SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED January 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 1-9186 TOLL BROTHERS, INC. (Exact name of registrant as specified in its charter) Delaware 23-2416878 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 3103 Philmont Avenue, Huntingdon Valley, Pennsylvania 19006 (Address of principal executive offices) (Zip Code) (215) 938-8000 (Registrant's telephone number, including area code) Not applicable (Former name, former address and former fiscal year, if changed since last report) 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 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 Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date: Common Stock, $.01 par value: 35,409,187 shares as of March 4, 2002 <TABLE> <CAPTION> TOLL BROTHERS, INC. AND SUBSIDIARIES INDEX <S> <C> Page No. Statement of Forward-Looking Information 1 PART I. Financial Information ITEM 1. Financial Statements Condensed Consolidated Balance Sheets (Unaudited) as of January 31, 2002 and October 31, 2001 2 Condensed Consolidated Statements of Income (Unaudited) For the Three Months Ended January 31, 2002 and 2001 3 Condensed Consolidated Statements of Cash Flows (Unaudited) For the Three Months Ended January 31, 2002 and 2001 4 Notes to Condensed Consolidated Financial Statements (Unaudited) 5 ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 7 ITEM 3. Quantitative and Qualitative Disclosures About Market Risk 10 PART II. Other Information 12 SIGNATURES 13 </TABLE> STATEMENT ON FORWARD-LOOKING INFORMATION Certain information included herein and in other Company reports, SEC filings, statements and presentations is forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995, including, but not limited to, statements concerning the Company's anticipated operating results, financial resources, changes in revenues, changes in profitability, interest expense, growth and expansion, ability to acquire land, ability to sell homes and properties, ability to deliver homes from backlog, ability to secure materials and subcontractors and stock market valuations. In some cases you can identify those so-called forward looking statements by words such as "may", "will", "should", "expects", "plans", "anticipates", "believes", "estimates", "predicts", "potential", or "continue" or the negative of those words or other comparable words. Such forward-looking information involves important risks and uncertainties that could significantly affect actual results and cause them to differ materially from expectations expressed herein and in other Company reports, SEC filings, statements and presentations. These risks and uncertainties include local, regional and national economic and political conditions, consequences of any future terrorist attacks such as those that occurred on September 11, 2001, the effects of governmental regulation, the competitive environment in which the Company operates, fluctuations in interest rates, changes in home prices, the availability and cost of land for future growth, the availability of capital, fluctuations in capital and securities markets, the availability and cost of labor and materials, and weather conditions. Additional information concerning potential factors that the Company believes could cause its actual results to differ materially from expected and historical results is included under the caption "Factors That May Affect Our Future Results" in Item 1 of our Annual Report on Form 10-K for the fiscal year ended October 31, 2001. If one or more of the assumptions underlying our forward-looking statements proves incorrect, then the Company's actual results, performance or achievements could differ materially from those expressed in, or implied by the forward-looking statements contained in this report. Therefore, we caution you not to place undue reliance on our forward-looking statements. This statement is provided as permitted by the Private Securities Litigation Reform Act of 1995. <TABLE> <CAPTION> PART 1. FINANCIAL INFORMATION ITEM 1. TOLL BROTHERS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Amounts in thousands) January 31, October 31, 2002 2001 (Unaudited) ASSETS <S> <C> <C> Cash and cash equivalents $ 273,552 $ 182,840 Inventory 2,276,803 2,183,541 Property, construction and office equipment, net 33,686 33,095 Receivables, prepaid expenses and other assets 94,708 91,784 Mortgage loans receivable 27,794 26,758 Investments in unconsolidated entities 13,457 14,182 $ 2,720,000 $ 2,532,200 LIABILITIES AND STOCKHOLDERS' EQUITY <S> <C> <C> Liabilities: Loans payable $ 382,871 $ 387,466 Subordinated notes 819,602 669,581 Customer deposits 100,895 101,778 Accounts payable 132,963 132,970 Accrued expenses 224,685 229,671 Income taxes payable 84,343 98,151 Total liabilities $ 1,745,359 $ 1,619,617 Stockholders' equity: Preferred stock Common stock 369 369 Additional paid-in capital 105,385 107,014 Retained earnings 926,775 882,281 Treasury stock (57,888) (77,081) Total stockholders' equity 974,641 912,583 $ 2,720,000 $ 2,532,200 </TABLE> See accompanying notes <TABLE> <CAPTION> TOLL BROTHERS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Amounts in thousands, except per share data) (Unaudited) Three Months Ended January 31, 2002 2001 Revenues: <S> <C> <C> Housing sales $ 482,702 $ 458,369 Land sales 6,423 10,907 Equity earnings of unconsolidated joint ventures 2,386 Interest and other 3,054 3,599 492,179 475,261 Costs and expenses: Housing sales 351,425 344,813 Land sales 4,217 8,540 Selling, general & administrative 52,398 46,949 Interest 14,155 11,764 422,195 412,066 Income before income taxes 69,984 63,195 Income taxes 25,490 23,270 Net income $ 44,494 $ 39,925 Earnings per share Basic $ 1.27 $ 1.10 Diluted $ 1.20 $ 1.01 Weighted average number of shares Basic 35,001 36,163 Diluted 37,122 39,415 </TABLE> See accompanying notes <TABLE> <CAPTION> TOLL BROTHERS, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Amounts in thousands) (Unaudited) Three months ended January 31, 2002 2001 Cash flows from operating activities: <S> <C> <C> Net income $ 44,494 $ 39,925 Adjustments to reconcile net income to net cash used in operating activities: Depreciation and amortization 2,903 2,265 Equity in the earnings of unconsolidated joint ventures (2,386) Deferred tax provision (1,414) 1,685 Changes in operating assets and liabilities: Increase in inventory (92,752) (136,047) Origination of mortgage loans (83,430) (26,186) Sale of mortgage loans 82,397 24,877 Increase in receivables, prepaid expenses and other assets (3,151) (5,800) (Decrease) increase in customer deposits (882) 603 Increase (decrease) in accounts payable and accrued expenses 1,860 (23,279) Decrease in current income taxes payable (8,096) (16,165) Net cash used in operating activities (58,071) (140,508) Cash flows from investing activities: <S> <C> <C> Purchase of property, construction and office equipment, net (3,072) (3,396) Investments in unconsolidated entities (2,000) Distribution from unconsolidated entities 2,800 8,750 Net cash (used in) provided by investing activities (2,272) 5,354 Cash flows from financing activities: <S> <C> <C> Proceeds from loans payable 96,540 40,000 Principal payments of loans payable (101,645) (42,268) Net proceeds from the issuance of subordinated debt 149,748 196,975 Proceeds from stock-based benefit plans 6,437 9,680 Purchase of treasury stock (25) (1,642) Net cash provided by financing activities 151,055 202,745 Increase in cash and cash equivalents 90,712 67,591 Cash and cash equivalents, beginning of period 182,840 161,860 Cash and cash equivalents, end of period $ 273,552 $ 229,451 </TABLE> See accompanying notes TOLL BROTHERS, INC. and SUBSIDIARIES NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (unaudited) 1. Basis of Presentation The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission for interim financial information. The October 31, 2001 balance sheet amounts and disclosures included herein have been derived from the October 31, 2001 audited financial statements of Toll Brothers, Inc. and Subsidiaries. Since the accompanying condensed consolidated financial statements do not include all the information and footnotes required by accounting principles generally accepted in the United States for complete financial statements, it is suggested that they be read in conjunction with the financial statements and notes thereto included in the Company's October 31, 2001 Annual Report on Form 10-K. In the opinion of management, the accompanying unaudited condensed consolidated financial statements include all adjustments, which are of a normal recurring nature, necessary to present fairly the Company's financial position as of January 31, 2002 and the results of its operations and cash flows for the three months ended January 31, 2002 and 2001. The results of operations for such interim periods are not necessarily indicative of the results to be expected for the full year. Certain amounts reported in prior periods have been reclassified for comparative purposes. Statement of Financial Accounting Standards ("SFAS") No. 142, "Goodwill and Other Intangible Assets" provides guidance on accounting for certain intangibles and eliminates the amortization of goodwill and certain other intangible assets. Intangible assets, including goodwill, that are not subject to amortization are required to be tested for impairment and possible write-down on an annual basis. The Company adopted SFAS 142 on November 1, 2001, the first day of its 2002 fiscal year. The Company had $9.4 million of goodwill at November 1, 2001. The adoption of SFAS 142 did not have a material impact on the Company's financial statements. <TABLE> <CAPTION> 2. Inventory Inventory consisted of the following (amounts in thousands): January 31, October 31, 2002 2001 <S> <C> <C> Land and land development costs $ 864,955 $ 833,386 Construction in progress 1,191,528 1,145,046 Sample homes 83,733 75,723 Land deposits and costs of future developments 90,942 89,360 Deferred marketing costs 45,645 40,026 $2,276,803 $2,183,541 </TABLE> Construction in progress includes the cost of homes under construction, land, land development costs and carrying costs of lots that have been substantially improved. <TABLE> <CAPTION> The Company capitalizes certain interest costs to inventories during the development and co Capitalized interest is charged to interest expense when the related inventory is delivered Interest incurred, capitalized and expensed is summarized as follows (amounts in thousands) Three months ended January 31, 2002 2001 <S> <C> <C> Interest capitalized, beginning of period $ 98,650 $ 78,443 Interest incurred 22,870 16,913 Interest expensed (14,155) (11,764) Write-off to cost of sales ( 823) Interest capitalized, end of period $ 106,542 $ 83,592 </TABLE> <TABLE> <CAPTION> 3. Earnings Per Share Information pertaining to the calculation of earnings per share for the three months e is as follows (amounts in thousands): 2002 2001 <S> <C> <C> Basic weighted average shares 35,001 36,163 Common stock equivalents 2,121 3,252 Diluted weighted average shares 37,122 39,415 </TABLE> 4. Subordinated Notes In November 2001, the Company issued $150,000,000 of 8.25% Senior Subordinated Notes due December 2011. The Company has used the proceeds for general corporate purposes including the acquisition of inventory. 5. Stock Repurchase Program The Company's Board of Directors has authorized the repurchase of up to 5,000,000 shares of its common stock, par value $.01, from time to time, in open market transactions or otherwise, for the purpose of providing shares for the Company's various employee benefit plans. As of January 31, 2002, the Company had repurchased approximately 2,062,000 shares under the program. 6. Subsequent Event On March 4, 2002, the Company's Board of Directors declared a two-for-one split of its common stock which will be effected in the form of a stock dividend. Record holders of the Company's common stock as of the close of business on March 14, 2002 will be entitled to one additional share for each share held as of that time. The new shares will be distributed on March 28, 2002. 7. Supplemental Disclosure to Statements of Cash Flows <TABLE> <CAPTION> The following are supplemental disclosures to the statements of cash flows (amounts in thousands): Three months ended January 31, 2002 2001 <S> <C> <C> Supplemental disclosures of cash flow information: Interest paid, net of capitalized amounts $ 3,574 $ 3,045 Income taxes paid $ 35,000 $ 37,750 Supplemental disclosures of non-cash activities: Cost of residential inventories acquired through seller financing $ 510 $ 4,500 Income tax benefit relating to exercise of employee stock options $ 4,298 $ 4,312 Stock bonus award $ 6,853 $ 4,413 </TABLE> ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS CRITICAL ACCOUNTING POLICIES Basis of Presentation The Company's financial statements include the accounts of Toll Brothers, Inc. and its majority owned subsidiaries. All significant intercompany accounts and transactions have been eliminated. Investments in 20% to 50% owned partnerships and affiliates are accounted for on the equity method. Income Recognition Revenue and cost of sales are recorded at the time each home, or lot, is closed and title and possession have been transferred to the buyer. Land, land development and related costs are amortized to the cost of homes closed based upon the total number of homes to be constructed in each community. Home construction and related costs are charged to the cost of homes closed under the specific identification method. Land, common development and related costs of master planned communities are allocated to individual communities within the master planned community on a relative sales value basis. Joint Venture Accounting The Company has entered into three joint ventures to develop and sell land that was owned or is currently owned by its venture partners. The Company recognizes its share of earnings from the sale of lots to other builders. The Company does not recognize earnings from lots it purchases from the ventures, but reduces its cost basis in the lots by its share of the earnings on those lots. The Company has agreed to purchase 180 lots from one of the ventures, 46 lots from another and has the right to purchase up to 385 lots from the third. In addition, the Company effectively owns one-third of Toll Brothers Realty Trust (the "Trust"), an entity that was formed to take advantage of commercial real estate opportunities that may present themselves from time to time. The Company is committed to invest an additional $9.2 million in the Trust if required. The Company provides development finance and administrative services to the Trust and receives fees from it under various agreements. The Company also owns 50% of a joint venture that is currently selling and building an active adult, age-qualified community. The Company's total commitment to these entities is not material to its financial position. These investments are accounted for on the equity method. <TABLE> <CAPTION> RESULTS OF OPERATIONS The following table sets forth, for the three months ended January 31, 2002 and 2001, certain income statement items related to the Company's operations (amounts in millions): Three months ended January 31, 2002 2001 $ % $ % <S> <C> <C> <C> <C> Housing sales Revenues 482.7 458.4 Costs 351.4 72.8 344.8 75.2 Land sales Revenues 6.4 10.9 Costs 4.2 65.7 8.5 78.3 Equity earnings in unconsolidated joint venture 2.4 Other 3.1 3.6 Total revenue 492.2 475.3 Selling, general & administrative expenses* 52.4 10.6 46.9 9.9 Interest expense* 14.2 2.9 11.8 2.5 Total costs and expenses* 422.2 85.8 412.1 86.7 Income before income taxes* 70.0 14.2 63.2 13.3 </TABLE> Note: Amounts may not add due to rounding *Percentages are based on total revenues. HOUSING SALES Housing revenues for the three months ended January 31, 2002 increased $24.3 million, or 5%, over housing revenues for the three months ended January 31, 2001. This increase was primarily the result of an increase in the average price of the homes delivered. The increase in the average price of the homes delivered was principally the result of increases in the base sales prices of our homes and a shift in the location of homes delivered to more expensive areas. The aggregate sales value of contracts signed during the three months ended January 31, 2002 amounted to $485.2 million, an 8% increase over the same period in fiscal 2001. This increase is primarily the result of a 5% increase in the number of homes for which new contracts were signed and a 3% increase in the average price of the homes under those contracts (due primarily to increases in base selling prices and a shift in the location of homes sold to more expensive areas). At January 31, 2002, the backlog of homes under contract but not delivered amounted to $1.41 billion (2,662 homes), as compared to $1.41 billion (2,727 homes) at October 31, 2001 and $1.42 billion (2,678 homes) backlog at January 31, 2001. Housing costs as a percentage of housing sales decreased from 75.2% to 72.8% in fiscal 2002 as compared to the comparable period of fiscal 2001. The decrease was primarily the result of sales prices of homes increasing faster than cost increases, lower land and land improvement costs, improved operating efficiencies and lower inventory write-offs. The Company incurred $1.3 million in write-offs in the three-month period of fiscal 2002 as compared to $2.7 million in the comparable period of fiscal 2001. The Company continues to increase the number of communities from which it is selling. At January 31, 2002 it had 165 selling communities as compared to 145 at January 31, 2001 and expects to have 175 by October 31, 2002. Demand for homes continues to strengthen. Customer deposits for the month of February 2002 were up 31% in the aggregate over February 2001 and 18% higher on a per community basis. Deposits are non-binding agreements signed by a home buyer which reserve a home site and fix the home price for a short period of time. Not all deposits result in signed, binding agreements of sale, and therefore, deposits are not included in backlog. Because it takes, on average, more than ten months from the time the Company receives a deposit until it delivers the home, deposits considered in the context of the Company's experience, are an indication of the level of business that the Company can anticipate in fiscal 2003. Based upon the strength of demand and the increased number of selling communities, the Company believes revenues for fiscal 2003 could exceed $2.5 billion. LAND SALES The Company operates a land development and sales operation in Loudoun County, Virginia and is also developing several master planned communities in which it may sell land to other builders. The amount of land sales will vary from quarter to quarter depending upon the scheduled timing of the delivery of the land parcels. Land sales amounted to $6.4 million for the three months ended January 31, 2002, a 41% decrease over the comparable quarter of 2001. The decrease in land sales was due to fewer lots being available for sale at South Riding, offset in part by increased sales of lots in the Company's other master planned communities. Cost of sales as a percentage of land sales declined from 78.3% in 2001 to 65.7% in 2002. This decrease was the result of lower cost land as a percentage of sales price being delivered in 2002 as compared to 2001. INTEREST AND OTHER INCOME For the three months ended January 31, 2002, other income decreased by $545,000 as compared to the three months ended January 31, 2001. This decrease was primarily the result of a decrease in interest income due to lower interest rates and a decrease in income from the Company's ancillary businesses offset in part by increased income from forfeitures of customer deposits. SELLING, GENERAL AND ADMINISTRATIVE EXPENSES ("SG&A") SG&A spending increased by $5.4 million, or 12%, in the three months ended January 31, 2002 as compared to the three months ended January 31, 2001. As a percentage of total revenues, SG&A increased to 10.6% for the first quarter of fiscal 2002 as compared to 9.9% for the first quarter of fiscal 2001. This increase was primarily due to the higher number of communities open for sale during the first quarter of fiscal 2002 compared to the first quarter of fiscal 2001. The Company had 165 selling communities at January 31, 2002 as compared to 145 at January 31, 2001. INTEREST EXPENSE The Company determines interest expense on a specific lot-by-lot basis for its homebuilding operations and on a parcel-by-parcel basis for its land sales. As a percentage of total revenues, interest expense will vary depending on many factors including the period of time that the land was owned, the length of time that the homes delivered during the period were under construction, and the interest rates and the amount of debt carried by the Company in proportion to the amount of its inventory during those periods. Interest expense as a percentage of revenues was higher in the first quarter of fiscal 2002 compared to the same period of fiscal 2001. INCOME TAXES Income taxes were provided at an effective rate of 36.4% and 36.8% for the first quarter of fiscal 2002 and the first quarter of fiscal 2001, respectively. The decrease in the 2002 rate is the result of higher tax free interest income during the 2002 quarter as compared to the 2001 quarter. CAPITAL RESOURCES AND LIQUIDITY Funding for the Company's operations has been principally provided by cash flows from operations, unsecured bank borrowings and the public debt and equity markets. Cash flow from operations, before inventory additions, has improved as operating results have improved. The Company anticipates that the cash flow from operations, before inventory additions, will continue to be strong but will be dependent on the level of revenues from the delivery of homes and land sales. The Company has used the cash flow from operations, bank borrowings and public debt to acquire additional land for new communities, to fund additional expenditures for land development and construction needed to support the Company's continuing expansion of the number of communities in which it is offering homes for sale, to repurchase Company stock and to reduce debt. The Company expects that inventories will continue to increase and is currently negotiating and searching for additional opportunities to obtain control of land for future communities. The Company has a $535 million unsecured revolving credit facility with 16 banks, of which $445 million extends through March 2006 and $90 million extends through February 2003. As of January 31, 2002, the Company had $80 million of loans and approximately $52.5 million of letters of credit outstanding under the facility. The Company believes that it will be able to fund its activities through a combination of existing cash resources, cash flow from operations and other sources of funds similar in nature to those the Company has accessed in the past. In November 2001, the Company issued $150 million of 8.25% Senior Subordinated Notes due 2011 to the public. The Company has used the proceeds for general corporate purposes including the acquisition of inventory. HOUSING DATA <TABLE> <CAPTION> New Contracts Three months ended January 31, 2002 2001 units $000 units $000 <S> <C> <C> <C> <C> Northeast (MA, RI, NH, CT, NY, NJ) 190 $ 108,121 180 $ 92,759 Mid-Atlantic (PA, DE, MD, VA) 319 145,780 309 146,397 Midwest (OH, IL, MI) 78 37,655 109 45,829 Southeast (FL, NC, TN) 115 55,176 76 40,153 Southwest (AZ, NV, TX) 116 53,604 111 59,604 West Coast (CA) 110 84,827 98 63,256 928 $ 485,163 883 $ 447,998 </TABLE> New contract amounts for the three months ended January 31, 2002 and 2001 include $1,796,000 (6 homes) and $4,333,000 (15 homes), respectively, from an unconsolidated 50% owned joint venture. <TABLE> <CAPTION> Closings Three months ended January 31, 2002 2001 units $000 units $000 <S> <C> <C> <C> <C> Northeast (MA, RI, NH, CT, NY, NJ) 223 $ 115,604 244 $ 118,685 Mid-Atlantic (PA, DE, MD, VA) 328 153,480 304 139,806 Midwest (OH, IL, MI) 112 55,019 92 39,865 Southeast (FL, NC, TN) 131 52,591 113 50,536 Southwest (AZ, NV, TX) 109 57,356 128 55,795 West Coast (CA) 76 48,652 90 53,682 979 $ 482,702 971 $ 458,369 </TABLE> <TABLE> <CAPTION> Backlog at January 31, 2002 2001 units $000 units $000 <S> <C> <C> <C> <C> Northeast (MA, RI, NH, CT, NY, NJ) 618 $ 323,117 659 $ 341,660 Mid-Atlantic (PA, DE, MD, VA) 824 384,521 684 325,811 Midwest (OH, IL, MI) 282 129,473 315 149,535 Southeast (FL, NC, TN) 312 153,999 275 136,248 Southwest (AZ, NV, TX) 349 183,810 400 213,136 West Coast (CA) 277 234,729 345 254,542 2,662 $1,409,649 2,678 $1,420,932 </TABLE> Backlog amounts at January 31, 2002 and 2001 include $5,396,000 (17 homes) and $10,116,000 (35 homes), respectively, from an unconsolidated 50% owned joint venture. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK There have been no material changes in the Company's market risk from October 31, 2001. For more information regarding the Company's market risk, see Item 7A, Quantitative and Qualitative Disclosures About Market Risk, in the Company's Annual Report on Form 10-K for the fiscal year ended October 31, 2001. PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a)Exhibits: 3.1 *Restated Certificate of Incorporation dated July 1, 1986 ( as previously filed with the Commission as Exhibit 3.1 to the Registrant's Form 10-K for the fiscal year ended October 31, 1989). 3.2 *Amendment to the Restated Certificate of Incorporation dated March 7, 1989. 3.3 *Amendment to the Restated Certificate of Incorporation dated March 11, 1993 (as previously filed with the Commission as Exhibit 3.3 to the Registrant's Form 10-Q for the quarter ended January 31, 1993). 3.4 *Amendment to the Restated Certificate of Incorporation dated June 12, 1997 (as previously filed with the Commission as Exhibit 3.4 to the Registrant's Form 10-K for the fiscal year ended October 31, 2001). 3.5 *Amendment to the Restated Certificate of Incorporation dated January 8, 1998 (as previously filed with the Commission as Exhibit 3.4 to the Registrant's Form 10-K for the fiscal year ended October 31, 2001. 3.6 *Amendment to the Restated Certificate of Incorporation dated March 7, 2002. *Filed electronically herewith (b) Reports on Form 8-K: During the quarter ended January 31, 2002 the Company filed Current Reports on Form 8-K on November 29, 2001 and December 6, 2001, reporting under items 5 and 7, for the purpose of filing documents pertaining to Toll Corp.'s issuance of $150,000,000 of 8.25% Senior Subordinated Notes due 2011 guaranteed on a senior subordinated basis by Toll Brothers, Inc. <TABLE> <CAPTION> SIGNATURES Pursuant to the requirements 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. TOLL BROTHERS, INC. (Registrant) <S> <C> Date: March 14, 2002 By: /Joel H. Rassman Joel H. Rassman Senior Vice President, Treasurer and Chief Financial Officer Date: March 14, 2002 By: /Joseph R. Sicree Joseph R. Sicree Vice President - Chief Accounting Officer (Principal Accounting Officer) </TABLE>