Supplemental consolidating financial information of Toll Brothers, Inc., the Subsidiary Issuer, the Guarantor Subsidiaries, the Non-Guarantor Subsidiaries and the eliminations to arrive at Toll Brothers, Inc. on a consolidated basis is presented below ($ amounts in thousands).

Condensed Consolidating Balance Sheet at July 31, 2013:



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Eliminations		Consolidated
ASSETS
Cash and cash equivalents	—		—		772,728		126,613		—		899,341
Marketable securities					112,508		10,019				122,527
Restricted cash	15,094				17,041		1,281				33,416
Inventory					4,494,099		22,909				4,517,008
Property, construction and office equipment, net					111,836		14,524				126,360
Receivables, prepaid expenses and other assets	120		16,524		86,904		98,424		(27,012	)	174,960
Mortgage loans held for sale							72,163				72,163
Customer deposits held in escrow					48,878						48,878
Investments in and advances to unconsolidated entities					173,118		183,719				356,837
Investments in distressed loans							42,500				42,500
Investments in foreclosed real estate							72,912				72,912
Investments in and advances to consolidated entities	2,953,381		2,455,063		4,740				(5,413,184	)	—
Deferred tax assets, net of valuation allowances	320,641										320,641
	3,289,236		2,471,587		5,821,852		645,064		(5,440,196	)	6,787,543
LIABILITIES AND EQUITY
Liabilities:
Loans payable					97,679						97,679
Senior notes			2,384,717						41,089		2,425,806
Mortgage company warehouse loan							65,654				65,654
Customer deposits					231,493						231,493
Accounts payable					153,200		(37	)			153,163
Accrued expenses			43,023		350,209		152,336		(27,121	)	518,447
Advances from consolidated entities					1,750,366		402,694		(2,153,060	)	—
Income taxes payable	78,973										78,973
Total liabilities	78,973		2,427,740		2,582,947		620,647		(2,139,092	)	3,571,215
Equity:
Stockholders’ equity:
Common stock	1,693				48		3,006		(3,054	)	1,693
Additional paid-in capital	430,191		49,400				1,734		(51,134	)	430,191
Retained earnings (deficits)	2,797,098		(5,553	)	3,238,967		13,502		(3,246,916	)	2,797,098
Treasury stock, at cost	(14,218	)									(14,218	)
Accumulated other comprehensive loss	(4,501	)			(110	)	(19	)			(4,630	)
Total stockholders’ equity	3,210,263		43,847		3,238,905		18,223		(3,301,104	)	3,210,134
Noncontrolling interest							6,194				6,194
Total equity	3,210,263		43,847		3,238,905		24,417		(3,301,104	)	3,216,328
	3,289,236		2,471,587		5,821,852		645,064		(5,440,196	)	6,787,543

Revised Condensed Consolidating Balance Sheet at October 31, 2012:



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Eliminations		Consolidated
ASSETS
Cash and cash equivalents	—		—		712,024		66,800		—		778,824
Marketable securities					378,858		60,210				439,068
Restricted cash	28,268				17,561		1,447				47,276
Inventory					3,740,181		21,006				3,761,187
Property, construction and office equipment, net					106,963		3,008				109,971
Receivables, prepaid expenses and other assets	134		15,130		76,192		64,543		(11,441	)	144,558
Mortgage loans held for sale							86,386				86,386
Customer deposits held in escrow					27,312		2,267				29,579
Investments in and advances to unconsolidated entities					180,159		150,458				330,617
Investments in distressed loans							37,169				37,169
Investments in foreclosed real estate							58,353				58,353
Investments in and advances to consolidated entities	2,816,607		2,092,810		4,740				(4,914,157	)	—
Deferred tax assets, net of valuation allowances	358,056										358,056
	3,203,065		2,107,940		5,243,990		551,647		(4,925,598	)	6,181,044
LIABILITIES AND EQUITY
Liabilities:
Loans payable					99,817						99,817
Senior notes			2,032,335						48,128		2,080,463
Mortgage company warehouse loan							72,664				72,664
Customer deposits					142,919		58				142,977
Accounts payable					99,889		22				99,911
Accrued expenses			27,476		344,555		115,922		(11,603	)	476,350
Advances from consolidated entities					1,385,475		348,909		(1,734,384	)	—
Income taxes payable	80,991										80,991
Total liabilities	80,991		2,059,811		2,072,655		537,575		(1,697,859	)	3,053,173
Equity:
Stockholders’ equity:
Common stock	1,687				48		3,006		(3,054	)	1,687
Additional paid-in capital	404,418		49,400				1,734		(51,134	)	404,418
Retained earnings (deficits)	2,721,397		(1,271	)	3,171,654		3,168		(3,173,551	)	2,721,397
Treasury stock, at cost	(983	)									(983	)
Accumulated other comprehensive loss	(4,445	)			(367	)	(7	)			(4,819	)
Total stockholders’ equity	3,122,074		48,129		3,171,335		7,901		(3,227,739	)	3,121,700
Noncontrolling interest							6,171				6,171
Total equity	3,122,074		48,129		3,171,335		14,072		(3,227,739	)	3,127,871
	3,203,065		2,107,940		5,243,990		551,647		(4,925,598	)	6,181,044

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the nine months ended July 31, 2013 ($ in thousands):



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries	Non- Guarantor Subsidiaries		Eliminations		Consolidated
Revenues					1,658,184	48,186		(76,605	)	1,629,765
Cost of revenues					1,322,437	7,083		(18,481	)	1,311,039
Selling, general and administrative	151		2,203		267,627	34,244		(57,758	)	246,467
	151		2,203		1,590,064	41,327		(76,239	)	1,557,506
Income (loss) from operations	(151	)	(2,203	)	68,120	6,859		(366	)	72,259
Other:
Income from unconsolidated entities					5,766	3,078				8,844
Other income - net	7,059				26,807	7,460		(4,882	)	36,444
Intercompany interest income			94,055					(94,055	)	—
Interest expense			(98,891	)		(412	)	99,303		—
Income from subsidiaries	110,639				9,946			(120,585	)	—
Income (loss) before income taxes	117,547		(7,039	)	110,639	16,985		(120,585	)	117,547
Income tax provision (benefit)	41,846		(2,757	)	43,326	6,651		(47,220	)	41,846
Net income (loss)	75,701		(4,282	)	67,313	10,334		(73,365	)	75,701
Other comprehensive income (loss)	(55	)			256	(12	)			189
Total comprehensive income (loss)	75,646		(4,282	)	67,569	10,322		(73,365	)	75,890

Revised Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the nine months ended July 31, 2012 ($ in thousands):



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Eliminations		Consolidated
Revenues					1,273,494		42,581		(66,120	)	1,249,955
Cost of revenues					1,034,761		4,550		(12,954	)	1,026,357
Selling, general and administrative	54		2,355		233,502		28,598		(51,724	)	212,785
	54		2,355		1,268,263		33,148		(64,678	)	1,239,142
Income (loss) from operations	(54	)	(2,355	)	5,231		9,433		(1,442	)	10,813
Other:
Income from unconsolidated entities					15,475		3,873				19,348
Other income - net	39				15,209		3,397		3,387		22,032
Intercompany interest income			86,466						(86,466	)	—
Interest expense			(84,111	)			(410	)	84,521		—
Income from subsidiaries	52,208				16,293				(68,501	)	—
Income before income taxes	52,193		—		52,208		16,293		(68,501	)	52,193
Income tax benefit	(23,536	)			(23,541	)	(7,346	)	30,887		(23,536	)
Net income	75,729		—		75,749		23,639		(99,388	)	75,729
Other comprehensive (loss) income	293				(509	)	(19	)			(235	)
Total comprehensive income	76,022		—		75,240		23,620		(99,388	)	75,494

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended July 31, 2013 ($ in thousands):



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries	Non- Guarantor Subsidiaries		Eliminations		Consolidated
Revenues					704,559	18,906		(34,305	)	689,160
Cost of revenues					549,456	2,439		(6,806	)	545,089
Selling, general and administrative	90		801		97,041	13,187		(22,249	)	88,870
	90		801		646,497	15,626		(29,055	)	633,959
Income (loss) from operations	(90	)	(801	)	58,062	3,280		(5,250	)	55,201
Other:
Income from unconsolidated entities					726	42				768
Other income - net	2,374				2,335	4,081		3,494		12,284
Intercompany interest income			33,995					(33,995	)	—
Interest expense			(35,561	)		(190	)	35,751		—
Income from subsidiaries	65,969				4,846			(70,815	)	—
Income (loss) before income taxes	68,253		(2,367	)	65,969	7,213		(70,815	)	68,253
Income tax provision (benefit)	21,658		(927	)	25,833	2,824		(27,730	)	21,658
Net income (loss)	46,595		(1,440	)	40,136	4,389		(43,085	)	46,595
Other comprehensive income (loss)	(37	)			220	48				231
Total comprehensive income (loss)	46,558		(1,440	)	40,356	4,437		(43,085	)	46,826

Revised Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended July 31, 2012 ($ in thousands):



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Eliminations		Consolidated
Revenues					562,143		16,959		(24,783	)	554,319
Cost of revenues					453,441		1,806		(7,319	)	447,928
Selling, general and administrative	27		573		84,061		9,637		(19,406	)	74,892
	27		573		537,502		11,443		(26,725	)	522,820
Income (loss) from operations	(27	)	(573	)	24,641		5,516		1,942		31,499
Other:
Income from unconsolidated entities					4,672		1,000				5,672
Other income - net	19				7,615		(134	)	(1,719	)	5,781
Intercompany interest income			28,575						(28,575	)	—
Interest expense			(28,002	)			(350	)	28,352		—
Income from subsidiaries	42,960				6,032				(48,992	)	—
Income before income taxes	42,952		—		42,960		6,032		(48,992	)	42,952
Income tax benefit	(18,691	)			(18,692	)	(1,966	)	20,658		(18,691	)
Net income	61,643		—		61,652		7,998		(69,650	)	61,643
Other comprehensive income	201				25		19				245
Total comprehensive income	61,844		—		61,677		8,017		(69,650	)	61,888

Condensed Consolidating Statement of Cash Flows for the nine months ended July 31, 2013 ($ in thousands):



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Eliminations		Consolidated
Net cash (used in) provided by operating activities	77,313		20,938		(541,461	)	(3,430	)	(9,895	)	(456,535	)
Cash flow provided by (used in) investing activities:
Purchase of property and equipment - net					(12,646	)	(11,538	)			(24,184	)
Purchase of marketable securities					(25,938	)	(10,264	)			(36,202	)
Sale and redemption of marketable securities					288,332		60,263				348,595
Investments in and advances to unconsolidated entities					(25,517	)	(23,693	)			(49,210	)
Return of investments in unconsolidated entities					38,811		11,642				50,453
Investments in distressed loans and foreclosed real estate							(26,155	)			(26,155	)
Return of investments in distressed loans and foreclosed real estate							15,396				15,396
Intercompany advances	(72,369	)	(362,253	)					434,622		—
Net cash provided by (used in) investing activities	(72,369	)	(362,253	)	263,042		15,651		434,622		278,693
Cash flow provided by (used in) financing activities:
Net proceeds from issuance of senior notes			400,383								400,383
Proceeds from loans payable							796,791				796,791
Principal payments of loans payable					(31,035	)	(803,801	)			(834,836	)
Redemption of senior notes			(59,068	)							(59,068	)
Proceeds from stock-based benefit plans	10,365										10,365
Receipts related to noncontrolling interest							33				33
Purchase of treasury stock	(15,309	)									(15,309	)
Intercompany advances					370,158		54,569		(424,727	)	—
Net cash provided by (used in) financing activities	(4,944	)	341,315		339,123		47,592		(424,727	)	298,359
Net increase in cash and cash equivalents	—		—		60,704		59,813		—		120,517
Cash and cash equivalents, beginning of period	—		—		712,024		66,800		—		778,824
Cash and cash equivalents, end of period	—		—		772,728		126,613		—		899,341

Revised Condensed Consolidating Statement of Cash Flows for the nine months ended July 31, 2012 ($ in thousands):



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries		Non- Guarantor Subsidiaries		Eliminations		Consolidated
Net cash (used in) provided by operating activities	(42,308	)	15,773		(168,722	)	(35,554	)	(1,127	)	(231,938	)
Cash flow (used in) provided by investing activities:
Purchase of property and equipment — net					(9,485	)	9				(9,476	)
Purchase of marketable securities					(257,431	)	(60,138	)			(317,569	)
Sale and redemption of marketable securities					270,503						270,503
Investments in and advances to unconsolidated entities					(112,717	)	(83,096	)			(195,813	)
Return of investments in unconsolidated entities					29,281		3,950				33,231
Investments in distressed loans and foreclosed real estate							(30,090	)			(30,090	)
Return of investments in distressed loans and foreclosed real estate							14,412				14,412
Acquisition of a business					(144,746	)					(144,746	)
Intercompany advances	18,177		(312,000	)					293,823		—
Net cash (used in) provided by investing activities	18,177		(312,000	)	(224,595	)	(154,953	)	293,823		(379,548	)
Cash flow provided by (used in) financing activities:
Net proceeds from issuance of senior notes			296,227								296,227
Proceeds from loans payable							675,481				675,481
Principal payments of loans payable					(19,480	)	(669,762	)			(689,242	)
Proceeds from stock-based benefit plans	24,515										24,515
Purchase of treasury stock	(384	)									(384	)
Intercompany advances					169,156		123,540		(292,696	)	—
Net cash provided by financing activities	24,131		296,227		149,676		129,259		(292,696	)	306,597
Net decrease in cash and cash equivalents	—		—		(243,641	)	(61,248	)	—		(304,889	)
Cash and cash equivalents, beginning of period	—		—		777,012		129,328		—		906,340
Cash and cash equivalents, end of period	—		—		533,371		68,080		—		601,451