated
herein by reference.)
10.4 Assignment of Management Agreement from CNL Fund Advisors,
Inc. to CNL APF Partners, LP. (Included as Exhibit 10.4 to
Form 10-Q filed with the Securities Exchange Commission on
August 9, 2001, and incorporated herein by reference.)
10.5 Assignment of Management Agreement from CNL APF Partners,
LP to CNL Restaurants XVIII, Inc. (Included as Exhibit 10.5
to Form 10-Q filed with the Securities and Exchange
Commission on August 14, 2002, and incorporated herein by
reference.)
99.1 Certification of Chief Executive Officer of Corporate
General Partner 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 Chief Financial Officer of Corporate
General Partner Pursuant to 18 U.S.C. Section 1350 as
Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act
of 2002. (Filed herewith.)
EXHIBIT 99.1
EXHIBIT 99.2