Edgar Filing: NEWMARK HOMES CORP

AMENDMENT NO. 2

SCHEDULE 14C INFORMATION STATEMENT

INFORMATION STATEMENT PURSUANT TO SECTION 14(c)
OF THE SECURITIES EXCHANGE ACT OF 1934

Check the appropriate box:
[X] Preliminary Information Statement [ ] Confidential, for Use of
the Commission Only (as
permitted by Rule
14c-5(d)(2))
[ ] Definitive Information Statement

NEWMARK HOMES CORP.
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(Name of Registrant as Specified in its Charter)

Payment of Filing Fee (check the appropriate box):

[ ] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14c-5(g) and 0-11.

1) Title of each class of securities to which transaction applies:

Engle Holdings Corp. common stock, par value $0.01 per share.
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2) Aggregate number of securities to which transaction applies:

9,500 shares of Engle Holdings Corp. common stock, par value $0.01 per
share.
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3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee
is calculated and state how it was determined):

$259,558,000 (book value of Engle Holdings Corp. computed as of December
31, 2001, the latest practicable date prior to the date of filing).
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4) Proposed maximum aggregate value of transaction:

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5) Total fee paid:
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[X] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.

1) Amount Previously Paid:

$23,879.34
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2) Form, Schedule or Registration Statement No.:

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3) Filing Party:

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4) Date Filed:

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NEWMARK HOMES CORP.
1200 SOLDIERS FIELD DRIVE
SUGAR LAND, TEXAS 77479

INFORMATION STATEMENT

JUNE 3, 2002

To the Stockholders of NEWMARK HOMES CORP.:

We are pleased to inform you that our board of directors and our
stockholder holding 80% of the outstanding voting shares of our common stock
have approved the following:

(1) The merger of Engle Holdings Corp., a Delaware corporation ("Engle
Holdings") with and into us (the "Merger"), under the terms and conditions
specified in the Agreement and Plan of Merger among us, Engle Holdings and
Technical Olympic, Inc. ("Technical Olympic") as the sole stockholder of
Engle Holdings (the "Merger Agreement"); and

(2) The amendment of our certificate of incorporation to (i) increase
the number of authorized shares of common stock from 30,000,000 to
67,000,000, (ii) increase the maximum number of authorized directors on our
board from 10 to 15 directors and (iii) change our corporate name to
"Technical Olympic USA, Inc." (the "Charter Amendment").

We refer to the Merger and the Charter Amendment collectively as the "Merger
Transactions." Details of the Merger and the Charter Amendment are described in
this Information Statement and in the attached Exhibits A and B, respectively.

WE ARE NOT ASKING YOU FOR A PROXY OR TO CONSENT TO THE MERGER TRANSACTIONS
AND YOU ARE NOT REQUESTED TO SEND US A PROXY OR TO TAKE ANY OTHER ACTION.

After a series of meetings and after carefully and thoroughly reviewing and
analyzing the proposed transactions, and after consulting with outside financial
advisors on the fairness of the proposed transactions from a financial point of
view, a special committee of our board of directors (the "Special Committee")
approved the Merger Transactions. The Special Committee consists of our four
independent directors and was delegated the authority by the board of directors
to evaluate and consider the Merger Transactions. Thereafter, our board of
directors unanimously approved the Merger Transactions and recommended the
Merger to our stockholders for approval on April 5, 2002. Stockholder approval
of the Merger Transactions was obtained by a written consent in lieu of a
stockholders' meeting signed by Technical Olympic, the holder of 80% of our
outstanding shares, dated April 5, 2002 pursuant to Section 228 of the Delaware
General Corporation Law. Because Technical Olympic holds the requisite voting
power under Delaware corporate law and the provisions of our certificate of
incorporation to approve each of the Merger Transactions without additional
stockholders' consent, we are not calling a special meeting of the stockholders
in respect of the Merger Transactions and are not asking you for a proxy or
consent. Engle Holdings' board of directors approved and recommended the Merger
to Engle Holdings' sole stockholder and then Engle Holdings' sole stockholder,
Technical Olympic, approved the Merger, in unanimous written consents of the
directors and stockholder dated April 5, 2002.

Pursuant to the Merger Agreement and as explained more fully in this
Information Statement, Engle Holdings will be merged with and into us on the
date the Merger becomes effective (the "Effective Date"), which we expect to be
on or about June 24, 2002. On the Effective Date, the separate existence of
Engle Holdings will cease and we will survive the Merger and will continue to be
governed by the laws of the State of Delaware. As a consequence of the Merger,
Engle Homes, Inc. ("Engle Homes"), a Florida corporation and wholly-owned
operating subsidiary of Engle Holdings, will become our wholly-owned subsidiary.

all of which are held by Technical Olympic. Thus, based on the last sale price
of our common stock on April 5, 2002, Engle Holdings would be valued at $243.2
million.

The Merger is subject to certain conditions, including the closing of the
proposed refinancing of our outstanding debt and Engle Homes' outstanding debt
(including the retirement, defeasance or discharge of specified borrowings) on
terms acceptable to our board of directors and as described in the section
entitled "The Merger -- The Refinancing" (the "Refinancing"). In addition,
immediately prior to the Merger we will assume a $71 million obligation of
Technical Olympic incurred in connection with its acquisition of Engle Homes in
November 2000 (the "Engle Homes Acquisition Debt"). We will repay the Engle
Homes Acquisition Debt as part of the Refinancing. See "The Merger -- The
Refinancing." The Special Committee and its financial advisors considered our
assumption of the Engle Homes Acquisition Debt in evaluating the ratio for the
exchange of each Engle share into shares of our common stock pursuant to the
Merger.

Currently, our authorized capital stock consists of 30,000,000 shares of
common stock, par value $0.01 per share, and 3,000,000 shares of preferred
stock, par value $0.01 per share. As of April 5, 2002, we had 11,500,000 shares
of our common stock outstanding and no shares of preferred stock outstanding. In
the Merger, we will issue 16,378,787 new shares, which will result in Technical
Olympic owning 25,578,787 shares of our common stock, representing 91.75% of our
outstanding common stock after the Merger. Consequently, to accomplish the
Merger we will amend our certificate of incorporation to increase the number of
authorized shares of common stock from 30,000,000 to 67,000,000 shares, as set
forth in the Charter Amendment. Pursuant to the Charter Amendment and the
amendment of our bylaws, we will also increase the maximum number of authorized
directors on our board from 10 to 15 directors and change our corporate name to
"Technical Olympic USA, Inc."

Our common stock trades on the Nasdaq National Market under the symbol
"NHCH." On April 5, 2002, the last sale price of our common stock was $14.85, as
reported by the Nasdaq National Market. Upon completion of the Merger
Transactions, we will file an amendment to our Nasdaq listing application to
change the symbol our stock trades under to the symbol "TOUS."

On April 15, 2002, we sold the stock of one of our wholly-owned
subsidiaries, Westbrooke Acquisition Corp., a Delaware corporation, and its
operating subsidiaries (which we refer to collectively as "Westbrooke") to
Standard Pacific Corp., a Delaware corporation ("Standard Pacific"), for
consideration consisting of $41.0 million in cash and the repayment by Standard
Pacific of $54.4 million of Westbrooke's debt, including $14.2 million of
intercompany liabilities owed to Newmark (the "Westbrooke Sale"). The purchase
price is subject to adjustment (either upwards or downwards) within 90 days of
the closing, based on Westbrooke's net income from January 1, 2002 through the
closing date. For more information on the Westbrooke Sale and its impact on our
business, see "Our Business -- Recent Developments" and "Financial Information."

Technical Olympic acquired Engle Homes in November 2000 through a merger
with Technical Olympic's wholly-owned subsidiary, Engle Holdings. As a result,
the common stock of Engle Homes ceased to be publicly traded and was therefore
delisted from the Nasdaq National Market. Thus, neither Engle Holdings nor Engle
Homes is subject to the reporting requirements of the Securities Exchange Act of
1934, as amended (the "Exchange Act"). Under the terms of indentures dated
February 2, 1998 and June 12, 1998, respectively, under which Engle Homes issued
certain debt while it was publicly held, Engle Homes is contractually obligated
to file annual and quarterly reports with the Securities and Exchange Commission
(the "SEC").

We believe that the Merger Transactions will increase stockholder value.
The combined company on a pro forma basis (after giving effect to the Westbrooke
Sale, the Merger Transactions and the Refinancing) would have had a total
capitalization of $723.1 million as of March 31, 2002, and revenues and EBITDA
before one time charges of $1.4 billion and $187.5 million, respectively, for
the twelve months ended March 31, 2002. We believe that the potential benefits
of the Merger Transactions provide us with a unique opportunity to enhance the
value of your investment in us.

This Information Statement was first mailed or delivered to our
stockholders on or about June 3, 2002. This Information Statement constitutes
notice to our stockholders of corporate action by stockholders without a meeting
as required by Section 228(e) of the Delaware General Corporation Law. Please
note that this is not a request for your vote or a proxy; rather, this
Information Statement is being furnished to our stockholders solely to provide
them with certain information regarding the Merger and the Charter Amendment in

accordance with the requirements of the Exchange Act and the regulations
promulgated thereunder, particularly Regulation 14C, and Section 228(e) of the
Delaware General Corporation Law. We are bearing the cost of this Information
Statement.

By Order of the Board of Directors,

/s/ TERRY C. WHITE
--------------------------------------
TERRY C. WHITE
Secretary

TABLE OF CONTENTS

FORWARD-LOOKING STATEMENTS.................................. iii
SUMMARY..................................................... 1
In General................................................ 1
The Merger Transactions................................... 1
The Companies............................................. 4
Recent Developments....................................... 4
Summary of Selected Financial Information................. 4
INTEREST OF CERTAIN PERSONS IN THE MERGER................... 4
RISK FACTORS................................................ 5
Risk Related to Our Business.............................. 5
Risk Related to Our Industry.............................. 6
Risks Related to the Merger............................... 8
THE MERGER.................................................. 9
Background of the Merger.................................. 9
Our Business.............................................. 11
Engle's Business.......................................... 17
Combined Operations....................................... 22
Merger Agreement and Related Matters...................... 24
Reasons for the Merger.................................... 25
Ownership After the Merger................................ 26
Opinion of Deutsche Bank Securities Inc., Financial
Advisor to the Special Committee....................... 26
No Appraisal Rights....................................... 30
The Refinancing........................................... 30
FINANCIAL INFORMATION....................................... 32
Selected Historical Consolidated Financial and Operating
Data for Newmark....................................... 32
Selected Historical Consolidated Financial and Operating
Data for Engle......................................... 34
Technical Olympic USA, Inc. Pro Forma Consolidated
Financial Statements (Unaudited)....................... 36
Capitalization............................................ 44
Federal Income Tax Treatment of the Merger................ 45
MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION.................................. 46
Newmark................................................... 46
Results of Operations..................................... 46
Liquidity and Capital Resources........................... 50
Dividends................................................. 52
Critical Accounting Policies.............................. 52
Engle..................................................... 53
Results of Operations..................................... 53
Liquidity and Capital Resources........................... 57
Dividends................................................. 59
Critical Accounting Policies.............................. 59
Technical Olympic USA, Inc. .............................. 60

RELATED PARTY AGREEMENTS AND TRANSACTIONS................... 63
Tax Allocation Agreements................................. 63
Management Services Agreement............................. 63
Mortgage Company Business................................. 64
Title Company Business.................................... 64
Contractor Agreements..................................... 64
MANAGEMENT.................................................. 65
Our Board of Directors.................................... 66
Family Relationships...................................... 66
Compensation of Directors................................. 66
Our Management............................................ 66
Employment Agreements..................................... 67
VOTING SECURITIES AND THE PRINCIPAL HOLDERS THEREOF......... 68
WHERE YOU CAN FIND MORE INFORMATION......................... 69
DOCUMENTS INCORPORATED BY REFERENCE AND PROVIDED HEREWITH... 69
EXHIBIT LIST................................................ 70
INDEX TO ENGLE CONSOLIDATED FINANCIAL STATEMENTS............ F-1

FORWARD-LOOKING STATEMENTS

This Information Statement includes "forward-looking statements." In
general, any statement other than a statement of historical fact is a
forward-looking statement. These statements appear in a number of places in this
Information Statement and include statements regarding our industry and our
prospects, plans, future financial position, operations and business strategy.
Forward-looking statements generally can be identified by the use of
forward-looking terminology such as "may," "will," "expect," "intend,"
"estimate," "anticipate," "believe," or "continue" or the negatives of these
terms or variations. Any such forward-looking statements are not assurances of
future performance and involve risks and uncertainties. Important factors that
could cause actual results to differ materially from anticipated results are set
forth below and included elsewhere in this Information Statement, including
under the heading "Risk Factors" beginning on page 5. These factors include,
among others:

- our significant level of debt;

- our ability to borrow or otherwise finance our business in the future;

- our ability to locate lots or parcels of land at anticipated prices;

- our relationship with Technical Olympic and its control over our board
and business activities;

- economic conditions that affect the desire or ability of our customers to
purchase new homes in markets in which we conduct our business;

- a decline in the demand for housing;

- a decline in the value of the land and home inventories we maintain;

- an increase in the cost of, or shortages in the availability of, skilled
labor or construction materials;

- an increase in interest rates;

- our ability to compete in our existing and future markets;

- an increase or change in governmental regulation; and

- our ability to successfully integrate Engle's operations with ours.

We urge you to review carefully the section "Risk Factors" in this
Information Statement for a more complete discussion of the risks related to our
business and industry.

iii

SUMMARY

The following is a summary of certain information contained elsewhere in
this Information Statement. This summary may not contain all of the information
that is important to you. You should carefully read this Information Statement
and the Exhibits, as well as the information we incorporate by reference, in
their entirety.

As used in this Information Statement, unless the context otherwise
requires or unless otherwise stated, the terms "Newmark," "we," "us," and "our"
refer to Newmark Homes Corp. and its subsidiaries and not to Engle Holdings,
Engle Homes or to Technical Olympic. The term "Engle" refers to Engle Holdings
and its subsidiaries, including Engle Homes. The term "Westbrooke" refers to
Westbrooke Acquisition Corp. and its subsidiaries.

IN GENERAL

We are pleased to inform you that our board of directors and our
stockholder holding 80% of the outstanding voting shares of our common stock
have approved the following:

(1) The merger of Engle Holdings Corp., a Delaware corporation ("Engle
Holdings") with and into us (the "Merger"), under the terms and conditions
specified in the Agreement and Plan of Merger among us, Engle Holdings and
Technical Olympic, Inc. ("Technical Olympic"), as the sole stockholder of
Engle Holdings (the "Merger Agreement"), a copy of which is attached as
Exhibit A; and

(2) The amendment of our certificate of incorporation to (i) increase
the number of authorized shares of common stock from 30,000,000 to
67,000,000, (ii) increase the maximum number of authorized directors on our
board from 10 to 15 and (iii) change our corporate name to "Technical
Olympic USA, Inc." (the "Charter Amendment"), as more particularly
described in the Amendment to the Certificate of Incorporation of Newmark
Homes Corp. attached as Exhibit B.

We refer to the Merger and the Charter Amendment collectively as the "Merger
Transactions."

After a series of meetings and after carefully and thoroughly reviewing and
analyzing the proposed transactions, and after consulting with outside financial
advisors on the fairness of the proposed transactions from a financial point of
view, the Special Committee approved the Merger Transactions. Thereafter, our
board of directors approved the Merger Transactions and recommended the Merger
to our shareholders for approval on April 5, 2002. Stockholder approval of the
Merger Transactions was obtained by a written consent in lieu of a stockholders'
meeting signed by Technical Olympic dated April 5, 2002 pursuant to Section 228
of the Delaware General Corporation Law. On that date, 11,500,000 shares of our
common stock were outstanding and each share entitled its holder to one vote.
The holders of a majority of our outstanding common stock, or 5,750,001 votes,
were required to adopt the Merger Agreement and to approve the Charter
Amendment. On April 5, 2002, Technical Olympic held 9,200,000 shares of our
common stock, representing 80% of our issued and outstanding common stock. Engle
Holdings' board of directors approved and recommended the Merger Transactions to
Engle Holdings' sole stockholder and then Engle Holdings' sole stockholder,
Technical Olympic, approved the Merger, in unanimous written consents of the
directors and stockholder dated April 5, 2002.

Because Technical Olympic held and voted the requisite number of shares
under Delaware corporate law and the provisions of our certificate of
incorporation to approve each of the Merger Transactions, we are not calling a
special meeting of the stockholders in respect of the Merger Transactions and
are not asking you for a proxy or consent.

THE MERGER TRANSACTIONS

be governed by the laws of the State of Delaware. Engle Homes, the wholly-owned
operating subsidiary of Engle Holdings, will become our wholly-owned subsidiary
as a result of the Merger.

In the Merger, each outstanding share of Engle Holdings' common stock, par
value $0.01 per share, will be converted into 1,724.08294 shares of our common
stock, par value $0.01 per share. As of April 5, 2002, there were 9,500 shares
of Engle Holdings common stock, par value $0.01 per share, issued and
outstanding, all of which are held by Technical Olympic. Thus, based on the last
sale price of our common stock on April 5, 2002, Engle Holdings would be valued
at $243.2 million.

We and Engle are under the common control of Technical Olympic. As a
result, the Merger is being accounted for in a manner similar to a
pooling-of-interests. Upon the closing of the Merger, we will initially record
the assets and liabilities transferred at the amounts at which they are carried
in Engle's accounts on the date of the Merger.

The Merger is subject to certain conditions, including the closing of the
Refinancing. In addition, immediately prior to the Merger, we will assume the
Engle Homes Acquisition Debt, which will be repaid as part of the Refinancing.
See "The Merger -- The Refinancing." The Special Committee and its financial
advisor considered our assumption of the Engle Homes Acquisition Debt in
evaluating the ratio for the exchange of each Engle Holdings share into shares
of our common stock pursuant to the Merger.

Currently, our authorized capital stock consists of 30,000,000 shares of
common stock, par value $0.01 per share, and 3,000,000 shares of preferred
stock, par value $0.01 per share. On April 5, 2002, we had 11,500,000 shares of
our common stock outstanding and no shares of preferred stock outstanding. In
the Merger, we will issue 16,378,787 new shares, which will result in Technical
Olympic owning 25,578,787 shares of our common stock, representing 91.75% of our
outstanding common stock after the Merger. Consequently, to accomplish the
Merger we will amend our certificate of incorporation to increase the number of
authorized shares of common stock from 30,000,000 to 67,000,000 shares, as set
forth in the Charter Amendment. Pursuant to the Charter Amendment and the
amendment of our bylaws, we will also increase the maximum number of authorized
directors on our board from 10 to 15 directors and change our corporate name to
"Technical Olympic USA, Inc."

Any federal or state regulatory requirements have been compiled with, and
no regulatory approvals are necessary in connection with the Merger
Transactions, other than the filing of the certificate of merger for the Merger
and the Charter Amendment with the Secretary of State of the State of Delaware.

Important Terms of the Merger:

Conditions to Closing the
Merger........................ The Merger Agreement provides that the
respective obligations of each of the parties
to effect the Merger are subject to the
satisfaction or waiver of a number of
conditions. In addition, the Merger is
contingent upon the closing of the Refinancing.

Effectiveness of the Merger... The Merger will become effective at the time a
Certificate of Merger is filed with and
recorded by the Secretary of State of the State
of Delaware.

Consideration for the
Merger........................ On the Effective Date, Engle Holdings will be
merged with and into us, and each issued and
outstanding share of Engle Holdings' common
stock will be converted into 1,724.08294 shares
of our common stock. This exchange rate will
result in Technical Olympic, which currently
holds 80% of our outstanding common stock,
owning 25,578,787 shares of our common stock,
representing 91.75% of our common stock
outstanding after the Merger.

Fractional Shares............. No fractional shares of our common stock will
be issued in the Merger. If the conversion
ratio would result in a fractional number of
shares of our common stock being issued, the
number of shares

of our common stock issuable in the Merger will
be rounded down to the next whole number.

Effect of the Merger.......... Engle Holdings will be merged with and into us
on the Effective Date. The separate existence
of Engle Holdings will cease and we will
survive the Merger and will continue to be
governed by the laws of the State of Delaware.
Engle Homes, the wholly-owned operating
subsidiary of Engle Holdings, will become our
wholly-owned subsidiary as a result of the
Merger. To accomplish the Merger we will need
to amend our certificate of incorporation to
increase authorized shares of common stock from
30,000,000 shares to 67,000,000 shares, as set
forth in the Charter Amendment. Pursuant to the
Charter Amendment we will also increase the
maximum number of authorized directors on our
board from 10 to 15 directors and change our
corporate name to "Technical Olympic USA, Inc."

Federal Income Tax
Consequences.................. The Merger will constitute a reorganization
within the meaning of Section 368(a) of the
Internal Revenue Code of 1986, as amended. No
gain or loss will be recognized by us or our
stockholders as a consequence of the Merger. A
stockholder's aggregate tax basis in our common
stock after the Merger will be the same as such
holder's aggregate tax basis in the shares of
our common stock immediately prior to the
Merger.

Representations and
Warranties.................... Each party to the Merger Agreement makes
representations and warranties to the other
parties. The representations and warranties of
each of the parties will not survive closing,
except Technical Olympic's representations and
warranties relating to the conduct of Engle's
business since November 2000 (when Technical
Olympic purchased Engle) and to Technical
Olympic's lack of knowledge regarding any
undisclosed Engle liabilities, which
representations and warranties will survive for
six months following the closing of the Merger.

Changes in Management......... Contemporaneously with the Merger, we will make
certain management changes as discussed under
"The Merger -- Changes in Management" below.

Termination of the Merger
Agreement..................... Before the closing of the Merger, the parties
may agree by mutual written consent to
terminate the Merger. Any of the parties may
terminate the Merger Agreement if the Merger is
not consummated on or before December 31, 2002,
unless the failure to consummate the Merger is
the result of a default by the party seeking to
terminate the Merger Agreement, or if a court
or governmental entity issues an order, decree
or ruling enjoining, restraining or otherwise
prohibiting the consummation of the Merger.

Reasons for the Merger........ We believe that the Merger will expand our
markets and increase our geographic
diversification; increase our operating
efficiencies as a result of economies of scale;
improve our purchasing power with respect to
subcontractors and suppliers; increase our
leverage with brokers and land owners to obtain
rights to the most attractive properties in our
markets; strengthen our management team by

combining our management with Engle Homes'
management; and enhance our access to capital.

Fairness Opinion. Deutsche Bank Securities Inc. ("DB") has delivered a
written opinion dated April 4, 2002 to the Special Committee, consisting of our
four independent directors, to the effect that, as of April 4, 2002 and based
upon and subject to certain matters stated therein, the Conversion Ratio (as
defined in the opinion) is fair, from a financial point of view, to the holders
of our common stock, other than Technical Olympic. DB'S OPINION IS ADDRESSED TO
THE SPECIAL COMMITTEE AND RELATES TO THE FAIRNESS TO THE HOLDERS OF OUR COMMON
STOCK (OTHER THAN TECHNICAL OLYMPIC) OF THE MERGER FROM A FINANCIAL POINT OF
VIEW AND DOES NOT CONSTITUTE A RECOMMENDATION TO ANY STOCKHOLDER WITH RESPECT TO
MATTERS RELATING TO THE MERGER. The full text of the written opinion dated April
4, 2002 of DB is attached hereto as Exhibit C and details the procedures
followed, assumptions made, matters considered and limitations on the review
undertaken by DB in connection with such opinion. See "The Merger -- Opinion of
Deutsche Bank Securities Inc., Financial Advisor to the Special Committee."

THE COMPANIES

Newmark. We design, build and sell single-family homes, town homes and
patio homes in five markets in Texas and Tennessee.

Engle. Engle designs, builds and sells single-family homes, town homes,
patio homes and condominiums in seven markets in Texas, Florida, Colorado,
Virginia and Arizona.

Technical Olympic. Technical Olympic is a wholly-owned, indirectly-held
subsidiary of Technical Olympic S.A., a Greek corporation publicly traded on the
Athens Stock Exchange that is engaged principally in infrastructure and real
estate development in Greece and other European countries and, indirectly
through Newmark and Engle, in the United States.

RECENT DEVELOPMENTS

On April 15, 2002, we sold the stock of Westbrooke to Standard Pacific for
consideration consisting of $41.0 million in cash and the repayment by Standard
Pacific of $54.4 million of Westbrooke's debt, including $14.2 million of
intercompany liabilities owed to Newmark. The purchase price is subject to
adjustment (either upwards or downwards) within 90 days of the closing, based on
Westbrooke's net income from January 1, 2002 through the closing date. For more
information on the Westbrooke Sale and its impact on our business, see "Our
Business -- Recent Developments" and "Financial Information."

SUMMARY OF SELECTED FINANCIAL INFORMATION

For certain historical consolidated financial data for both Engle and us
and pro forma combined financial data which gives effect to the Westbrooke Sale,
the Merger and the Refinancing, see "Financial Information."

INTEREST OF CERTAIN PERSONS IN THE MERGER

Engle Holdings is a wholly-owned subsidiary of Technical Olympic. Technical
Olympic also owns 80% of our outstanding common stock. We were not required to
solicit proxies to obtain stockholder approval for the Merger and the Charter
Amendment because Technical Olympic, as our majority stockholder, approved the
Merger Transactions by written consent in lieu of a stockholders' meeting.

Technical Olympic acquired Engle at a total enterprise value equal to
$390.4 million on November 20, 2000, consisting of the assumption or repayment
of $183.5 million of outstanding net homebuilding debt and the payment of $206.9
million for the equity of Engle.

We agreed to acquire Engle at total enterprise value equal to $486.8
million, which as of April 3 consisted of the assumption or repayment of $257.3
million of outstanding net homebuilding debt and the issuance of 16.4 million
shares of Newmark stock, which shares were on April 2, 2002 trading at $14.01
per share and had an implied valued of $229.5 million.
4

RISK FACTORS

The following risk factors apply to the combined businesses of Newmark and
Engle following the Merger. References to "our," "we" or "us" in this section
only refer to the combined business which is the surviving corporation in the
Merger. You should carefully consider each of the following factors, as well as
other information contained in this Information Statement.

RISK RELATED TO OUR BUSINESS

OUR SIGNIFICANT LEVEL OF DEBT COULD ADVERSELY AFFECT OUR FINANCIAL CONDITION
AND PREVENT US FROM FULFILLING OUR DEBT SERVICE OBLIGATIONS.

We currently have, and after the completion of the Merger will continue to
have, a significant amount of debt. As of March 31, 2002, we would have had on a
pro forma basis (after giving effect to the Westbrooke Sale, the Merger
Transactions and the Refinancing) approximately $381.8 million aggregate
principal amount of outstanding debt (including Engle's 9 1/4% senior notes due
2008 with respect to which, as part of the Refinancing, we intend to deposit
approximately $14.2 million with the trustee to defease or discharge the
covenants thereunder and the Engle Homes Acquisition Debt that we are assuming
prior to the Merger and repaying pursuant to the Refinancing; see "The
Merger -- The Refinancing"). We also would have had the capacity to borrow an
additional $220.0 million under our new credit facility, provided that we meet a
specified borrowing base capacity, specified net worth, fixed charge coverage
and leverage ratios contained in the credit agreement, and the availability to
borrow up to $33.2 million under our warehouse line of credit (including a
purchase agreement) and our other credit facilities. In addition, subject to
restrictions in our financing documents (including the requirement to maintain
specified minimum of tangible net worth and debt to tangible net worth ratios),
we may incur additional debt beyond that provided under the new credit facility
and the warehouse line of credit. Based on the most restrictive reading of the
restrictions of our financing documents we estimate that we would be able to
incur approximately $177.4 million of additional debt beyond that outstanding at
March 31, 2002.

The level of our debt could have important consequences, including:

- making it more difficult for us to pay interest and principal with
respect to our debt;

- requiring us to dedicate a substantial portion of our cash flow from
operations for interest and principal payments on our debt and reducing
our ability to use our cash flow to fund working capital, acquisitions
and other general corporate requirements;

- limiting our ability to obtain additional financing to fund working
capital, acquisitions and other general corporate requirements;

- increasing our vulnerability to general adverse economic and industry
conditions;

- limiting our flexibility in planning for, or reacting to, changes in our
business and the industry in which we operate;

- placing us at a disadvantage compared to our competitors who are less
leveraged; and

- exposing us to fluctuations in interest rates with respect to that
portion of our debt which is at a variable rate of interest.

Our ability to meet our debt service obligations depends on our future
performance as well as the housing market in general. Numerous factors outside
of our control, including changes in economic or other business conditions
generally or in the markets or industry in which we do business, may adversely
affect our operating results and cash flows which in turn may affect our ability
to meet our debt service obligations. If we are unable to meet our debt service
obligations, we could be forced to restructure or refinance our debt, seek
additional equity capital or sell assets. We may be unable to restructure or
refinance our debt, obtain additional financing or sell assets on satisfactory
terms or at all.

WE MAY NEED ADDITIONAL FUNDS FOR THE GROWTH AND DEVELOPMENT OF OUR BUSINESS
AND IF WE ARE UNABLE TO OBTAIN THESE FUNDS, WE MAY NOT BE ABLE TO EXPAND OUR
BUSINESS AS PLANNED, AND THIS COULD ADVERSELY EFFECT OUR RESULTS OF OPERATIONS
AND FUTURE GROWTH.

Our operations require significant amounts of cash. While we do not
anticipate any need for additional sources of financing following the closing of
the Refinancing to operate our existing business, if our business does not
achieve the levels of profitability or generate the amount of cash that we
anticipate or if we expand through acquisitions or growth through operations
faster than anticipated, we may need to seek additional debt or equity financing
to operate and expand our business. If we are unable to obtain sufficient
capital to fund our growth and development initiatives, it could adversely
affect our earnings and future growth. We may be unable to obtain additional
financing on satisfactory terms or at all.

If additional funds are raised through the incurrence of debt, we will
incur increased debt service costs and may become subject to additional
restrictive financial and other covenants. Moreover, the instruments governing
the debt we incur pursuant to the Refinancing will contain provisions that
restrict the amount of debt we may incur.

ECONOMIC DOWNTURNS IN THE GEOGRAPHIC AREAS IN WHICH WE OPERATE WOULD ADVERSELY
AFFECT OUR BUSINESS.

Although we operate in 11 major metropolitan areas, our operations are
concentrated in the southwestern and southeastern United States. Adverse
economic or other business conditions in these regions or in the particular
markets in which we operate, all of which are outside of our control, could have
a material adverse impact on our revenues and earnings.

WE MAY NOT BE ABLE TO ACQUIRE SUITABLE LAND AT REASONABLE PRICES, WHICH COULD
ADVERSELY AFFECT OUR BUSINESS.

We have experienced an increase in competition for available land and
developed lots in some of our market areas as a result of the strength of the
economy in many of these markets over the past few years and the availability of
more capital to major homebuilders. Our ability to continue development
activities over the long term depends upon our ability to locate suitable
parcels of land or developed lots and acquire them to support our homebuilding
operations. As competition for land increases, the cost of acquiring it may rise
and the availability of suitable parcels at acceptable prices may decline. If we
are unable to acquire suitable land or developed lots at reasonable prices, it
could limit our ability to develop new projects or result in increased land
costs which we may not be able to pass through to our customers. Both of these
factors could adversely affect our earnings.

TECHNICAL OLYMPIC, OUR MAJORITY STOCKHOLDER, WILL CONTINUE TO CONTROL US AFTER
THE MERGER AND CAN CAUSE US TO TAKE CERTAIN ACTIONS OR PRECLUDE US FROM TAKING
CERTAIN ACTIONS WITHOUT THE APPROVAL OF THE OTHER STOCKHOLDERS.

Currently, Technical Olympic owns 80% of the voting power of our common
stock. Following the Merger, Technical Olympic will own 25,578,787 shares of our
common stock, representing 91.75% of the voting power of our common stock. As a
result, Technical Olympic will retain the ability to control all fundamental
matters affecting us, including with respect to the election of our directors
and the outcome of any matter submitted to our board of directors or our
stockholders for approval.

RISK RELATED TO OUR INDUSTRY

CHANGES IN ECONOMIC OR OTHER BUSINESS CONDITIONS COULD ADVERSELY AFFECT OUR
BUSINESS.

The homebuilding industry historically has been cyclical and is affected
significantly by adverse changes in general and local economic conditions, such
as:

- employment levels;

- population growth;

- consumer confidence and stability of income levels;

- availability of financing for land acquisitions, construction and
permanent mortgages;

- interest rates;

- inventory levels of both new and existing homes;

- supply of rental properties; and

- conditions in the housing resale market.

One or more of these conditions, all of which are outside of our control, could
adversely affect demand and the prices for new homes in some or all of the
regions in which we operate. A decline in demand or the prices we can obtain for
our homes could have an adverse effect on our revenues and earnings.

WE ARE SUBJECT TO SUBSTANTIAL RISKS WITH RESPECT TO THE LAND AND HOME
INVENTORIES WE MAINTAIN.

As a homebuilder, we must constantly locate and acquire new tracts of land
for development and developed lots to support our homebuilding operations. There
is often a lag time between the time we acquire land for development or
developed lots and the time that we can bring the developed properties to market
and sell them. As a result, we face the risk that demand for housing may decline
during this period and that we will not be able to dispose of developed
properties or undeveloped land or lots acquired for development at expected
prices or within anticipated time frames or at all. The market value of housing
inventories, undeveloped land and developed lots can fluctuate significantly
because of changing market conditions. In addition, inventory carrying costs can
be significant and can adversely affect our performance. Because of these
factors, we may be forced to sell homes or other property at a loss or for
prices that generate less profit than originally anticipated. We may also be
required to make material write-downs of the book value of our real estate
assets in accordance with generally accepted accounting principles if values
decline.

SUPPLY RISKS AND SHORTAGES CAN HARM OUR BUSINESS.

The homebuilding industry from time to time has experienced significant
difficulties with respect to:

- shortages of qualified trades people and other labor;

- inadequately capitalized local contractors;

- shortages of materials; and

- volatile increases in the cost of certain materials, including lumber,
framing and cement, which are significant components of home construction
costs.

These difficulties could cause us to take longer and pay more to build our
homes. In addition, we may not be able to pass through any increased costs to
our customers, particularly because in many cases we fix the price of a home at
the time a sales contract is signed which may be up to one year in advance of
the delivery of the home.

FUTURE INCREASES IN INTEREST RATES COULD PREVENT POTENTIAL CUSTOMERS FROM
PURCHASING OUR HOMES WHICH WOULD ADVERSELY AFFECT OUR BUSINESS.

Virtually all of our customers finance their purchases through mortgage
financing obtained from us or other sources. Increases in interest rates or
decreases in the availability of mortgage financing could depress the market for
new homes as potential homebuyers may not be able to afford higher monthly
mortgage costs. Even if our potential customers do not need financing, changes
in interest rates and mortgage availability could make it harder for them to
sell their existing homes to potential buyers who need financing. Consequently,
any future increases in interest rates could adversely affect our revenues and
earnings.

THE COMPETITIVE CONDITIONS IN THE HOMEBUILDING INDUSTRY COULD ADVERSELY AFFECT
OUR RESULTS OF OPERATIONS.

The homebuilding industry is highly competitive and fragmented. We compete
in each of our markets with numerous national, regional and local builders,
including some builders with greater financial resources, more experience and
more established market positions than ours and who have lower costs of capital,
labor and material than us and better opportunities for land acquisitions.
Builders of new homes compete for homebuyers, as well as for desirable
properties, raw materials and skilled subcontractors. The competitive conditions
in the homebuilding industry could among other things:

- increase our costs and reduce our revenues;

- make it difficult for us to acquire suitable land at acceptable prices;

- require us to increase selling commissions and other incentives;

- result in delays in construction; and

- result in lower sales volumes.

We also compete with resales of existing homes, available rental housing
and, to a lesser extent, condominium resales. An oversupply of attractively
priced resale or rental homes in the markets in which we operate could adversely
affect our ability to sell homes profitably.

Our mortgage origination and title operations are also subject to
competition from third-party providers, many of which are substantially larger
and may have a lower cost of funds or overhead than we do.

OUR BUSINESS IS SUBJECT TO GOVERNMENTAL REGULATIONS WHICH INCREASE THE COST OF
OUR DEVELOPMENT AND HOMEBUILDING PROJECTS AND MAY ADVERSELY AFFECT OUR
BUSINESS.

We are subject to extensive and complex laws and regulations that affect
the development and homebuilding process, including laws and regulations related
to zoning, permitted land uses, levels of density, building design, elevation of
properties, water and waste disposal and use of open spaces. We also are subject
to a variety of local, state and federal laws and regulations concerning the
protection of health and the environment. In some of the jurisdictions in which
we operate, we are required to pay impact fees, use energy saving construction
materials and give commitments to provide certain infrastructure such as roads
and sewage systems. We must also obtain permits and approvals from local
authorities to complete residential development or home construction. The laws
and regulations under which we operate and our obligations to comply with them
may result in delays in construction and development, cause us to incur
substantial compliance and other increased costs and prohibit or severely
restrict development and homebuilding activity in certain areas in which we
operate.

Our mortgage origination and title insurance operations are subject to
numerous federal, state and local laws and regulations. Failure to comply with
these requirements can lead to administrative enforcement actions, the loss of
required licenses and claims for monetary damages.

RISKS RELATED TO THE MERGER

WE MAY NOT BE ABLE TO SUCCESSFULLY INTEGRATE AND OPERATE NEWMARK AND ENGLE AS
A COMBINED COMPANY OR TO REALIZE THE EXPECTED BENEFITS OF THE MERGER.

Although Newmark and Engle have been controlled by Technical Olympic as a
majority or sole stockholder since November 2000, they have been operated
independently. Following the Merger, we intend to integrate the operations of
the companies in order to achieve, among other things, various operating and
purchasing efficiencies. In connection with the Merger, the departure of
management and other key personnel or difficulties in integrating the companies'
operations could cause our financial condition, results of operations and
competitive position to be adversely affected. Even if we overcome these
challenges and risks, we may not realize the expected benefits of the Merger.

THE MERGER

Pursuant to the Merger Agreement, and as explained more fully below, Engle
Holdings will be merged with and into us on the Effective Date, which we expect
to be on or about June 24, 2002. When the Merger becomes effective, the separate
existence of Engle Holdings will cease and we will survive the Merger and will
continue to be governed by the laws of the State of Delaware. Engle Homes, the
wholly-owned operating subsidiary of Engle Holdings, will become our
wholly-owned subsidiary as a result of the Merger.

The Merger is conditioned upon certain conditions as well as the closing of
the Refinancing. In addition, immediately prior to the Merger, we will assume
the Engle Homes Acquisition Debt, which will be repaid as part of the
Refinancing. See "The Merger -- The Refinancing." The Special Committee and its
financial advisors considered our assumption of the Engle Homes Acquisition Debt
in evaluating the ratio for the exchange of each Engle Holdings share into
shares of our common stock pursuant to the Merger.

Currently, our authorized capital stock consists of 30,000,000 shares of
common stock, par value $0.01 per share, and 3,000,000 shares of preferred
stock, par value $0.01 per share. We have 11,500,000 shares of our common stock
outstanding and no shares of preferred stock outstanding. In the Merger, we will
issue 16,378,787 new shares, which will result in Technical Olympic owning
25,578,787 shares of our common stock, representing 91.75% of our outstanding
common stock after the Merger. Consequently, to accomplish the Merger we will
amend our certificate of incorporation to increase the number of authorized
shares of common stock from 30,000,000 to 67,000,000 shares, as set forth in the
Charter Amendment. Pursuant to the Charter Amendment and the amendment of our
bylaws, we will also increase the maximum number of authorized directors on our
board from 10 to 15 directors and change our corporate name to "Technical
Olympic USA, Inc."

BACKGROUND OF THE MERGER

During late 2000 and early 2001, Technical Olympic began exploring the
possibilities of merging the homebuilding operations of Newmark and Engle.
Technical Olympic analyzed the financial aspects of a combination, various legal
structures to accomplish such a combination, and the potential benefits that
might be realized by combining Newmark and Engle. Technical Olympic's financial
advisor, Banc of America Securities LLC ("BAS"), analyzed the market trends in
the homebuilding industry, provided an analysis of the two companies and
calculated an exchange ratio that reflected the value of each company at that
time. Technical Olympic's legal counsel, Vinson & Elkins LLP ("VE"), analyzed
the legal process necessary to complete a combination of us with Engle.

On March 6, 2001, our board of directors ratified the appointment of all of
the independent and outside directors of the board of directors (those directors
who are not affiliated with Technical Olympic and who are not our employees or
management) to the Special Committee. The Special Committee was delegated the
authority by the board of directors to consider a potential merger between Engle
and us and to employ or retain such consultants as necessary to advise the
committee.

On March 6, 2001, representatives of Technical Olympic met with members of
the Special Committee to describe generally the proposed framework pursuant to
which Engle Holdings could be merged into us in a stock-for-stock transaction.
Following such meeting the Special Committee contacted DB with respect to the
financial aspects and Andrews & Kurth LLP ("AK") with respect to the legal
aspects about advising the Special Committee regarding a proposed merger.

On March 6, 2001, we issued a press release that disclosed that we had
formed the Special Committee to evaluate the possible merger of Engle Holdings
and us and that the Special Committee was expected to

engage outside counsel and other advisers to assist in the process of analyzing
and evaluating the feasibility of the proposed merger.

On or about March 8 and 13, 2001, the Special Committee retained DB and AK,
respectively.

On March 14, 2001, representatives of Technical Olympic and BAS met with
members of the Special Committee and their consultants and made a presentation
with respect to a proposed merger, including ranges of exchange values for each
outstanding share of Engle Holdings.

From March 14 to March 26, 2001, the Special Committee's consultants met
with our management and the management of Engle Holdings, as well as consultants
to Technical Olympic, and exchanged information regarding the two companies.

On March 26, 2001, the Special Committee received a letter from Mr.
Constantine Stengos, in his capacity as chairman of Technical Olympic, proposing
an exchange value whereby Technical Olympic would own 96% of the combined
company after the merger.

On March 29, 2001, the Special Committee sent a letter to Mr. Stengos
indicating that although the committee believed a combination of the two
companies would provide certain strategic and financial advantages and would
benefit the stockholders, the proposed exchange ratio was not sufficient.

From March 26, 2001 to April 17, 2001, the Special Committee and
representatives of Technical Olympic held discussions with respect to the
proposed merger, exchanged and analyzed additional information, and identified
points to be resolved or concluded prior to a merger.

On April 17, 2001, the Special Committee received a letter from Technical
Olympic indicating that Technical Olympic would be agreeable to an exchange
ratio that would result in Technical Olympic owning 93% of the combined entity
after the merger and our public shareholders owning 7%, subject to negotiations
of other terms and conditions of the Merger Transactions.

Commencing and continuing from April 17, 2001, representatives of the
Special Committee and Technical Olympic considered the proposed terms of the
Merger Transactions, conducted due diligence with respect to Engle and us and
negotiated the terms of a merger agreement. As part of the merger negotiations,
the Special Committee indicated that the proposed merger was dependent on the
satisfactory resolution of the following issues:

(i) the determination of the management of the combined business; and

(ii) the refinancing of the debt of both Engle and us.

From March 2001 to October 2001, Technical Olympic conducted a search for
an appropriate candidate to be the Chief Executive Officer of the merged entity.
On October 1, 2001, Technical Olympic hired Antonio B. Mon as its Chief
Executive Officer with the expectation that Mr. Mon would become our Chief
Executive Officer upon approval of the terms of his employment agreement by the
Special Benefits Committee of our board of directors and consummation of the
proposed merger. Tommy McAden, the Chief Financial Officer of Technical Olympic,
also agreed to become our Chief Financial Officer effective upon consummation of
the proposed merger. The Special Benefits Committee of our board of directors
approved the economic terms for Mr. Mon and Mr. McAden on April 5, 2002. Mr.
Mon's employment agreement has been finalized and executed by us and Mr. Mon. We
are currently negotiating the terms of Mr. McAden's employment contract.

On August 14, 2001, Technical Olympic retained a major investment bank to
assist in arranging an aggregate of $600 million of financing for the combined
business, including assumption of the Engle Homes Acquisition Debt. Since August
14, 2001, management and consultants of Technical Olympic, Engle Holdings and
Newmark have been working with the bank to arrange the necessary financing of
the combined business.

Commencing in September 2001, representatives of Technical Olympic and the
Special Committee began to negotiate the terms of the proposed merger to include
the proposed refinancing, the assumption and repayment of the Engle Homes
Acquisition Debt, and any necessary adjustment to the exchange ratio.

On or about January 25, 2002, Technical Olympic formalized these
discussions in a letter to the Special Committee, including the assumption and
repayment of the Engle Homes Acquisition Debt. Based upon the revised financial
structure, Technical Olympic proposed an exchange ratio which upon consummation
of the merger would result in Technical Olympic owning 92.5% of the combined
business.

On or about February 5, 2002, after further negotiations, Technical Olympic
agreed to an exchange ratio whereby Technical Olympic would own 91.75% of the
merged entity and the public shareholders would own 8.25%. On or about April 4,
2002, after further consultation with its financial and legal advisors, the
Special Committee approved and recommended to our full board of directors the
Merger and the terms of a definitive Merger Agreement, subject to resolution of
any due diligence questions.

The definitive Merger Agreement that was negotiated between the Special
Committee and Technical Olympic was presented to our full board of directors.
Our board analyzed and reviewed with the appropriate officers and consultants of
each respective company, the definitive merger agreement and considered, among
other things, the various considerations set forth under "-- Reasons for the
Merger."

The Merger, the Merger Agreement and the Charter Amendment were approved by
our board of directors and the Merger Transaction were recommended to our
stockholders on April 5, 2002.

On April 5, 2002, following the approval of the Merger Agreement by our
board of directors, Technical Olympic, which holds 80% of our issued and
outstanding common stock, entered into a written consent of the majority
stockholder approving the Merger on the terms and conditions specified in the
Merger Agreement and approved the Charter Amendment.

The board of directors of Engle Holdings approved and recommended the
Merger to Engle Holdings' sole stockholder and then Technical Olympic as the
sole stockholder of Engle Holdings approved the Merger by unanimous written
consents dated April 5, 2002.

OUR BUSINESS

We design, build and sell single-family homes, town homes and patio homes
in five markets in Texas and Tennessee. At March 31, 2002, we operated in 57
communities and had 486 homes under construction. We are also actively engaged
in residential land acquisition and lot development and at March 31, 2002, owned
or had under option contracts 2,467 lots available for future homebuilding.

The homes we market under our various brand names generally differ in terms
of the locations offered, price, size and degree of customization. We market
homes under the names Newmark(R), Fedrick, Harris Estate Homes and Marksman
Homes in our markets in Texas and Tennessee. Typically, Newmark(R) homes range
in size from 1,700 square feet to over 4,500 square feet, with an average sales
price of $281,893 for homes closed during the year ended March 31, 2002. The
homes we market under the Fedrick, Harris Estate Homes name provide the highest
degree of customization and typically range in size from 3,500 square feet to
over 7,000 square feet, with an average sales price of $491,982 for homes closed
during the year ended March 31, 2002. Marksman Homes typically range in size
from 1,550 square feet to over 2,450 square feet, with an average sales price of
$166,662 for homes closed during the year ended March 31, 2002.

We believe we compete favorably with other homebuilders in our markets by
offering a broad selection of homes with a wide range of amenities and
significant design customization options. We provide homebuyers the ability to
select various design features in accordance with their personal preferences.
Although most design modifications are significant to the homebuyer, they
typically involve relatively minor adjustments that allow us to maintain
construction efficiencies and achieve greater profitability due to increased
sales prices and margins. As a high-volume builder, we believe our homes offer
more value than those offered by local, lower-volume custom builders, primarily
due to our effective purchasing, construction and marketing programs resulting
from economies of scale. We believe that our ability to meet the design tastes
of prospective homebuyers at competitive prices enables us to compete
effectively with many of the other builders in our markets.

Our predecessor company was founded in Houston, Texas in 1983. In March
1995, we acquired The Adler Companies, Inc., which has operated in southern
Florida from 1990 until 2000. In January 1998, we acquired Westbrooke
Communities, Inc. and affiliated entities, which has operated in southern
Florida area since 1976. With the acquisition of Westbrooke, the Company wound
down the operations of Adler's operations by the end of 2000. We completed our
initial public offering of common stock in March 1998. On December 15, 1999,
Technical Olympic purchased 9,200,000 shares of our common stock from Pacific
Realty Group, Inc., representing 80% of our outstanding common stock. In March
2001, we changed our state of incorporation from Nevada to Delaware. On April
15, 2002, we sold the stock of Westbrooke to Standard Pacific. For more
information on the sale of Westbrooke, see "Our Business -- Recent
Developments."

Our current principal executive offices are located at 1200 Soldiers Field
Drive, Sugar Land, Texas 77479 and our phone number is (281) 243-0100. After the
Merger, our principal executive offices will change to 4000 Hollywood Blvd.,
Suite 500 N, Hollywood, Florida 33021 and our phone number will be (954)
364-4000.

Recent Developments. On April 15, 2002, we sold the stock of Westbrooke to
Standard Pacific for consideration consisting of $41.0 million in cash and the
repayment by Standard Pacific of $54.4 million of Westbrooke's debt, including
$14.2 million of intercompany liabilities owed to Newmark. The purchase price is
subject to adjustment (either upwards or downwards) within 90 days of the
closing, based on Westbrooke's net income from January 1, 2002 through the
closing date. In 2001, Westbrooke closed 919 homes and generated $196.5 million
in revenue. As a result of the Westbrooke Sale, we have eliminated operating
redundancies in our South Florida market and we believe that we have
strengthened our financial position.

Markets. We build homes in five markets in Texas and Tennessee. We
selected these markets based on a number of factors, including regional economic
conditions, projected job growth, land availability, the local land development
process, consumer tastes, competition from other builders of new homes and
secondary home sales activity. We continue to evaluate new markets for possible
entry where we believe there are attractive opportunities for us.

The table below shows, by region, our sales contracts executed (net of
cancellations), home closed, homebuilding revenue and average sales price, in
each case for the three months ended March 31, 2002, and our backlog at March
31, 2002:

MARKET REGION DATA
NEWMARK

BACKLOG
AVERAGE ----------------
NET SALES HOMES HOMEBUILDING SALES SALES
REGION CONTRACTS CLOSED REVENUE PRICE HOMES VALUE
------ --------- ------ ------------ ------- ----- --------
(DOLLARS IN THOUSANDS)

Texas....................... 351 240 $69,080 $288 413 $110,780
Mid-Atlantic(1)............. 62 42 14,481 $345 57 19,068
--- --- ------- --- --------
Total..................... 413 282 $83,561 $296 470 $129,848
=== === ======= === ========

---------------

(1) This region consists of our operations in North Carolina and Tennessee.

Our sales backlog at March 31, 2002 was 470 homes compared to 505 homes at
March 31, 2001. Backlog represents home purchase contracts that have been
executed and for which earnest money deposits have been received, but for which
the sale has not yet closed. Home sales are not recorded as revenues until the
closings occur. Historically, substantially all of the homes in our backlog at
any given point in time have been sold in the following 12-month period. For
example, 95% of the homes in our backlog at December 31, 2000 were closed in the
year ended December 31, 2001, and 96% and 100% of the homes in our backlog at
December 31, 1999 and 1998, respectively, were closed in the subsequent calendar
year. Although cancellations can disrupt anticipated home closings, we believe
that cancellations have not had a material negative impact on our operations or
liquidity during the last several years. We attempt to reduce cancellations by
reviewing each homebuyer's ability to obtain mortgage financing early in the
sales process and by closely monitoring the mortgage approval process.

Land Policies and Positions. To support our homebuilding operations, we
acquire (i) lots that have sewage systems, drainage and other similar
infrastructure in place (we refer to these lots as "developed lots"); and (ii)
larger tracts of land having the necessary approvals for residential
homebuilding (we refer to these tracts of land as "entitled land"). A developed
lot is ready to have a house constructed on it. Before we build a house on
entitled land, we must construct sewage systems, drainage and other
infrastructure.

We generally acquire multiple developed lots that are located adjacent to
or near each other in a community. This enables us to build and market our homes
more cost efficiently than if the lots were located in many separate locations.
Historically, we have been able to acquire a majority of our developed lots
through options rather than firm purchase contracts due to the awareness of our
brand names among developers and the willingness of developers in our markets to
option available lots. With the continuing strength in the housing sector,
increasingly we have been required to acquire more of our developed lots under
firm purchase contracts.

We also acquire entitled land to develop lots through both options and firm
purchase contracts. Before we enter into these options or contracts, we conduct
extensive due diligence using our local experience and expertise, including
on-site inspection and soil testing, and we confirm that the land has the
required approvals for sewage systems, drainage and other infrastructure
necessary for us to develop the lots and build homes on them. Occasionally, we
sell a portion of the entitled land we purchase and develop to third-party
builders to provide a source of additional revenue and to reduce the risk we
incur by holding these lots in inventory.

The table below shows our lot inventory by region and in total for the
periods indicated.

DECEMBER 31,
MARCH 31, ---------------------
2002 2001 2000 1999
--------- ----- ----- -----

Texas............................................... 2,085 2,204 2,398 1,724
Mid-Atlantic........................................ 382 415 407 352
----- ----- ----- -----
Total(1)....................................... 2,467 2,619 2,805 2,076
===== ===== ===== =====

---------------

(1) Includes 1,344, 1,386, 2,500, and 1,682 lots under option contracts as of
March 31, 2002 and December 31, 2001, 2000, and 1999, respectively.

Design. Our home designs and floor plans are prepared by outside
architects we hire in each of our markets to appeal to the local tastes and
preferences of the community. Using our internal design department, we have the
capability to change our standard floor plans to accommodate the individual
homebuyer. While most design modifications are significant to the homebuyer,
they typically involve relatively minor adjustments that allow us to maintain
construction efficiencies and result in greater profitability due to increased
margins.

Centralized Purchasing. We utilize centralized purchasing to leverage our
purchasing power into volume discounts, a practice that reduces costs, ensures
timely deliveries and reduces the risk of supply shortages due to allocations of
materials. We have negotiated favorable price arrangements with high quality
national and regional suppliers such as Weyerhaeuser, National Gypsum Company,
General Electric, Rheem Manufacturing, Dupont Corian, Moen, Inc., Owens Corning,
Mohawk Industries, Dow Chemical, Royal Baths, Ingersoll-Rand and
Sherwin-Williams for lumber, sheetrock, appliances, heating and air
conditioning, counter tops, bathroom fixtures, roofing and insulation products,
floor coverings, and other housing components. Other major materials, such as
concrete and brick, are also centrally purchased to obtain volume discounts.
There are no minimum purchase requirements for these arrangements.

Construction. Subcontractors perform substantially all of our construction
work. Our construction superintendents monitor the construction of each home,
coordinate the activities of subcontractors and suppliers, subject the work of
subcontractors to quality and cost controls and monitor compliance with zoning
and building codes. Subcontractors typically are retained pursuant to a contract
that obligates the subcontractor to complete construction at a fixed price in a
workmanlike manner. In addition, under these contracts the subcontractor
provides us with standard indemnifications and warranties. Typically, we work
with the same subcontractors within each city, which provides us with a stable
and reliable work force and better control over

the costs and quality of the work performed. Although we compete with other
homebuilders for qualified subcontractors, we have established long-standing
relationships with many of our subcontractors.

We typically complete the construction of a home within four to five
months. Construction time for our homes depends on weather, availability of
labor, materials, supplies and other factors. We do not maintain significant
inventories of construction materials, except for materials related to work in
progress for homes under construction. Generally, the construction materials
used in our operations are readily available from numerous sources. We have
favorable price arrangements or contracts with suppliers of certain of our
building materials, but we are not under any specific purchasing requirements.
In recent years, we have not experienced any significant delays in construction
due to shortages of materials.

Marketing and Sales. We build and market different types of homes to meet
the needs of different homebuyers and the needs of different markets. For
example, we sell to "first-time" homebuyers, "move-up" homebuyers who want to
purchase a home that is larger and more expensive than their current home,
homebuyers who are being relocated to a new city or state, homebuyers who want
to move into a smaller and less expensive home and "empty-nesters" (homebuyers
with grown children). We employ a variety of marketing techniques to attract
potential homebuyers through numerous avenues including our Internet web site,
extensive telemarketing and advertising, and other marketing programs. We
advertise on television, in newspapers and other publications, through brochures
and newsletters, on billboards and in brochures and newsletters produced and
distributed by real estate and mortgage brokers. Certain of our suppliers
participate in our advertising and promotional materials, either through
co-branding, cost-sharing or through rebates.

We typically conduct home sales from sales offices located in furnished
model homes used in each community. At March 31, 2002, we conducted our
marketing from 57 model homes. Our commissioned sales personnel assist
prospective buyers by providing them with floor plans, price information, tours
of model homes and information on the available options and other custom
features. We provide our sales personnel with extensive training and we keep
them updated as to the availability of financing, construction schedules and
marketing and advertising plans to facilitate their marketing and sales
activities. We supplement our in-house training program with training by outside
sales and marketing consultants. We have also formed sales teams comprised of a
sales person and other employees, who provide sales support and motivation.

In addition to using model homes, we enhance our marketing and sales
activity with a limited number of speculative homes, which we build in most
communities in advance of any specific customer order or contract. We construct
speculative homes to satisfy the requirements of relocated buyers, "move-up"
homebuyers, and other buyers who need completed homes prior to the completion of
the typical four to five month construction period. The number of speculative
homes we build in any given community is influenced by local market factors,
such as new employment opportunities, significant job relocations, housing
demand and the length of time we have built in the market.

We market and sell homes through commissioned sales personnel and in
cooperation with independent real estate brokers. Because a significant portion
of our sales originate from independent real estate brokers, we sponsor a
variety of programs and events, including breakfasts, contests and other events
to ensure that the brokers have the level of familiarity with our communities,
homes and financing options necessary to successfully market our homes. We also
offer other incentives to brokers to actively market our homes.

Sales of our homes generally are made pursuant to a standard sales contract
that is tailored to the requirements of each jurisdiction. Generally, our sales
contracts require a down payment of a fixed amount (typically between $1,000 and
$5,000) on our less expensive homes and as a percentage of the sales price
(typically 5% to 10%) on our more expensive customized homes. The contract
includes a financing contingency which permits the customer to cancel in the
event mortgage financing at prevailing interest rates cannot be obtained within
a specified period, typically four to six weeks from the signing, and may
include other contingencies, such as the prior sale of a buyer's existing home.
We estimate that the average period between the execution of a sales contract
for a home and closing is approximately four to eight months for presold homes.

Title and Mortgage Services. We provide title insurance and mortgage
origination services through our financial services businesses. In 1997, we
acquired a 49% interest in Pacific Title, L.C. ("Pacific Title"), which serves
as a title insurance agent and provides title insurance policies and closing
services to purchasers of homes built and sold by us in Texas. Our capital is
not at risk beyond our limited partnership interest in Pacific Title and we
assume no title insurance risk associated with these title policies. Stewart
Title Company owns the balance of the interests of Pacific Title.

In 2001, Westbrooke acquired a 49% limited partnership interest in
Universal Land Title of South Florida, Ltd., which serves as a title insurance
agent and provides title insurance policies and closing services to purchasers
of homes Westbrooke builds and sells in Florida. Our capital is not at risk
beyond our limited partnership interest and we assume no title insurance risk
associated with these title policies. Engle subsidiaries, affiliates of
Technical Olympic, own the balance of the partnership.

In 2001, we also acquired a 49.99% limited partnership interest in
Technical Mortgage, L.P., a mortgage origination company. TM Investments LLC and
Preferred Home Mortgage Company ("PHMC"), both of which are affiliates of
Technical Olympic and wholly-owned subsidiaries of Engle Homes, own the balance
of the partnership. Our capital is not at risk in connection with these
mortgages beyond our limited partnership interest. For more information on PHMC,
see the section entitled "The Merger -- Engle Holdings, Title and Mortgage
Services."

Customer Service and Quality Control. Our operating divisions are
responsible for both pre-closing quality control inspections and responding to
customer's post-closing needs. We believe that the prompt, courteous response to
homebuyers' needs during and after construction reduces post-closing repair
costs, enhances our reputation for quality and service and ultimately leads to
significant repeat and referral business. We conduct pre-closing inspections
with homebuyers immediately before closing. In conjunction with the inspections,
a list of items for home completion is created and outstanding issues are
promptly addressed.

An integral part of our customer service program includes post-closing
interviews. In most markets, a customer service representative is sent into each
home within 45 days of closing to evaluate the homeowners' satisfaction with
their new home, as well as their experience with our sales personnel,
construction department, and title and mortgage services. Typically,
approximately a year after we sell a house we conduct another interview with the
homeowner to determine the level of their continued satisfaction. These
interviews provide us with a direct link to the customer's perception of the
entire buying experience as well as valuable feedback on the quality of the
homes we deliver and the services we provide.

Warranty Program. We provide a two-year limited warranty of workmanship
and materials with each of our homes. We subcontract homebuilding work to
subcontractors who provide us with an indemnity and a certificate of insurance
before receiving payments for their work and, therefore, claims relating to
workmanship and materials are the primary responsibility of our subcontractors.
In all markets we provide an additional eight-year limited homeowners' warranty
covering major structural defects through an agreement with the Residential
Warranty Corporation, an unaffiliated insurance company. An appropriate warranty
reserve is established to cover anticipated warranty expenses not borne by our
subcontractors. Our historical experience is that warranty expenses generally
are within the reserve we have established. We generally have not had any
material litigation or claims regarding warranties or latent defects with
respect to construction of homes. Current claims and litigation are expected to
be substantially covered by our reserve or insurance. After we sell a house, all
warranty requests are processed through our customer service departments located
in each of our markets. In most instances, a customer service manager inspects
the warranty request within 48 hours of receipt. If a warranty repair is
necessary, the construction superintendent who built the particular home manages
and supervises the repair to ensure that the appropriate subcontractor takes
prompt and appropriate corrective action.

Governmental Regulation and Environmental Matters. We are subject to
extensive and complex laws and regulations that affect the development and
homebuilding process, including laws and regulations related to zoning,
permitted land uses, levels of density, building design, elevation of
properties, water and waste disposal, use of open spaces and the protection of
health and the environment. We must also obtain permits and approvals from local
authorities to complete residential development or home construction. Our
mortgage
15

financing and title insurance operations are subject to numerous federal, state
and local laws and regulations, including applicable insurance laws and
regulations. Failure to comply with these requirements can lead to
administrative enforcement actions, the loss of required licenses and claims for
monetary damages.

Competition and Market Forces. The development and sale of residential
properties is a highly competitive business with many competitors. We compete in
each of our markets with numerous national, regional and local builders.
Builders of new homes compete for homebuyers, as well as for desirable
properties, raw materials and reliable, skilled subcontractors. We also compete
with resales of existing homes, available rental housing and, to a lesser
extent, with resales of condominiums.

We believe we generally compare favorably to other builders in the markets
in which we operate, due primarily to:

(a) our experience within our geographic markets;

(b) the ability of our local managers to identify and quickly respond
to local market conditions; and

Our mortgage origination and title operations focus primarily on providing
services to buyers of our homes. Thus, although we compete with other
third-party providers of such financial services with respect to purchasers of
our homes, we generally do not compete directly with such providers, many of
whose sole business involves these operations with respect to homes we do not
build. We believe marketing these services to our homebuilding clients provides
us with a competitive advantage compared to those providers marketing such
services without an established relationship.

Employees. At March 31, 2002, we employed 347 persons, of whom 110 were
sales and marketing personnel, 152 were executive, administrative and clerical
personnel, and 85 were construction personnel. None of our employees are covered
by collective bargaining agreements. We believe our relations with our employees
are good.

Corporate Properties. We own a 19,000 square foot facility in Sugar Land,
Texas for both our Houston homebuilding operations and a design center, which
allows a prospective homebuyer to view samples of some of the products and
features we offer in our homes in Houston. We lease an aggregate of
approximately 28,000 square feet in Dallas, Austin, San Antonio and Nashville
for our homebuilding operations in these markets. We believe our existing
facilities are adequate for our current and planned levels of operations.

Legal Proceedings. We are involved in various claims and legal actions
arising in the ordinary course of business. We do not believe that the ultimate
resolution of these matters will have a material adverse effect on our financial
condition or results of operations.

Subsequent to our press release on March 6, 2001 regarding the possibility
of a merger with Engle, we were notified of the filing of two class action suits
challenging any transaction between us and Engle Holdings as a violation of
fiduciary duty. The first case was filed in the District Court, Clark County,
Nevada and is entitled: Cause No. A431555; Barry Feldman v. Michael J. Poulos,
Yannis Delikanakis, Michael S. Stevens, Constantinos Stengos, Georgios Stengos,
Andreas Stengos, James M. Carr, William A. Hasler, Larry D. Horner, Lonnie M.
Fedrick, Engle Holdings Corp. and Newmark Homes Corp. The second case was filed
in the 80th Judicial District Court of Harris County, Texas and is entitled:
Cause No. 2001-14194; and Michael Gormley v. Michael J. Poulos, Yannis
Delikanakis, Michael S. Stevens, Constantinos Stengos, Georgios Stengos, Andreas
Stengos, James M. Carr, William A. Hasler, Larry D. Horner, Lonnie M. Fedrick,
Engle Holdings Corp. and Newmark Homes Corp.

The first class action lawsuit filed in Nevada has been stayed indefinitely
pending the resolution of the second class action lawsuit filed in Texas. Our
obligation to answer the complaint in the second class action lawsuit was
deferred until the plaintiffs requested in writing that we answer the complaint
pursuant to an agreement with the plaintiffs.

Subsequent to the filing of the class action lawsuit in Texas, two
intervenors filed interventions in the Texas class action: Intervention by
Plaintiff Barry Feldman; Cause No. 2001-14194; Michael Gormley, on behalf of
himself and all others similarly situated v. Michael J. Poulos, et al; in the
80th Judicial District Court Harris County, Texas, filed March 23, 2001; and
Intervention by Plaintiff William F. Ring; Cause No. 2001-14194; Michael
Gormley, on behalf of himself and all others similarly situated v. Michael J.
Poulos, et al; in the 80th Judicial District Court Harris County, Texas, filed
March 29, 2001.

In March 2002, we reached an agreement in principle with representatives
for the plaintiffs for the proposed settlement of the class actions, as well as
the interventions. Under the terms of the settlement, we have agreed to pay the
plaintiffs' attorneys' fees and expenses in an amount not to exceed $350,000 in
the aggregate. The settlement is subject to a number of conditions, including
the closing of the Merger, providing notice to the class, conducting
confirmatory discovery, executing a definitive settlement agreement and
obtaining final approval by the court.

Market for Our Common Equity and Related Stockholder Matters. Our common
stock commenced trading on the Nasdaq National Market on March 12, 1998 under
the trading symbol "NHCH". The range of high and low closing sales prices per
share by quarter for calendar years 1999, 2000 and 2001, as well as for the
first quarter of 2002, as reported by the Nasdaq National Market, appear in the
following table. These prices are what a securities dealer would pay for a share
of our common stock and do not include any commissions you might have to pay or
any retail mark-ups or mark-downs.

RANGE
---------------
YEAR QUARTER HIGH LOW
---- ------- ------ ------

1999 First....................................................... $ 8.50 $ 6.25
Second...................................................... 6.75 5.00
Third....................................................... 8.13 5.25
Fourth...................................................... 7.50 5.00
2000 First....................................................... $ 6.50 $ 5.50
Second...................................................... 6.50 5.06
Third....................................................... 8.75 6.38
Fourth...................................................... 11.50 8.31
2001 First....................................................... $12.38 $ 9.11
Second...................................................... 17.00 10.52
Third....................................................... 13.29 8.75
Fourth...................................................... 14.50 9.60
2002 First....................................................... $17.84 $13.09

As of December 31, 2001, there were 37 shareholders of record. We believe
there are approximately 800 beneficial owners of our common stock.

We did not declare any cash dividends on our common stock in 2000. We
declared a dividend on March 6, 2001 of $0.54 per share of common stock to
record holders of March 31, 2001, which was paid May 15, 2001.

Our credit agreements generally contain covenants that limit the amount of
dividends or distributions we can pay on our common stock and the amount of
stock we can repurchase.

ENGLE'S BUSINESS

Engle designs, builds and sells single-family homes, town homes, patio
homes and condominiums in seven markets in Texas, Florida, Colorado, Virginia
and Arizona. At March 31, 2002, Engle operated in 89 communities and had 1,293
homes under construction. Engle is also actively engaged in residential land
acquisition and lot development and at March 31, 2002, owned or had under option
contracts 10,839 lots

available for future building. Engle markets homes under the Engle name only,
but it offers a variety of home styles, with an average sales price of
approximately $253,000 for the three months ended March 31, 2002.

Engle believes that it competes favorably with other homebuilders in its
markets by offering a wide variety of homes styles. Engle believes that its
market oriented approach, coupled with its emphasis on product and price
diversification, permits it to sell to many different types of homebuyers,
including "first-time" homebuyers, "move-up" homebuyers, homebuyers who are
being relocated to a new city or state and empty-nesters, and enables Engle to
respond rapidly to changing market conditions and the cyclical nature of the
homebuilding industry.

On November 22, 2000, Engle Homes became a wholly-owned subsidiary of Engle
Holdings, a wholly-owned subsidiary of Technical Olympic, pursuant to a merger
agreement dated October 12, 2000. Prior to its acquisition by Technical Olympic,
Engle Homes' fiscal year ended on October 31. On November 22, 2000, Engle Homes
changed its fiscal year from October 31 to December 31. Following the merger,
the common stock of Engle Homes ceased to be publicly traded.

Engle's principal executive office is located at 123 N.W. 13th Street,
Suite 300, Boca Raton, Florida 33432, and its phone number is (561) 391-4012.

Markets. Engle builds homes in seven markets in Texas, Florida, Colorado,
Virginia and Arizona. Engle selected these markets based on a number of factors,
including regional economic conditions, projected job growth, land availability,
the local land development process, consumer tastes, competition from other
builders of new homes and secondary home sales activity. Engle continues to
evaluate new markets for possible entry where it believes there are attractive
opportunities.

The table below shows, by region, for Engle sales contracts executed (net
of cancellations), home sales closed, homebuilding revenue and average sales
price, in each case for the three months ended March 31, 2002 and its backlog at
March 31, 2002:

MARKET REGION DATA
ENGLE

AVERAGE BACKLOG
MARKET NET SALES HOMES HOMEBUILDING SALES -------------------
REGION CONTRACTS CLOSED REVENUE PRICE HOMES SALES VALUE
------ --------- ------ ------------ ------- ----- -----------
(DOLLARS IN THOUSANDS)

Texas...................... 89 64 $ 12,634 $197 125 $ 24,924
Florida.................... 473 489 117,454 $240 1,257 328,097
Mid-Atlantic(1)............ 130 328 29,849 $328 171 65,258
West(2).................... 303 220 58,480 $266 388 103,146
--- --- -------- ----- --------
Total.................... 995 864 $218,417 $253 1,941 $521,425
=== === ======== ===== ========

---------------

(1) This region consists of Engle's operations in Virginia.

(2) This region consists of Engle's operations in Colorado and Arizona.

Engle's sales backlog at March 31, 2002 was 1,941 homes, compared to 2,369
homes at March 31, 2001. Backlog represents home purchase contracts that have
been executed and for which earnest money deposits have been received, but for
which the sale has not yet closed. Home sales are not recorded as revenues until
the closings occur. Although cancellations can disrupt anticipated home
closings, Engle does not believe that cancellations have had a material negative
impact on its operations or liquidity during the last several years. Engle
attempts to reduce cancellations by reviewing each homebuyer's ability to obtain
mortgage financing early in the sales process and by closely monitoring the
mortgage approval process.

Land Policies and Positions. Engle supports its homebuilding operations by
acquiring (i) developed lots and (ii) entitled land for development. Engle
generally acquires multiple developed lots that are located

adjacent to or near each other in a community. This enables Engle to build and
market its houses more cost efficiently than if the lots were located in many
separate locations. Historically, Engle has been able to acquire a substantial
portion of its developed lots through options rather than through firm purchase
contracts due to the awareness of its brand name among developers and the
willingness of developers in its markets to option available lots. With the
continuing strength in the housing sector, increasingly Engle has been required
to acquire more of its developed lots under firm purchase contracts.

Engle also acquires entitled land to develop lots through both options and
firm purchase contracts. Before Engle enters into such options or contracts it
conducts extensive due diligence using its local experience and expertise,
including on-site inspection and soil testing, and Engle confirms that the
development has the approvals for sewage systems, drainage and other
infrastructure necessary for Engle to develop the lots and build houses on them.
Occasionally, Engle sells a portion of the entitled land it purchases and
develops to third-party builders to provide a source of additional revenue and
to reduce the risk it incurs by holding these lots in inventory.

The table below shows Engle's lot inventory by region and in total for
periods indicated.

OCTOBER 31,
MARCH 31, DECEMBER 31, ---------------
2002 2001 2000 1999
--------- ------------ ------ ------

Texas......................................... 1,057 1,058 1,351 1,256
Florida....................................... 4,540 3,761 4,755 6,306
Mid-Atlantic.................................. 1,603 1,510 1,357 1,663
West.......................................... 3,639 3,711 3,675 4,143
------ ------ ------ ------
Total(1)................................. 10,839 10,040 11,138 13,368
====== ====== ====== ======

---------------

(1) Includes 7,161, 6,146, 4,562, and 5,874 lots under option contracts as of
March 31, 2002, December 31, 2001, October 31, 2000 and 1999, respectively.
Lot inventory excludes lots upon which construction has commenced.

Construction. Subcontractors perform substantially all of Engle's
construction work. Engle's construction superintendents monitor the construction
of each home, coordinate the activities of subcontractors and suppliers, subject
their work to quality and cost controls and monitor compliance with zoning and
building codes. Subcontractors typically are retained pursuant to a contract
that obligates the subcontractor to complete construction at a fixed price in a
workmanlike manner. In addition, under these contracts the subcontractor
provides Engle with standard indemnifications and warranties. Typically, Engle
works with the same subcontractors within each city, which provides Engle with a
stable and reliable work force and better control over the costs and quality of
the work performed. Although Engle competes with other homebuilders for
qualified subcontractors, Engle has an established long-standing relationship
with many of its subcontractors.

Engle typically completes the construction of a home within four to five
months. Construction time for its homes depends on weather, availability of
labor, materials, supplies and other factors. Engle does not maintain
significant inventories of construction materials, except for materials related
to work in progress for homes under construction. Generally, the construction
materials used in its operations are readily available from numerous sources.
Engle has favorable price arrangements or contracts with suppliers of certain of
its building materials, but it is not under specific purchasing requirements. In
recent years, Engle has not experienced any significant delays in construction
due to shortages of materials.

Marketing and Sales. Engle uses a variety of marketing techniques to
attract potential homebuyers, including the Internet, extensive telemarketing
and advertising, and other marketing programs. Engle advertises on television,
in newspapers and other publications, through brochures and newsletters, on
billboards and in brochures and newsletters produced by real estate and mortgage
brokers. Engle also uses a cross-referral program that encourages its personnel
to direct customers to other Engle communities, as necessary to meet the
customer's needs.
19

Engle sells its homes primarily through commissioned sales personnel, as
well as in cooperation with independent brokers. In all instances, Engle's sales
personnel are available to assist prospective buyers by providing them with
floor plans, price information, tours of model homes and the selection of
various options and upgrades. Engle trains its sales personnel and they receive
additional training from outside sales and marketing consultants. Engle keeps
its sales personnel informed as to the availability of financing, construction
schedules and marketing and advertising plans to facilitate their marketing and
sales activities.

Engle generally sells its homes pursuant to a standard sales contract that
is tailored to the requirements of each jurisdiction in which it operates.
Generally, Engle's sales contracts require a down payment of up to 10% of the
sales price. The contract includes a financing contingency which permits the
customer to cancel in the event mortgage financing at prevailing interest rates
cannot be obtained within a specified period, typically four to six weeks from
signing, and may include other contingencies, such as the prior sale of a
buyer's existing home. Engle estimates that the average period between the
execution of a sales contract for a home and closing is approximately six
months.

Title and Mortgage Services. Engle Homes provides title insurance and
mortgage origination services through its financial services business. Universal
Land Title, Inc. ("ULT"), a wholly-owned subsidiary of Engle Homes, currently
provides title services to Engle's homebuyers in its Florida, Colorado and Texas
markets, as well as to buyers of houses built by other homebuilders. At December
31, 2001, ULT was operating 19 offices in Florida, 1 office in Colorado, and 1
office in Texas.

PHMC, a wholly-owned subsidiary of Engle Homes, is a mortgage origination
company that underwrites, originates and sells mortgages for homes built by
Engle and, to a lesser extent, homes built by other homebuilders. In addition,
PHMC refinances homes as well. PHMC is an approved lender by the Federal
National Mortgage Association ("FNMA") to deliver loan origination to FNMA and
to other investors and to service such loans. During 2001, PHMC sold a total of
approximately $489 million in mortgage loans (including servicing rights),
representing most of the loans made by PHMC. Substantially all of PHMC's
revenues are derived from mortgages on homes built by Engle. At December 31,
2001, PHMC was originating mortgages in all Engle homebuilding divisions.

Customer Service and Quality Control. Engle's customer service department
is responsible for pre-closing and post-closing customer needs. Before closing,
an Engle employee accompanies the buyer on a home orientation and inspection
tour. In conjunction with the inspections, a list of items for home completion
is created and outstanding issues are properly addressed.

Warranty Program. Engle provides each homebuyer with a one-year limited
warranty of workmanship and materials and a ten-year structural warranty. Engle
subcontracts homebuilding work to subcontractors who provide it with an
indemnity and a certificate of insurance before receiving payments for their
work and, therefore, claims relating to workmanship and materials are the
primary responsibility of its subcontractors. Engle generally has not had any
material litigation or claims regarding warranties or latent defects with
respect to construction of homes. Current claims and litigation are expected to
be substantially covered by Engle's reserve or insurance.

Governmental Regulation and Environmental Matters. Engle is subject to
extensive and complex laws and regulations that affect the development and
homebuilding process, including laws and regulations related to zoning,
permitted land uses, levels of density, building design, elevation of
properties, water and waste disposal, use of open spaces and the protection of
health and the environment. Engle must also obtain permits and approvals from
local authorities to complete residential development or home construction.
Engle's mortgage financing and title insurance operations are subject to
numerous federal, state and local laws and regulations. Failure to comply with
these requirements can lead to administrative enforcement actions, the loss of
required licenses and claims for monetary damages.

Competition and Market Forces. The development and sale of residential
properties is a highly competitive and fragmented business. Engle competes in
each of its markets with numerous national, regional and local builders.
Builders of new homes compete for homebuyers, as well as for desirable
properties, raw

materials and reliable, skilled subcontractors. Engle also competes with resales
of existing homes, available rental housing and, to a lesser extent, with
resales of condominiums.

Engle believes it generally compares favorably to other builders in the
markets in which it operates, due primarily to:

(a) Engle's experience within its geographic markets;

(b) the ability of Engle's local managers to identify and quickly
respond to local market conditions; and

Engle's mortgage origination and title operations focus on providing
services to customers of its homebuilding operations. Thus, although Engle
competes with other third-party providers of such financial services with
respect to purchasers of its homes, Engle generally does not compete directly
with such providers, many of whose sole business involves these operations with
respect to homes it does not build.

Employees. At March 31, 2002, Engle Homes employed 874 persons, of whom
176 were sales and marketing personnel, 576 were executive, administrative and
clerical personnel, and 122 were construction personnel. None of Engle Homes'
employees are covered by collective bargaining agreements. Engle Homes believes
that its relations with its employees are good.

Corporate Properties. Engle's corporate office is located at 123 N.W. 13th
Street, Suite 300, Boca Raton, Florida 33432, where Engle leases 9,356 square
feet of office space for a term expiring in August 2006. Engle's building
divisions, PHMC and ULT branch operations lease additional office space at
various locations for their day-to-day operations. Management of Engle believes
that the current leased offices are adequate for its needs for the near future.

Legal Proceedings. Engle is involved in various claims and legal actions
arising in the ordinary course of business. Engle does not believe that the
ultimate resolution of these matters will have a material adverse effect on its
financial condition or results of operations. Engle is also a defendant in the
two class action lawsuits and interventions described under "The Merger -- Our
Business, Legal Proceedings."

In early February 2002, Alec Engelstein, Chief Executive Officer of Engle
Homes, and David Shapiro, Vice President-Chief Financial Officer of Engle Homes,
resigned from their executive positions with Engle Homes and alleged that they
were entitled to receive severance packages in the aggregate of $9,404,895, plus
other benefits, including a monthly retirement benefit equal to one-twelfth of
Mr. Engelstein's annual Base Salary at the time of the termination, such
payments to continue for a period of 60 consecutive months. Engle Homes has
advised them that it disputes their claims, but there can be no assurance that,
if litigated or arbitrated, Engle Homes will prevail. However, Engle Homes has
included amounts sufficient to cover the alleged payments due to Mr. Engelstein
and Mr. Shapiro in the restructuring charges reflected in the pro forma
financial statements.

Market for Engle Holdings' Common Equity and Related Stockholder
Matters. There is no current trading market for the common stock of either
Engle Holdings or Engle Homes. Technical Olympic owns all the outstanding common
stock of Engle Holdings, which owns all the outstanding common stock of Engle
Homes.

Technical Olympic acquired Engle Homes in November 2000 through a merger
with a subsidiary of Technical Olympic's wholly-owned subsidiary, Engle
Holdings. As a result, the common stock of Engle Homes ceased to be publicly
traded and was therefore delisted from the Nasdaq National Market. Thus, neither
Engle Holdings nor Engle Homes is subject to the reporting requirements of the
Exchange Act. However, under the terms of indentures dated February 2, 1998 and
June 12, 1998, respectively, under which Engle Homes issued certain debt while
it was publicly traded, Engle Homes is contractually obligated to file annual
and quarterly reports with the SEC while that debt remains outstanding.

Market for Common Equity and Related Stockholder Matters. On November 22,
2000, the outstanding shares of Engle Homes' common stock ceased trading as a
result of the merger with a subsidiary of Technical
21

Olympic. Since such date, all shares of Engle Homes' common stock have been
beneficially owned by Engle Holdings and none have traded.

YEAR ENDED
----------------------------------------
DECEMBER 31, 2001 OCTOBER 31, 2000
------------------ -----------------
HIGH LOW HIGH LOW
------- ------ ------ ------

First Quarter................................. N/A N/A $13.63 $10.31
Second Quarter................................ N/A N/A $11.00 $ 9.13
Third Quarter................................. N/A N/A $10.56 $ 9.13
Fourth........................................ N/A N/A $18.94 $ 9.56

For the fiscal year October 31, 2000, Engle declared and paid per share
dividends as set forth in the following table:

CASH DIVIDENDS
--------------
2000
--------------

First Quarter............................................... $0.06
Second Quarter.............................................. $0.06
Third Quarter............................................... $0.06

In November 2000 Technical Olympic acquired Engle Homes, which then became
a wholly-owned subsidiary of Technical Olympic. During the twelve months ended
December 31, 2001, Engle made distributions to its parent company of
approximately $29.5 million.

The payment of future cash dividends will be at the discretion of Engle's
board of directors and will depend upon, among other things, results of
operations, capital requirements, Engle's financial condition, debt covenant
restrictions and such other factors as Engle's board of directors may consider.

The indentures for Engle's 9 1/4% Senior Notes due 2008 contain
restrictions on the payment of dividends, dependent, in part, on the Engle's net
income earned since February 1, 1998. Engle's bank credit agreement also
restricts it from declaring or paying dividends with certain exceptions.

Changes in and Disagreements with Accountants. On October 1, 2001, Engle
dismissed BDO Seidman, LLP as its independent accountants. Engle's board of
directors approved the dismissal of BDO Seidman, LLP as its independent
accountants. Engle engaged Ernst & Young, LLP as its new independent certified
public accountants as of October 1, 2001. Engle had not consulted Ernst & Young,
LLP on any accounting issues.

The reports of BDO Seidman, LLP on Engle's financial statements for the
past two fiscal years contained no adverse opinion or disclaimer of opinion and
were not qualified or modified as to uncertainty, audit scope or accounting
principle.

In connection with its audits for the two most recent fiscal years ending
on December 31, 2000 and October 31, 1999 and during the subsequent interim
period through October 1, 2001, there have been no disagreements with BDO
Seidman, LLP on any matter of accounting principles or practices, financial
statement disclosure, or auditing scope or procedure, which disagreements if not
resolved to the satisfaction of BDO Seidman, LLP would have caused them to make
reference thereto in their report on the financial statements for such years.

Engle has previously filed a letter from BDO Seidman, LLP addressed to the
SEC stating whether or not it agrees with the above statements. A copy of such
letter, dated October 8, 2001 and filed with the SEC on Engle's Form 8-K filed
on October 9, 2001, is filed as Exhibit D to this Information Statement.

COMBINED OPERATIONS

Upon completion of the Merger, we will be a geographically diversified,
national homebuilder that is the twelfth largest homebuilder in the United
States based on the number of homes closed in 2001, according to Builder
Magazine's list of the top 100 homebuilders in the United States. We will
operate in 11 metropolitan

markets located in four major geographic regions: Texas, Florida, the West
(Arizona and Colorado) and the Mid-Atlantic (Virginia and Tennessee). For the
year ended March 31, 2002, on a pro forma combined basis (after giving effect to
the Westbrooke Sale, the Merger Transactions and the Refinancing), we would have
delivered 5,224 new homes and generated approximately $1.4 billion in revenues
and $187.5 million in EBITDA before one time charges.

We will continue to design, construct, and market single-family residences,
town homes, and condominiums principally targeting "first-time" homebuyers,
"move-up" homebuyers, homebuyers who are being relocated to a new city or state,
second home seasonal buyers and empty-nesters. We will continue to offer a
variety of home styles and sizes under the brand names: Newmark(R), Fedrick,
Harris Estate Homes, Marksman and Engle. We will also continue to offer
financial services, including mortgage financing, title insurance and closing
services, to buyers of our homes in the majority of our markets, as well as to
buyers of homes built by other homebuilders.

Upon completion of the Merger, we will operate in seven of the twenty
fastest growing housing markets in the nation based on single-family housing
starts in the ten months ended October 31, 2001. We believe that significant
growth opportunities exist in the majority of these markets. As of March 31,
2002, on a pro forma combined basis (after giving effect to the Westbrooke
Sale), we owned or had under option contracts 13,306 lots, and we were actively
building or marketing in 146 communities. Our backlog of homes at March 31, 2002
(on a pro forma combined basis after giving effect to the Westbrooke Sale) would
have been 2,411 homes under contract, representing approximately $651.3 million
in revenues.

Our business strategy upon completion of the Merger, will include the
following:

Expand in existing and new markets. We have successfully expanded
operations in new and existing markets through internal growth, start-up
operations, and selected acquisitions. Within our existing markets, we intend to
further expand our market share by increasing the number of residential homes we
build, thereby leveraging our management structure and enhancing profitability
by achieving further economies of scale. Over time, we also intend to diversify
further geographically by expanding into new markets that have favorable
characteristics, including significant single-family home permit activity,
substantial job growth, a diversified economy and an availability of strong
management with local market expertise. We believe this diversification will
enable us to minimize our exposure to adverse conditions in individual local
markets.

Selectively acquire and manage lot inventory. We intend to continue to
pursue a lot acquisition and inventory management policy that is designed to
enhance both profitability and return on capital while minimizing the risks
associated with investments in lots. We intend to continue to identify and
acquire attractive locations to support our homebuilding operations in our
markets and offer our customers a variety of communities with diverse products
and prices. Wherever possible, we intend to continue to acquire lots to support
our homebuilding operations through options to purchase rather than outright
purchases. We generally also will seek to acquire improved residential lots
ready for construction in order to minimize lot delivery issues and timing
risks. To support our homebuilding operations we also expect to continue to
acquire tracts of land that require site improvements before the start of home
construction when we believe opportunities available outweigh the development
risks and in markets demanding land development due to a shortage of available
completed lots. In addition, we intend to continue to pursue partnership or
joint venture agreements with other major homebuilders and investors, to
purchase and develop well located parcels of land.

Provide superior quality and customer service. We intend to continue to
focus on building high quality homes and achieving high customer satisfaction
because we believe they have been, and will continue to be, critical to our
success. We will continue to provide prompt, courteous responses to homebuyers'
needs throughout the homebuying process and after the closing because we believe
it reduces post-closing repair costs, enhances our reputation for quality and
service, and further leads to significant repeat and referral business.

Grow our financial services businesses. We believe that the Merger
provides us with attractive opportunities to grow our financial services
business by:

- increasing the number of homebuyers who use our financial services;

- marketing our financial services more aggressively to buyers of homes
built by other homebuilders, including smaller homebuilders that do not
provide their own financial services;

- offering services that compliment our existing financial services
business, such as homeowners' insurance and mortgage refinancing, in all
our markets; and

- targeting our financial services to the general residential real estate
market.

MERGER AGREEMENT AND RELATED MATTERS

Conditions to Closing the Merger. The Merger Agreement provides that the
respective obligations of each of the parties to effect the Merger are subject
to the satisfaction or waiver of customary conditions, including the condition
that no injunction, restraining order or decree issued or entered by any
governmental authority, or other legal restraint or prohibition, will be in
effect preventing or materially restraining consummation of the Merger
Agreement. The Merger is also contingent upon the completion of the Refinancing.
See "The Refinancing" below.

Effectiveness of the Merger. The Merger will become effective at the time
a Certificate of Merger is recorded by the Secretary of State of the State of
Delaware.

Consideration for the Merger. As explained more fully in the Merger
Agreement, on the Effective Date, Engle Holdings will be merged with and into us
and each issued and outstanding share of Engle Holdings' common stock will be
converted into 1,724.08294 shares of our common stock. In addition, immediately
prior to the Merger we will assume the Engle Homes Acquisition Debt, which will
be repaid as part of the Refinancing. See "The Merger -- The Refinancing." The
Special Committee and its financial advisors considered our assumption of the
Engle Homes Acquisition Debt in evaluating the ratio for the exchange of each
Engle Holdings share into shares of our common stock pursuant to the Merger.

Fractional Shares. No fractional shares of our common stock will be issued
in the Merger. To the extent that the conversion ratio would result in a
fractional number of shares of our common stock being issued, the number of
shares of our common stock issuable in the Merger will be rounded down to the
next whole number.

Effect of the Merger. Engle Holdings will be merged with and into us on
the Effective Date. The separate existence of Engle Holdings will cease and we
will survive the Merger and continue to be governed by the laws of Delaware.
Engle Homes will become our wholly-owned subsidiary as a result of the Merger.
To accomplish the Merger we will amend our certificate of incorporation to
increase the number of authorized shares of common stock from 30,000,000 to
67,000,000, as set forth in the Charter Amendment. Pursuant to the Charter
Amendment and the amendment of our bylaws, we will also increase the maximum
number of authorized directors on our board from 10 to 15 directors and change
our corporate name to "Technical Olympic USA, Inc." We will continue to conduct
our existing business and to possess all of our assets, rights, powers and
property, and be subject to all our debts, liabilities and obligations as
constituted at and as of the Effective Date.

We will succeed to all of Engle Holdings' assets, rights, powers and
property, as well as its debts, liabilities and obligations. As a result, Engle
Homes, the wholly-owned operating subsidiary of Engle Holdings, will become our
wholly-owned subsidiary.

Changes in Management. Upon consummation of the Merger, Antonio B. Mon
will become a director of Newmark. All of our other existing directors will
continue in office following the Merger. Upon consummation of the Merger, our
Chief Executive Officer will be Antonio B. Mon and our Chief Financial Officer
will be Tommy McAden. See "Management."

Representations and Warranties. Each party to the Merger Agreement makes
representations and warranties to the other parties, including its qualification
to do business, and its ability and authorization to enter into the Merger
Agreement. The representations and warranties of each of the parties will not
survive closing, except Technical Olympic's representations and warranties
relating to the conduct of Engle's business since November 2000 (when Technical
Olympic purchased Engle) and to Technical Olympic's lack of knowledge regarding
any undisclosed Engle liabilities, which representations and warranties will
survive for six months following the closing of the Merger.

Termination of the Merger Agreement. Before the closing of the Merger, the
parties may agree by mutual written consent to terminate the Merger. Any of the
parties may terminate the Merger Agreement in writing to the other parties if
the Merger is not consummated on or before December 31, 2002, unless the failure
to consummate the Merger is the result of a default by the party seeking to
terminate the Merger Agreement, or if a court or governmental entity issues an
order, decree or ruling enjoining, restraining or otherwise prohibiting the
consummation of the Merger. We may terminate the Merger Agreement if Engle
Holdings or Technical Olympic is in material default of any provision of the
Merger Agreement and such default continues for 10 days after we give notice of
the default. Similarly, Engle Holdings or Technical Olympic may terminate the
Merger Agreement, if we are in material default of any provision of the Merger
Agreement and such default continues for 10 days after either Engle Holdings or
Technical Olympic gives notice of the default.

Indemnification. Our certificate of incorporation provides that we will
indemnify the members of our board of directors to the fullest extent permitted
by law. In addition, we have entered into indemnification agreements with our
directors to clarify their indemnification pursuant to their membership on the
board of directors and to establish a procedure for indemnification and the
advancement of expenses.

REASONS FOR THE MERGER

We believe that the Merger provides an opportunity to improve our operating
and financial performance. The combined entity will create one of the largest
homebuilding companies in the United States, with pro forma combined revenue
(after giving effect to the Westbrooke Sale, the Merger Transactions and the
Refinancing) of approximately $1.4 billion for the year ended March 31, 2002.
The addition of Engle will also significantly increase our market penetration.
Based on annual job growth, we currently operate in three of the top twenty
residential markets in the United States and Engle operates in six of the top
twenty residential markets in the United States. With the acquisition of Engle,
we will increase our presence to seven of the top twenty fastest growing housing
markets in the nation based on single-family housing starts in the ten months
ended October 31, 2001.

We also believe the merger with Engle will:

- expand our markets and increase our geographic diversification;

- increase our operating efficiencies as a result of economies of scale;

- improve our purchasing power with respect to subcontractors and
suppliers;

- increase our leverage with brokers and land owners to obtain rights to
the most attractive properties in our markets;

- enhance our management team and homebuilding expertise through the
addition of Engle Homes' management and key employees; and

- enhance our access to capital.

For these reasons, the Special Committee and our board of directors believe that
the Merger Transactions are in the best interest of our company and our
stockholders. In reaching their conclusions, the Special Committee and our board
of directors considered:

- the judgment, advice and analyses of our management with respect to the
strategic, financial and potential operational benefits of the Merger,
based in part on the business, financial and legal due diligence
investigations performed with respect to Engle;

- the accretive effect of the Merger on our pro forma combined earnings per
share;

- the reputation of Engle, including the reputation and experience of its
management team;

- the advice of, and financial analyses prepared by, DB;

- the opinion of DB regarding the fairness from a financial point of view
of the Conversion Ratio to the holders of Newmark's common stock, other
than Technical Olympic; and

- the advice of counsel that the Merger should be tax-free to us and our
stockholders for federal income tax purposes.

OWNERSHIP AFTER THE MERGER

After the Merger, our stockholders will continue to own their existing
shares. We will issue 16,378,787 new shares of our common stock to Technical
Olympic, which owns all the outstanding stock of Engle Holdings, in the Merger.
Upon completion of the Merger, stockholders other than Technical Olympic will
own 8.25% of our outstanding common stock and Technical Olympic will own
25,578,787 shares of our common stock, representing 91.75% of our outstanding
common stock.

OPINION OF DEUTSCHE BANK SECURITIES INC., FINANCIAL ADVISOR TO THE SPECIAL
COMMITTEE

DB has acted as financial advisor to the Special Committee in connection
with the proposed Merger pursuant to the Merger Agreement. As set forth more
fully in the Merger Agreement, Engle Holdings will be merged with and into
Newmark. Each share of Engle Holding's common stock, $0.01 par value, issued and
outstanding immediately prior to the Effective Date shall, by virtue of the
Merger, be changed and converted into fully paid and nonassessable shares of
common stock, par value $0.01 per share, of Newmark ("Newmark Common Stock") at
the Conversion Ratio (as defined below). The conversion ratio ("Conversion
Ratio") shall be the ratio of 1,724.08294 Newmark Shares to one Engle Holdings
Share. At the April 4, 2002 meeting of the Special Committee, DB delivered its
oral opinion, subsequently confirmed in writing as of the same date, to the
Special Committee to the effect that, as of the date of such opinion, based upon
and subject to the assumptions made, matters considered and limits of the review
undertaken by DB, the Conversion Ratio to be applied in the Merger was fair,
from a financial point of view, to the stockholders of Newmark, other than
Technical Olympic.

THE FULL TEXT OF DB'S WRITTEN OPINION, DATED APRIL 4, 2002, WHICH SETS
FORTH, AMONG OTHER THINGS, THE ASSUMPTIONS MADE, MATTERS CONSIDERED AND LIMITS
ON THE REVIEW UNDERTAKEN BY DB IN CONNECTION WITH THE OPINION, IS ATTACHED AS
EXHIBIT C TO THIS INFORMATION STATEMENT AND IS INCORPORATED HEREIN BY REFERENCE.
OUR STOCKHOLDERS ARE URGED TO READ THE OPINION IN ITS ENTIRETY. THE SUMMARY OF
THE OPINION SET FORTH IN THIS INFORMATION STATEMENT IS QUALIFIED IN ITS ENTIRETY
BY REFERENCE TO THE FULL TEXT OF THE OPINION.

In connection with DB's role as financial advisor to the Special Committee,
and in arriving at its opinion, DB has, among other things, reviewed certain
publicly available financial and other information concerning Newmark and Engle
Holdings and certain internal analyses and other information furnished to it by
Newmark and Engle Holdings. DB has also held discussions with members of the
senior management of Newmark and Engle Holdings regarding the business and
general future prospects of Newmark and Engle Holdings. In addition, DB has (i)
reviewed the reported prices and trading activity for Newmark Common Stock, (ii)
compared certain financial and stock market information for Newmark and Engle
Holdings, as appropriate, with similar information for certain other companies
whose securities are publicly traded,

(iii) reviewed the terms of the draft Merger Agreement, and (iv) performed such
other studies and analyses and considered such other factors as it deemed
appropriate.

In preparing its opinion, DB did not assume responsibility for independent
verification of, and did not independently verify, any information, whether
publicly available or furnished to it, concerning Newmark or Engle Holdings,
including, without limitation, any financial information, forecasts or
projections considered in connection with the rendering of its opinion.
Accordingly, for purposes of its opinion, DB assumed and relied upon the
accuracy and completeness of all such information and DB did not conduct a
physical inspection of any of the properties or assets, and did not prepare or
obtain any independent evaluation or appraisal of any of the assets or
liabilities of Newmark or Engle Holdings. With respect to the financial
forecasts and projections made available to DB and used in its analyses, DB
assumed that they have been reasonably prepared on bases reflecting the best
currently available estimates and judgments of the management of Newmark or
Engle Holdings as to the matters covered thereby. In rendering its opinion, DB
expresses no view as to the reasonableness of such forecasts and projections or
the assumptions on which they are based. DB's opinion is necessarily based upon
economic, market and other conditions as in effect on, and the information made
available to it as of, the date of the opinion.

For purposes of rendering its opinion, DB has assumed that, in all respects
material to its analysis, the draft Merger Agreement reviewed by DB and the
executed Merger Agreement will not be materially different, the representations
and warranties of Newmark, Engle Holdings and Technical Olympic contained in the
Merger Agreement are true and correct and that Newmark, Engle Holdings and
Technical Olympic will each perform all of the covenants and agreements to be
performed by it under the Merger Agreement and all conditions to the obligations
of each of Newmark, Engle Holdings and Technical Olympic to consummate the
Merger will be satisfied without any waiver thereof. DB has also assumed that
all material governmental, regulatory or other approvals and consents required
in connection with the consummation of the Merger will be obtained and that in
connection with obtaining any necessary governmental, regulatory or other
approvals and consents, or any amendments, modifications or waivers to any
agreements, instruments or orders to which any of Engle Holdings, Technical
Olympic and Newmark is a party or is subject or by which it is bound, no
limitations, restrictions or conditions will be imposed or amendments,
modifications or waivers made that would have a material adverse effect on Engle
Holdings, Technical Olympic or Newmark or materially reduce the contemplated
benefits of the Merger to Newmark or the holders of Newmark Common Stock, other
than Engle Holdings and its affiliates. For purposes of rendering its opinion,
DB has assumed that the Merger will be tax-free to each of Newmark and Engle and
their respective stockholders.

Set forth below is a brief summary of certain financial analyses performed
by DB in connection with its opinion and reviewed with the Special Committee at
its meeting on April 4, 2002.

Accretion/dilution analysis. DB conducted an analysis of the expected
Newmark earnings per share ("EPS") in the absence of the Merger, and determined
the extent to which that expectation would change following the Merger. DB
conducted the analysis on a pro forma basis as if the Merger had occurred as of
the beginning of 2001 using the actual results for the fiscal years ended for
Newmark and Engle. In addition, DB analyzed the expected impact for the fiscal
years 2002 and 2003 on the basis of the projections delivered to DB, taking into
account certain adjustments relating to the Merger, including the impact of the
proposed sale of Westbrooke. The following table summarizes the results of the
DB analysis:

ACCRETION/DILUTION ANALYSIS -- SUMMARY

EPS PRO FORMA EPS ACCRETION/ DILUTION
----- ------------- -------------------

2001......................................... $2.11 $3.27 54.6%
2002E........................................ 1.70 2.76 63.0
2003E........................................ 2.44 3.60 47.5

Financial contribution analysis. DB reviewed and analyzed the relative
financial contribution of both Newmark and Engle Holdings on both historic and
prospective bases, and compared the percentage contributions from Newmark to the
level of pro forma ownership that is provided to current stockholders of

Newmark following consummation of the Merger (41.25%). In doing so, the analysis
assumes that each of the two companies operated, and would continue to operate,
as a separate entity, in order to determine the level of contribution (defined
as a percentage of the total) that each company provides. As the following chart
summarizes, the analysis compared revenue, EBITDA (defined as earnings before
interest, taxes, depreciation and amortization), net income and tangible book
value for each of three calendar years ending 2001, 2002E and 2003E.

FINANCIAL CONTRIBUTION ANALYSIS

2001 2002E 2003E
------------------ ------------------ ------------------
ENGLE ENGLE ENGLE
NEWMARK HOLDINGS NEWMARK HOLDINGS NEWMARK HOLDINGS
------- -------- ------- -------- ------- --------

Revenue............................. 38.3% 61.7% 32.2% 67.8% 33.0% 67.0%
EBITDA.............................. 27.1 72.9 24.9 75.1 24.6 75.4
Net income.......................... 25.6 74.4 25.2 74.8 27.0 73.0
Tangible book value................. 31.0 69.0 37.9 62.1 35.1 64.9

Analysis of Selected Publicly Traded Companies. DB reviewed certain
financial information and calculated commonly used valuation measurements for
Newmark and Engle Holdings (as applicable) to corresponding information and
measurements for a group of four publicly traded companies in the homebuilding
industry consisting of: Beazer Homes USA Inc., Hovnanian Enterprises Inc.,
Meritage Corporation, and M/I Schottenstein Homes Inc. Such financial
information and valuation measurements included, among other things:

- current equity market valuation and 52 week range;

- total enterprise value (the sum of equity market valuation and net debt);

- ratios of total enterprise value to revenues, EBITDA, and earnings before
interest and taxes ("EBIT");

- ratios of current equity market valuation to latest twelve months'
reported net income; and

- ratios of current equity market valuation to tangible book value.

To determine the total enterprise value and equity value for Engle
Holdings, DB used the Conversion Ratio and Newmark's share price as of April 2,
2002. To calculate the trading multiples for Newmark and the selected companies,
DB used information provided by Newmark and publicly available information
concerning historical and projected financial performance, including published
historical financial information and earnings estimates reported by the
Institutional Brokers Estimate System ("IBES"). IBES is a data service that
monitors and publishes compilations of earnings estimates by selected research
analysts regarding companies of interest to institutional investors. The results
can be summarized as follows:

TRADING COMPANY ANALYSIS -- SUMMARY

HIGH LOW MEAN MEDIAN
---- --- ---- ------

LAST TWELVE MONTHS
Total enterprise value/EBITDA.......................... 5.8x 5.0x 5.4x 5.4x
Total enterprise value/EBIT............................ 6.1 5.3 5.7 5.6
Equity value/tangible book value....................... 2.5 1.5 2.0 2.0
Market price/EPS....................................... 8.0 6.4 7.2 7.2
Market price/2002E EPS................................. 8.0 7.0 7.6 7.8

MULTIPLES AT MERGER(1)

NEWMARK AND
NEWMARK, ENGLE HOLDINGS
STAND-ALONE COMBINED, PRO FORMA
----------- -------------------

LAST TWELVE MONTHS
Total enterprise value/EBITDA.......................... 4.7x 3.7x
Total enterprise value/EBIT............................ 5.2 4.0
Equity value/net income................................ 6.6 4.3
Equity value/tangible book value....................... 1.5 1.4

---------------

(1) Based on the total enterprise value of Newmark as of April 2, 2002.

None of the companies utilized in the trading company analysis is identical
to Newmark or Engle Holdings. Accordingly, DB believes the analysis is not
simply mathematical. Rather, it involves complex considerations and qualitative
judgments, reflected in DB's opinion, concerning differences in financial and
operating characteristics of the selected companies and other factors that could
affect the public trading value of the selected companies.

The foregoing summary describes the analyses and factors that DB deemed
material in its presentation to the Special Committee, but is not a
comprehensive description of all analyses performed and factors considered by DB
in connection with preparing its opinion. The preparation of a financial
advisor's fairness opinion is a complex process involving the application of
subjective business judgment in determining the most appropriate and relevant
methods of financial analysis and the application of those methods to the
particular circumstances and, therefore, is not readily susceptible to summary
description. DB believes that its analyses must be considered as a whole and
that considering any portion of such analyses and of the factors considered
without considering all analyses and factors could create a misleading view of
the process underlying the opinion. In arriving at its opinion, DB did not
assign specific weights to any particular analyses.

In conducting its analyses and arriving at its opinion, DB utilized a
variety of generally accepted valuation methods. The analyses were prepared
solely for the purpose of enabling DB to provide its opinion to the Special
Committee as to the fairness, from a financial point of view, of the Conversion
Ratio to stockholders of Newmark, other than Technical Olympic, and do not
purport to be appraisals or necessarily reflect the prices at which businesses
or securities actually may be sold, which are inherently subject to uncertainty.
In connection with its analyses, DB made, and was provided by Newmark management
and the Special Committee, with numerous assumptions with respect to industry
performance, general business and economic conditions and other matters, many of
which are beyond Newmark's control. These analyses based on estimates or
forecasts of future results are not necessarily indicative of actual past or
future values or results, which may be significantly more or less favorable than
suggested by such analyses. Because such analyses are inherently subject to
uncertainty, being based upon numerous factors or events beyond the control of
Newmark or its advisors, neither Newmark, the Special Committee nor DB nor any
other person assumes responsibility if future results or actual values are
materially different from these forecasts or assumptions.

The exchange ratio pursuant to the Merger Agreement and other terms of the
Merger Agreement were determined through negotiations between Technical Olympic
and the Special Committee. Although DB provided advice to the Special Committee
relating to the Merger, the decision to recommend the Merger was solely that of
the Special Committee and Newmark's Board of Directors. As described above, the
opinion and presentation of DB to the Special Committee were only one of a
number of factors taken into consideration by the Special Committee and
Newmark's Board of Directors in making their determinations to recommend the
Merger. DB's opinion was rendered to the Special Committee to assist it in
connection with its consideration of the Merger and does not constitute a
recommendation to any holder of Newmark Common Stock.

The Special Committee and Newmark selected DB as financial advisor to the
Special Committee in connection with the Merger based on DB's qualifications,
expertise, reputation and experience in mergers and acquisitions. The Special
Committee has retained DB pursuant to a letter agreement dated as of March 8,
2001. As compensation for DB's services in connection with the Merger, DB was
paid a cash retainer fee of
29

$100,000 and, upon delivery of its opinion, is entitled to be paid an additional
cash fee of $400,000. In the event that the Merger is consummated, Newmark has
agreed to pay DB an additional fee of $250,000. Regardless of whether the Merger
is consummated, subject to certain limitations, Newmark has agreed to reimburse
DB for all reasonable fees and disbursements of DB's counsel and all of DB's
reasonable travel and other out-of-pocket expenses incurred in connection with
the Merger or otherwise arising out of the retention of DB under the letter
agreement. Newmark has also agreed to indemnify DB and certain related persons
to the full extent lawful against certain liabilities, including certain
liabilities under the federal securities laws, arising out of or related to its
engagement or the Merger.

DB is an internationally recognized investment banking firm experienced in
providing advice in connection with mergers and acquisitions and related
transactions. DB is an affiliate of Deutsche Bank AG (together with its
affiliates, the "Deutsche Bank Group"). In the ordinary course of business,
members of the Deutsche Bank Group may actively trade in the securities and
other instruments and obligations of Newmark or Engle Holdings for their own
accounts and for the accounts of their customers. Accordingly, the Deutsche Bank
Group may at any time hold a long or short position in such securities,
instruments and obligations. In addition, a member of the DB Group, as of April
4, 2002, was considering but had not yet committed to a role in the financing
required to consummate the Merger. Such role, if assumed, would result in
additional fees payable to the DB Group upon the provision of such financing and
consummation of the Merger.

NO APPRAISAL RIGHTS

Our stockholders will have no appraisal rights in connection with the
Merger due to a Delaware statutory exemption for companies whose securities are
listed on a national securities exchange or designated as a national market
system security on an interdealer quotation system by the National Association
of Securities Dealers, Inc.

THE REFINANCING

The Merger is conditioned upon the simultaneous completion of the
Refinancing, pursuant to which we expect to (i) enter into a $220 million credit
facility (the "Bank Facility"); (ii) issue $350 million aggregate principal
amount of one or more series of senior and senior subordinated notes in a
private placement (the "Notes Offering"); (iii) repay the Engle Homes
Acquisition Debt; (iv) repay, defease or discharge an aggregate of $214.9
million of outstanding Engle debt; and (v) repay an aggregate of $50.9 million
of outstanding Newmark debt.

In the Notes Offering, we expect to issue $350 million aggregate principal
amount of one or more series of senior and senior subordinated notes. The terms
of the notes issued in the Notes Offering, including the maturities, ranking and
aggregate principal amount will be negotiated by us with the initial purchasers
of the notes immediately prior to the completion of the Refinancing. The Notes
Offering will not be registered under the Securities Act of 1933 or any state
securities laws and will be offered and sold to Qualified Institutional Buyers
(as defined under Rule 144A under the Securities Act) and outside of the United
States in accordance with Regulation S under the Securities Act. The information
in this Information Statement regarding the Notes Offering is not complete and
may be changed. This Information Statement is not an offer to sell the
securities to be issued in the Notes Offering and it is not soliciting an offer
to buy these securities issued in the Notes Offering in any state where the
offer or sale is not permitted.

We intend to use the net proceeds from the Notes Offering to repay, defease
or discharge outstanding Newmark and Engle loans, credit facilities, notes and
other debt, as well as to repay the Engle Homes Acquisition Debt. The Bank
Facility will be available to fund our working capital requirements after
completion of the Merger Transactions.

SOURCES OF FUNDS USES OF FUNDS
---------------- -------------
(DOLLARS IN THOUSANDS)

Proceeds of the offering of the Repay Newmark debt(1)............. $ 50,944
notes........................... $350,000
Cash on hand...................... 3,047 Repay Engle credit facility(2).... 202,000
Repay Engle Homes acquisition
debt(3)......................... 71,981
Defease or discharge Engle 9 1/4%
Senior Notes due 2008(4)........ 14,157
Expenses of the offering of the
notes........................... 13,965
-------- --------
Total sources..................... $353,047 Total uses(5)..................... $353,047
======== ========

---------------

(1) Represents: (i) amounts outstanding under loans to finance the purchase of
lots and construction of homes, which are collateralized by the lots and
homes, bear interest at varying rates from LIBOR plus a spread (4.20% per
annum at March 31, 2002) to the prime rate (4.75% per annum at March 31,
2002) and mature, in each case, upon the earlier of the sale of the financed
home or the termination of the facility, with the facility maturing on June
27, 2003; (ii) amounts outstanding under a loan used to finance the purchase
of Newmark's current corporate office, which bears interest at 7.45% per
annum and matures on August 1, 2008; and (iii) amounts outstanding under a
mortgage on a company condominium in Miami, Florida, which bears interest at
the prime rate and matures on March 15, 2031.

(2) Represents amounts outstanding under a credit facility, consisting of term
and revolving loans, entered into in connection with Engle's acquisition by
Technical Olympic on November 22, 2000. The term loan bears interest, at
Engle's option, at either LIBOR plus a spread or prime rate plus a spread
(4.16% per annum at March 31, 2002) and the revolving loans bear interest at
LIBOR plus a spread or prime rate plus a spread (4.91% per annum at March
31, 2002). The loans under the credit facility mature on November 22, 2002.

(3) Represents a $72.0 million obligation of Technical Olympic incurred in
connection with its acquisition of Engle on November 22, 2000, which bears
interest at 14.875% per annum. The obligation consists of two notes: (i) a
$60.0 million note that matures on September 30, 2004; and (ii) an $11.0
million note that matures on June 30, 2003. Commencing on January 1, 2002,
pursuant to the terms of the notes, cash interest is paid at a rate of 10%
per annum. All interest accruing in excess of the 10% payment rate is
capitalized and added to the principal amounts of the notes. As of March 31,
2002, $1.0 million of accrued interest in excess of interest paid has been
capitalized.

(4) Represents the estimated amount required to defease or discharge the
outstanding $12.9 million principal amount of the Engle 9 1/4% Senior Notes
due 2008.

(5) Includes the principal amounts of the debt we will repay with the net
proceeds from the Notes Offering and cash on hand. In addition, we will also
be required to repay accrued and unpaid interest through the date of the
closing (approximately $3.3 million assuming a closing on June 14, 2002).

FINANCIAL INFORMATION

SELECTED HISTORICAL CONSOLIDATED FINANCIAL AND OPERATING DATA FOR NEWMARK

The following selected historical consolidated financial data of Newmark
are derived from Newmark's consolidated financial statements and the related
notes included elsewhere in this Information Statement or incorporated by
reference. Westbrooke is accounted for as a discontinued operation of Newmark
for all periods discussed below and, therefore, the operating and financial data
below do not include Westbrooke. These historical results are not necessarily
indicative of the results of operations or financial condition to be expected in
the future. You should read the section entitled "Management's Discussion and
Analysis of Financial Condition and Results of Operations" and the financial
statements of Newmark and the related notes to those financial statements
included elsewhere in this Information Statement or incorporated by reference.

THREE MONTHS ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
-------------------- --------------------------------------------------------
2002 2001 2001 2000 1999(1) 1998 1997
-------- -------- -------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS)

STATEMENT OF INCOME DATA:
Revenues(2)................... $ 84,656 $ 95,900 $424,288 $462,293 $420,748 $289,752 $215,360
Cost of sales(3).............. 68,571 75,902 338,521 375,121 348,617 236,621 175,300
Equity from unconsolidated
subsidiaries................ 268 140 918 729 725 812 465
Selling, general and
administrative expense...... 11,685 12,466 52,534 51,888 44,478 36,849 26,512
Income from continuing
operations before income
taxes....................... 4,417 5,875 28,591 30,278 24,547 14,025 10,927
Income tax expense............ 1,393 2,001 10,150 10,908 8,721 5,166 4,272
Income from continuing
operations.................. 3,024 3,874 18,441 19,370 15,826 8,859 6,655
Income from discontinued
operations, net of income
taxes....................... 641 1,179 6,272 6,321 1,559 3,936 --
Net income.................... 3,665 5,053 24,713 25,691 17,385 12,795 6,655
OPERATING AND FINANCIAL DATA:
Homes closed.................. 282 329 1,411 1,638 1,620 1,205 972
Average sales price per home
closed...................... $ 296 $ 289 $ 295 $ 279 $ 255 $ 239 $ 219
New sales contracts, net of
cancellations............... 413 442 1,358 1,490 1,569 1,517 984
Backlog at end of period,
number of homes............. 470 505 339 392 540 591 279
Backlog at end of period,
sales value................. $129,848 $149,561 $ 97,675 $116,448 $137,582 $141,643 $ 60,048
BALANCE SHEET DATA (AT PERIOD
END):
Cash and cash equivalents:
Unrestricted................ $ 11,878 $ 16,051 $ 9,719 $ 6,173 $ 7,586 $ 3,664 $ 746
Inventories................... 165,746 154,906 162,233 149,305 166,676 141,069 102,547
Total assets.................. 335,989 336,562 342,087 327,022 328,892 245,337 139,213
Total homebuilding debt(4).... 91,377 87,425 87,428 75,402 97,587 83,932 66,100
Total debt(5)................. 95,062 92,859 92,862 82,052 105,876 84,681 67,875
Stockholders' equity.......... 157,477 134,152 153,812 135,309 109,618 90,112 55,691

---------------

(1) Technical Olympic acquired 80% of Newmark's common stock on December 15,
1999. Consequently, Newmark's audited financial statements for 1999 present
the results of operations in two columns on a predecessor and successor
basis. The predecessor column includes the results of operations from
January 1, 1999 to December 15, 1999. The successor column includes the
results of operations from December 16, 1999 to December 31, 1999. In this
table, the financial and operating data reflects the operations of Newmark
on a full-year basis, which represents the total of the predecessor and
successor columns.

(2) Represents revenues from homebuilding and land sales.

(3) Represents homebuilding and land cost of sales.

(4) Total homebuilding debt does not include acquisition notes payable and debt
related to discontinued operations.

(5) Total debt does not include debt related to discontinued operations.

SELECTED HISTORICAL CONSOLIDATED FINANCIAL AND OPERATING DATA FOR ENGLE

The following selected historical consolidated financial data of Engle are
derived from Engle's consolidated financial statements and the related notes
included elsewhere in this Information Statement and other financial data of
Engle. These historical results are not necessarily indicative of the results of
operations or financial condition to be expected in the future. You should read
the section entitled "Management's Discussion and Analysis of Financial
Condition and Results of Operations" and the financial statements of Engle and
the related notes to those financial statements included elsewhere in this
Information Statement.

THREE MONTHS ENDED TWO MONTHS
MARCH 31, YEAR ENDED ENDED YEAR ENDED OCTOBER 31,
------------------- DECEMBER 31, DECEMBER 31, -----------------------------------------
2002 2001 2001 2000 2000 1999 1998 1997
-------- -------- ------------ ------------ -------- -------- -------- --------
(DOLLARS IN THOUSANDS)

STATEMENT OF INCOME DATA:
Revenues(1)...................... $228,027 $222,581 $1,006,695 $114,892 $844,011 $741,940 $536,040 $425,295
Cost of sales(2)................. 173,983 173,380 773,347 91,168 686,223 603,705 438,921 352,390
Selling, general and
administrative expense......... 25,011 20,970 95,947 12,973 79,158 71,079 52,815 39,620
Merger related expenses.......... 13,748 -- 1,864 20,118 -- -- -- --
Income (loss) before income
taxes.......................... 9,485 22,555 111,392 (13,014) 57,198 45,645 28,370 21,899
Income tax expense............... 3,581 8,402 42,068 (3,185) 21,534 17,619 10,922 8,431
Income (loss) before
extraordinary items............ 5,904 14,153 69,324 (9,829) 35,664 28,026 17,448 13,468
Extraordinary items, net......... -- -- -- -- -- -- (2,612) --
Net income (loss)................ 5,904 14,153 69,324 (9,829) 35,664 28,026 14,836 13,468
OPERATING DATA:
Homes closed..................... 864 897 3,893 469 3,573 3,514 2,605 1,992
Average sales price per home
closed......................... $ 253 $ 238 $ 246 $ 232 $ 222 $ 201 $ 192 $ 203
New sales contracts, net of
cancellations.................. 995 1,172 3,609 498 3,778 3,753 3,357 1,845
Backlog at end of period, number
of homes....................... 1,941 2,369 1,810 2,094 2,065 1,860 1,621 869
Backlog at end of period, sales
value.......................... $521,400 $596,400 $ 475,700 $512,855 $497,800 $411,100 $324,000 $174,000
BALANCE SHEET DATA (AT PERIOD
END):
Cash and cash equivalents:
Unrestricted................... $ 74,260 $ 42,815 $ 65,417 $ 18,078 $ 68,102 $ 60,944 $ 20,041 $ 15,565
Restricted(3).................. 24,189 6,930 27,343 10,205 3,714 2,092 1,074 981
Inventories...................... 470,054 422,128 456,303 444,070 409,458 386,804 352,620 230,108
Total assets..................... 635,386 556,732 654,848 539,563 542,697 514,893 431,428 288,412
Total homebuilding debt(4)....... 214,897 256,110 215,835 255,597 251,606 253,635 205,137 152,064
Financial services borrowings.... 13,933 20,379 38,689 9,071 17,857 26,776 25,770 14,529
Land bank obligations............ 29,578 -- 30,022 -- -- -- -- --
Total debt(5).................... 258,408 276,489 284,546 264,668 269,463 280,411 230,907 166,593
Stockholder's equity............. 262,450 214,840 259,558 219,750 217,691 186,432 161,724 93,180

---------------

(1) Represents primarily revenues from homebuilding sales, land sales and
financial services.

(2) Represents homebuilding and land cost of sales.

(3) Restricted cash and cash equivalents represents deposits held in escrow by
our title subsidiaries pursuant to purchase contracts or required by law and
compensating balances under letters of credit.

(4) Total homebuilding debt does not include financial services borrowings and
consolidated land bank obligations. For more information on consolidated
land bank obligations, see "Management's Discussion and Analysis of
Financial Condition and Results of Operations -- Engle -- Critical
Accounting Policies."

(5) Total debt does not include consolidated land bank obligations. For more
information on consolidated land bank obligations, see "Management's
Discussion and Analysis of Financial Condition and Results of
Operations -- Engle -- Critical Accounting Policies."

TECHNICAL OLYMPIC USA, INC. PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

The following unaudited pro forma consolidated financial statements give
effect to the Westbrooke Sale, the Merger Transactions and the Refinancing. In
the Westbrooke Sale, Newmark sold all the stock of Westbrooke for consideration
consisting of $41.0 million in cash and the repayment by Standard Pacific of
$54.4 million of Westbrooke's debt, including $14.2 million of intercompany
liabilities owed to Newmark. The purchase price is subject to adjustment (either
upwards or downwards) within 90 days of the closing, based on Westbrooke's net
income from January 1, 2002 through the closing date.

In the Merger, each issued and outstanding share of Engle Holdings common
stock will be exchanged for 1,724.082935 shares of Newmark common stock. As of
April 5, 2002, there were 9,500 shares of Engle Holdings common stock issued and
outstanding, all of which are held by Technical Olympic. As a result of the
Merger, Newmark will issue 16,378,787 shares of common stock. In addition, prior
to the Merger, Newmark will assume the Engle Homes Acquisition Debt, which will
be repaid as part of the Refinancing. Technical Olympic USA, Inc. (TOUSA) will
be the name of the combined businesses after the Merger Transactions are closed.

Both Newmark and Engle are under the common control of Technical Olympic,
and consequently the Merger is being accounted for in a manner similar to a
pooling-of-interests, in accordance with Statement of Financial Accounting
Standards (SFAS) No. 141, "Business Combinations." Pursuant to SFAS No. 141,
when accounting for the exchange of shares between entities under common
control, the entity that receives the equity interests (Newmark) will recognize
the assets and liabilities transferred at their carrying amounts in the accounts
of the transferring entity (Engle) at the date of transfer.

The Merger is conditioned upon the simultaneous completion of the
Refinancing, pursuant to which TOUSA expects to (i) enter into the Bank
Facility; (ii) issue approximately $350 million aggregate principal amount of
one or more series and senior or senior subordinated notes in the Notes
Offering; (iii) repay the Engle Homes Acquisition Debt; (iv) repay, defease or
discharge an aggregate of $214.9 million of Engle debt outstanding as of
December 31, 2001; and (v) repay an aggregate of $50.9 million of Newmark debt
outstanding as of December 31, 2001.

The Bank Facility is anticipated to be a $220 million revolving credit
facility. The Bank Facility is expected to expire three years from the effective
date of the Merger and includes, at TOUSA's option, two one-year extensions. The
Bank Facility is expected to contain financial covenants and provisions that
may, under some circumstances, limit the amount TOUSA may borrow. As determined
by its leverage ratio as defined under the Bank Facility, the interest rate is
anticipated to vary based on LIBOR or a base rate plus an applicable margin to
be agreed. TOUSA intends to use the net proceeds from the Notes Offering to
defease or repay outstanding loans, credit facilities, notes and other debt, as
well as to repay the Engle Homes Acquisition Debt. For more information on the
Bank Facility, see "The Merger -- The Refinancing."

The unaudited pro forma consolidated financial statements have been
prepared in accordance with accounting principles generally accepted in the
United States and should be read in conjunction with the historical consolidated
financial statements of Newmark and Engle including the notes thereto.

The accompanying unaudited pro forma information is presented for
illustrative purposes only and is based on certain assumptions and adjustments
described in the notes thereto. Such information is not necessarily indicative
of the operating results or financial position that would have occurred had the
Westbrooke Sale, the Merger Transactions and the Refinancing been consummated at
the dates indicated, nor is it necessarily indicative of future operating
results or financial position of the combined companies. No effect has been
given in the unaudited pro forma consolidated financial statements for operating
and synergistic benefits that may be realized through the Merger Transactions,
except for the reduction in executive compensation which will be realized based
on employment contracts. In addition, the unaudited pro forma consolidated
financial statements do not reflect any of the initial, non-recurring costs
associated with the Westbrooke Sale or the Merger Transactions, because those
costs cannot currently be estimated.

The accompanying unaudited Pro Forma Consolidated Statement of Financial
Condition gives effect to the Westbrooke Sale, the Merger and the Refinancing as
if they had occurred on March 31, 2002, combining

the Consolidated Statement of Financial Condition of Newmark and the
Consolidated Statement of Financial Condition of Engle Homes, each at March 31,
2002. The accompanying unaudited Pro Forma Consolidated Statements of Income
give effect to the sale of Westbrooke, the Merger and the Refinancing as if they
had occurred on January 1, 2001, combining the results of operations for Newmark
and Engle Homes for the three months ended March 31, 2002 and for the year ended
December 31, 2001.

As both Newmark and Engle are under common control of Technical Olympic,
the Merger is being accounted for as a reorganization of entities under common
control as described above. As required, we are providing an unaudited Pro Forma
Consolidated Statement of Income for the year ended December 31, 2000, which
represents the earliest year that both entities were under common control. This
pro forma statement of income gives effect to the Merger as if it occurred on
November 22, 2000, the date at which Engle was acquired by Technical Olympic.

THE PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED) DO NOT PURPORT
TO REPRESENT WHAT THE FINANCIAL POSITION OR RESULTS OF OPERATIONS OF TECHNICAL
OLYMPIC USA, INC. WOULD ACTUALLY HAVE BEEN IF THE WESTBROOKE SALE, THE
REFINANCING AND THE MERGER HAD IN FACT OCCURRED ON THE DATES INDICATED OR TO
PROJECT THE FINANCIAL POSITION OR RESULTS OF OPERATIONS FOR ANY FUTURE DATE OR
PERIOD.

TECHNICAL OLYMPIC USA, INC.

PRO FORMA CONSOLIDATED STATEMENT OF FINANCIAL CONDITION (UNAUDITED)

MARCH 31, 2002

TECHNICAL
NEWMARK OLYMPIC USA,
NEWMARK WESTBROOKE PRO FORMA REFINANCING INC.
AS REPORTED SALE(1) ADJUSTED ENGLE AND MERGER CONSOLIDATED
----------- ---------- --------- -------- ----------- ------------
(DOLLARS IN THOUSANDS)

Assets:
Cash -- unrestricted...... $ 11,878 $ 14,192 $ 26,070 $ 74,260(2) $ (3,047) $ 97,283
Cash -- restricted........ -- -- 24,189(2) 14,157 38,346
Mortgage loans held for
sale................... -- -- 28,719 28,719
Inventory................. 165,746 165,746 470,054 635,800
Property, premises and
equipment, net......... 5,859 5,859 5,172 11,031
Other assets, net......... 8,599 (4,992) 3,607 18,179(2) 13,965 35,751
Goodwill, net............. 42,914 42,914 14,813 57,727
Westbrooke assets held for
sale................... 100,993 (100,993) -- -- --
-------- -------- -------- --------
Total assets................ $335,989 $244,196 $635,386 $904,657
======== ======== ======== ========

Liabilities and stockholders' equity:
Accounts payable and
accrued liabilities.... $ 16,928 $ 16,928 $ 61,443(3) $ 11,452 $ 89,823
Other liabilities......... 5,783 3,150 8,933 21,687 30,620
Borrowings................ 95,062 (41,000) 55,872 214,897(4) 71,981 367,825
1,810 (2) 25,075
Consolidated land bank
obligation............. -- -- 29,578 29,578
Financial services
borrowings............. -- -- 13,933 13,933
Westbrooke liabilities
associated with assets
held for sale.......... 60,640 (60,640) -- -- --
-------- -------- -------- --------
Total liabilities........... 178,413 81,733 341,538 531,779
Minority interest........... 99 99 31,398 31,497
Stockholders' equity:
Common stock.............. 115 115 --(3) 164 279
Additional
paid-in-capital........ 106,855 106,855 215,709(3) (164) 250,419
-- (4) (71,981)
Retained earnings......... 50,507 4,887 55,394 46,741(3) (11,452) 90,683
-------- -------- -------- --------
Total stockholders'
equity.................... 157,477 162,364 262,450 341,381
-------- -------- -------- --------
Total liabilities and
stockholders' equity...... $335,989 $244,196 $635,386 $904,657
======== ======== ======== ========

TECHNICAL OLYMPIC USA, INC.

PRO FORMA CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

FOR THE THREE MONTHS ENDED MARCH 31, 2002

TECHNICAL
OLYMPIC USA,
NEWMARK ENGLE AS REFINANCING INC.
AS REPORTED REPORTED AND MERGER CONSOLIDATED
----------- -------- ----------- ------------
(DOLLARS IN THOUSANDS)

Revenues:
Homebuilding............................... $ 83,561 $218,417 301,978
Land sales................................. 1,095 215 1,310
Financial services......................... -- 8,083 8,083
Other...................................... 276 1,312 1,588
----------- -------- -----------
Total revenues............................... 84,932 228,027 312,959
Expenses:
Cost of sales.............................. 68,571 173,983(5) 1,886 244,440
Selling, general & administration.......... 11,685 25,011(6) (781) 35,915
Depreciation and amortization.............. 192 1,440 1,632
Financial services expenses................ -- 4,360 4,360
Interest expense........................... 67 -- 67
Merger and related expenses................ -- 13,748 13,748
----------- -------- -----------
Total expenses............................... 80,515 218,542 300,162
----------- -------- -----------
Income from continuing operations before
income taxes............................... 4,417 9,485 12,797
Income taxes................................. 1,393 3,581(7) (408) 4,566
----------- -------- -----------
Income from continuing operations before
nonrecurring adjustments................... 3,024 5,904 8,231
=========== ======== ===========
Basic and diluted earnings per common share:
Income from continuing operations.......... $ 0.26 $ 0.30
=========== ===========
Weighted average number of shares
outstanding:
Basic and diluted.......................... 11,500,000 (8) 16,378,787 27,878,787
=========== ===========

TECHNICAL OLYMPIC USA, INC.

PRO FORMA CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

FOR THE YEAR ENDED DECEMBER 31, 2001

TECHNICAL
OLYMPIC USA,
PRO FORMA INC.
NEWMARK ENGLE ADJUSTMENTS CONSOLIDATED
----------- ---------- ----------- ------------

Revenues:
Homebuilding.............................. $ 416,426 $ 958,125 $ 1,374,551
Land sales................................ 7,862 10,499 18,361
Financial services........................ -- 32,659 32,659
Other..................................... (384) 5,412 5,028
----------- ---------- -----------
Total revenues.............................. 423,904 1,006,695 1,430,599
Expenses:
Cost of sales............................. 338,521 773,347(5) 6,459 1,118,327
Selling, general & administration......... 52,534 95,947(6) (3,129) 145,352
Depreciation and amortization............. 2,392 6,457 8,849
Financial services expenses............... -- 17,688 17,688
Interest expense.......................... 1,087 -- 1,087
Merger and related expenses............... 779 1,864 2,643
----------- ---------- -----------
Total expenses.............................. 395,313 895,303 1,293,946
----------- ---------- -----------
Income from continuing operations before
income taxes.............................. 28,591 111,392 136,653
Income taxes................................ 10,150 42,068(7) (1,232) 50,986
----------- ---------- -----------
Income from continuing operations before
nonrecurring adjustments.................. 18,441 69,324 85,667
=========== ========== ===========
Basic and diluted earnings per common share:
Income from continuing operations......... $ 1.60 $ 3.07
=========== ===========
Weighted average number of shares
outstanding:
Basic and diluted......................... 11,500,000 (8) 16,378,787 27,878,787
=========== ===========

TECHNICAL OLYMPIC USA, INC.

PRO FORMA CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

FOR THE YEAR ENDED DECEMBER 31, 2000

ENGLE
AS REPORTED
(PERIOD FROM
NOVEMBER 22 TECHNICAL
2000 THROUGH OLYMPIC USA,
NEWMARK DECEMBER 31, PRO FORMA INC.
AS REPORTED 2000 ADJUSTMENTS CONSOLIDATED
----------- ------------ ----------- -------------

Revenues:
Homebuilding............................. $ 456,778 $82,999 $ 539,777
Land sales............................... 5,515 1,374 6,889
Financial services....................... -- 2,562 2,562
Other.................................... 667 351 1,018
----------- ------- -----------
Total revenues............................. 462,960 87,286 550,246

Expenses:
Cost of sales............................ 375,121 69,515(9) 521 445,157
Selling, general & administration........ 51,888 8,247 60,135
Depreciation and amortization............ 2,391 721 3,112
Financial services expenses.............. -- 1,635 1,635
Interest expense......................... 3,282 -- 3,282
----------- ------- -----------
Total expenses............................. 432,682 80,118 513,321
----------- ------- -----------

Income from continuing operations
before income taxes...................... 30,278 7,168 36,925
Income taxes............................... 10,908 2,764(10) (193) 13,479
----------- ------- -----------
Income from continuing operations.......... 19,370 4,404 23,446
=========== ======= ===========

Basic and diluted earnings per common
share:
Income from continuing operations........ $ 1.68 $ 1.77
=========== ===========

Weighted average number of shares
outstanding:
Basic and diluted........................ 11,500,000 (11) 1,750,062 13,250,062
=========== ===========

TECHNICAL OLYMPIC USA, INC.

NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)

(DOLLARS IN THOUSANDS, EXCEPT SHARE OR PER SHARE AMOUNTS)

The pro forma adjustments to the Pro Forma Consolidated Statement of
Financial Condition as of March 31, 2002 are as follows:

(1) In accordance with Statement of Financial Accounting Standards (SFAS)
No. 144, "Accounting for the Impairment or Disposal of Long-Lived
Assets," the effect of the sale of Westbrooke and the application of
the proceeds therefrom have been reflected in Newmark's Consolidated
Statements of Financial Condition as follows:

Gross cash proceeds from Westbrooke sale used to repay
additional existing Newmark debt.......................... $ 41,000
Initial purchase price adjustment on the Westbrooke sale
through the closing date.................................. (1,810)
Sale of Westbrooke assets................................... (100,993)
Sale of Westbrooke liabilities.............................. 60,640
Cash received for Westbrooke intercompany receivable and
Westbrooke portion of income taxes under tax sharing
agreement................................................. 14,192
Westbrooke income tax receivable under tax sharing
agreement, reflected under the caption "Other assets"..... (4,992)
Deferred tax liability resulting from the Westbrooke sale... (3,150)
---------
Gain on Westbrooke sale..................................... $ 4,887
=========

(2) To record the application of the gross proceeds of the Notes Offering
and cash on hand as described under "Use of Proceeds:"

Principal amount of notes................................... $ 350,000
Repayment of Newmark debt................................... (50,944)
Repayment of Engle credit facility.......................... (202,000)
Repayment of Engle acquisition debt......................... (71,981)
---------
Net increase in debt........................................ 25,075
Deferred financing costs.................................... (13,965)
---------
Net proceeds from offering.................................. 11,110
Defeasance or discharge of Engle 9 1/4% Senior Notes due
2008...................................................... (14,157)
---------
Cash on hand used........................................... $ (3,047)
=========

(3) To reflect the issuance of 16,378,787 new shares of common stock at
$0.01 par value and accrue severance and merger related costs of
$11,452. Severance costs approximate $3,949 and relate to the
departure of certain executives pursuant to their employment contracts
in connection with the Merger. Merger related charges approximate
$7,503 and relate primarily to attorney's fees, advisory fees,
accountant's fees and include a $2,000 early termination fee in
connection with the Company's early repayment of certain debt as a
result of the change in control. These nonrecurring charges were not
considered in the pro forma statement of income. Approximately $3,000
of the severance charges will be recognized in income during April in
connection with the departure of one of the executives. The remaining
$949 will be recognized upon consummation of the Merger. The merger
related charges of $7,503, including the early termination fee of
$2,000, will be recognized in income upon consummation of the Merger
and Refinancing.

(4) To record the repayment of a $71,981 obligation of Technical Olympic
incurred in connection with its acquisition of Engle in November 2000.

TECHNICAL OLYMPIC USA, INC.

NOTES TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The pro forma adjustments to the Pro Forma Consolidated Statements of
Income for the three months ended March 31, 2002 and the year ended December 31,
2001 are as follows:

(5) To record the net increase in cost of sales as a result of the
interest expected to be incurred resulting from the issuance of
$200,000 aggregate principal amount of senior notes due 2010 and
$150,000 aggregate principal amount of senior subordinated notes due
2012. Interest is calculated assuming 8 3/4% and 9.55% on the senior
and senior subordinated notes, respectively. For each 1/8% change in
interest rates assumed for the new notes to be issued, pro forma
interest included in cost of sales will change by approximately $47
and $308 for the three months ended March 31, 2002 and the year ended
December 31, 2001, respectively.

(6) To record the decrease in selling, general and administrative expenses
due to the departures of certain officers and key employees in
connection with the Merger, net of the addition of new officers and
key employees.

(7) To reflect the tax effect of the adjustments set forth in (5) and (6)
above.

(8) To reflect the issuance of 16,378,787 new shares of common stock in
the Merger, which for pro forma purposes are assumed to be outstanding
for the three months ended March 31, 2002 and for the year ended
December 31, 2001.

The pro forma adjustments to the Pro Forma Consolidated Statements of
Income for the year ended December 31, 2000 are as follows:

(9) To record the net increase in cost of sales due to the increase in
interest resulting from the assumption of $71,981 of debt incurred by
Technical Olympic in connection with the acquisition of Engle on
November 22, 2000.

(10) To reflect the tax effect of the adjustment set forth in (9) above.

(11) To reflect the weighted average shares outstanding for the period from
November 22, 2000 through December 31, 2000.

CAPITALIZATION

The following table sets forth our capitalization as of March 31, 2002 on a
pro forma consolidated basis to give effect to the Westbrooke Sale, the Merger
Transactions and the Refinancing as if they occurred on March 31, 2002. You
should read our pro forma financial statements and notes that are included in
this Information Statement.

PRO FORMA
CONSOLIDATED
AS OF
MARCH 31, 2002
--------------
(DOLLARS IN
THOUSANDS)

Cash and cash equivalents:
Unrestricted.............................................. $ 97,283
Restricted(1)............................................. 38,346
--------
Total cash and cash equivalents........................ $135,629
========
Debt:
New revolving credit facility(2).......................... $ --
Senior notes offered hereby............................... 200,000
Senior subordinated notes offered hereby.................. 150,000
Construction and lot loans(3)............................. 4,928
--------
Total homebuilding debt(4)............................. 354,928
Engle 9 1/4% Senior Notes due 2008(5)..................... 12,897
Financial services borrowings(6).......................... 13,933
--------
Total debt(7).......................................... 381,758
Stockholders' equity........................................ 341,381
--------
Total capitalization........................................ $723,139
========

---------------

(1) Represents deposits held in escrow by our title subsidiaries pursuant to
purchase contracts or as required by law, compensating balances under
letters of credit and treasury securities placed on deposit to defease or
discharge the outstanding $12.9 million aggregate principal amount of the
Engle 9 1/4% Senior Notes due 2008.

(2) In connection with the Notes Offering, we will enter into the Bank Facility
that we expect will provide for revolving loans of up to $220.0 million and
which will be available to fund our working capital requirements after
completion of the Merger Transactions.

(3) Represents construction and lot loans from financial institutions.

(4) Total homebuilding debt does not include the outstanding $12.9 million
aggregate principal amount of Engle's 9 1/4% Senior Notes due 2008 to be
defeased or discharged in connection with the Notes Offering, $13.9 million
aggregate principal amount of financial services borrowings and $29.6
million aggregate principal amount of consolidated land bank obligations.
For information concerning the consolidated land bank obligations, see
"Management's Discussion and Analysis of Financial Condition and Results of
Operations -- Engle -- Critical Accounting Policies."

(5) Represents the outstanding aggregate principal amount of the Engle 9 1/4%
Senior Notes due 2008 that will be defeased or discharged.

(6) Represents a warehouse line of credit used to provide financing for the
origination of mortgage loans.

(7) Total debt does not include the $29.6 million of consolidated land bank
obligations. For information concerning the consolidated land bank
obligations, see "Management's Discussion and Analysis of Financial
Condition and Results of Operations -- Engle -- Critical Accounting
Policies."

FEDERAL INCOME TAX TREATMENT OF THE MERGER

For Federal income tax purposes

(i) the Merger will constitute a reorganization within the meaning of
Section 368(a) of the Internal Revenue Code of 1986, as amended,

(ii) no gain or loss will be recognized by our stockholders as a
consequence of the Merger,

(iii) a stockholder's aggregate tax basis in our common stock after
the Merger will be the same as the holder's aggregate tax basis in the
shares of our common stock immediately prior to the Merger and

(iv) no gain or loss will be recognized by us as a consequence of the
Merger.

THE DISCUSSION SET FORTH ABOVE CONCERNING CERTAIN FEDERAL INCOME TAX
CONSEQUENCES OF THE MERGER IS INCLUDED HEREIN FOR GENERAL INFORMATION ONLY. ALL
STOCKHOLDERS ARE ADVISED TO CONSULT THEIR OWN TAX ADVISORS AS TO ANY FEDERAL,
STATE, LOCAL OR FOREIGN TAX CONSEQUENCES APPLICABLE TO THEM WHICH COULD RESULT
FROM THE MERGER.

MANAGEMENT DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATION

The following discussion and analysis of the financial condition and
results of operations of Newmark and Engle should be read in conjunction with
the section "Selected Historical Consolidated Financial and Operating Data of
Newmark" and "Selected Historical Consolidated Financial and Operating Data of
Engle Homes" and the consolidated financial statements and related notes
included elsewhere in this Information Statement or incorporated by reference.

The information in this discussion under the caption "Newmark" relates only
to Newmark and its consolidated subsidiaries on a stand-alone basis and the
information in this discussion under the caption "Engle Homes" relates only to
Engle Homes and its consolidated subsidiaries on a stand-alone basis. Westbrooke
is accounted for as a discontinued operation of Newmark for all periods
discussed below and, therefore, the results of operations and other information
below do not include Westbrooke. The information in this discussion under the
caption "Technical Olympic USA, Inc." relates to the combined enterprise
following the Merger. Unless the context indicates otherwise, the terms "we,"
"ours" and "us" refer to the combined enterprise that is the surviving
corporation after giving effect to the Merger.

NEWMARK

Newmark designs, builds and sells single-family homes, town homes and patio
homes in five markets in Texas and Tennessee. At March 31, 2002, Newmark
operated in 57 communities in its markets and had 486 homes under construction.
Newmark is also engaged in residential land acquisition and lot development and
at March 31, 2002, Newmark owned, or had under option contracts, 2,467 lots
available for future home building.

Newmark's predecessor company was founded in Houston, Texas in 1983. In
March 1995, Newmark acquired The Adler Companies, Inc., which operated in
southern Florida from 1990 until 2000. In January 1998, Newmark acquired
Westbrooke, which has operated in the Miami, Florida area since 1976. With the
acquisition of Westbrooke, Newmark wound down Adler's operations by the end of
2000. Newmark completed its initial public offering of common stock in March
1998. On December 15, 1999, Technical Olympic purchased 80% of Newmark's
outstanding common stock from Pacific Realty Group, Inc.

On April 15, 2002, Newmark sold all the stock of Westbrooke, its Florida
operations, to Standard Pacific Corp. for consideration consisting of $41.0
million in cash and the repayment by Standard Pacific of $54.4 million of
Westbrooke's debt, including $14.2 million of intercompany liabilities owed to
Newmark. The purchase price is subject to adjustment (either upwards or
downwards) within 90 days of the closing, based on Westbrooke's net income from
January 1, 2002 through the closing date. In connection with the Merger, Newmark
sold Westbrooke to eliminate operating redundancies in its South Florida markets
and to strengthen its financial position.

RESULTS OF OPERATIONS

Newmark derives its revenues primarily from two sources: (i) sales of homes
and (ii) sales of land. The following table sets forth Newmark's revenue by
source and in total for the periods indicated:

THREE MONTHS
ENDED MARCH 31, YEAR ENDED DECEMBER 31,
------------------ --------------------------------
SOURCE 2002 2001 2001 2000 1999
------ ------- ------- -------- -------- --------
(DOLLARS IN THOUSANDS)

Sales of homes........................ $83,561 $95,225 $416,426 $456,778 $413,780
Sales of land......................... 1,095 675 7,862 5,515 6,968
------- ------- -------- -------- --------
Total............................ $84,656 $95,900 $424,288 $462,293 $420,748
======= ======= ======== ======== ========

Newmark's principal expenses are (i) cost of sales and (ii) selling,
general and administrative expenses, or SG&A. Cost of sales reflects the cost of
home construction and land purchases (including, in each case,

capitalized interest and financing costs). SG&A includes administrative costs,
advertising expenses, on-site marketing expenses and commission costs. The
following table sets forth Newmark's principal expenses by category and in total
for the periods indicated:

THREE MONTHS ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
------------------- --------------------------------
EXPENSES 2002 2001 2001 2000 1999
-------- -------- -------- -------- -------- --------
(DOLLARS IN THOUSANDS)

Cost of sales............................ $68,571 $75,902 $338,521 $375,121 $348,617
SG&A..................................... 11,685 12,466 52,534 51,888 44,478
------- ------- -------- -------- --------
Total............................... $80,256 $88,368 $391,055 $427,009 $393,095
======= ======= ======== ======== ========

The following table sets forth certain historical operating data for
Newmark as a percentage of revenues:

THREE MONTHS
ENDED
MARCH 31, YEAR ENDED DECEMBER 31,
------------ -----------------------
2002 2001 2001 2000 1999
---- ---- ----- ----- -----

Cost of sales........................................... 81.0% 79.1% 79.8% 81.1% 82.9%
Gross profit............................................ 19.0% 20.9% 20.2% 18.9% 17.1%
SG&A.................................................... 13.8% 13.0% 12.4% 11.2% 10.6%
Income from continuing operations before income taxes... 5.2% 6.1% 6.7% 6.5% 5.8%
Income taxes(1)......................................... 31.5% 34.1% 35.5% 36.0% 35.5%
Net income.............................................. 4.3% 5.3% 5.8% 5.6% 4.1%

---------------

(1) As a percentage of income from continuing operations before income taxes.

THREE MONTHS ENDED MARCH 31, 2002 COMPARED TO THREE MONTHS ENDED MARCH 31,
2001

Revenues decreased by $11.2 million, or 11.7%, to $84.7 million in the
three months ended March 31, 2002 from $95.9 million in the three months ended
March 31, 2001. This decrease was primarily due to a decrease in the number of
homes closed offset in part by an increase in the average selling price of homes
closed and an increase in revenues from land sales. The number of homes closed
declined by 47 homes, or 14.3%, to 282 in the three months ended March 31, 2002
from 329 in the three months ended March 31, 2001 due to general market
conditions. The average selling price of homes closed increased by $7,000, or
2.4%, to $296,000 in the three months ended March 31, 2002 from $289,000 in the
three months ended March 31, 2001. Revenue from home sales decreased by $11.6
million, or 12.2%, to $83.6 million in the three months ended March 31, 2002
from $95.2 million in the three months ended March 31, 2001, primarily as a
result of a decline in homes closed in Texas. Revenue from land sales increased
by $0.4 million, or 57.1%, to $1.1 million in the three months ended March 31,
2002 from $0.7 million in the three months ended March 31, 2001, primarily as a
result of an increase in land sold in Texas.

New net sales contracts decreased by 29 homes, or 6.6%, to 413 homes for
the three months ended March 31, 2002 from 442 homes for the three months ended
March 31, 2001 due to the general economic conditions in our markets. The dollar
amount of new net sales contracts decreased by $12.6 million, or 9.8%, to $115.7
million in the three months ended March 31, 2002 from $128.3 million in the
three months ended March 31, 2001.

Newmark operated in 57 subdivisions at March 31, 2002 compared to 51
subdivisions at March 31, 2001. As of March 31, 2002, Newmark's backlog of sales
contracts was 470 homes, a 6.9% decrease from 505 homes at March 31, 2001.

Cost of sales decreased by $7.3 million, or 9.6%, to $68.6 million, in the
three months ended March 31, 2002 from $75.9 million in the three months ended
March 31, 2001, primarily due to a decrease in revenue. As a percentage of
revenues, cost of sales for the three months ended March 31, 2002 increased to
81.0% from 79.1% in the three months ended March 31, 2001. This increase in cost
of sales as a percentage of revenues

was due to a shift in the product mix of homes closed to lower margin homes.
Cost of home sales decreased by $7.7 million, or 10.2%, to $67.6 million in the
three months ended March 31, 2002 from $75.3 million in the three months ended
March 31, 2001, primarily due to a decline in homes closed in Texas. Cost of
land sales increased by $0.4 million, or 66.7%, to $1.0 million in the three
months ended March 31, 2002 from $0.6 million in the three months ended March
31, 2001, primarily due to a decline in land sales in Texas.

Equity in earnings from unconsolidated subsidiaries, which are primarily
earnings from mortgage origination and title operations in which Newmark has an
ownership interest of less than 50%, increased by $0.2 million, or 200%, to $0.3
million in the three months ended March 31, 2002 from $0.1 million in the three
months ended March 31, 2001 due to increased earnings from mortgage origination
and title operations and land development joint ventures.

SG&A decreased by $0.8 million, or 6.3%, to $11.7 million in the three
months ended March 31, 2002 from $12.5 million in the three months ended March
31, 2001, primarily due to decreased commissions. As a percentage of revenues,
SG&A remained relatively constant, increasing to 13.8% in the three months ended
March 31, 2002 from 13.0% in the three months ended March 31, 2001.

Income from continuing operations before income taxes decreased by $1.5
million, or 24.8%, to $4.4 million in the three months ended March 31, 2002 from
$5.9 million in the three months ended March 31, 2001, primarily due to a
decline in homes closed in Texas.

Newmark's provision for income taxes decreased as a percentage of income
from continuing operations before taxes to 31.6% in the three months ended March
31, 2002 compared to 34.1% in the three months ended March 31, 2001. The
decrease was primarily a result of the timing difference associated with the
deductibility of the amortization of goodwill for tax purposes and the result of
no amortization of goodwill for the three months ended March 31, 2002 in
accordance with Statement of Financial Accounting Standards, or SFAS, No. 142.

Net income decreased by $1.4 million, or 20.5%, to $3.7 million, in the
three months ended March 31, 2002 from $5.1 million for the three months ended
March 31, 2001, primarily due to the decrease in home closings as described
above.

TWELVE MONTHS ENDED DECEMBER 31, 2001 COMPARED TO TWELVE MONTHS ENDED DECEMBER
31, 2000

Revenues decreased by $38.0 million, or 8.2%, to $424.3 million in 2001
from $462.3 million in 2000. This decrease was primarily due to a decrease in
the number of homes closed offset in part by an increase in the average selling
price and an increase in revenues from land sales. The number of homes closed
declined by 227 homes, or 13.9%, to 1,411 homes in 2001 from 1,638 homes in 2000
due to a decline in the demand for homes in some of our Texas markets. The
average selling price of homes closed increased by $16,000, or 5.7%, to $295,000
in 2001 from $279,000 in 2000 due to general market conditions. Revenue from
home sales decreased by $40.4 million, or 8.8%, to $416.4 million in 2001 from
$456.8 million in 2000, primarily due to a decline in homes closed in Texas and
the Mid-Atlantic markets. Revenue from land sales in 2001 increased by $2.4
million, or 43.6%, to $7.9 million from $5.5 million in 2000, primarily due to
an increase in land sold in Texas.

New net sales contracts decreased by 132 homes, or 8.9%, to 1,358 homes in
2001 from 1,490 homes in 2000 due to the general economic conditions in our
markets. The dollar amount of new net sales contracts decreased by $38.1
million, or 8.7%, to $397.7 million in 2001 from $435.6 million in 2002.

Newmark operated in 59 subdivisions at December 31, 2001 compared to 54
subdivisions at December 31, 2000. As of December 31, 2001, Newmark's backlog of
sales contracts was 339 homes, a 13.5% decrease from December 31, 2000.

Cost of sales decreased by $36.6 million, or 9.8%, to $338.5 million in
2001 from $375.1 million in 2000. As a percentage of revenues, cost of sales for
2001 decreased to 79.8% from 81.1% in 2000. The decrease in cost of sales in
both dollar amount and percentage was primarily due to the decrease in revenue
and a shift in the product mix of homes closed to higher margin homes. Cost of
home sales decreased by $38.3 million, or

10.4%, to $331.5 million in 2001 from $369.8 million in 2000, primarily due to a
decline in homes closed in Texas and the Mid-Atlantic. Cost of land sales
increased by $1.7 million, or 32.1%, to $7.0 million, in 2001 from $5.3 million
in 2000, primarily due to the increase in land sold in Texas.

Equity in earnings from unconsolidated subsidiaries increased by $0.2
million, or 25.8%, to $0.9 million in 2001 from $0.7 million in 2000 due to
increased earnings from the land development joint ventures.

SG&A increased by $0.6 million, or 1.2%, to $52.5 million in 2001 from
$51.9 million in 2000. As a percentage of revenues, SG&A increased to 12.4% in
2001 from 11.2% in 2000. The increase in SG&A was primarily due to the expansion
of Newmark's operations in some of its Texas markets. In addition, Newmark
incurred approximately $0.8 million in legal and related costs in connection
with the Merger.

Income from continuing operations before income taxes decreased by $1.7
million, or 5.6%, to $28.6 million in 2001 from $30.3 million in 2000, primarily
due to a decline in homes closed in Texas and the Mid-Atlantic.

Newmark's provision for income taxes remained relatively consistent as a
percentage of income from continuing operations before taxes at 35.5% in 2001
compared to 36.0% in 2000.

Net income decreased by 3.8%, primarily due to the decrease in home
closings as described above.

TWELVE MONTHS ENDED DECEMBER 31, 2000 COMPARED TO TWELVE MONTHS ENDED DECEMBER
31, 1999

Revenues increased by $41.5 million, or 9.9%, to $462.3 million in 2000
from $420.8 million in 1999. This increase was primarily due to an increase in
the average selling price of homes. The average selling price of homes increased
by $24,000, or 9.4%, to $279,000 in 2000 from $255,000 in 1999, which was
primarily due to market conditions and the mix of homes sold. Revenues from home
sales increased by $43.0 million, or 10.4%, to $456.8 million in 2000 from
$413.8 million in 1999, primarily due to an increase in the average selling
price of homes. The overall increase in revenues was slightly offset by a
decrease in revenue from land sales, which decreased by $1.5 million, or 20.9%,
to $5.5 million in 2000 from $7.0 million in 1999. This decrease in revenue from
land sales was primarily due to a decline in land sales during 2000, principally
in Newmark's markets in Texas.

New net sales contracts decreased by 79 homes, or 5.0%, to 1,490 homes in
2000 from 1,569 homes in 1999 due to the general economic conditions in our
markets. The dollar amount of new net sales contracts decreased by $25.9
million, or 6.3%, to $435.6 million in 2000 from $409.7 million in 1999.

Newmark operated in 54 subdivisions at December 31, 2000 compared to 48
subdivisions at December 31, 1999. As of December 31, 2000, Newmark's backlog of
sales contracts was 392 homes, a 27.4% decrease from 540 homes at December 31,
1999.

Cost of sales increased by $26.5 million, or 7.6%, to $375.1 million in
2000 from $348.6 million in 1999 primarily due to the increase in revenues from
home sales closed as described above. Cost of home sales increased by $27.6
million, or 8.1%, to $369.8 million in 2000 from $342.2 million in 1999. Cost of
land sales for 2000 decreased by $1.1 million, or 16.4%, to $5.3 million from
$6.4 million in 1999. This decrease in the cost of land sales was primarily due
to a decline in land sales during 2000, primarily in Newmark's markets in Texas.
As a percentage of revenues, cost of sales for 2000 decreased to 81.1% from
82.9% in 1999 primarily due to a shift in product mix of home sales closed to
higher margin homes.

Equity in earnings from unconsolidated subsidiaries remained relatively
constant at $0.7 million in 2000 and 1999.

SG&A increased by $7.4 million, or 16.7%, to $51.9 million in 2000 from
$44.5 million in 1999. This increase in SG&A resulted primarily from the
expansion into new markets in Tennessee and North Carolina, as well as the
expansion in existing markets in Texas. As a percentage of revenues, SG&A
increased to 11.2% in 2000 from 10.6% in 1999.

Income from continuing operations before income taxes increased by $5.7
million, or 23.3%, to $30.3 million in 2000 from $24.5 million in 1999,
primarily due to an increase in homes closed in Texas.

Newmark's provision for income taxes remained relatively constant as a
percentage of income from continuing operations before taxes at 36.0% in 2000
compared to 35.5% in 1999.

Net income increased by $8.3 million, or 47.8%, to $25.7 million in 2000
from $17.4 million in 1999, primarily due to the increase in homes closed, as
described above.

LIQUIDITY AND CAPITAL RESOURCES

Newmark's financing needs historically have varied based primarily on its
operations, sales volume, inventory levels, inventory turnover and land
acquisitions. Newmark's cash needs historically have been provided by cash flows
from operations, unsecured bank borrowings and, from time to time, notes issued
in the debt markets. At March 31, 2002, Newmark had cash and cash equivalents of
$11.9 million. Inventories (including finished homes and construction in
progress, developed lots and other land) at March 31, 2002 were $165.7 million,
an increase of $3.5 million from $162.2 million at December 31, 2001. This
increase results from general growth in Newmark's business. Newmark's ratio of
homebuilding debt to total assets was 27.2% at March 31, 2002 and 25.6% at
December 31, 2001. The equity to total assets ratio increased during the three
months to 46.9% at March 31, 2002 from 45.0% at December 31, 2001, primarily due
to an increase in equity from earnings.

CASH FROM OPERATING ACTIVITIES

Cash provided by operating activities increased by $1.2 million to $0.7
million in three months ended March 31, 2002 from a use of cash of $0.5 million
in three months ended March 31, 2001, primarily due to a $3.5 million increase
in inventory in the three months ended March 31, 2002 compared to a $5.4 million
increase in inventory in the three months ended March 31, 2001.

Cash provided by operating activities decreased by $25.9 million to a use
of funds of $0.9 million in 2001 from a source of funds of $25.0 million in
2000, primarily due to a $12.9 million increase in inventory in 2001 compared to
a $17.2 million decrease in 2000 that was a result of lot and land acquisitions
in Texas.

Cash provided by operating activities increased by $30.7 million in 2000 to
$25.0 million from a use of cash of $5.7 million in 1999, primarily due to a
$17.2 million decrease in inventory in 2000 compared to a $25.1 increase in
inventory in 1999. The decrease in inventory in 2000 was a result of decreased
home construction in Texas.

CASH FROM INVESTING ACTIVITIES

Net cash used in investing activities increased by $2.8 million to $2.8
million in three months ended March 31, 2002 compared to zero in three months
ended March 31, 2001. Funds used in investments in unconsolidated subsidiaries
increased by $2.2 million to $2.3 million for the three months ended March 31,
2002 from $0.1 million in the three months ended March 31, 2001. Net purchases
of property, premises and equipment increased by $0.6 million to $0.8 million in
the three months ended March 31, 2002 from $0.2 million in the three months
ended March 31, 2001, primarily due to the construction costs incurred on
Newmark's 19,000 square foot office facility. This facility was completed in the
first quarter of 2002 and accommodates Newmark's Houston division operations and
a design center.

Net cash used in investing activities remained relatively stable at $2.1
million in 2001 compared to $3.3 million in 2000. In 2001, net purchases of
property, premises and equipment totaled $3.0 million in 2001 compared to $1.5
million in 2000, primarily due to the construction costs incurred on Newmark's
19,000 square foot office facility.

Net cash used in investing activities increased to $3.3 million in 2000
compared to zero in 1999. Additional purchase price paid for Westbrooke was $1.2
million for the twelve months ended December 31, 2000 compared to zero for the
twelve months ended December 31, 1999. Cash used for purchases of property
premises and equipment was $1.5 million in 2000 compared to $0.7 million in
1999.

CASH FROM FINANCING ACTIVITIES

Net cash from financing activities decreased by $2.4 million to $2.2
million in the three months ended March 31, 2002 from $4.6 million in the three
months ended March 31, 2001. Proceeds from advances on construction loans
payable decreased by $17.3 million to $29.5 million in the three months ended
March 31, 2002 from $46.8 million in three months ended March 31, 2001.
Principal payments on construction loans decreased to $25.5 million in the three
months ended March 31, 2002 from $34.8 million in the three months ended March
31, 2001. Dividends paid decreased to zero in the three months ended March 31,
2002 from $6.2 million in the three months ended March 31, 2001.

Net cash from financing activities increased by $28.5 million to $4.7
million in 2001 from a use of cash of $23.8 million in 2000. Proceeds from
advances on construction loans payable decreased to $163.2 million in 2001 from
$211.9 million in 2000. Principal payments on construction loans payable
decreased to $151.1 million in 2001 from $234.8 million in 2000. The decreases
in both the proceed advances and principal payments were due to the conversion
to a borrowing base revolver from construction and lot loans on June 27, 2000.
Construction and lot loans are generally repaid as individual homes are closed.
The revolver is typically repaid when excess cash becomes available. This
flexibility decreases the number of payoffs required and the number of times it
is necessary to draw on the loan. Dividends paid increased to $6.2 million in
2001 from zero in 2000.

Net cash from financing activities decreased by $45.9 million to $23.8
million in 2000 from a source of cash of $22.1 million in 1999. Proceeds from
advances on construction loans payable decreased to $211.9 million in 2000 from
$276.6 million in 1999. Principal payments on construction loans payable
decreased to $234.8 million in 2000 from $262.1 million in 1999. The decreases
in both the proceed advances and principal payments were due to the conversion
to a borrowing base revolver from construction and lot loans on June 27, 2000.

INDEBTEDNESS

Except for ordinary expenditures for the construction of homes and, to a
limited extent, the acquisition of land and lots for development and sales of
homes, at March 31, 2002 Newmark had no material commitments for capital
expenditures.

On June 27, 2000, Newmark entered into a $150 million secured revolving
credit facility with six banks which matures on June 27, 2003, with annual
options for one-year extensions. This credit facility has been used to finance
the acquisition and development of residential communities, the purchase of
developed lots and the construction of homes in Newmark's markets in Texas,
Tennessee and North Carolina. As of March 31, 2002, Newmark had borrowings of
$85.9 million outstanding under this facility. Newmark intends to repay a
portion of the debt outstanding under this facility with the net proceeds from
the sale of Westbrooke and will repay the remaining portion with the net
proceeds from this offering.

In addition to the secured revolving credit facility, Newmark is a party
from time to time to other agreements providing for construction, lot and other
loans. As of March 31, 2002, Newmark had $5.5 million of debt outstanding under
these loans.

The following table sets forth the maturities on Newmark's construction and
lot development loans at March 31, 2002:

AMOUNT
YEAR ENDED -----------
DECEMBER 31, (DOLLARS IN
------------ THOUSANDS)

2002.............................................. $ 90,918
2003.............................................. 100
2004.............................................. 107
2005.............................................. 114
Thereafter........................................ 138
--------
Total........................................ $ 91,377
========

At March 31, 2002, Newmark owed approximately $3.7 million under promissory
notes issued in connection with the acquisition of Westbrooke. Newmark repaid
these notes with the net proceeds from the sale of Westbrooke.

DIVIDENDS

Newmark did not pay any cash dividends on its common stock in 2000. Newmark
paid a dividend of $0.54 per share of common stock in 2001.

CRITICAL ACCOUNTING POLICIES

In the preparation of its financial statements, Newmark applies accounting
principles generally accepted in the United States. The application of generally
accepted accounting principles may require management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying results.

Housing and other real estate sales are recognized when title passes to the
buyer and certain other conditions are met. As a result, Newmark's revenue
recognition process does not involve significant judgments or estimates.
However, Newmark does rely on certain estimates to determine the related
construction and land costs and resulting gross margins associated with revenues
recognized. Newmark's construction and land costs are comprised of direct and
allocated costs, including estimated costs for future warranties and
indemnities. Land, land improvements and other common costs are generally
allocated on a relative fair value basis to units within a parcel or
subdivision. Land and land development costs generally include related interest
and property taxes incurred until development is substantially completed.

Newmark had goodwill in the amount of $42.9 million at March 31, 2002.
Newmark periodically evaluates goodwill for impairment by determining whether
the carrying amount can be recovered through future undiscounted cash flows.
Newmark's estimates of future cash flows are based on reasonable and supportable
assumptions and represent Newmark's best estimates of the cash flows expected to
result from the use of the corresponding assets and their eventual disposition.

During March 2002, Newmark's management committed to a plan to dispose of
Westbrooke. Pursuant to this plan of disposition, Newmark would sell 100% of the
common stock of Westbrooke. On April 15, 2002, Newmark completed the sale of
Westbrooke to Standard Pacific. Accordingly, as of March 31, 2002, management
has determined that in accordance with SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets," the criteria to classify the
Westbrooke assets as held for sale were met. Results of Westbrooke's operations
have been classified as discontinued operations and prior periods have been
restated. For additional information concerning SFAS 144 see "Technical Olympic
USA, Inc. -- Impact of New Accounting Standards."

Newmark is involved in litigation incidental to its business, the
disposition of which is expected to have no material effect on Newmark's
financial position or results of operations. It is possible, however, that
future results of operations for any particular period could be materially
affected by changes in Newmark's

assumptions related to these proceedings. Newmark accrues its best estimate of
the probable cost for the resolution of legal claims. Such estimates are
developed in consultation with outside counsel handling these matters and are
based upon a combination of litigation and settlement strategies. To the extent
additional information arises or Newmark's strategies change, it is possible
that Newmark's best estimate of its probable liability in these matters may
change.

ENGLE

Engle designs, builds and sells single-family homes, town homes and
condominiums in seven markets in Texas, Florida, Colorado, Virginia and Arizona.
At March 31, 2002, Engle operated in 89 communities in its markets and had 1,293
homes under construction. Engle is also actively engaged in residential land
acquisition and lot development and at March 31, 2002, owned, or had under
option contracts, 10,839 lots available for future building.

On November 22, 2000, Engle became a wholly-owned subsidiary of Technical
Olympic. Prior to its acquisition by Technical Olympic, Engle Homes, Inc.'s
fiscal year ended on October 31, and information with respect to Engle is
presented below for the years ended October 31, 1999 and 2000. On November 22,
2000, Engle changed its fiscal year from October 31 to December 31. Engle did
not recast the data for prior years to reflect this change in fiscal years.
Information with respect to Engle is also presented below for the year ended
December 31, 2001.

RESULTS OF OPERATIONS

Engle derives its revenue from three principal sources: (i) sales of homes;
(ii) sales of land; and (iii) provision of financial services consisting of
mortgage origination and title services. The following table sets forth Engle's
revenue by source and in total for the periods indicated:

THREE MONTHS ENDED YEAR ENDED
MARCH 31, DECEMBER 31, YEAR ENDED OCTOBER 31,
-------------------- ------------ ----------------------
2002 2001 2001 2000 1999
-------- -------- ------------ --------- ---------
(DOLLARS IN THOUSANDS)

SOURCE
Sales of homes.................... $218,417 $213,581 $ 958,125 $794,445 $704,563
Sales of land..................... 215 688 10,499 24,053 11,236
Financial services................ 8,083 6,395 32,659 22,130 22,691
Other(1).......................... 1,312 1,917 5,412 3,383 3,450
-------- -------- ---------- -------- --------
Total........................ $228,027 $222,581 $1,006,695 $844,011 $741,940
======== ======== ========== ======== ========

---------------

(1) Represents revenue primarily derived from rent of office subleases.

Engle's principal expenses are: (i) the cost of sales and (ii) SG&A. Costs
of sales reflects the cost of home construction and land purchases (including,
in each case, capitalized interest and financing costs). SG&A includes
administrative costs, advertising expenses, on-site marketing expenses,
commission costs and closing costs. The following table sets forth Engle's
principal expenses by category and in total for the periods indicated:

EXPENSE
Cost of sales..................... $173,984 $173,380 $773,347 $686,223 $603,705
SG&A.............................. 25,010 20,970 95,947 79,158 71,079
-------- -------- -------- -------- --------
Total........................ $198,994 $194,350 $869,294 $765,381 $674,784
======== ======== ======== ======== ========

The following table sets forth certain historical operating data for Engle
as a percentage of total revenues:

THREE MONTHS
ENDED YEAR ENDED YEAR ENDED
MARCH 31, DECEMBER 31, OCTOBER 31,
------------ ------------ ------------
2002 2001 2001 2000 1999
---- ---- ---- ---- ----

Cost of sales..................................... 76.3% 77.9% 76.8% 81.2% 81.4%
Gross profit...................................... 23.7% 22.1% 24.1% 18.8% 18.6%
SG&A.............................................. 11.0% 9.4% 9.5% 9.4% 9.6%
Income before income taxes........................ 4.2% 10.1% 11.1% 6.8% 6.2%
Income taxes(1)................................... 37.8% 37.3% 37.8% 37.6% 38.6%
Net Income........................................ 2.6% 6.4% 6.9% 4.2% 3.8%

---------------

(1) As a percentage of income before income taxes.

THREE MONTHS ENDED MARCH 31, 2002 COMPARED TO THREE MONTHS ENDED MARCH 31,
2001

Total revenues increased by $5.4 million, or 2.4%, to $228.0 million in the
three months ended March 31, 2002 from $222.6 million in the three months ended
March 31, 2001, primarily due to an increase in revenues from home sales and
financial services revenues.

Revenues from home sales increased by $4.8 million, or 2.3%, to $218.4
million in the three months ended March 31, 2002 from $213.6 million in the
three months ended March 31, 2001. This increase was primarily due to an
increase in the average selling price per home offset in part by a decrease in
the number of homes closed. The number of homes closed decreased by 33 homes, or
3.7%, to 864 homes in the three months ended March 31, 2002 from 897 homes in
the three months ended March 31, 2001. The average selling price of homes closed
increased by approximately $15,000, or 6.3%, to approximately $253,000 in the
three months ended March 31, 2002 from approximately $238,000 in the three
months ended March 31, 2001 due to general market conditions.

Revenues from land sales decreased by $0.5 million, or 68.8%, to $0.2
million in the three months ended March 31, 2002 from $0.7 million in the three
months ended March 31, 2001, primarily due to a decrease in land sales in
Florida and Virginia.

Revenues from financial services increased $1.7 million, or 26.4%, to $8.1
million in the three months ended March 31, 2002 from $6.4 million in the three
months ended March 31, 2001, primarily due to an increase in mortgage
origination and title services provided in conjunction with the increase in the
number of homes closed.

New net sales contracts decreased by 177 homes, or 15.1%, to 995 homes for
the three months ended March 31, 2002 from 1,172 homes for the three months
ended March 31, 2001 due to the general economic conditions in our markets. The
dollar amount of new net sales contracts decreased by $33.0 million, or 11.1%,
to $264.1 million in the three months ended March 31, 2002.

Engle operated in 89 communities at March 31, 2002 compared to 113
communities at March 31, 2001. As of March 31, 2002, Engle's backlog of sales
contracts was 1,941 homes, a 18.1% decrease from March 31, 2001.

Cost of sales increased by $0.6 million, or 0.3%, to $174.0 million in the
three months ended March 31, 2002 from $173.4 million in the three months ended
March 31, 2001. Cost of home sales increased by $0.9 million, or 0.5%, to $173.8
million in the three months ended March 31, 2002 from $172.9 million in the
three months ended March 31, 2001, primarily due to the increase in home sale
revenues. Cost of home sales as a percentage of home sales revenue decreased to
79.6% from 81.0% as a result of the product mix of homes delivered. Cost of land
sales decreased by $0.3 million, or 60.0%, to $0.2 million in the three months
ended March 31, 2002 from $0.5 million in the three months ended March 31, 2001,
primarily due to a decline in land sales in Florida and Virginia. Cost of
financial services increased by $0.4 million, or 9.4%, to $4.4 million

in the three months ended March 31, 2002 from $4.0 million in the three months
ended March 31, 2001, primarily due to an increase in financial services
revenue.

SG&A increased by $4.0 million, or 19.3%, to $25.0 million in the three
months ended March 31, 2002 from $21.0 million in the three months ended March
31, 2001. SG&A as a percentage of total revenues increased to 11.0% from 9.4%.
The increase in SG&A in dollar amount as well as in percentage of total revenue
is primarily due to higher information technology expenditures and performance
compensation accrual.

Income before income taxes increased by $13.1 million, or 57.9%, to $9.5
million in the three months ended March 31, 2002 from $22.6 million in the three
months ended March 31, 2001, primarily due to the decrease in revenues from
severance charges.

Engle's provision for income taxes remained relatively constant as a
percentage of income before taxes at 37.8% in the three months ended March 31,
2002 compared to 37.3% in the three months ended March 31, 2001.

Net income decreased by $8.2 million, or 58.3%, to $5.9 million in the
three months ended March 31, 2002 from $14.1 million in the three months ended
March 31, 2001, primarily as a result of the increase in severance charges.

TWELVE MONTHS ENDED DECEMBER 31, 2001 COMPARED TO THE TWELVE MONTHS ENDED
OCTOBER 31, 2000

Total revenues increased by $162.7 million, or 19.3%, to $1,006.7 million
in the twelve months ended December 31, 2001 from $844.0 million in the twelve
months ended October 31, 2000, primarily due to an increase in home sales and
financial services revenues.

Revenues from home sales increased by $163.7 million, or 20.6%, to $958.1
million in the twelve months ended December 31, 2001 from $794.4 million in the
twelve months ended October 31, 2000. This increase was primarily due to an
increase in the number of homes closed. The number of homes closed increased by
320 homes, or 9.0%, to 3,893 homes in the twelve months ended December 31, 2001
from 3,573 homes in the twelve months ended October 31, 2001. The average
selling price of homes closed increased by approximately $24,000, or 10.8%, to
approximately $246,000 in the twelve months ended December 31, 2001 from
approximately $222,000 in the twelve months ended October 31, 2000 due to
general market conditions.

Revenues from land sales decreased by $13.6 million, or 56.4%, to $10.5
million in the twelve months ended December 31, 2001 from $24.1 million in the
twelve months ended October 31, 2000, primarily as a result of a decrease in
land sales in Florida and Virginia.

Revenues from financial services increased $10.5 million, or 47.6%, to
$32.7 million for the twelve months ended December 31, 2001 from $22.1 million
in the twelve months ended October 31, 2000, primarily due to increased mortgage
and title services provided in conjunction with the increase in the number of
homes closed.

New net sales contracts decreased by 169 homes, or 4.5%, to 3,609 homes in
2001 from 3,778 homes in 2000 due to the general economic conditions in our
markets. The dollar amount of new net sales contracts decreased by $39.9
million, or 4.5%, to $921.0 million in 2001.

Engle operated in 92 communities at December 31, 2001 compared to 107
communities at October 31, 2000. As of December 31, 2001, Engle's backlog of
sales contracts was 1,810 homes, a 12.3% decrease from 2,065 homes at October
31, 2000.

Cost of sales increased by $87.1 million, or 12.7%, to $773.3 million in
the twelve months ended December 31, 2001 from $686.2 million in the twelve
months ended October 31, 2000. This increase was primarily due to an increase in
cost of home sales offset, in part, by a decline in cost of land sales. Cost of
home sales increased by $98.9 million, or 14.9%, to $763.7 million in the twelve
months ended December 31, 2001 from $664.8 million in the twelve months ended
October 31, 2000. The increase in the cost of home sales was primarily due to
the related increase in home sales revenue. Cost of land sales decreased by
$11.8 million, or 55.0%, to $9.6 million in the twelve months ended December 31,
2001 from $21.4 million in the twelve

months ended October 31, 2000, primarily due to the related decrease in land
sales revenue. Cost of financial services increased $2.4 million, or 15.7%, to
$17.7 million in the twelve months ended December 31, 2001 from $15.3 million in
the twelve months ended October 31, 2000, primarily due to the related increase
in financial services revenue.

SG&A increased by $16.8 million, or 21.2%, to $95.9 million in the twelve
months ended December 31, 2001 from $79.2 million in the twelve months ended
October 31, 2000. As a percentage of revenues, SG&A increased slightly to 9.5%
from 9.4%.

Income before income taxes increased by $54.2 million, or 94.7%, to $111.4
million in the twelve months ended December 31, 2001 from $57.2 million in the
twelve months ended October 31, 2000, primarily due to the increase in revenues
from home sales and a decrease in cost of home sales as a percentage of home
sales revenue.

Engle's provision for income taxes remained relatively constant at 37.8% in
twelve months ended December 31, 2001 compared to 37.6% in twelve months ended
October 31, 2000.

Net income increased $33.7 million, or 94.4%, to $69.3 million in the
twelve months ended December 31, 2001 from $35.7 million in the twelve months
ended October 31, 2000.

TWELVE MONTHS ENDED OCTOBER 31, 2000 COMPARED TO TWELVE MONTHS ENDED OCTOBER
31, 1999

Total revenues increased by $102.1 million, or 13.8%, to $844.0 million in
the twelve months ended October 31, 2000 from $741.9 million in the twelve
months ended October 31, 1999, primarily due to an increase in revenues from
home and land sales.

Revenues from home sales increased by $89.9 million, or 12.8%, to $794.4
million in the twelve months ended October 31, 2000 from $704.5 million in the
twelve months ended October 31, 1999, primarily due to an increase in the
average selling price of homes closed. The number of homes closed increased by
59 homes, or 1.7%, to 3,573 homes in the twelve months ended October 31, 2000
from 3,514 homes in the twelve months ended October 31, 1999. The average
selling price of homes closed increased by $21,000, or 10.5%, to $222,000 in the
twelve months ended October 31, 2000 from $201,000 in the twelve months ended
October 31, 1999.

Revenues from land sales increased by $12.8 million, or 114%, to $24.1
million in the twelve months ended October 31, 2000 from $11.2 million in the
twelve months ended October 31, 1999, primarily as a result of an increase in
land sales in Florida and Virginia.

Revenues from financial services decreased slightly by $0.6 million, or
2.5%, to $22.1 million in the twelve months ended October 31, 2000 from $22.7
million in the twelve months ended October 31, 1999.

New net sales contracts increased by 25 homes, or 0.7%, to 3,778 homes in
2000 from 3,753 homes in 1999 due to general economic conditions in our markets.
The dollar amount of new net sales contracts decreased by $89.5 million, or
11.3%, to $881.1 million in 2000 from $791.7 million in 1999.

Engle operated in 107 communities at December 31, 2000 compared to 100
communities at October 31, 1999. As of December 31, 2000, Engle's backlog of
sales contracts was 2,065 homes, an 11.0% increase from October 31, 1999.

Cost of sales increased by $82.5 million, or 13.7%, to $686.2 million in
the twelve months ended October 31, 2000 from $603.7 million in the twelve
months ended October 31, 1999, primarily due to an increase in cost of home
sales. Cost of home sales increased by $71.8 million, or 12.1%, to $664.8
million in the twelve months ended October 31, 2000 from $593.0 million in the
twelve months ended October 31, 1999, primarily as result of an increase in home
sales revenues. Cost of land sales increased by $10.7 million, or 101%, to $21.4
million in the twelve months ended October 31, 2000 from $10.7 million in the
twelve months ended October 31, 1999, primarily due to an increase in land
sales. Cost of financial services decreased $0.6 million, or 3.7%, to $15.3
million in the twelve months ended October 31, 2000 from $15.9 million in the
twelve months ended October 31, 1999, primarily due to the related decrease in
financial service revenues.

SG&A increased by $8.1 million, or 11.4%, to $79.2 million in the twelve
months ended October 31, 2000 from $71.1 million in the twelve months ended
October 31, 1999, primarily due to an increase in revenues. SG&A as a percentage
of total revenues was constant with the twelve months ended October 31, 1999.

Income before income taxes increased by $11.6 million, or 25.3%, to $57.2
million in the twelve months ended October 31, 2000 from $45.6 million in the
twelve months ended October 31, 1999, primarily due to the increase in revenues
from home sales and a decrease in cost of home sales as a percentage of home
sales revenue.

Engle's provision for income taxes remained relatively constant at 37.6% in
the twelve months ended October 31, 2000 compared to 38.6% in the twelve months
ended October 31, 1999.

Net income increased $7.6 million, or 27.3%, to $35.7 million in the twelve
months ended October 31, 2000 from $28.0 million in the twelve months ended
October 31, 1999, primarily due to an increase in homes closed and an increase
in the average price per home closed.

LIQUIDITY AND CAPITAL RESOURCES

Engle's financing needs historically have varied based primarily on its
operations, sales volume, inventory levels, inventory turnover and land
acquisitions. Engle's cash needs historically have been provided by cash flows
from operations, unsecured bank borrowings and, from time to time, notes issued
in the debt markets. At March 31, 2002, Engle had cash and cash equivalents of
$98.4 million. Inventories (including land and improvements held for development
and residential homes under construction) at March 31, 2002 were $470.1 million,
an increase of $13.8 million, or 3.0%, from $456.3 million at March 31, 2001.
This increase resulted from general growth in Engle's business.

CASH FROM OPERATING ACTIVITIES

Cash provided by operating activities decreased by $1.1 million to $43.0
million for the three months ended March 31, 2002 from $44.1 million for the
three months ended March 31, 2001. Cash provided from net income decreased by
$8.2 million to $5.9 million in the three months ended March 31, 2002 from $14.2
million for the three months ended March 31, 2001. The primary reason for the
decrease in net income was a severance charge of approximately $13.7 million in
the three months ended March 31, 2002. Cash used for inventory increased by
$35.7 million to $13.8 million for the three months ended March 31, 2002 from a
source of cash of $21.9 million in the three months ended March 31, 2001. The
increases in inventory were related to increases in homes under construction in
the majority of Engle's markets. Cash flows provided by mortgages held for sale
increased by $34.2 million to $22.2 million for the three months ended March 31,
2002 compared to $12.0 million provided in the three months ended March 31,
2001, due to the timing of the mortgages closing at the end of the period and
when they are sold.

Cash provided by operating activities decreased by $2.5 million to $25.3
million for the twelve months ended December 31, 2001 from $27.8 million for the
twelve months ended October 31, 2000. Cash provided from net income increased by
$33.6 million to $69.3 million in the twelve months ended December 31, 2001 from
$35.7 million for the twelve months ended October 31, 2000. Net income increased
due to a 9.0% increase in homes closed, a 10.8% increase in average sales price
and an improvement in the gross profit to 24.1% in 2001 compared to 18.8% in
2000. Cash flows for mortgages held for sale decreased by $41.5 million to a use
of $36.5 million for twelve months ended December 31, 2001 from $5.0 million
provided in the twelve months ended October 31, 2000, primarily due to the
timing of the mortgages closing at the end of the period and when they were
sold.

Cash provided by operating activities increased by $23.7 million to $27.8
million for the twelve months ended October 31, 2000 from $4.1 million for the
twelve months ended October 31, 1999. Cash provided from net income increased
$7.7 million to $35.7 million in the twelve months ended October 31, 2000 from
$28.0 million for the twelve months ended October 31, 1999. Net income increased
due to a 10.5% increase in average sales price and to a lesser degree a 1.7%
increase in homes closed and an improvement in the homebuilding gross profit to
16.3% in the twelve months ended October 31, 2000 compared to 15.8% for the

twelve months ended October 31, 1999. Increase in inventories used $26.6 million
in cash for the twelve months ended October 31, 2000 compared to $36.9 million
in the twelve months ended October 31, 1999, primarily due to increases in both
land and improvements for residential homes under development as well as
residential homes under construction. Cash flows from mortgages held for sale
was $5.0 million for twelve months ended October 31, 2000 compared to a use of
$1.6 million in the twelve months ended October 31, 1999, primarily due to the
timing of the mortgages closing at the end of the period and when they are sold.

CASH FROM INVESTING ACTIVITIES

Cash flows used for investing activities decreased to $0.7 million for the
three months ended March 31, 2002 from $0.8 million for the three months ended
March 31, 2001. These cash flows were used for acquisition of property and
equipment.

Cash flows used in investing activities remained relatively stable at $4.0
million for the twelve months ended December 31, 2001 from $3.8 million for the
twelve months ended October 31, 2000. These cash flows were used for acquisition
of property and equipment.

Cash flows used in investing activities decreased to $3.8 million for the
twelve months ended October 31, 2000 from $6.2 million for the twelve months
ended October 31, 1999. These cash flows were used for acquisition of property
and equipment.

CASH FROM FINANCING ACTIVITIES

Cash flows used in financing activities increased by $14.8 million to $33.4
million for the three months ended March 31, 2002 from $18.6 million for the
three months ended March 31, 2001. Repayment of borrowings declined as a use of
funds by $25.6 million to $0.9 million in the three months ended March 31, 2002
from a use of funds of $26.5 million for the three months ended March 31, 2001.
Funds provided by borrowings decreased by $51.8 million using $24.8 million for
the three months ended March 31, 2002 from $27.0 million provided by increased
borrowings for the three months ended March 31, 2001. Distributions to Engle's
parent company decreased by $16.1 million to $3.0 million in the three months
ended March 31, 2002 from $19.1 million used in the three months ended March 31,
2001. A decrease in minority interest used $4.3 million in the three months
ended March 31, 2002 compared to zero in the three months ended March 31, 2001.
The minority interest represents the equity of investors in the land bank
consolidation.

Cash flows from financing activities increased by $42.9 million to $26.1
million for the twelve months ended December 31, 2001 from a use of $16.8
million for the twelve months ended October 31, 2000. Distributions to Engle's
parent company in the twelve months ended December 31, 2001 used funds of $29.5
million compared to zero in the twelve months ended October 31, 2000. Financial
service borrowings for the twelve months ended December 31, 2001 provided $29.6
million in funds compared to a use of funds of $8.9 million for the twelve
months ended October 31, 2000. Financial service borrowings increased due to the
increase in financial service revenue which increased by 47.6% in the twelve
months ended December 31, 2001 compared to the twelve months ended October 31,
2000. The cash provided by an increase in minority interest and consolidated
land bank obligation for twelve months ended December 31, 2001 were $35.7
million and $30.0 million, respectively, compared to zero for both of these
categories in the twelve months ended October 31, 2000. The minority interest
represents the equity of investors in the land bank consolidation.

Cash flows used in financing activities increased to a use of funds of
$16.8 million in the twelve months ended October 31, 2000 from a source of funds
of $43.0 million provided in the twelve months ended October 31, 1999. Proceeds
from borrowings plus proceeds from issuance of senior debt totaled $118.6
million for the twelve months ended October 31, 1999 compared to zero in the
twelve months ending October 31, 2000. Repayment of borrowings were $2.2 million
in the twelve months ended October 31, 2000 compared to $72.4 million for the
twelve months ended October 31, 1999. The changes in proceeds from borrowing and
repayment of borrowing were primarily due to the issuance of senior debt in the
twelve months ended October 31, 1999. Financial service borrowings for the
twelve months ended October 31, 2000 used $8.9 million in funds compared to $1.0
million funds provided for the twelve months ended October 31, 1999. This was
primarily due to the increase in mortgages held for sale.

INDEBTEDNESS

At March 31, 2002, Engle had homebuilding borrowings of approximately
$214.9 million outstanding and an aggregate of $57.1 million in letters of
credit and payment and performance bonds outstanding. Outstanding homebuilding
borrowings at March 31, 2002 consisted of $202.0 million aggregate principal
amount of unsecured borrowings from financial institutions, $12.9 million of the
Engle 9 1/4% Senior Notes due 2008. The letters of credit and payment and
performance bonds are required for certain development activities, such as
deposits on land and lot purchase contract deposits. Deposits for future
purchases of land totaled $25.9 million at March 31, 2002.

To fund the origination of residential mortgage loans, our subsidiary,
PHMC, entered into a $40.0 million warehouse line of credit. The facility is
guaranteed by Engle and secured by the mortgage loans held for sale. The line of
credit bears interest at the federal funds rate plus 1.375% (2.895% at December
31, 2001) and matures July 5, 2002. PHMC is required by the terms of the line of
credit to fund 2.0% of all mortgages originated and to sell all funded mortgages
within 90 days. At March 31, 2002, the outstanding balance on the warehouse line
of credit was $13.9 million.

In connection with the acquisition of Engle by Technical Olympic on
November 22, 2000, Engle entered into a credit agreement providing for a $100.0
million term loan and a $275.0 million revolving credit facility (subject to
reduction based upon periodic determinations of a borrowing base). Proceeds from
the term loan and the revolving credit facility were used to finance Engle's
required offer to repurchase the then outstanding $250.0 million principal
amount of its 9 1/4% Senior Notes due 2008. In connection with this offer $12.9
million of Engle's 9 1/4% Senior Notes due 2008 were not tendered and remain
outstanding as of March 31, 2002. In addition, the revolving credit facility
provides working capital and credit support for the issuance of letters of
credit needed from time to time. The term loan and revolving credit facility
mature on November 22, 2002 whereupon all amounts outstanding become due. At
March 31, 2002, $100.0 million under the term notes and $102.0 million under the
revolving credit facility were outstanding.

The following table sets forth the maturities of Engle's borrowings as of
March 31, 2002:

YEAR ENDED
DECEMBER 31, AMOUNT
------------ ----------------------
(DOLLARS IN THOUSANDS)

2002...................................... $202,000
2003...................................... --
2004...................................... --
2005...................................... --
Thereafter................................ 12,897
--------
Total..................................... $214,897
========

DIVIDENDS

Engle paid dividends to its parent company of $2.6 million in the twelve
months ended October 31, 2000 and $29.5 million in the twelve months ended
December 31, 2001. During the three months ended March 31, 2002, Engle paid
dividends to its parent company of $3.0 million.

CRITICAL ACCOUNTING POLICIES

In the preparation of its financial statements, Engle applies accounting
principles generally accepted in the United States. The application of generally
accepted accounting principles may require management to make estimates and
assumptions that affect the amounts reported in the financial statements and
accompanying results.

Housing and other real estate sales are recognized when title passes to the
buyer and certain other conditions are met. As a result, Engle's revenue
recognition process does not involve significant judgments or estimates.
However, Engle does rely on certain estimates to determine the related
construction and land costs

and resulting gross margins associated with revenues recognized. Engle's
construction and land costs are comprised of direct and allocated costs,
including estimated costs for future warranties and amenities. Land, land
improvements and other common costs are generally allocated on a relative fair
value basis to units within a parcel or subdivision. Land and land development
costs generally include related interest and property taxes incurred until
development is substantially completed.

Engle had goodwill in the amount of $14.8 million at March 31, 2002. Engle
periodically evaluates goodwill for impairment by determining whether the
carrying amount can be recovered through future undiscounted cash flows. Engle's
estimates of future cash flows are based on reasonable and supportable
assumptions and represent Engle's best estimates of the cash flows expected to
result from the use of the corresponding assets and their eventual disposition.

Engle enters into option agreements with third parties to acquire developed
lots. From time to time to leverage its ability to acquire and finance the
development of these lots, Engle transfers its option right to a special purpose
entity owned by third parties, including current and former officers or trusts
related to them. These special purpose entities incur debt to finance the
acquisition and development of the lots and grant Engle an option to acquire
their assets. In consideration for these options, Engle makes a non-refundable
deposit, typically less than 20% of the option price. Engle does not have legal
title to the special purpose entities or their assets and has not guaranteed
their liabilities. However, because Engle has the right to exercise the options,
it may be deemed to have certain rights of ownership over these entities'
assets. As a result, Engle is required to include the assets of these entities
and their corresponding liabilities in its financial statements under the
caption "Consolidated land bank obligations." Accordingly, Engle included on its
statement of financial position assets of $61.0 million, representing inventory
and land deposits, minority interests of $31.4 million, representing the equity
of investors, and Consolidated land bank obligations of $29.6 million,
representing the liabilities of these entities.

Engle is involved in litigation incidental to its business, the disposition
of which is expected to have no material effect on Engle's financial position or
results of operations. It is possible, however, that future results of
operations for any particular quarterly or annual period could be materially
affected by changes in Engle's assumptions related to these proceedings. Engle
accrues its best estimate of the probable cost for the resolution of legal
claims. Such estimates are developed in consultation with outside counsel
handling these matters and are based upon a combination of litigation and
settlement strategies. To the extent additional information arises or Engle's
strategies change, it is possible that Engle's best estimate of its probable
liability in these matters may change.

TECHNICAL OLYMPIC USA, INC.

IMPACT OF NEW ACCOUNTING STANDARDS

In June 1998, the Financial Accounting Standards Board, or the FASB, issued
SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities."
SFAS 133 requires companies to recognize all derivative contracts as either
assets or liabilities in the balance sheet and to measure them at fair value. If
certain conditions are met, a derivative may be specifically designated as a
hedge, the object of which is to match the timing of gain or loss recognition on
the hedging derivative with the recognition of (i) the changes in the fair value
of the hedged asset or liability that are attributable to the hedge risk or (ii)
the earnings effect of the hedged forecasted transaction. For a derivative not
designated as a hedging instrument, the gain or loss is recognized in income in
the period of change. SFAS 133 is effective for all fiscal quarters of fiscal
years beginning after June 15, 2000. Historically, Newmark and Engle have not
entered into derivative contracts either to hedge existing risks or for
speculative purposes. Accordingly, neither Newmark nor Engle expects the
adoption of the new standard on January 1, 2001 to affect their respective
financial statements.

In September 2000, the FASB issued SFAS No. 140, "Accounting for Transfers
and Servicing of Financial Assets and Extinguishment of Liabilities." SFAS 140
provides accounting and reporting standards for transfers and servicing of
financial assets and extinguishments of liabilities. SFAS 140 replaces SFAS 125
and is effective for transfers and servicing of financial assets and
extinguishments occurring after March 31, 2001. SFAS 140 is effective for
recognition and reclassification of collateral and for disclosures relating to

securitization transactions and collateral for fiscal years ended after December
15, 2000. The adoption of SFAS 140 did not materially affect either Engle's or
Newmark's earnings or financial position.

In June 2001, the FASB issued SFAS No. 141, "Business Combinations," and
No. 142, "Goodwill and Other Intangible Assets." SFAS 141 requires the use of
the purchase method of accounting and prohibits the use of the
pooling-of-interests method of accounting for business combinations initiated
after June 30, 2001. SFAS 141 also requires companies to recognize acquired
intangible assets apart from goodwill if the acquired intangible assets meet
certain criteria. SFAS 141 applies to all business combinations completed on or
after July 1, 2001. It also requires, upon adoption of SFAS 142, that companies
reclassify the carrying amounts of intangible assets and goodwill based on the
criteria in SFAS 141. The adoption of SFAS No. 141 did not have a material
impact on the consolidated financial statements of either Newmark or Engle.

SFAS 142 requires, among other things, that companies no longer amortize
goodwill, but instead review goodwill for impairment at least annually. SFAS No.
142 prescribes a two-phase process for impairment testing of goodwill. The first
phase, required to be completed by June 30, 2002, screens for impairment. The
second phase (if necessary), required to be completed by December 31, 2002,
measures the impairment. The impairment loss is the amount, if any, by which the
implied fair value of goodwill is less than the book carrying value. In
addition, SFAS 142 requires companies to identify reporting units for the useful
lives of other existing recognized intangible assets, and cease amortization of
intangible assets with an indefinite useful life. An intangible asset with an
indefinite useful life should be tested for impairment in accordance with the
guidance in SFAS 142. SFAS 142 is required to be applied in fiscal years
beginning after December 15, 2001 to all goodwill and other intangible assets
recognized at that date, regardless of when those assets were initially
recognized. Companies are also required to reassess the useful lives of other
intangible assets within the first interim quarter after adoption of SFAS 142.

Both Newmark and Engle adopted SFAS 142 as of January 1, 2002 and have
accounted for previous business combinations using the purchase method. As of
March 31, 2002, the net carrying amount of goodwill for Newmark and Engle is
$42.9 million and $14.8 million, respectively. Newmark and Engle both completed
the first phase impairment analysis during the second quarter and found no
instances of impairment on their recorded goodwill. Accordingly, the second
testing phase, absent future indicators of impairment, is not necessary during
2002.

In October 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment or Disposal of Long-Lived Assets." This Statement supersedes the
rules on asset impairment under SFAS No. 121, "Accounting for Long Lived Assets
and for Long Lived Assets to Be Disposed Of," but retains many of its
fundamental provisions. Additionally this Statement expands the scope of
discontinued operations to include more disposal transactions. SFAS 144 provides
a single accounting model for long-lived assets to be disposed of and
significantly changes the criteria that would have to be met to classify an
asset held-for-sale. Classification as held-for-sale is an important distinction
since such assets are not depreciated and are stated at the lower of fair value
or carrying amount. SFAS 144 also requires expected future operating losses from
discontinued operations to be displayed in the periods in which the losses are
incurred, rather than as of the measurement date as previously required. The
provisions of this Statement are effective for financial statements issued
beginning after December 15, 2001. The adoption of SFAS 144 on January 1, 2002
by both Newmark and Engle did not have a material impact on the consolidated
financial statements either company.

In April 2002, the FASB issued SFAS No. 145, "Rescission of SFAS Nos. 4, 44
and 64, Amendment of FASB Statement No. 13 and Technical Corrections." SFAS 145
prevents gains or losses on extinguishment of debt not meeting the criteria of
APB 30 to be treated as extraordinary. SFAS 145 amends SFAS No. 13, "Accounting
for Leases," to eliminate inconsistency between the required accounting for
sale-leaseback transactions and the required accounting for certain lease
modifications that have economic effects that are similar to sale-leaseback
transactions. In addition, SFAS 145 rescinds SFAS No. 44, "Accounting for
Intangible Assets of Motor Carriers" and amends other existing authoritative
pronouncements to make various technical corrections, clarify meanings or
describe their applicability under changed conditions. SFAS 145 is effective for
fiscal years beginning after May 15, 2002. The adoption of SFAS 145 by both
Newmark and Engle does not have a material impact on previously issued financial
statements of either

company. However, the adoption of SFAS 145 could impact the financial statements
of subsequent periods of Newmark and Engle, although it is not expected to be
material.

SEASONALITY OF OPERATIONS

The homebuilding industry tends to be seasonal, as generally there are more
homes sold in the spring and summer months when the weather is good, resulting
in more home closings in the fall. After the Merger we will continue to operate
primarily in the southwest and southeast, where weather conditions are more
suitable to a year-round construction process than in other parts of the
country. We also believe the geographic diversity of our operations after the
Merger will reduce our exposure to the cyclical nature of the homebuilding
industry to some extent, with adverse economic conditions associated with
certain of our markets often being offset by more favorable economic conditions
in other markets. The school term also affects our operations because, in
general, homebuyers do not move during the school term. Following the Merger, we
expect to continue experiencing more sales in the spring and summer months, and
more closings in the fall.

PRO FORMA COMBINED LIQUIDITY AND CAPITAL RESOURCES

Our combined company will require significant amounts of cash. We
anticipate that our future home construction, purchases of developed lots and
entitled land, mortgage lending operations and debt service obligations will be
funded from internally generated cash from operations, and our new Bank Facility
to be provided as part of the Refinancing.

The Merger is conditioned upon the simultaneous completion of the
Refinancing, pursuant to which we expect to (i) enter into the $220 million Bank
Facility; and (ii) issue $350 million aggregate principal amount of one or more
series and senior or senior subordinated notes in the Notes Offering. We intend
to use the net proceeds from the Notes Offering to (i) repay the Engle Homes
Acquisition Debt; (ii) repay, defease or discharge an aggregate of $214.9
million of outstanding Engle debt; and (iii) repay an aggregate of $50.9 million
of outstanding Newmark debt. For more information on the Refinancing, see "The
Refinancing."

The Bank Facility is anticipated to be a $220 million revolving credit
facility. The Bank Facility is expected to expire three years after the
effective date of the Merger and includes, at our options, two one-year
extensions. The Bank Facility is expected to contain financial covenants and
provisions that may, under some circumstances, limit the amount we may borrow.
Based on its leverage ratio as defined under the Bank Facility, the interest
rate is anticipated to vary based on LIBOR or a base rate plus an applicable
margin to be agreed. We also have a warehouse line of credit (and a purchase
agreement), providing for borrowings up to $40.0 million available to fund our
origination of residential mortgage loans.

We believe following the completion of the Merger Transactions and the
Refinancing we will have adequate financial resources, including cash from
operations and availability under our new Bank Facility and warehouse line of
credit, to meet our current working capital and land acquisition and development
needs based on current market conditions through at least May 31, 2003. However,
there can be no assurance that the amounts available from such sources will be
sufficient. If we identify significant new acquisition opportunities, or if our
operations do not generate sufficient cash from operations at levels currently
anticipated, we may need to seek additional debt or equity financing to operate
and expand our business. If we are unable to obtain sufficient capital to fund
our growth and development initiatives, it could adversely affect our earnings
and future growth. We may be unable to obtain additional financing on
satisfactory terms or at all. If additional funds are raised through the
incurrence of debt, we will incur increased debt service costs and may become
subject to additional restrictive financial and other covenants. Moreover, the
instruments governing the debt we incur pursuant to the Refinancing will contain
provisions that restrict the amount of debt we may incur.

PRO FORMA QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

We are exposed to market risk primarily related to potential adverse
changes in interest rates. We expect our exposure to market risks to relate
primarily to changes in the interest rates applicable to borrowings under
62

our new credit agreement. We have not entered into and currently do not intend
to enter into, derivative financial instruments for trading or speculative
purposes. We expect the interest rates relative to our bank loans to fluctuate
with the prime and LIBOR lending rates, both upwards and downwards. On a pro
forma basis giving effect to the Merger and the Refinancing, we would have an
aggregate of approximately $4.9 million as of March 31, 2002 drawn under our
bank loan arrangements that is subject to changes in interest rates.

Interest Rates. Our operations are interest rate sensitive. Overall
housing demand is adversely affected by increases in interest rates. If mortgage
interest rates increase significantly, this may negatively affect the ability of
homebuyers to secure adequate financing. Higher interest rates will adversely
affect our revenues, gross margins and net income. Higher interest rates also
increase our borrowing costs because, as indicated above, our bank loans will
fluctuate with the prime and LIBOR lending rates, both upwards and downwards.

Inflation. We may be adversely affected during periods of high inflation,
primarily because of higher land and construction costs. In addition, inflation
may result in higher mortgage interest rates, which may significantly affect the
affordability of permanent mortgage financing for prospective purchasers.
Inflation also increases our interest costs. We attempt to pass through to our
customers any increases in our costs through increased selling prices and, to
date, inflation has not had a material adverse effect on our results of
operations. However, there is no assurance that inflation will not have a
material adverse impact on our future results of operations.

RELATED PARTY AGREEMENTS AND TRANSACTIONS

TAX ALLOCATION AGREEMENTS

Pursuant to a Tax Allocation Agreement between Technical Olympic and us
dated March 15, 2000 and effective as of December 16, 1999, our earnings may be
included in the consolidated federal income tax returns filed by Technical
Olympic. The amount of our liability to (or entitlement to payment from)
Technical Olympic will equal the amount of taxes that we would owe (or refund
that we would receive) had we prepared our federal tax returns on a stand-alone
basis. In addition, under federal income tax law, each member of a consolidated
group (as determined for federal income tax purposes) is also jointly and
severally liable for the federal income tax liability of the consolidated group.
Pursuant to the Tax Allocation Agreement, Technical Olympic has agreed to
indemnify us for payments which Technical Olympic has already received from us
or with respect to any tax liabilities of Technical Olympic or its affiliated
entities other than us. We have made payments totaling $12.8 million during and
for the year ending December 31, 2001 related to this agreement.

Pursuant to a similar Tax Allocation Agreement between Technical Olympic
and Engle Homes dated March 22, 2000 and effective as of March 15, 2000, Engle
Homes' earnings may be included in the consolidated federal income tax returns
filed by Technical Olympic. The amount of Engle Homes' liability to (or
entitlement to payment from) Technical Olympic will equal the amount of taxes
that Engle Homes would owe (or refund that it would receive) had it prepared its
federal tax returns on a stand-alone basis. In addition, under federal income
tax law, each member of a consolidated group (as determined for federal income
tax purposes) is also jointly and severally liable for the federal income tax
liability of the consolidated group. Pursuant to the Tax Allocation Agreement,
Technical Olympic has agreed to indemnify Engle Homes for payments which
Technical Olympic has already received from Engle Homes or with respect to any
tax liabilities of Technical Olympic or its affiliated entities other than Engle
Homes. Engle Homes made payments totaling $34.5 million during and for the year
ending December 31, 2001 related to this agreement. After the Merger, this
agreement will be terminated.

MANAGEMENT SERVICES AGREEMENT

Technical Olympic, through its subsidiary Techolym, L.P., provided certain
corporate and staff support and management services to and for us in fiscal year
2001. Functions that were performed by Technical Olympic included consultation
with and assistance to our board of directors and management in connection
63

with issues involving any and all matters of our business affairs. Functions as
of January 1, 2001 include plan administration of a self-funded group medical
and dental plan for us and our subsidiaries. We made payments totaling $1.9 and
$1.5 million during and for the years ending December 31, 2001 and 2000,
respectively, related to this agreement.

MORTGAGE COMPANY BUSINESS

On March 9, 2001, we acquired for nominal consideration a 49.99% limited
partnership interest in Technical Mortgage, L.P., a mortgage origination company
owned jointly with TM Investments LLC and PHMC, both of which are affiliates of
Technical Olympic and wholly-owned subsidiaries of Engle Homes. Our capital is
not at risk in connection with these mortgages beyond our limited partnership
interest. For more information, see "The Merger -- Our Business, Title and
Mortgage Services" and "The Merger -- Engle Homes, Title and Mortgage Services."

TITLE COMPANY BUSINESS

On April 1, 2001, Westbrooke acquired for $10,000 a 49% limited partnership
interest and Engle Homes acquired for $20,000 a 50% limited partnership interest
and a 1% general partnership interest (through affiliates) in Universal Land
Title of South Florida, Ltd., a title insurance business. Neither our capital
nor Engle Homes' capital is at risk beyond our respective limited partnership
interest and we assume no title insurance risk associated with the title
policies. For more information, see "The Merger -- Our Business, Title and
Mortgage Services" and "The Merger -- Engle Homes, Title and Mortgage Services."

CONTRACTOR AGREEMENTS

On November 6, 2000, we entered into a Contractor Agreement with Technical
Olympic S.A. ("TOSA"), an affiliate of Technical Olympic. TOSA agreed to provide
certain construction services and to purchase such materials, supplies and labor
on our behalf pursuant to certain third-party contracts assigned to TOSA by us
or our subsidiaries, all in an effort to consolidate the purchasing function. We
maintained the right to contract directly for any construction services and
purchase any goods and services from any vendors in our own free unlimited
discretion. Although TOSA would incur certain franchise tax expense, we and our
subsidiaries are not liable for such additional purchasing liability. We paid on
behalf of TOSA, for goods and services pursuant to this Contractor Agreement,
$137 million and $51.0 million during the fiscal years ending December 31, 2001
and 2000, respectively.

On November 22, 2000, Engle Homes entered into a similar Contractor
Agreement with TOSA. TOSA agreed to provide certain construction services and to
purchase such materials, supplies and labor on behalf of Engle Homes pursuant to
certain third-party contracts assigned to TOSA by Engle Homes or its
subsidiaries, all in an effort to consolidate the purchasing function. Engle
Homes maintained the right to contract directly for any construction services
and purchase any goods and services from any vendors in its own free unlimited
discretion. Although TOSA would incur certain franchise tax expense, Engle Homes
and its subsidiaries are not liable for such additional purchasing liability.
Engle Homes paid on behalf of TOSA, for goods and services pursuant to this
Contractor Agreement, $205.6 million during the fiscal year ending December 31,
2001.

MANAGEMENT

OUR BOARD OF DIRECTORS

Upon consummation of the Merger, our board of directors will consist of all
of our existing directors and Antonio B. Mon. Set forth below is certain
information regarding our directors following the Merger:

NAME AGE POSITION
---- --- --------

Constantine Stengos.................... 66 Chairman of the Board
Antonio B. Mon......................... 56 Executive Vice Chairman, Chief
Executive Officer, President and
Director
Yannis Delikanakis..................... 35 Executive Vice Chairman and Director
Lonnie M. Fedrick...................... 57 Emeritus Vice Chairman and Director
Andreas Stengos........................ 40 Director
George Stengos......................... 35 Director
Larry D. Horner........................ 67 Director
William A. Hasler...................... 60 Director
Michael J. Poulos...................... 71 Director
Michael S. Stevens..................... 52 Director

Constantine Stengos has been our Chairman of the Board since December 15,
1999. Mr. Stengos has also been a director and the President of Technical
Olympic and a director of Technical Olympic (UK) PLC, since November 1999.
Technical Olympic is a wholly owned subsidiary of Technical Olympic (UK) PLC.
Technical Olympic (UK) PLC is a wholly owned subsidiary of Technical Olympic
S.A. Mr. Stengos formed Technical Olympic S.A. in 1965 and serves as a director,
the Chairman of its board of directors and its Managing Director. Mr. Stengos
owns more than 5% of the outstanding equity of Technical Olympic S.A. Technical
Olympic, Technical Olympic (UK) PLC, and Technical Olympic S.A. are all
affiliates of Newmark.

Antonio B. Mon will become one of our directors, and our Executive Vice
Chairman, Chief Executive Officer and President upon consummation of the Merger.
Since October 2001, Mr. Mon has served as the Chief Executive Officer of
Technical Olympic and since February 2002 Mr. Mon has served as Chief Executive
Officer and President of Engle Homes. From May 2001 to October 2001, Mr. Mon was
a consultant to Technical Olympic. From 1997 to 2001, Mr. Mon was the Chairman
of Maywood Investment Company, LLC, a private firm engaged in private equity
investments and general consulting. In 1991, Mr. Mon co-founded Pacific
Greystone Corporation, a west-coast homebuilder that merged with Lennar
Corporation in 1997 and served as its Vice Chairman from 1991 to 1997. Prior to
1991, Mr. Mon worked in various positions for The Ryland Group, Inc. (a national
homebuilder), M.J. Brock Corporation (a California homebuilder) and Cigna
Corporation (a financial services corporation).

Yannis Delikanakis has been one of our directors since 1999 and has also
served as a director and Vice President of Technical Olympic since 1999. Mr.
Delikanakis has been the Real Estate and Housing Director of Technical Olympic
S.A. since 1999. Mr. Delikanakis was a director and the manager of the Real
Estate Development and Project Management Departments of Lambert Smith Hampton
S.A. from 1994 to 1999.

Lonnie M. Fedrick has been one of our directors since 1998 and is serving
as our President and Chief Executive Officer from 1997 until consummation of the
Merger. Mr. Fedrick has been President and Chief Executive Officer of Newmark
Home Corporation, our wholly owned subsidiary, since 1994 and was Executive Vice
President from 1984 to 1994.

Andreas Stengos has been one of our directors since 1999, has served as a
director and Treasurer of Technical Olympic since 1999, and has been a director
and the General Director of Technical Olympic (UK) PLC since 1997. Mr. Stengos
has also been a director of Technical Olympic S.A. since 1989, has served as its
Managing Director from 1989 to 1995 and has been its General Manager since 1995.

George Stengos has been one of our directors since 1999, has served as a
director of Technical Olympic since November 1999 and has been a director and
the Corporate Secretary of Technical Olympic (UK) PLC since 1997. Mr. Stengos
has been the Stock Market & Purchasing Director of Technical Olympic S.A. since
1996.

Larry D. Horner has been one of our directors since 1998. Mr. Horner served
as Chairman of Pacific USA Holdings Corp. from 1994 to 2001 and was Chairman of
the Board of Asia Pacific Wire & Cable Corporation Limited, a telecommunications
corporation, with operations in Southeast Asia, which is publicly traded on the
New York Stock Exchange until 2001. He is also a director of Phillips Petroleum
Company, Atlantis Plastics Corp., UT Starcom, Inc., Biological and Popular
Cultures, Inc., and New River Pharmaceuticals, Inc. Mr. Horner was formerly
associated with KPMG LLP, a professional services firm, for 35 years, retiring
as Chairman and Chief Executive Officer of both the U.S. and International firms
in 1991. He is a certified public accountant.

William A. Hasler has been one of our directors since 1998 and has served
as Vice Chair and Co-Chief Executive Officer of Aphton Corporation since July
1998. Aphton Corporation is a biotechnology products company. From August 1991
to July 1998, Mr. Hasler served as Dean of the Haas School of Business at the
University of California at Berkeley. Prior to that, he was both Vice Chairman
and a director of KPMG LLP, a professional services firm. Mr. Hasler also serves
on the boards of Mission West, Walker Interactive, Solectron Corp., DiTech
Communications Schwab Funds and DMC Strategy. Mr. Hasler is a trustee of Pomona
College.

Michael J. Poulos has been one of our directors since 2000. Mr. Poulos has
also served as an advisory director of Greystone Capital Partners I, LP and a
trustee of Century Shares Trust. Mr. Poulos had been Chairman, President, and
Chief Executive Officer of Western National Corporation from 1993 until 1998
when he retired. Mr. Poulos worked for American General Corporation, from 1970
to 1993, and served as its Vice Chairman from 1991 to 1993.

Michael S. Stevens has been one of our directors since 2000. Mr. Stevens
has been the Chairman and owner of Michael Stevens Interests, Inc., a real
estate development company, since 1981, as well as the owner and director of
various affiliated companies. Mr. Stevens serves on the board of directors of
the Greater Houston Partnership, the Memorial Hermann Foundation, the Houston
Convention Center Hotel Corporation, the Houston 2012 Foundation and the Texas
Exile Foundation.

FAMILY RELATIONSHIPS

Constantine Stengos is the father of both Andreas Stengos and George
Stengos. Yannis Delikanakis is the son-in-law of Constantine Stengos and the
brother-in-law of Andreas Stengos and George Stengos. We have no other familial
relationships among the executive officers and directors.

COMPENSATION OF DIRECTORS

Our independent or non-affiliate directors receive an annual fee of $15,000
and $2,000 per board meeting attended and are reimbursed for reasonable
out-of-pocket expenses incurred for attendance at meetings.

OUR MANAGEMENT

Upon consummation of the Merger our management will consist of the
following individuals:

NAME AGE POSITION
---- --- --------

TECHNICAL OLYMPIC USA, INC.
Antonio B. Mon.......................... 56 Executive Vice Chairman, President and
Chief Executive Officer
Tommy McAden............................ 40 Vice President -- Finance and
Administration and Chief Financial Officer

NAME AGE POSITION
---- --- --------

NEWMARK HOMES, LP
Eric Rome............................... 42 Chief Operating Officer
Steve Von Hofe.......................... 41 Senior Vice President -- Houston Division
Bryan Shields........................... 42 Senior Vice President -- Central Texas
Division
Jeff Buell.............................. 35 Senior Vice President -- San Antonio
Division
Steve Treece............................ 50 Executive Vice President -- North Texas
Division
Mike Moody.............................. 34 Senior Vice President -- Nashville
Division
Rick Robideau........................... 40 MIS Director
Mike Beckett............................ 42 Executive Vice President -- Purchasing and
Product Development
ENGLE HOMES
Bill Carmichael......................... 53 President -- Orlando Division
Ron Yuter............................... 53 President -- Broward/Pembroke Division
David Cobb.............................. 46 President -- Southwest Division
Bruce Leinberger........................ 47 President -- Virginia Division
Rich Alberque........................... 52 President -- Texas Division
Eric Eckberg............................ 41 President -- Colorado Division
Mark Upton.............................. 44 President -- Arizona Division
Paul Leikert............................ 46 President -- PHMC, Chief Accounting
Officer -- Engle
Harry Engelstein........................ 66 Vice President -- Construction
John Kraynick........................... 47 Vice President
Larry Shaw.............................. 46 Vice President -- Sales and Marketing
Mike Glass.............................. 43 President -- Universal Land Title Division

For information regarding Antonio B. Mon, see "Management -- Our Board of
Directors."

Tommy McAden will become our Chief Financial Officer and Vice President -
Finance and Administration upon consummation of the Merger. Since February 2002,
Mr. McAden has served as Chief Financial Officer of Engle Homes. Mr. McAden has
served as a director, Vice President and Chief Financial Officer of Technical
Olympic since January 2000. From 1994 to December 1999, Mr. McAden was Chief
Financial Officer of Pacific Realty Group, Inc., which was the former 80%
shareholder of Newmark.

EMPLOYMENT AGREEMENTS

Upon the consummation of the Merger, Antonio B. Mon will become our Chief
Executive Officer, President and Executive Vice-Chairman, as well as one of our
directors. Under the terms of the employment agreement between Mr. Mon and us,
which is attached as Exhibit E, to become effective upon consummation of the
Merger, Mr. Mon will receive a minimum base salary of $800,000 for the first
year with an increase of 10% per year thereafter until the agreement expires or
is terminated as discussed below. In addition, Mr. Mon will receive an annual
bonus ("Incentive Compensation") under the Newmark Annual and Long-Term
Incentive Plan as follows: (i) for the period ending on December 31, 2002, an
annual bonus of not less than $1,000,000, payable monthly; provided, however,
that the payment of the bonus for any month is contingent on the "Results of
Operation" (as defined in the agreement) for such month being positive (greater
than or equal to zero) and (ii) additional Incentive Compensation as determined
by the board of directors in its sole discretion. Upon implementation of the
Newmark Annual and Long-Term Incentive Plan and subject to consummation of the
Merger, Mr. Mon will also receive options to purchase approximately 2,020,000
shares of our common stock (representing approximately 7% of the Company after
the Merger) that consists of the following: (i) a vested sign-on option grant,
(ii) a front-end option one-third of which vests on each January 1,

2003, 2004 and 2005 and (iii) a performance vesting option that vests on the
seventh anniversary of the option grant date unless certain performance criteria
are achieved that will allow for earlier vesting.

In the event of an involuntary termination, Mr. Mon will receive (a) the
greater of (i) three times the sum of his base salary, his highest annual cash
bonus, and the value of his fringe benefits or (ii) the aggregate amount of his
base salary, his annual cash bonuses and the value of the fringe benefits that
would be payable for the remainder of the employment term; and (b) continued
health plan coverage until age 65 or until he becomes covered under another
plan. If severance remuneration payable under the agreement is held to
constitute an "excess parachute payment" and Mr. Mon becomes liable for any tax
penalties imposed thereon, we will make a cash payment to him in an amount equal
to the tax penalties plus an amount equal to any additional tax for which he
will be liable as a result of receipt of the payment for such tax penalties and
payment for such reimbursement for additional tax. The employment agreement
contains noncompete provisions in the event of Mr. Mon's termination of
employment. Mr. Mon's employment agreement expires on December 31, 2006.

VOTING SECURITIES AND THE PRINCIPAL HOLDERS THEREOF

As of April 5, 2002, there were 11,500,000 shares of our common stock
outstanding and upon completion of the Merger, we will have 27,878,787 shares of
our common stock outstanding. The following table sets forth certain information
regarding beneficial ownership of our common stock upon completion of the
Merger, by (i) each person (or group of affiliated persons) who we know to
beneficially own more that 5% of the outstanding shares of our common stock,
(ii) each of our current directors and executive officers, and (iii) all of our
current executive officers and directors as a group.

NAME AND ADDRESS OF AMOUNT AND NATURE OF
BENEFICIAL OWNER BENEFICIAL OWNERSHIP PERCENT OWNED
------------------- -------------------- -------------

Technical Olympic, Inc............................... 25,578,787 91.75%
1200 Soldiers Field Drive
Sugar Land, Texas 77479(1)
Lonnie M. Fedrick.................................... 42,900 *
Constantine Stengos.................................. 25,000 *
Andreas Stengos...................................... -- *
George Stengos....................................... -- *
Yannis Delikanakis................................... -- *
Larry D. Horner...................................... -- *
William A. Hasler.................................... -- *
Michael J. Poulos.................................... -- *
Michael S. Stevens................................... -- *
Antonio B. Mon....................................... 262,452(2) 1.0%
Tommy L. McAden...................................... 65,613(2) *
All directors and executive officers as a group (11
persons)........................................... 395,965 1.5%

---------------

* Less than one percent.

(1) Technical Olympic, Inc. is a subsidiary of Technical Olympic (UK) PLC, which
is a subsidiary of Technical Olympic S.A. Mr. Constantine Stengos owns more
than 5% of the outstanding stock of Technical Olympic S.A.

(2) Consists of shares issuable upon exercise of stock options that have already
vested or will vest within 60 days.

WHERE YOU CAN FIND MORE INFORMATION

We file annual, quarterly and special reports, proxy statements and other
information with the SEC under the Exchange Act. Pursuant to the terms of
indentures dated February 2, 1998 and June 12, 1998, under which Engle Homes is
the issuer of certain debt, Engle Homes is contractually obligated to file
annual and quarterly reports with the SEC. You may read and copy this
information at, or obtain copies by mail at prescribed rates from, the Public
Reference Room of the SEC, 450 Fifth Street, N.W., Washington, D.C. 20549. You
may obtain information on the operation of the Public Reference Room by calling
the SEC at (800) SEC-0330.

The SEC also maintains an internet world wide web site that contains
reports, proxy statements and other information about issuers, like us and Engle
Homes, who file reports electronically. The address of that site is
http://www.sec.gov.

DOCUMENTS INCORPORATED BY REFERENCE AND PROVIDED HEREWITH

We hereby incorporate by reference in this Information Statement:

- our Annual Report on Form 10-K for the fiscal year ended December 31,
2001 filed on March 25, 2002;

- our Quarterly Report on Form 10-Q for the quarter ended March 31, 2002
filed on May 15, 2002; and

- our Current Report on Form 8-K filed on May 31, 2002.

Accompanying this Information Statement are our Annual Report on Form 10-K
for fiscal year ended December 31, 2001, our Quarterly Report on Form 10-Q for
the quarter ended March 31, 2002 and our Current Report on Form 8-K filed on May
31, 2002.

You may obtain additional copies of these documents by requesting them from
us in writing or by telephone at the following address:

1200 Soldiers Field Drive
Attn: General Counsel
Sugar Land, Texas 77479
Phone: 281-243-0100

If you request any incorporated documents from us, we will mail them to you by
first-class mail, or another equally prompt means, within one business day after
we receive your request.

EXHIBIT LIST

Exhibit A Agreement and Plan of Merger among Newmark Homes Corp., a
Delaware corporation, Engle Holdings Corp., a Delaware
corporation, and Technical Olympic, Inc., a Delaware
corporation, as the sole stockholder of Engle Holdings
Corp., dated April 5, 2002.
Exhibit B Amendment to Certificate of Incorporation of Newmark Homes
Corp.
Exhibit C Deutsche Bank Securities Inc. Fairness Opinion dated April
4, 2002.
Exhibit D Letter from BDO Seidman, LLP, dated October 8, 2001.
Exhibit E Employment Agreement, dated April 5, 2002, by and between
Newmark Homes Corp., to be known as Technical Olympic USA,
Inc., a Delaware corporation, and Antonio B. Mon, an
individual.
Exhibit F Newmark Homes Corp., Reports of Independent Certified Public
Accountants.

INDEX TO ENGLE CONSOLIDATED FINANCIAL STATEMENTS

PAGE
----

Reports of Independent Certified Public Accountants......... F-2
Consolidated Balance Sheets as of December 31, 2001 and
December 31, 2000......................................... F-4
Consolidated Statements of Income For the Twelve Months
Ended December 31, 2001, the Period From November 22, 2000
through December 31, 2000, the Period From November 1,
2000 through November 21, 2000, the Twelve Months Ended
October 31, 2000, and the Twelve Months Ended October 31,
1999...................................................... F-5
Consolidated Statements of Shareholder's Equity For the
Twelve Months Ended December 31, 2001, the Period From
November 22, 2000 through December 31, 2000, the Period
From November 1, 2000 through November 21, 2000, the
Twelve Months Ended October 31, 2000, and the Twelve
Months Ended October 31, 1999............................. F-6
Consolidated Statements of Cash Flows For the Twelve Months
Ended December 31, 2001, the Period From November 22, 2000
through December 31, 2000, the Period From November 1,
2000 through November 21, 2000, the Twelve Months Ended
October 31, 2000, and the Twelve Months Ended October 31,
1999...................................................... F-7
Notes to Consolidated Financial Statements.................. F-8
Unaudited Condensed Consolidated Balance Sheets as of March
31, 2002 and December 31, 2001............................ F-20
Unaudited Condensed Consolidated Statements of Income for
the Three Months Ended March 31, 2001 and 2002............ F-21
Unaudited Consolidated Statement of Stockholder's Equity for
the Three Months Ended March 31, 2002..................... F-22
Unaudited Condensed Consolidated Statements of Cash Flows
for the Three Months Ended March 31, 2002 and 2001........ F-23
Notes to Condensed Consolidated Financial Statements........ F-24

F-1

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

The Stockholder
Engle Homes, Inc.

We have audited the accompanying consolidated balance sheet of Engle Homes,
Inc., and subsidiaries as of December 31, 2001 and the related consolidated
statements of income, stockholder's equity and cash flows for the year then
ended. These financial statements are the responsibility of the Company's
management. Our responsibility is to express an opinion on these financial
statements based on our audit.

We conducted our audit in accordance with auditing standards generally
accepted in the United States. Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements
are free of material misstatement. An audit includes examining, on a test basis,
evidence supporting the amounts and disclosures in the financial statements. An
audit also includes assessing the accounting principles used and significant
estimates made by management, as well as evaluating the overall financial
statement presentation. We believe that our audit provides a reasonable basis
for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Engle Homes,
Inc. and subsidiaries at December 31, 2001, and the consolidated results of
their operations and their cash flows for the year then ended in conformity with
accounting principles generally accepted in the United States.

ERNST & YOUNG LLP

Miami, Florida
January 18, 2002

F-2

REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

To the Stockholder
Engle Homes, Inc.

We have audited the accompanying consolidated balance sheet of Engle Homes,
Inc., and subsidiaries as of December 31, 2000 and the related consolidated
statements of income, shareholder's equity and cash flows for the periods from
November 22, 2000 to December 31, 2000 and November 1, 2000 to November 21,
2000, and for the fiscal years ended October 31, 2000 and 1999. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with auditing standards generally
accepted in the United States of America. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
presentation of the financial statements. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above
present fairly, in all material respects, the financial position of Engle Homes,
Inc. and subsidiaries at December 31, 2000, and the results of their operations
and their cash flows for the periods from November 22, 2000 to December 31, 2000
and November 1, 2000 to November 21, 2000, and for the fiscal years ended
October 31, 2000 and 1999, in conformity with accounting principles generally
accepted in the United States of America.

BDO SEIDMAN, LLP

Miami, Florida
February 27, 2001

F-3

ENGLE HOMES, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

DECEMBER 31,
-------------------
2001 2000
-------- --------
(IN THOUSANDS,
EXCEPT SHARE DATA)

Assets
Homebuilding:
Cash and cash equivalents
Unrestricted........................................... $ 57,487 $ 15,460
Restricted............................................. 7,738 3,841
Inventories............................................... 456,303 444,070
Property and equipment, net............................... 5,474 5,330
Other assets.............................................. 27,126 21,549
Goodwill, net of accumulated amortization of $953 and
$105, respectively..................................... 14,788 15,128
Deferred tax asset........................................ 4,169 9,557
-------- --------
573,085 514,935
-------- --------
Financial Services:
Cash and cash equivalents
Unrestricted........................................... 7,930 2,618
Restricted............................................. 19,605 6,364
Mortgage loans held for sale.............................. 50,933 14,406
Other assets.............................................. 3,295 1,240
-------- --------
81,763 24,628
-------- --------
Total assets......................................... $654,848 $539,563
======== ========
Liabilities
Homebuilding:
Accounts payable and accrued liabilities.................. $ 34,226 $ 27,293
Customer deposits......................................... 21,994 21,817
Consolidated land bank obligation......................... 30,022
Borrowings................................................ 202,938 217,532
Senior notes payable...................................... 12,897 38,065
-------- --------
302,077 304,707
-------- --------
Financial services:
Accounts payable and accrued liabilities.................. 18,828 6,035
Financial service borrowings.............................. 38,689 9,071
-------- --------
57,517 15,106
-------- --------
Total liabilities.................................... $359,594 $319,813
-------- --------
Minority interest......................................... 35,696
Shareholder's equity
Common stock, $.01 par, 1,000 shares authorized and 100
shares issued and outstanding
Additional paid-in capital................................ 215,709 215,709
Retained earnings......................................... 43,849 4,041
-------- --------
Total shareholder's equity........................... 259,558 219,750
-------- --------
$654,848 $539,563
======== ========

See accompanying notes to consolidated financial statements

F-4

ENGLE HOMES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

PERIOD FROM PERIOD FROM
NOVEMBER 22, NOVEMBER 1,
2000 2000 YEARS ENDED
YEAR ENDED THROUGH THROUGH OCTOBER 31,
DECEMBER 31, DECEMBER 31, NOVEMBER 21, -------------------
2001 2000 2000 2000 1999
------------ ------------ ------------ -------- --------
SUCCESSOR SUCCESSOR PREDECESSOR PREDECESSOR
(IN THOUSANDS)

Homebuilding:
Revenues
Sales of homes......................... $958,125 $82,999 $ 25,768 $794,445 $704,563
Sales of land.......................... 10,499 1,374 360 24,053 11,236
Rent and other......................... 5,412 351 400 3,383 3,450
-------- ------- -------- -------- --------
974,036 84,724 26,528 821,881 719,249
-------- ------- -------- -------- --------
Costs and Expenses
Cost of sales-homes.................... 763,708 68,189 21,385 664,818 593,046
Cost of sales-land..................... 9,639 1,326 268 21,405 10,659
Selling, general and administrative.... 95,947 8,247 4,726 79,158 71,079
Acquisition and merger related
charges.............................. 1,864 20,118
Depreciation and amortization.......... 6,457 721 330 6,108 5,604
-------- ------- -------- -------- --------
877,615 78,483 46,827 771,489 680,388
-------- ------- -------- -------- --------
Homebuilding pretax income (loss)...... 96,421 6,241 (20,299) 50,392 38,861
-------- ------- -------- -------- --------
Financial Services:
Revenue................................ 32,659 2,562 1,078 22,130 22,691
Expenses............................... 17,688 1,635 961 15,324 15,907
-------- ------- -------- -------- --------
Financial services pretax income....... 14,971 927 117 6,806 6,784
-------- ------- -------- -------- --------
Income (loss) before
income taxes
(benefit)......................... 111,392 7,168 (20,182) 57,198 45,645
Provision (benefit) for income
taxes............................. 42,068 2,764 (5,949) 21,534 17,619
-------- ------- -------- -------- --------
Net income (loss)...................... $ 69,324 $ 4,404 $(14,233) $ 35,664 $ 28,026
======== ======= ======== ======== ========

See accompanying notes to consolidated financial statements

F-5

ENGLE HOMES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF SHAREHOLDER'S EQUITY

COMMON STOCK ADDITIONAL
-------------------- PAID-IN RETAINED
SHARES AMOUNT CAPITAL EARNINGS TOTAL
----------- ------ ---------- --------- ---------
(IN THOUSANDS, EXCEPT NUMBER OF SHARES)

Predecessor Company:
Amounts at October 31, 1998.......... 11,169,000 $ 112 $ 103,134 $ 58,478 $ 161,724
Net Income......................... 28,026 28,026
Dividends to shareholders.......... (2,242) (2,242)
Common stock issued in connection
with employee stock bonus
plan............................ 69,000 882 882
Common stock issued in connection
with exercise of stock
options......................... 10,000 96 96
Common stock purchased in
connection with Company's share
repurchase plan................. (200,000) (2) (2,052) (2,054)
----------- ----- --------- --------- ---------
Amounts at October 31, 1999.......... 11,048,000 $ 110 $ 102,060 $ 84,262 $ 186,432
Net Income......................... 35,664 35,664
Dividends to shareholders.......... (2,641) (2,641)
Common stock issued in connection
with employee stock bonus
plan............................ 127,000 1 1,222 1,223
Common stock issued in connection
with exercise of stock
options......................... 5,000 1 55 56
Common stock purchased in
connection with Company's share
repurchase plan................. (308,000) (3) (3,040) (3,043)
----------- ----- --------- --------- ---------
Amounts at October 31, 2000.......... 10,872,000 $ 109 $ 100,297 $ 117,285 $ 217,691
Net loss for the period November 1,
2000 through November 21,
2000............................ (14,233) (14,233)
Cancellation of Company's shares as
a result of merger.............. (10,872,000) (109) (100,297) (103,052) (203,458)
----------- ----- --------- --------- ---------
Amounts at November 21, 2000......... 0 $ 0 $ 0 $ 0 $ 0
=========== ===== ========= ========= =========
Successor Company:
Conversion of Helios Acquisition
Corporation stock to Company
stock under Merger.............. 100 -- 215,709 215,709
Net income for the period November
22, 2000 through December 31,
2000............................ 4,404 4,404
Net Distributions to Parent........ (363) (363)
----------- ----- --------- --------- ---------
Amounts at December 31, 2000......... 100 -- $ 215,709 $ 4,041 $ 219,750
Net income......................... 69,324 69,324
Net Distributions to Parent........ (29,516) (29,516)
----------- ----- --------- --------- ---------
Amounts at December 31, 2001......... 100 -- $ 215,709 $ 43,849 $ 259,558
=========== ===== ========= ========= =========

See accompanying notes to consolidated financial statements

F-6

ENGLE HOMES, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

Cash flows from operating activities
Net income (loss)......................... $ 69,324 $ 4,404 $(14,233) $ 35,664 $ 28,026
Adjustments to reconcile net income
(loss) to net cash provided (required)
by operating activities:
Depreciation and amortization........... 6,457 721 330 6,108 5,604
Impairment loss......................... 530 161 3,979 2,690
Deferred tax provision (benefit)........ 5,388 2,764 (5,949) (1,692) (226)
Employee stock compensation............. 1,223 882
Other................................... (516)
Changes in assets and liabilities:
(Increase) decrease in restricted
cash.................................. (17,138) (494) 4 (1,622) (1,018)
(Increase) in inventories............... (12,763) (3,124) (29,314) (26,633) (36,874)
(Increase) in other assets.............. (9,367) (3,525) (61) (1,688) (2,699)
(Increase) decrease in mortgages held
for sale.............................. (36,527) (6,062) 14,027 4,951 (1,553)
Increase (decrease) in accounts payable
and accrued expenses.................. 19,726 (17,426) 16,513 2,843 5,201
Increase (decrease) in customer
deposits.............................. 177 (62) 950 4,650 4,052
-------- -------- -------- -------- --------
Net cash provided (required) by
operating activities.................. 25,291 (22,643) (17,733) 27,783 4,085
-------- -------- -------- -------- --------
Cash flows from investing activities
Acquisition of property and equipment..... (4,009) (32) (521) (3,829) (6,176)
-------- -------- -------- -------- --------
Net cash (required) by investing
activities.............................. (4,009) (32) (521) (3,829) (6,176)
-------- -------- -------- -------- --------
Cash flows from financing activities
Proceeds from borrowings.................. 27,001 215,000 22,000
Repayment of borrowings................... (66,764) (214,925) (21) (2,249) (72,399)
Proceeds from issuance of senior debt..... 96,587
Repurchase of common stock................ (3,043) (2,054)
Distributions to shareholders............. (2,641) (2,242)
Distributions to parent................... (29,516) (363)
Proceeds from exercise of stock options... 56 96
Decrease (increase) in financial service
borrowings.............................. 29,618 5,585 (14,371) (8,919) 1,006
Increase in minority interest............. 35,696
Increase in consolidated land bank
obligation.............................. 30,022
-------- -------- -------- -------- --------
Net cash provided (required) by financing
activities.............................. 26,057 5,297 (14,392) (16,796) 42,994
-------- -------- -------- -------- --------
Net increase (decrease) in cash........... 47,339 (17,378) (32,646) 7,158 40,903
Cash and cash equivalents at beginning of
period.................................. 18,078 35,456 68,102 60,944 20,041
-------- -------- -------- -------- --------
Cash and cash equivalents at end of
period.................................. $ 65,417 $ 18,078 $ 35,456 $ 68,102 $ 60,944
======== ======== ======== ======== ========

See accompanying notes to consolidated financial statements

F-7

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1 -- SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

BASIS OF PRESENTATION AND BUSINESS

Engle Homes, Inc. and subsidiaries ("the Company") is engaged principally
in the construction and sale of residential homes and land development. The
Company operates throughout Florida with divisions in Broward County; Palm Beach
and Martin Counties; Orlando; Fort Myers; and Naples. The Company also has
divisions operating outside Florida including Dallas, Texas; Denver, Colorado;
Virginia; and Phoenix, Arizona. Ancillary products and services to its
residential home building include land sales to other builders, origination and
sale of mortgage loans and title services. The consolidated financial statements
include the accounts of the Company and all subsidiaries. All significant
intercompany balances and transactions have been eliminated in consolidation.

BASIS OF PRESENTATION

On November 22, 2000, the Company became a wholly-owned subsidiary of
Technical Olympic Inc., formerly known as Technical Olympic USA., Inc.
("Technical Olympic"), pursuant to a merger agreement dated October 12, 2000.
Technical Olympic is a wholly-owned subsidiary of Technical Olympic (UK) PLC
that is a wholly-owned subsidiary of Technical Olympic S.A., a publicly traded
Greek corporation. Company stockholders received $19.10 for each share of the
Company's common stock at the time of the merger. Following the merger, the
common stock of the Company ceased to be publicly traded.

For accounting purposes, the merger is being accounted for as of November
22, 2000 using the purchase method. Accordingly, the consolidated financial
statements for periods after that date reflect the push-down of the purchase
price allocations made by Technical Olympic to the assets and liabilities of the
Company.

Total consideration for the acquisition approximated $542 million,
including $326 million of assumed liabilities and $216 million in cash paid. The
"push down" basis of accounting resulted in the Company allocating approximately
$527 million to inventories and other identifiable assets and $15 million to
goodwill.

As a result of the change in control of the Company, the Company was
required by the indentures governing its Senior Notes to offer to repurchase all
of its outstanding Senior Notes at a price of 101% of the principal plus accrued
interest. Upon termination of the offer in January 2001, the Company repurchased
approximately $237 million of $250 million of its Senior Notes. Approximately
$13 million of the Senior Notes were not tendered and remain outstanding as of
December 31, 2001.

Acquisition related charges amounting to $20.1 million are included in the
results of operations in the period from November 1, 2000 through November 21,
2000.

There is no disclosure of earnings per share since the Company has no
registered trading capital stock.

Due to the Company's normal operating cycle being in excess of one year, we
present an unclassified balance sheet.

PREPARATION OF FINANCIAL STATEMENTS

The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and reported amounts of revenues and expenses during the reporting
period. Actual results could differ from those estimates.

F-8

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

RECLASSIFICATIONS

Certain reclassifications have been made to conform the prior periods'
amounts to the current year's presentation.

SEGMENT REPORTING

Effective October 31, 1998, the Company adopted Statement of Financial
Accounting Standards (SFAS) No. 131, Disclosures About Segments of an Enterprise
and Related Information. Under the provisions of SFAS 131, our operating
segments consist of homebuilding and financial services. These two segments are
segregated in the accompanying consolidated financial statements under
"Homebuilding" and "Financial Services", respectively.

ASSET IMPAIRMENTS

The Company periodically reviews the carrying value of certain of its
assets in relation to historical results, current business conditions and trends
to identify potential situations in which the carrying value of assets may not
be recoverable. If such reviews indicate that the carrying value of such assets
may not be recoverable, the Company would estimate the undiscounted sum of the
expected future cash flows of such assets to determine if such sum is less than
the carrying value of such assets to ascertain if a permanent impairment exists.
If a permanent impairment exists, the Company would determine the fair value by
using quoted market prices, if available, for such assets, or if quoted market
prices are not available, the Company would discount the expected future cash
flows of such assets and would recognize the impairment through a charge to
operations.

CASH AND CASH EQUIVALENTS

Unrestricted cash includes amounts in transit from title companies for home
closings and highly liquid investments with an initial maturity of three months
or less.

Restricted cash consists of amounts held in escrow as required by purchase
contracts or by law for escrow deposits held by our title company and
compensating balances for various open letters of credit.

INVENTORIES

Inventories are stated at the lower of cost or fair value. Inventories
under development or held for development are stated at an accumulated cost
unless such cost would not be recovered from the cash flows generated by future
disposition. In this instance, such inventories are recorded at fair value.
Inventories to be disposed of are carried at the lower of cost or fair value
less cost to sell.

Interest, real estate taxes and certain development costs are capitalized
to land and construction costs during the development and construction period
and are amortized to costs of sales as closings occur.

PROPERTY AND EQUIPMENT, DEPRECIATION AND AMORTIZATION

Property and equipment are stated at cost. Depreciation and amortization
are provided over the assets' estimated useful lives ranging from 18 months to
30 years, primarily on the straight-line method. Loan costs are deferred and
amortized over the term of the outstanding borrowings.

GOODWILL

The Company has classified the excess of cost over the fair value of the
net assets of companies acquired in purchase transactions as goodwill. Goodwill
is being amortized on a straight-line method over 20 years. Amortization charged
to operations amounted to $856,531, $104,992, $20,373,$349,236 and $343,871 for
the

F-9

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

year ended December 31, 2001, the period from November 22, 2000 through December
31, 2000, the period from November 1, 2000 through November 21, 2000, and the
fiscal years ended October 31, 2000, and October 31, 1999, respectively.

REVENUE RECOGNITION

Revenues and profits from sales of commercial and residential real estate
and related activities are recognized at closing when title passes to the buyer
and all of the following conditions are met: a sale is consummated, a
significant down payment is received, the earnings process is complete and the
collection of any remaining receivables is reasonably assured.

Fees derived from the Company's financial services segment, including title
and mortgage organization services, are recognized as revenue concurrent with
the closing of the sale.

SELLING AND MARKETING

Selling and marketing costs are expensed as incurred. Selling and marketing
costs included in selling, marketing, and general and administrative expenses in
the accompanying consolidated statement of income amount to approximately
$63,400,000, $5,700,000, $2,300,000, $53,300,000, and $50,600,000 for the year
ended December 31, 2001, the period from November 22, 2000 through December 31,
2000, the period from November 1, 2000 through November 21, 2000, and the fiscal
years ended October 31, 2000, and October 31, 1999, respectively.

INCOME TAXES

As a result of the merger as described in Note 1, the Company filed
consolidated income tax returns with Technical Olympic beginning November 22,
2000. For the periods ended December 31, 2001, and 2000, income taxes are
allocated to the Company based upon a "stand alone" computation in the
accompanying consolidated statement of income.

FINANCIAL INSTRUMENTS

The fair value of financial instruments is determined by reference to
various market data and other valuation techniques, as appropriate, and unless
otherwise disclosed, the fair values of financial instruments approximate their
recorded values.

STOCK BASED COMPENSATION

The Company recognizes compensation expense for its stock option incentive
plans using the intrinsic value method of accounting. Under the terms of the
intrinsic value method, compensation cost is the excess, if any, of the quoted
market price of the stock at the grant date, or other measurement date, over the
amount an employee must pay to acquire the stock.

NEW ACCOUNTING PRONOUNCEMENTS

In June 2001, the Financial Accounting Standards Board (FASB) approved
Statement of Financial Accounting Standard 141 (Statement 141), Business
Combinations, and Statement of Financial Accounting Standards 142 (Statement
142), Goodwill and Other Intangible Assets. Statement 141 requires that the
purchase method of accounting be used for all business combinations initiated
after June 30, 2001. Statement 142 changes the accounting for goodwill from an
amortization method to an impairment-only approach. Statement 142 will be
effective for the Company's fiscal year 2002 and is immediately effective for
goodwill and intangible assets acquired after June 30, 2001. Management is in
the process of evaluating the effect these standards will have on its financial
statements.

F-10

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

In September 2000, the FASB issued Statement of Financial Accounting
Standards 140 (Statement 140), Accounting for Transfers and Servicing of
Financial Assets and Extinguishments of Liabilities. Statement 140 amends
Statement 125 and provides revised accounting and financial reporting rules for
sales, securitizations, and servicing of receivables and other financial assets,
and for secured borrowing and collateral transactions. The provisions concerning
servicing assets and liabilities as well as extinguishments of liabilities
remain consistent with Statement 125. Statement 140 is applicable to transfers
occurring after March 31, 2001. The impact of adopting Statement 140 has not
been significant to the Company's financial statements.

NOTE 2 -- INVENTORIES

Inventories consist of:

DECEMBER 31,
-----------------------
2001 2000
---------- ----------
(DOLLARS IN THOUSANDS)

Land and improvements held for development.................. $302,630 $301,426
Residential homes under construction........................ 153,673 142,644
-------- --------
$456,303 $444,070
======== ========

Included in inventory is the following:

PERIOD FROM PERIOD FROM
NOVEMBER 22, NOVEMBER 1, FOR THE YEAR
FOR THE YEAR 2000 2000 ENDED
ENDED THROUGH THROUGH OCTOBER 31,
DECEMBER 31, DECEMBER 31, NOVEMBER 21, -------------------
2001 2000 2000 2000 1999
------------ ------------ ------------ -------- --------
(DOLLARS IN THOUSANDS)

Interest capitalized, beginning
of period..................... $ 23,019 $22,296 $21,684 $ 19,205 $ 16,326
Interest incurred and
capitalized................... 18,294 3,169 1,451 24,185 22,098
Amortized to cost of
sales -- homes................ (27,664) (2,352) (832) (19,746) (18,625)
Amortized to cost of
sales -- land................. (808) (94) (7) (1,960) (594)
Reduction of capitalized
interest -- transferred to
land bank..................... (3,407)
-------- ------- ------- -------- --------
Interest capitalized, end of
period........................ $ 9,434 $23,019 $22,296 $ 21,684 $ 19,205
======== ======= ======= ======== ========

---------------

Included in cost of sales -- homes during the year ended December 31, 2001, the
period from November 1, 2000 through December 31, 2000, and the fiscal years
ended October 31, 2000, and October 31, 1999, are impairment losses of
approximately $530,000, $161,000, $3,979,000 and $2,690,000, respectively, to
reduce certain projects under development to fair value.

During 2001, the Company sold to an investment limited liability company
("Investment Company") certain undeveloped real estate tracts. The Investment
Company is owned by several of the current and former executive officers of the
Company, including without limitation related trusts of management. As of
December 31, 2001, the remaining value of lots that can be acquired by the
Company approximates $43 million. The Company has placed deposits, entered into
a number of agreements, including option contracts and construction contracts
with the Investment Company, to develop and buy back fully developed lots from
time to time subject to the terms and conditions of such agreements.
Additionally, under these agreements, the Company can cancel these agreements to
purchase the land by forfeiture of the Company's deposit. The Company believes
that the terms of the purchase contract and the terms of the related option and
development contracts were comparable to those available from unaffiliated
parties.

F-11

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Although Engle does not have legal title to the assets of the Investment
Company and has not guaranteed the liabilities of the Investment Company, Engle
does exercise certain rights of ownership over the Investment Company assets.
Consequently, the assets and associated liabilities of the Investment Company
have been recorded in the accompanying Consolidated Balance Sheet as of December
31, 2001. Minority interest in consolidated subsidiaries, represents the equity
provided by members of management.

During 2001, the Company entered into option arrangements with independent
third parties to acquire developed lots. Under these option arrangements, the
Company placed deposits, which provide the right to acquire developed lots at
market prices. Additionally, under these arrangements, the Company can cancel
these arrangements to purchase the land by forfeiture of the deposit.

Although the Company does not have legal title to the assets of these
independent third parties and have not guaranteed the liabilities, the Company
does exercise certain rights of ownership over the entity's assets.
Consequently, the assets and associated liabilities of these entities have been
recorded in the accompanying consolidated statement of financial condition as of
December 31, 2001.

As a result of the above transaction, the Company has included on its
consolidated statement of financial condition inventory and land deposits of
approximately $66 million, minority interest of approximately $36 million, which
represents the equity of investors, and consolidated land bank obligation of
approximately $30 million. These obligations are at market interest rates and
are repaid on lot closings with a final maturity through 2004.

NOTE 3 -- FINANCIAL SERVICES

Financial service revenue and expenses consist of the following:

PERIOD FROM PERIOD FROM
NOVEMBER 22, NOVEMBER 1,
2000 2000 YEAR ENDED
YEAR ENDED THROUGH THROUGH OCTOBER 31,
DECEMBER 31, DECEMBER 31, NOVEMBER 21, -----------------
2001 2000 2000 2000 1999
------------ ------------ ------------ ------- -------
SUCCESSOR SUCCESSOR PREDECESSOR PREDECESSOR
(DOLLARS IN THOUSANDS)

Revenue:
Mortgage Services.......... $16,400 $1,265 $ 432 $10,277 $ 9,745
Title Services............. 16,259 1,297 646 11,853 12,946
------- ------ ------ ------- -------
Total Financial Service
Revenue.................... 32,659 2,562 1,078 22,130 22,691
------- ------ ------ ------- -------
Expenses:
Mortgage Services.......... 6,800 545 378 5,635 5,517
Title Services............. 10,888 1,090 583 9,689 10,390
------- ------ ------ ------- -------
Total Financial Service
Expense.................... 17,688 1,635 961 15,324 15,907
------- ------ ------ ------- -------
Total Financial Service
Income Before Income
Taxes...................... $14,971 $ 927 $ 117 $ 6,806 $ 6,784
======= ====== ====== ======= =======

---------------

Intercompany charges have been eliminated.

In order to fund the origination of residential mortgage loans, the Company
entered into a $40 million revolving warehouse line of credit (including a
purchase agreement) whereby funded mortgage loans are pledged as collateral. The
line of credit bears interest at the Federal Funds rate plus 1.375% (2.895% at
December 31, 2001).

F-12

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The line of credit includes restrictions including maintenance of certain
financial covenants. The Company is required to fund 2% of all mortgages
originated and to sell all funded mortgages within 90 days. The warehouse line
of credit expires July 5, 2002. As of December 31, 2001, the Company was
committed to selling its entire portfolio of mortgage loans held for sale.

NOTE 4 -- BORROWINGS

Borrowings consist of:

DECEMBER 31,
-----------------------
2001 2000
---------- ----------
(DOLLARS IN THOUSANDS)

Unsecured borrowings from banks............................. $202,000 $215,000
Senior Notes due 2008, at 9.25%............................. 12,897 38,065
Other....................................................... 938 2,532
-------- --------
$215,835 $255,597
======== ========

In connection with the acquisition of the Company by Technical Olympic on
November 22, 2000, the Company entered into a Credit Agreement (the "Credit
Agreement") with a bank providing for a $100 million term loan commitment and a
$275 million revolving credit facility (subject to reduction based upon periodic
determinations of a borrowing base). Proceeds from these facilities provide
working capital and financed the required repurchase offer made to holders of
the Company's then outstanding $250 million principal amount of 9 1/4% Senior
Notes due 2008 ("Senior Notes"). The term loan and revolving credit facility
terminate on November 22, 2002 whereupon all amounts outstanding become due. The
revolving credit facility also provides credit support for the issuance of
letters of credit needed from time to time in the Company's business. The
Company's previous bank revolving credit facility was repaid and cancelled. The
terms of the Credit Agreement contain restrictive covenants which require the
Company, among other things, to maintain a minimum tangible net worth and
maintain certain financial ratios.

As a result of the change in control of the Company, the Company was
required by the indentures governing its Senior Notes to offer to repurchase all
of its outstanding Senior Notes at a price of 101% of the principal plus accrued
interest. Upon termination of the offer in January 2001, the Company repurchased
approximately $237 million of its Senior Notes. Funds to repurchase these Senior
Notes were provided from the issuance of the $100 million term loan under the
Credit Agreement and additional advances under the Company's revolving credit
facility. Approximately $13 million of the Senior Notes were not tendered and
remain outstanding as of December 31, 2001.

Maturities of borrowings are as follows:

YEAR ENDED DECEMBER 31,
-----------------------

2002........................................................ 202,000
2003........................................................ 938
2004........................................................ --
2005........................................................ --
Thereafter.................................................. 12,897
--------
$215,835
========

The carrying amount of the Company's borrowings approximates fair value as
of December 31, 2001 due to their fluctuating interest rates based on the prime
rate or LIBOR.

F-13

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 5 -- STOCK BASED COMPENSATION

There are no common stock options outstanding at December 31, 2001 and
December 31, 2000. During the year ended October 31, 2000, 4,900 common stock
options were exercised at an average exercise price of $11.50. Additionally,
20,000 common stock options were forfeited. As a result of the change of control
in November 2000 (see Note 1), all of the outstanding common stock options
(965,000) were bought out by the Company.

Under the Company's former Performance Bonus Plan established in 1997, the
Company issued 127,000 and 69,000 shares of common stock valued at approximately
$1,223,000 and $882,000 during the fiscal years ended October 31, 2000, and
1999, respectively. No shares under the Plan were issued during 2001 and the
period ended from November 1, 2000, through December 31, 2000.

At October 31, 2000, the Company had a fixed stock option plan which is
described below. The Company applies APB Opinion 25, Accounting for Stock Issued
to Employees, and related interpretations in accounting for the Plan. Under APB
Opinion 25, if the exercise price of the Company's employee stock options equals
the market price of the underlying stock on the date of grant, no compensation
expense is recognized.

Under the 1991 Stock Option Plan ("the Plan"), as amended, options were
authorized to be granted to purchase 1,000,000 common shares of the Company's
stock at not less than the fair market value at the date of the grant. Options
expire ten years from the date of grant, and typically vest evenly over a five
year period.

SFAS Statement No. 123, Accounting for Stock-Based Compensation, requires
the Company to provide pro forma information regarding net income and net income
per share as if compensation cost associated with options granted under the
Company's stock option plan had been determined in accordance with the fair
value based method prescribed in SFAS Statement No 123. During the year ended
October 31, 1999, the Company granted 10,000 options to purchase shares of the
Company's common stock at $12.75 and 110,000 options at $10.88, the closing
prices on the date of each grant. There were no options granted subsequent to
fiscal year October 31, 1999. The Company's pro forma net income and income per
share under the accounting provisions of SFAS Statement No. 123 did not
materially differ from the reported amounts and are presented below.

YEAR ENDED OCTOBER 31, 2000 1999
---------------------- ------- -------

Net income, as reported..................................... $35,664 $28,026
Estimated stock compensation costs.......................... (497) (512)
------- -------
Pro forma net income........................................ $35,167 $27,514
======= =======

The Black-Scholes method was used to compute the pro forma amounts
presented above, utilizing the weighted average assumptions summarized below.
The weighted average fair value of options granted was $4.76 for the year ended
October 31, 1999.

1999
-------

Risk-free interest rate..................................... 5.15%
Volatility %................................................ 45.83%
Expected life (in years).................................... 7 years
Dividend yield rate......................................... 2.00%

F-14

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

A summary of the status of the Plan and changes are presented below:

PERIOD FROM
NOVEMBER 1, 2000
THROUGH YEAR ENDED YEAR ENDED
NOVEMBER 21, 2000 OCTOBER 31, 2000 OCTOBER 31, 1999
------------------- ------------------ -------------------
WEIGHTED WEIGHTED WEIGHTED
AVERAGE AVERAGE AVERAGE
EXERCISE EXERCISE EXERCISE
SHARES PRICE SHARES PRICE SHARES PRICE
-------- -------- ------- -------- -------- --------

Outstanding at beginning of
year..................... 965,100 $11.70 990,000 $11.74 895,200 $11.81
Granted.................... 120,000 11.04
Exercised.................. (4,900) 11.50 (10,200) 9.49
Repurchased................ (965,100) 11.70
Forfeited.................. (20,000) 13.75 (15,000) 11.68
-------- ------ ------- ------ -------- ------
Outstanding at end of
year..................... 0 $ 0 965,100 $11.70 990,000 $11.74
======== ====== ======= ====== ======== ======
Options exercisable at
year-end................. 0 $ 0 709,100 $11.31 610,400 $11.24
======== ====== ======= ====== ======== ======
Weighted average fair value
of options granted during
the year................. $ 4.76
======

NOTE 6 -- INCOME TAXES

The income tax provision in the consolidated statements of income consists
of the following components:

PERIOD FROM PERIOD FROM
NOVEMBER 22, NOVEMBER 1,
FOR THE YEAR 2000 2000 FOR THE YEARS ENDED
ENDED THROUGH THROUGH OCTOBER 31,
DECEMBER 31, DECEMBER 31, NOVEMBER 21, -------------------
2001 2000 2000 2000 2001
------------ ------------ ------------ -------- --------
(DOLLARS IN THOUSANDS)

Current:
Federal.................. $37,030 $ $ $21,252 $15,287
State.................... 3,951 1,974 2,558
------- ------ ------- ------- -------
40,981 0 0 23,226 17,845
------- ------ ------- ------- -------
Deferred:
Federal.................. 877 2,449 (5,389) (1,994) (194)
State.................... 210 315 (560) 302 (32)
------- ------ ------- ------- -------
1,087 2,764 (5,949) (1,692) (226)
------- ------ ------- ------- -------
Total.................... $42,068 $2,764 $(5,949) $21,534 $17,619
======= ====== ======= ======= =======

The provision for income taxes was different from the amount computed by
applying the statutory rate due to the effect of state income taxes, except for
the period for November 1, 2000 through November 21, 2000, which included merger
related expenses not deductible for tax purposes.

F-15

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

Temporary differences which gave rise to deferred income tax assets and
liabilities at December 31, 2001 and December 31, 2000 are as follows:

DECEMBER 31, DECEMBER 31,
2001 2000
------------ ------------
(DOLLARS IN THOUSANDS)

Deferred tax liabilities:
Differences in reporting selling and marketing costs for
tax purposes........................................... $ (744) $(1,096)
Other..................................................... (120) (572)
------ -------
Gross deferred tax liabilities.............................. (864) (1,668)
Deferred tax assets:
Inventory................................................. 4,745 5,771
Property and equipment.................................... 250 468
Income recognized for tax purposes and deferred for
financial reporting purposes........................... 38 107
Net operating loss for tax purposes....................... 4,879
------ -------
Gross deferred tax assets................................... 5,033 11,225
------ -------
Net deferred tax asset...................................... $4,169 $ 9,557
====== =======

NOTE 7 -- COMMITMENTS AND CONTINGENCIES

The Company is subject to the normal obligations associated with entering
into contracts for the purchase, development and sale of real estate in the
routine conduct of its business. The Company is committed under various letters
of credit and performance bonds which are required for certain development
activities, deposits on land and lot purchase contract deposits. Deposits for
future purchases of land totaled approximately $25.6 million at December 31,
2001. Outstanding letters of credit and performance bonds under these
arrangements totaled approximately $57.1 million at December 31, 2001.

The Company and its subsidiaries occupy certain facilities, including the
Company's headquarters in Boca Raton, Florida, under lease arrangements. Rent
expense, net of sublease income, amounted to approximately $2,200,000, $269,000,
$127,000, $2,000,000, and $1,900,000, for the year ended December 31, 2001, the
period from November 22, 2000 through December 31, 2000, the period from
November 1, 2000 through November 21, 2000, and the fiscal years ended October
31, 2000, and 1999, respectively. Sublease income is derived primarily from
tenants occupying space under month-to-month and annual leases. Future minimum
rental commitments for operating leases with non-cancelable terms in excess of
one year are as follows:

2002........................................................ $2,410,000
2003........................................................ 2,000,000
2004........................................................ 1,674,000
2005........................................................ 1,246,000
2006........................................................ 906,000
2007........................................................ 253,000
2008........................................................ 242,000
2009........................................................ 242,000

F-16

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

The Company has a defined contribution plan established pursuant to Section
401(k) of the Internal Revenue Code. Employees contribute to the plan a
percentage of their salaries, subject to certain dollar limitations, and the
Company matches a portion of the employees' contributions. The Company's
contribution to the plan for the year ended December 31, 2001, the period from
November 22, 2000 through December 31, 2000, the period from November 1, 2000
through November 21, 2000, and the fiscal years ended October 31, 2000, and
1999, amounted to $615,000, $65,000, $24,000, $429,000, and $181,000,
respectively. Concurrently with the signing of the merger agreement with
Technical Olympic, the Company entered into employment contracts with certain
executive officers. The agreements provide for an initial employment term
beginning on the closing of the tender offer and ending December 31, 2003.
Pursuant to the employee agreements, executive officers received annual base
salaries aggregating approximately $2,474,000 for the calendar year, with
scheduled annual increases beginning January 1, 2001 thereafter. In addition,
the employee agreements establish incentive bonus formulas comparable to the
criteria previously used by the Company in determining annual discretionary
incentive bonuses. Total compensation under the employee agreement with the
Company's former Chairman of the Board, President, and Chief Executive Officer
amounted to $2,355,770 for the year ended December 31, 2001.

The Company has entered into an agreement with an insurance company to
underwrite Private Mortgage Insurance on certain loans originated by PHMC. Under
the terms of the agreement, the Company shares in premiums generated on the
loans and is exposed to losses in the event of loan default. At December 31,
2001, the Company's maximum exposure to losses relating to loans insured is
approximately $1,387,000, which is further limited to the amounts held in trust
of approximately $511,000. The Company minimizes the credit risk associated with
such loans through credit investigations of customers as part of the loan
origination process and by monitoring the status of the loans and related
collateral on a continuous basis.

The Company is involved, from time to time, in litigation arising in the
ordinary course of business, none of which is expected to have a material
adverse effect on the Company's consolidated financial position or results of
operations.

NOTE 8 -- ACQUISITION AND MERGER RELATED CHARGES

On March 6, 2001, Newmark Homes Corp. ("Newmark") announced it is
considering the possible merger of Newmark with Engle Holdings Corp., the parent
company of the Company. The Special Committee of Newmark's independent directors
is reviewing the transaction and will make a recommendation to Newmark's full
board. There are no assurances that the Special Committee will either recommend
the merger or that such a merger will be consummated. Any merger would also be
subject to execution of a definitive agreement, certain regulatory and other
approvals as well as the approval of various lenders of Engle, Newmark, and
Technical Olympic Inc. If the merger is consummated, it is contemplated that
shares of Engle Holdings Corp. would be exchanged for shares of Newmark. During
2001, in connection with the proposed merger, the Company incurred approximately
$2 million in legal, consulting, and related costs. These costs are included in
acquisition and merger related charges in the accompanying statement of income.

NOTE 9 -- RELATED PARTY TRANSACTIONS

During 2001, Engle Homes entered into purchasing agreements with Technical
Olympic S.A. The agreements provide that Technical Olympic S.A. would purchase
certain of the materials and supplies necessary for operations and sell them to
Engle Homes, all in an effort to consolidate the purchasing function. Although
Technical Olympic S.A. would incur certain franchise tax expense, the
subsidiaries would not be required to pay such additional liability.

During 2001, Engle Homes entered into certain transactions to acquire
developed lots from an entity owned by several of the current and former
executive officers of the Company. See Note 2.

F-17

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 10 -- QUARTERLY RESULTS FOR 2001 AND 2000

Quarterly results for the twelve months ended December 31, 2001 and October
31, 2000 follow (dollars in thousands):

1ST QUARTER 2ND QUARTER 3RD QUARTER 4TH QUARTER
----------- ----------- ----------- -----------
(UNAUDITED)

2001
Revenues................................... $222,581 $254,576 $260,032 $269,506
Income before income taxes................. 22,555 26,139 31,150 31,548
Net Income................................. 14,153 16,402 19,547 19,222
2000
Revenues................................... $167,174 $212,112 $224,308 $240,417
Income before income taxes................. 8,660 14,572 16,620 17,346
Net Income................................. 5,490 9,239 10,537 10,398

NOTE 11 -- UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF OPERATION AND CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS

PERIOD FROM PERIOD FROM
NOVEMBER 22, NOVEMBER 1,
2000 2000 THREE MONTHS
THROUGH THROUGH ENDED
DECEMBER 31, NOVEMBER 21, JANUARY 31,
2000 2000 2000
------------ ------------ ------------
(IN THOUSANDS)

Revenues..................................... $87,286 $ 27,606 $167,174
Costs and Expenses........................... 80,118 47,788 158,514
------- -------- --------
Income (Loss) Before Income Tax (Benefit).... 7,168 (20,182) 8,660
Provision (Benefit) for income taxes
(Benefit)................................. 2,764 (5,949) 3,170
------- -------- --------
Net Income (Loss)............................ $ 4,404 $(14,233) $ 5,490
======= ======== ========

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

Net Cash (Provided) Required By Operating
Activities........................................ $(22,643) $(17,733) $(24,300)
-------- -------- --------
Net Cash (Required) by Investing Activities.......... (32) (521) (1,012)
-------- -------- --------
Net Cash Provided (Required) by Financing
Activities........................................ 5,297 (14,392) (1,784)
-------- -------- --------
Net Increase (Decrease) in Cash...................... (17,378) (32,646) (27,096)
Cash and Cash Equivalents at Beginning of Period..... 35,456 68,102 60,944
-------- -------- --------
Cash and Cash Equivalents at End of Period........... $ 18,078 $ 35,456 $ 33,848
======== ======== ========

F-18

ENGLE HOMES, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 12 -- SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

PERIOD FROM PERIOD FROM
NOVEMBER 22, NOVEMBER 1,
FOR THE YEAR 2000 2000 FOR THE YEAR ENDED
ENDED THROUGH THROUGH OCTOBER 31,
DECEMBER 31, DECEMBER 31, NOVEMBER 21, -------------------
2001 2000 2000 2000 1999
------------ ------------ ------------ -------- --------

Interest paid (net of
interest capitalized)... $ 1,889 $5,611 $ -- $ 374 $ --
======= ====== ====== ======= =======
Income taxes paid.......... $38,752 $ -- $1,000 $23,612 $16,418
======= ====== ====== ======= =======

F-19

ENGLE HOMES, INC. AND SUBSIDIARIES

(A WHOLLY-OWNED SUBSIDIARY OF TECHNICAL OLYMPIC, INC.)

CONDENSED CONSOLIDATED BALANCE SHEETS
(UNAUDITED)

MARCH 31, DECEMBER 31,
2002 2001
--------- ------------
(DOLLARS IN THOUSANDS,
EXCEPT PER SHARE DATA)

Assets
Homebuilding:
Cash and cash equivalents
Unrestricted........................................... $ 67,589 $ 57,487
Restricted............................................. 11,626 7,738
Inventories............................................... 470,054 456,303
Property and equipment, net............................... 5,172 5,474
Other assets.............................................. 15,309 31,295
Goodwill.................................................. 14,813 14,788
-------- --------
584,563 573,085
-------- --------
Financial Services:
Cash and cash equivalents
Unrestricted........................................... 6,671 7,930
Restricted............................................. 12,563 19,605
Mortgage loans held for sale.............................. 28,719 50,933
Other assets.............................................. 2,870 3,295
-------- --------
50,823 81,763
-------- --------
Total assets......................................... $635,386 $654,848
======== ========
Liabilities
Homebuilding:
Accounts payable and accrued liabilities.................. $ 49,817 $ 34,226
Customer deposits......................................... 21,687 21,994
Consolidated land bank obligation......................... 29,578 30,022
Borrowings................................................ 202,000 202,938
Senior notes payable...................................... 12,897 12,897
-------- --------
315,979 302,077
-------- --------
Financial services:
Accounts payable and accrued liabilities.................. 11,626 18,828
Financial services borrowings............................. 13,933 38,689
-------- --------
25,559 57,517
-------- --------
Total liabilities.................................... 341,538 359,594
-------- --------
Minority interest......................................... 31,398 35,696
Shareholder's equity
Common stock, $.01 par, shares authorized 1,000; issued
100
Additional paid-in capital................................ 215,709 215,709
Retained earnings......................................... 46,741 43,849
-------- --------
Total shareholder's equity........................... 262,450 259,558
-------- --------
$635,386 $654,848
======== ========

See accompanying notes to condensed consolidated financial statements.

F-20

ENGLE HOMES, INC. AND SUBSIDIARIES
(A WHOLLY-OWNED SUBSIDIARY OF TECHNICAL OLYMPIC, INC.)

CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)

THREE MONTHS ENDED
MARCH 31,
---------------------
2002 2001
--------- ---------
(IN THOUSANDS, EXCEPT
PER SHARE DATA)

Revenues
Sales of homes.............................................. $218,417 $213,581
Sales of land............................................... 215 688
Rent and other.............................................. 1,312 1,917
-------- --------
219,944 216,186
-------- --------
Costs and Expenses
Cost of sales -- homes...................................... 173,811 172,908
Cost of sales -- land....................................... 172 472
Selling, general and administrative......................... 25,011 20,970
Severance and merger related charges........................ 13,748
Depreciation and amortization............................... 1,440 1,690
-------- --------
214,182 196,040
-------- --------
Homebuilding pretax income.................................. 5,762 20,146
-------- --------
Financial Services:
Revenue..................................................... 8,083 6,395
Expenses.................................................... 4,360 3,986
-------- --------
Financial services pretax income............................ 3,723 2,409
-------- --------
Income before income tax.................................... 9,485 22,555
Provision for income taxes................................ 3,581 8,402
-------- --------
Net income.................................................. $ 5,904 $ 14,153
======== ========

See accompanying notes to condensed consolidated financial statements.

F-21

ENGLE HOMES, INC. AND SUBSIDIARIES
(A WHOLLY-OWNED SUBSIDIARY OF TECHNICAL OLYMPIC, INC.)

CONDENSED CONSOLIDATED STATEMENT OF SHAREHOLDER'S EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2002
(UNAUDITED)

COMMON STOCK ADDITIONAL
--------------- PAID-IN RETAINED
SHARES AMOUNT CAPITAL EARNINGS TOTAL
------ ------ ---------- -------- --------
(IN THOUSANDS EXCEPT NUMBER OF SHARES)

Amounts at December 31, 2001.................. 100 -- $215,709 $43,849 $259,558
Net Income for the Three Months Ended March
31, 2002................................. 5,904 5,904
Net Dividends to Parent..................... (3,012) (3,012)
--- ----- -------- ------- --------
Amounts at March 31, 2002..................... 100 $ -- $215,709 $46,741 $262,450
=== ===== ======== ======= ========

See accompanying notes to condensed consolidated financial statements.

F-22

ENGLE HOMES, INC. AND SUBSIDIARIES
(A WHOLLY-OWNED SUBSIDIARY OF TECHNICAL OLYMPIC, INC.)

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

THREE MONTHS ENDED
MARCH 31,
-------------------
2002 2001
-------- --------
(IN THOUSANDS)

Net cash provided by operating activities................... $ 42,994 $ 44,137
-------- --------
Cash flows from investing activities
Net acquisitions of property and equipment................ (704) (849)
-------- --------
Net cash required by investing activities................. (704) (849)
-------- --------
Cash flows from financing activities
(Decrease) Increase in borrowings......................... (24,756) 27,001
Repayment of borrowings................................... (938) (26,489)
Decrease in minority interest............................. (4,298)
Decrease in consolidated land bank obligation............. (443)
Distributions to parent................................... (3,012) (19,063)
-------- --------
Net cash required by financing activities................. (33,447) (18,551)
-------- --------
Net increase in cash........................................ 8,843 24,737
Unrestricted cash at beginning of period.................... 65,417 18,078
-------- --------
Unrestricted cash at end of period.......................... $ 74,260 $ 42,815
======== ========

See accompanying notes to condensed consolidated financial statements.

F-23

ENGLE HOMES, INC. AND SUBSIDIARIES
(A WHOLLY-OWNED SUBSIDIARY OF TECHNICAL OLYMPIC, INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(UNAUDITED)

NOTE 1 -- BASIS OF PRESENTATION AND BUSINESS

Engle Homes, Inc. and subsidiaries ("the Company") is engaged principally
in the construction and sale of residential homes and land development. The
Company operates throughout Florida with divisions in Broward County; Palm Beach
and Martin Counties; Orlando; Fort Myers; and Naples. The Company also has
divisions operating outside Florida including Dallas/Ft. Worth, Texas; Denver,
Colorado; Virginia; and Phoenix, Arizona. Ancillary products and services to its
residential home building include land sales to other builders, origination and
sale of mortgage loans and title services. The consolidated financial statements
include the accounts of the Company and all subsidiaries. All significant
intercompany balances and transactions have been eliminated in consolidation.

There is no disclosure of earnings per share since the Company has no
registered trading capital stock.

These statements do not contain all information required by accounting
principles generally accepted in the United States that are included in a full
set of financial statements. In the opinion of management, the accompanying
unaudited condensed consolidated financial statements reflect all adjustments
consisting primarily of normal recurring items necessary to present fairly the
financial position of the Company at March 31, 2002 and December 31, 2001, and
results of its operations for the three months ended and its cash flows for the
three months ended March 31, 2002 and March 31, 2001. These unaudited condensed
consolidated financial statements should be read in conjunction with the audited
financial statements and notes contained in the Company's Annual Report on Form
10-K for the year ended December 31, 2001. Results of operations for these
periods are not necessarily indicative of results to be expected for the full
year.

NOTE 2 -- INVENTORIES

MARCH 31, DECEMBER 31,
2002 2001
--------- ------------
(DOLLARS IN THOUSANDS)

Land and improvements for residential homes under
development............................................... $317,573 $302,630
Residential homes under construction........................ 152,481 153,673
-------- --------
$470,054 $456,303
======== ========

NOTE 3 -- CAPITALIZATION OF INTEREST

Included in inventory is the following:

FOR THE THREE MONTHS
ENDED MARCH 31,
----------------------
2002 2001
--------- ---------
(DOLLARS IN THOUSANDS)

Interest capitalized, beginning of period................... $ 9,434 $23,019
Interest incurred and capitalized........................... 3,154 5,000
Amortized to cost of sales-homes............................ (6,134) (6,293)
Amortized to cost of sales-land............................. (2) (56)
------- -------
Interest capitalized, end of period......................... $ 6,452 $21,670
======= =======

F-24

ENGLE HOMES, INC. AND SUBSIDIARIES
(A WHOLLY-OWNED SUBSIDIARY OF TECHNICAL OLYMPIC, INC.)

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS -- (CONTINUED)

NOTE 4 -- SEGMENT REPORTING

Our segments consist of homebuilding and financial services. These two
segments are segregated in the accompanying condensed consolidated financial
statements under "Homebuilding" and "Financial Services", respectively.

NOTE 5 -- CONTINGENCIES

In early February 2002, Alec Engelstein, Chief Executive Officer of Engle
Homes, and David Shapiro, Vice President-Chief Financial Officer of Engle Homes,
resigned from their executive positions with Engle Homes and alleged that they
were entitled to receive severance packages in the aggregate of $9,404,895, plus
other benefits, including a monthly retirement benefit equal to one-twelfth of
Mr. Engelstein's annual Base Salary at the time of the termination, such
payments to continue for a period of 60 consecutive months. We have advised them
that we dispute their claims, but there can be no assurance that, if litigated
or arbitrated, we will prevail. However, we have amounts sufficient to cover the
alleged payments due to Mr. Engelstein and Mr. Shapiro in the accompanying
condensed consolidated statement of income.

NOTE 6 -- NEW ACCOUNTING PRONOUNCEMENTS

In June 2001, the Financial Accounting Standards Board (FASB) approved
Statement of Financial Accounting Standard 141 (Statement 141), Business
Combinations, and Statement of Financial Accounting Standards 142 (Statement
142), Goodwill and Other Intangible Assets. Statement 141 requires that the
purchase method of accounting be used for all business combinations initiated
after June 30, 2001. Statement 142 changes the accounting for goodwill from an
amortization method to an impairment-only approach. Statement 142 is effective
for the Company's fiscal year 2002. The impact of adopting Statement 141 and 142
has not been significant to the Company's financial statements.

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