Supplemental consolidating financial information of Toll Brothers, Inc., the Subsidiary Issuer, the Guarantor Subsidiaries, the Nonguarantor 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 January 31, 2017:



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries	Nonguarantor Subsidiaries	Eliminations		Consolidated
ASSETS
Cash and cash equivalents	—		—		280,504	92,965	—		373,469
Restricted cash and investments	11,796					649			12,445
Inventory					7,244,287	295,687			7,539,974
Property, construction and office equipment, net					156,691	15,768			172,459
Receivables, prepaid expenses and other assets	17				353,100	200,837	(40,980	)	512,974
Mortgage loans held for sale						85,765			85,765
Customer deposits held in escrow					57,663	349			58,012
Investments in unconsolidated entities					96,840	504,856			601,696
Investments in foreclosed real estate and distressed loans									—
Investments in and advances to consolidated entities	4,163,667		2,747,471		91,740	166,492	(7,169,370	)	—
Deferred tax assets, net of valuation allowances	160,006								160,006
	4,335,486		2,747,471		8,280,825	1,363,368	(7,210,350	)	9,516,800
LIABILITIES AND EQUITY
Liabilities
Loans payable					879,894				879,894
Senior notes			2,687,342				8,182		2,695,524
Mortgage company loan facility						57,040			57,040
Customer deposits					326,407	17,743			344,150
Accounts payable					256,323	2,371			258,694
Accrued expenses			36,869		585,661	367,776	(50,204	)	940,102
Advances from consolidated entities					1,834,429	728,851	(2,563,280	)	—
Income taxes payable	20,372								20,372
Total liabilities	20,372		2,724,211		3,882,714	1,173,781	(2,605,302	)	5,195,776
Equity
Stockholders’ equity
Common stock	1,779				48	3,006	(3,054	)	1,779
Additional paid-in capital	718,861		49,400			93,734	(143,134	)	718,861
Retained earnings (deficits)	4,047,713		(26,140	)	4,398,063	86,937	(4,458,860	)	4,047,713
Treasury stock, at cost	(450,072	)							(450,072	)
Accumulated other comprehensive loss	(3,167	)							(3,167	)
Total stockholders’ equity	4,315,114		23,260		4,398,111	183,677	(4,605,048	)	4,315,114
Noncontrolling interest						5,910			5,910
Total equity	4,315,114		23,260		4,398,111	189,587	(4,605,048	)	4,321,024
	4,335,486		2,747,471		8,280,825	1,363,368	(7,210,350	)	9,516,800

Condensed Consolidating Balance Sheet at October 31, 2016:



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries	Nonguarantor Subsidiaries	Eliminations		Consolidated
ASSETS
Cash and cash equivalents	—		—		583,440	50,275	—		633,715
Restricted cash and investments	11,708					19,583			31,291
Inventory					6,896,205	457,806	(44	)	7,353,967
Property, construction and office equipment, net					153,663	15,913			169,576
Receivables, prepaid expenses and other assets	77				319,319	299,978	(36,616	)	582,758
Mortgage loans held for sale						248,601			248,601
Customer deposits held in escrow					50,079	2,978			53,057
Investments in unconsolidated entities					101,999	394,412			496,411
Investments in and advances to consolidated entities	4,112,876		2,741,160		20,519	90,671	(6,965,226	)	—
Deferred tax assets, net of valuation allowances	167,413								167,413
	4,292,074		2,741,160		8,125,224	1,580,217	(7,001,886	)	9,736,789
LIABILITIES AND EQUITY
Liabilities
Loans payable					871,079				871,079
Senior notes			2,683,823				10,549		2,694,372
Mortgage company loan facility						210,000			210,000
Customer deposits					292,794	16,305			309,099
Accounts payable					280,107	1,848			281,955
Accrued expenses			32,559		610,958	469,527	(40,744	)	1,072,300
Advances from consolidated entities					1,737,682	799,082	(2,536,764	)	—
Income taxes payable	62,782								62,782
Total liabilities	62,782		2,716,382		3,792,620	1,496,762	(2,566,959	)	5,501,587
Equity
Stockholders’ equity
Common stock	1,779				48	3,006	(3,054	)	1,779
Additional paid-in capital	728,464		49,400			6,734	(56,134	)	728,464
Retained earnings (deficits)	3,977,297		(24,622	)	4,332,556	67,805	(4,375,739	)	3,977,297
Treasury stock, at cost	(474,912	)							(474,912	)
Accumulated other comprehensive loss	(3,336	)							(3,336	)
Total stockholders’ equity	4,229,292		24,778		4,332,604	77,545	(4,434,927	)	4,229,292
Noncontrolling interest						5,910			5,910
Total equity	4,229,292		24,778		4,332,604	83,455	(4,434,927	)	4,235,202
	4,292,074		2,741,160		8,125,224	1,580,217	(7,001,886	)	9,736,789

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended January 31, 2017:



	Toll Brothers, Inc.	Subsidiary Issuer		Guarantor Subsidiaries	Nonguarantor Subsidiaries		Eliminations		Consolidated
Revenues				915,823	45,696		(40,789	)	920,730
Cost of revenues				724,257	29,471		(20,726	)	733,002
Selling, general and administrative		968		143,881	16,948		(24,702	)	137,095
	—	968		868,138	46,419		(45,428	)	870,097
Income (loss) from operations	—	(968	)	47,685	(723	)	4,639		50,633
Other:
Income from unconsolidated entities				5,144	41,301				46,445
Other income – net	2,393			7,251	4,500		(1,441	)	12,703
Intercompany interest income		36,496					(36,496	)	—
Interest expense		(37,895	)		(663	)	38,558		—
Income from subsidiaries	107,388			42,048			(149,436	)	—
Income (loss) before income taxes	109,781	(2,367	)	102,128	44,415		(144,176	)	109,781
Income tax provision (benefit)	39,365	(849	)	36,621	15,926		(51,698	)	39,365
Net income (loss)	70,416	(1,518	)	65,507	28,489		(92,478	)	70,416
Other comprehensive income	169								169
Total comprehensive income (loss)	70,585	(1,518	)	65,507	28,489		(92,478	)	70,585

Condensed Consolidating Statement of Operations and Comprehensive Income (Loss) for the three months ended January 31, 2016:



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries	Nonguarantor Subsidiaries		Eliminations		Consolidated
Revenues					784,596	170,223		(26,253	)	928,566
Cost of revenues					624,801	90,087		(2,577	)	712,311
Selling, general and administrative	12		969		125,905	17,973		(23,063	)	121,796
	12		969		750,706	108,060		(25,640	)	834,107
Income (loss) from operations	(12	)	(969	)	33,890	62,163		(613	)	94,459
Other:
Income from unconsolidated entities					2,997	5,641				8,638
Other income – net	2,391				8,169	4,193		(1,033	)	13,720
Intercompany interest income			36,497					(36,497	)	—
Interest expense			(37,895	)		(248	)	38,143		—
Income from subsidiaries	114,438				69,382			(183,820	)	—
Income (loss) before income taxes	116,817		(2,367	)	114,438	71,749		(183,820	)	116,817
Income tax provision (benefit)	43,637		(912	)	44,104	27,652		(70,844	)	43,637
Net income (loss)	73,180		(1,455	)	70,334	44,097		(112,976	)	73,180
Other comprehensive (loss) income	(288	)			27					(261	)
Total comprehensive income (loss)	72,892		(1,455	)	70,361	44,097		(112,976	)	72,919

Consolidating Statement of Operations and Comprehensive Income (Loss) for the fiscal year ended October 31, 2016



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries	Nonguarantor Subsidiaries		Eliminations		Consolidated
Revenues					4,984,356	361,685		(176,533	)	5,169,508
Cost of revenues					3,919,729	288,044		(63,708	)	4,144,065
Selling, general and administrative	75		3,809		558,822	74,328		(101,652	)	535,382
	75		3,809		4,478,551	362,372		(165,360	)	4,679,447
Income (loss) from operations	(75	)	(3,809	)	505,805	(687	)	(11,173	)	490,061
Other:
Income from unconsolidated entities					16,913	23,835				40,748
Other income - net	9,501				27,873	17,456		3,388		58,218
Intercompany interest income			145,828					(145,828	)	—
Interest expense			(151,410	)		(2,203	)	153,613		—
Income from consolidated subsidiaries	579,601				29,010			(608,611	)	—
Income (loss) before income taxes	589,027		(9,391	)	579,601	38,401		(608,611	)	589,027
Income tax provision (benefit)	206,932		(3,299	)	203,614	13,490		(213,805	)	206,932
Net income (loss)	382,095		(6,092	)	375,987	24,911		(394,806	)	382,095
Other comprehensive (loss) income	(858	)			31					(827	)
Total comprehensive income (loss)	381,237		(6,092	)	376,018	24,911		(394,806	)	381,268

Condensed Consolidating Statement of Cash Flows for the three months ended January 31, 2017:



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries		Nonguarantor Subsidiaries		Eliminations		Consolidated
Net cash (used in) provided by operating activities	(25,840	)	6,311		(273,424	)	338,773		(3,856	)	41,964
Cash flow provided by (used in) investing activities:
Purchase of property and equipment - net					(6,393	)	79				(6,314	)
Investment in unconsolidated entities					(267	)	(99,674	)			(99,941	)
Return of investments in unconsolidated entities					9,950		23,303				33,253
Investment in foreclosed real estate and distressed loans							(274	)			(274	)
Return of investments in foreclosed real estate and distressed loans							1,852				1,852
Acquisition of a business					(85,183	)					(85,183	)
Investment paid - intercompany					45,000				(45,000	)	—
Intercompany advances	14,992		(6,311	)					(8,681	)	—
Net cash provided by (used in) investing activities	14,992		(6,311	)	(36,893	)	(74,714	)	(53,681	)	(156,607	)
Cash flow used in financing activities:
Proceeds from loans payable							360,382				360,382
Debt issuance costs for loans payable											—
Principal payments of loans payable					(3,491	)	(513,342	)			(516,833	)
Proceeds from stock-based benefit plans	25,831										25,831
Excess tax benefits from stock-based compensation	253										253
Purchase of treasury stock	(15,236	)									(15,236	)
Dividend paid - intercompany											—
Investment received intercompany							45,000		(45,000	)	—
Intercompany advances					10,872		(113,409	)	102,537		—
Net cash used in financing activities	10,848		—		7,381		(221,369	)	57,537		(145,603	)
Net decrease in cash and cash equivalents	—		—		(302,936	)	42,690		—		(260,246	)
Cash and cash equivalents, beginning of period	—		—		583,440		50,275		—		633,715
Cash and cash equivalents, end of period	—		—		280,504		92,965		—		373,469

Condensed Consolidating Statement of Cash Flows for the three months ended January 31, 2016:



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries		Nonguarantor Subsidiaries		Eliminations		Consolidated
Net cash (used in) provided by operating activities	18,482		14,528		(178,283	)	132,051		(10,003	)	(23,225	)
Cash flow provided by (used in) investing activities:
Purchase of property and equipment — net					(1,667	)	74				(1,593	)
Purchase of marketable securities											—
Sale and redemption of marketable securities							10,000				10,000
Investments in unconsolidated entities					(1,445	)	(10,393	)			(11,838	)
Return of investments in unconsolidated entities					12,167		2,637				14,804
Investment in foreclosed real estate and distressed loans							(694	)			(694	)
Return of investments in foreclosed real estate and distressed loans							5,321				5,321
Dividend received – intercompany					5,000				(5,000	)	—
Intercompany advances	126,587		(14,464	)					(112,123	)	—
Net cash provided by (used in) investing activities	126,587		(14,464	)	14,055		6,945		(117,123	)	16,000
Cash flow used in financing activities:
Debt issuance costs for senior notes			(64	)							(64	)
Proceeds from loans payable							339,854				339,854
Principal payments of loans payable					(394,592	)	(375,947	)			(770,539	)
Proceeds from stock-based benefit plans	4,769										4,769
Excess tax benefits from stock-based compensation	297										297
Purchase of treasury stock	(150,135	)									(150,135	)
Receipts related to noncontrolling interest							294				294
Dividend paid – intercompany							(5,000	)	5,000		—
Intercompany advances					(46,017	)	(76,109	)	122,126		—
Net cash used in financing activities	(145,069	)	(64	)	(440,609	)	(116,908	)	127,126		(575,524	)
Net (decrease) increase in cash and cash equivalents	—		—		(604,837	)	22,088		—		(582,749	)
Cash and cash equivalents, beginning of period	—		—		783,599		135,394		—		918,993
Cash and cash equivalents, end of period	—		—		178,762		157,482		—		336,244

Consolidating Statement of Cash Flows for the fiscal year ended October 31, 2016



	Toll Brothers, Inc.		Subsidiary Issuer		Guarantor Subsidiaries		Nonguarantor Subsidiaries		Eliminations		Consolidated
Net cash provided by (used in) operating activities	60,465		14,768		105,709		(64,386	)	32,215		148,771
Cash flow provided by (used in) investing activities:
Purchase of property and equipment — net					(27,835	)	(591	)			(28,426	)
Purchase of marketable securities											—
Sale and redemption of marketable securities							10,000				10,000
Investment in unconsolidated entities					(2,637	)	(67,018	)			(69,655	)
Return of investments in unconsolidated entities					32,857		14,949				47,806
Investment in distressed loans and foreclosed real estate							(1,133	)			(1,133	)
Return of investments in distressed loans and foreclosed real estate							49,619				49,619
Dividends received intercompany					5,000				(5,000	)	—
Investment paid intercompany					(5,000	)			5,000		—
Intercompany advances	323,207		(14,733	)					(308,474	)	—
Net cash provided by (used in) investing activities	323,207		(14,733	)	2,385		5,826		(308,474	)	8,211
Cash flow (used in) provided by financing activities:
Debt issuance costs for senior notes			(35	)							(35	)
Proceeds from loans payable					550,000		1,893,496				2,443,496
Debt issuance costs for loans payable					(4,868	)					(4,868	)
Principal payments of loans payable					(714,089	)	(1,783,496	)			(2,497,585	)
Proceeds from stock-based benefit plans	6,986										6,986
Excess tax benefits from stock-based compensation	2,114										2,114
Purchase of treasury stock	(392,772	)									(392,772	)
Receipts related to noncontrolling interest							404				404
Dividends paid intercompany							(5,000	)	5,000		—
Investment received intercompany							5,000		(5,000	)	—
Intercompany advances					(139,296	)	(136,963	)	276,259		—
Net cash (used in) provided by financing activities	(383,672	)	(35	)	(308,253	)	(26,559	)	276,259		(442,260	)
Net decrease in cash and cash equivalents	—		—		(200,159	)	(85,119	)	—		(285,278	)
Cash and cash equivalents, beginning of period	—		—		783,599		135,394		—		918,993
Cash and cash equivalents, end of period	—		—		583,440		50,275		—		633,715