-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, DOGV7Znkaa5FopCkW40XaLtMsHFyGgtsBBK9dSJq2V1injhcRmYzxLXmbLuhvXdo dHAsoyoYshjPUDiDp+/mzw== 0000950116-02-001380.txt : 20020620 0000950116-02-001380.hdr.sgml : 20020620 20020620172526 ACCESSION NUMBER: 0000950116-02-001380 CONFORMED SUBMISSION TYPE: S-3/A PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20020620 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST HUNTINGTON FINANCE CORP CENTRAL INDEX KEY: 0001095653 STANDARD INDUSTRIAL CLASSIFICATION: OPERATIVE BUILDERS [1531] STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: S-3/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-85030-02 FILM NUMBER: 02683704 BUSINESS ADDRESS: STREET 1: 3103 PHILMONT AVE CITY: HUNTINGDON VALLEY STATE: PA ZIP: 19006 BUSINESS PHONE: 2159388000 MAIL ADDRESS: STREET 1: 3103 PHILMONT AVENUE CITY: HUNTINGDON VALLEY STATE: PA ZIP: 19006 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOLL FINANCE CORP CENTRAL INDEX KEY: 0001095652 STANDARD INDUSTRIAL CLASSIFICATION: OPERATIVE BUILDERS [1531] IRS NUMBER: 232978196 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: S-3/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-85030-01 FILM NUMBER: 02683705 BUSINESS ADDRESS: STREET 1: 3103 PHILMONT AVE CITY: HUNTINGDON VALLEY STATE: PA ZIP: 19006 BUSINESS PHONE: 2159388000 MAIL ADDRESS: STREET 1: 3103 PHILMONT AVENUE CITY: HUNTINGDON VALLEY STATE: PA ZIP: 19006 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOLL BROTHERS INC CENTRAL INDEX KEY: 0000794170 STANDARD INDUSTRIAL CLASSIFICATION: OPERATIVE BUILDERS [1531] IRS NUMBER: 232416878 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: S-3/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-85030 FILM NUMBER: 02683703 BUSINESS ADDRESS: STREET 1: 3103 PHILMONT AVE CITY: HUNTINGDON VALLEY STATE: PA ZIP: 19006 BUSINESS PHONE: 2159388000 MAIL ADDRESS: STREET 1: 3103 PHILMONT AVENUE CITY: HUNTINGDON VALLEY STATE: PA ZIP: 19006 FILER: COMPANY DATA: COMPANY CONFORMED NAME: TOLL CORP CENTRAL INDEX KEY: 0000836623 STANDARD INDUSTRIAL CLASSIFICATION: LAND SUBDIVIDERS & DEVELOPERS (NO CEMETERIES) [6552] IRS NUMBER: 222485860 STATE OF INCORPORATION: DE FISCAL YEAR END: 1031 FILING VALUES: FORM TYPE: S-3/A SEC ACT: 1933 Act SEC FILE NUMBER: 333-85030-03 FILM NUMBER: 02683706 BUSINESS ADDRESS: STREET 1: 3103 PHILMONT AVE CITY: HUNTINGDON VALLEY STATE: PA ZIP: 19006 BUSINESS PHONE: 2159388000 MAIL ADDRESS: STREET 1: 3103 PHILMONT AVENUE CITY: HUNTINGTON VALLEY STATE: PA ZIP: 19006 S-3/A 1 b319003_s3a.txt As filed with the Securities and Exchange Commission, via EDGAR, on June 20, 2002. Registration Nos. 333-85030, 333-85030-01, 333-85030-02 and 333-85030-03. - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ----------------------------- AMENDMENT NO. 1 TO FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ----------------------------- TOLL BROTHERS, INC. TOLL CORP. FIRST HUNTINGDON FINANCE CORP. TOLL FINANCE CORP. (Exact name of each registrant as specified in its charter) Delaware ------------ 22-2416878 - Toll Brothers, Inc. (State or other 22-2485860 - Toll Corp. jurisdiction of 23-2485787 - First Huntingdon Finance Corp. incorporation 23-2978196 - Toll Finance Corp. of each registrant) ------------------------------------------- (I.R.S. Employer Identification Number) 3103 Philmont Avenue Huntingdon Valley, Pennsylvania 19006 (215) 938-8000 --------------------------------------------------------------------------- (Address, including zip code, and telephone number, including area code, of registrants' principal executive offices) Robert I. Toll Chairman of the Board and Chief Executive Officer Toll Brothers, Inc. 3103 Philmont Avenue Huntingdon Valley, Pennsylvania 19006 (215) 938-8000 (Name, address, including zip code, and telephone number, including area code, of agent for service) ------------------ Copies to: Mark K. Kessler, Esquire Wolf, Block, Schorr and Solis-Cohen LLP 1650 Arch Street, 22nd Floor Philadelphia, Pennsylvania 19103-2097 (215) 977-2000 ------------------ Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this registration statement. If the only securities being registered on this Form are to be offered pursuant to dividend or interest reinvestment plans, please check the following box. [ ] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If this form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [ ] If delivery of the prospectus is expected to be made pursuant to Rule 434 under the Securities Act, please check the following box. [ ] ------------------ The registrants hereby amend this registration statement on such date or dates as may be necessary to delay its effective date until the registrants shall file a further amendment which specifically states that this registration statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine. Subject to Completion, dated June 20, 2002 PROSPECTUS [TOLL BROTHERS, INC. LOGO] TOLL BROTHERS, INC. Common Stock Preferred Stock Warrants Guarantees of Debt Securities TOLL CORP. FIRST HUNTINGDON FINANCE CORP. TOLL FINANCE CORP. Debt Securities Toll Brothers, Inc. may offer any of the following securities from time to time: o common stock; o preferred stock; o warrants to purchase common stock or preferred stock issued by Toll Brothers, Inc. or debt securities issued by Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp.; and o guarantees of debt securities issued by Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. may offer debt securities from time to time. Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. are indirect, wholly-owned subsidiaries of Toll Brothers, Inc. Toll Brothers, Inc.'s common stock is listed on the New York Stock Exchange and the Pacific Exchange under the Symbol "TOL." YOU SHOULD CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE 4 OF THIS PROSPECTUS BEFORE PURCHASING ANY SECURITIES OFFERED BY THIS PROSPECTUS. Each time we offer any of the securities described in this prospectus we will provide a prospectus supplement that will describe the specific price of the securities being offered and the other terms of the offering. You should read this prospectus and the applicable prospectus supplement carefully before you invest. This prospectus may not be used to sell any securities unless it is accompanied by the applicable prospectus supplement. ---------------- Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved these securities or passed on the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense. The date of this prospectus is ___________ __, 2002. ***************************************************************************** The following text is to appear vertically in the left margin of cover. The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is effective. This prospectus is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any state where the offer or sale is not permitted. SUMMARY Toll Brothers, Inc. Toll Brothers, Inc., through its subsidiaries, designs, builds, markets and arranges financing for single-family homes in residential communities that include both detached and attached homes. We market our homes primarily to middle-income and upper-income buyers, catering to move-up, empty nester and age-qualified home buyers. We emphasize high quality construction and consumer satisfaction. We utilize our own land development, architectural, engineering, mortgage, title, security monitoring, landscape, cable TV, broadband Internet access, lumber distribution, house component assembly and manufacturing operations. We also own and operate golf courses in conjunction with several of our master planned communities. We currently operate in twenty-two states in six regions around the country. While we continue to explore additional geographic areas for expansion, our operations are currently conducted in major suburban residential areas of: o southeastern Pennsylvania and Delaware o central New Jersey o the Virginia and Maryland suburbs of Washington, D.C. o Baltimore County, Maryland o the Boston, Massachusetts metropolitan area o Rhode Island o southern New Hampshire o Fairfield and Hartford Counties, Connecticut o Westchester County, New York o the Los Angeles metropolitan area and San Diego, California o the San Francisco Bay area of northern California o Palm Springs, California o the Phoenix, Arizona metropolitan area o Raleigh and Charlotte, North Carolina o Dallas, Austin and San Antonio, Texas o the east and west coasts of Florida o Las Vegas, Nevada o Columbus, Ohio o Nashville, Tennessee o Detroit, Michigan o Chicago, Illinois o Denver, Colorado In recognition of its achievements, Toll Brothers, Inc. has received numerous awards from national, state and local homebuilder publications and associations. Toll Brothers, Inc. is the only publicly traded home builder to have won all three of the industry's highest honors: America's Best Builder (1996), The National Housing Quality Award (1995), and Builder of the Year (1988). Co-founded by Robert I. Toll and Bruce E. Toll, Toll Brothers, Inc. commenced its business operations, through predecessor entities, in 1967. Toll Brothers, Inc. is a Delaware corporation that was formed in May 1986. 2 Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. are indirect, wholly-owned subsidiaries of Toll Brothers, Inc. which were incorporated in Delaware in July 1987, July 1987 and October 1998, respectively. Neither Toll Corp., First Huntingdon Finance Corp. nor Toll Finance Corp. has any independent operations or generates any operating revenues other than providing financing to other subsidiaries of Toll Brothers, Inc. by lending the proceeds of its offerings of debt securities and related activities. There is no present intention to have Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. engage in other activities. Principal Executive Offices The principal executive offices of Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. are located at 3103 Philmont Avenue, Huntingdon Valley, Pennsylvania 19006, and their telephone number is (215) 938-8000. About This Prospectus This prospectus describes securities that may be offered from time to time by Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. This prospectus is part of a registration statement that we filed with the SEC utilizing a "shelf" registration process, which allows us to offer and sell any combination of the securities described in this prospectus in one or more offerings. Using this prospectus, Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. may offer up to $750,000,000 worth of securities. This prospectus provides you with a general description of the securities we may offer. Each time we sell securities, we will provide a prospectus supplement that will describe the specific terms of the securities we are offering. Each supplement will also contain specific information about the terms of the offering it describes. The prospectus supplement may also add to, update or change the information contained in this prospectus. In addition, as we describe below in the section entitled "Where You Can Find More Information," Toll Brothers, Inc. has filed and plans to continue to file other documents with the SEC that contain information about it and the business conducted by it and its subsidiaries. Before you decide whether to invest in any of the securities offered by this prospectus, you should read this prospectus, the prospectus supplement that further describes the offering of those securities and the information Toll Brothers, Inc. otherwise files with the SEC. When this prospectus or a supplement to this prospectus uses the words "we," "us" and "our," they refer to Toll Brothers, Inc. and its subsidiaries, including Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp., unless the context otherwise requires. The phrase "this prospectus" refers to this prospectus and any applicable prospectus supplement, unless the context otherwise requires. 3 RISK FACTORS YOU SHOULD CONSIDER CAREFULLY THE FOLLOWING RISK FACTORS, AS WELL AS ALL OF THE OTHER INFORMATION CONTAINED OR INCORPORATED BY REFERENCE IN THIS PROSPECTUS, BEFORE PURCHASING ANY SECURITIES OFFERED IN CONNECTION WITH THIS PROSPECTUS. An Adverse Change in Economic Conditions Could Reduce the Demand For Homes and, as a Result, Could Reduce Our Earnings. Changes in national and regional economic conditions, as well as local economic conditions where we conduct our operations and where prospective purchasers of our homes live, can have a negative impact on our business. Adverse changes in employment levels, job growth, consumer confidence, housing demand, interest rates and population growth may reduce demand and depress prices for our homes. This, in turn, can reduce our earnings. The Homebuilding Industry is Highly Competitive and, if Others are More Successful, Our Business Could Decline. We operate in a very competitive environment, which is characterized by competition from a number of other home builders in each market in which we operate. We compete with large national and regional homebuilders and with smaller local homebuilders for land, financing, raw materials and skilled management and labor resources. We also compete with the resale, or "previously owned," home market. Heavy competition could make it more difficult for us to acquire land at acceptable prices and cause us to increase our selling incentives and/or reduce our sales. An oversupply of homes available for sale could depress our home prices and adversely affect our operations. If we are unable to compete effectively in our markets, our business could decline. If Land Is Not Available at Reasonable Prices, Our Sales and Earnings Could Decrease. Our operations depend on our ability to continue to obtain land for the development of our residential communities at reasonable prices. Changes in the general availability of land, competition for available land, availability of financing to acquire land, zoning, regulations that limit housing density and other market conditions may hurt our ability to obtain land for new residential communities. If land appropriate for development of our residential communities becomes less available because of these factors, or for any reason, the cost of land could increase and/or the number of homes that we build and sell could be reduced. If the Market Value of Our Land Inventory Drops Significantly, Our Costs Could Increase and Our Profits Could Decrease. The market value of our land and housing inventories depends on market conditions. We acquire land for expansion into new markets and for replacement of land inventory and expansion within our current markets. If housing demand decreases below what we anticipated when we acquired our inventory, we may not be able to make profits similar to what we have made in the past, may experience less than anticipated profits and/or may not be able to recover our costs when we build and sell homes. We may have substantial inventory carrying costs or we may have to sell land or homes at a loss in the face of adverse market conditions. Government Regulations May Delay the Completion of Our Communities, Increase Our Expenses or Limit Our Homebuilding Activities, Which Could Have a Negative Impact on Our Operations. We incur substantial costs related to compliance with legal and regulatory requirements. Any increase in legal and regulatory requirements may cause us to incur substantial additional costs, as discussed below. Various local, state and federal statutes, ordinances, rules and regulations concerning building, zoning, sales and similar matters apply to and/or affect the housing industry. This governmental regulation affects construction activities as well as sales activities, mortgage lending activities and other dealings with consumers. The industry also has experienced an increase in state and local legislation authorizing the acquisition, mainly by governmental, quasi-public and non-profit entities, of land as designated open space. We must obtain the approval of numerous governmental authorities in connection with our development activities, and these governmental authorities often have broad discretion in exercising their approval authority. We may be required to apply for additional approvals or the modification of our existing approvals because of changes in local circumstances or applicable law. 4 Expansion of regulation in the housing industry has increased the time required to obtain the necessary approvals to begin construction and has prolonged the time between the initial acquisition of land or land options and the commencement and completion of construction. These delays can increase our costs and decrease our profitability. Municipalities may restrict or place moratoriums on the availability of utilities, such as water and sewer taps. In some areas, municipalities may enact growth initiatives, which will restrict the number of building permits available in a given year. If municipalities in which we operate take actions like these, it could have an adverse effect on our business by causing delays, increasing our costs or severely limiting our ability to operate in those municipalities. Increases in Taxes or Government Fees Could Increase Our Costs and Adverse Changes In Tax Laws Could Reduce Customer Demand For Our Homes. Increases in real estate taxes and other local government fees, such as fees imposed on developers to fund schools, open space, road improvements, and/or low and moderate income housing, could increase our costs and have an adverse effect on our operations. In addition, increases in local real estate taxes could adversely affect our potential customers who may consider those costs in determining whether to make a new home purchase and decide, as a result, not to purchase one of our homes. In addition, any changes in the income tax laws that would reduce or eliminate tax incentives to homeowners could make housing less affordable or otherwise reduce the demand for housing, which in turn could reduce our sales and hurt our operating results. Adverse Weather Conditions and Conditions in Nature Beyond Our Control Could Disrupt the Development of Our Communities, Which Would Harm Our Sales and Earnings. Adverse weather conditions and natural disasters, such as hurricanes, tornadoes, earthquakes, floods and fires can have serious effects on our ability to develop our residential communities. We also may be affected by unforeseen engineering, environmental or geological problems. Any of these adverse events or circumstances could cause delays in the completion of, or increase the cost of, developing one or more of our residential communities and, as a result, could harm our sales and earnings. If We Experience Shortages of Labor and Supplies or Other Circumstances Beyond Our Control, There Could Be Delays or Increased Costs in Developing Our Communities, Which Would Adversely Affect Our Operating Results. Our ability to develop residential communities may be affected by circumstances beyond our control, including: o work stoppages, labor disputes and shortages of qualified trades people, such as carpenters, roofers, electricians and plumbers; o lack of availability of adequate utility infrastructure and services; o our need to rely on local subcontractors who may not be adequately capitalized or insured; and o shortages or fluctuations in prices of building materials. Any of these circumstances could give rise to delays in the start or completion of, or increase the cost of, developing one or more of our residential communities. We may not be able to recover these increased costs by raising our home prices because, typically, the home price for each home is set months prior to delivery in a home sale contract with the customer. If that happens, our operating results could be harmed. 5 Product Liability Litigation and Warranty Claims that Arise in the Ordinary Course of Business May Be Costly, Which Could Adversely Affect Our Business. As a homebuilder, we are subject to construction defect and home warranty claims arising in the ordinary course of business. These claims are common in the homebuilding industry and can be costly. In addition, the costs of insuring against construction defect and product liability claims are high and the amount of coverage offered by insurance companies is currently limited. There can be no assurance that this coverage will not be further restricted and become more costly. If we are not able to obtain adequate insurance against these claims, we may experience losses that could hurt our business. If We Are Not Able to Obtain Suitable Financing, Our Business May Decline. Our business and earnings depend substantially on our ability to obtain financing for the development of our residential communities, whether from bank borrowings or from sales of our debt or equity securities. If we are not able to obtain suitable financing, our costs could increase and our revenues could decrease, or we could be precluded from continuing our operations at current levels. Increases in interest rates can make it more difficult and/or expensive for us to obtain the funds we need to operate our business. The interest rate on our revolving credit facility fluctuates based on changes in short-term interest rates, the amount of borrowings we incur and the ratings that national rating agencies assign to our outstanding debt securities. Increases in interest rates generally and/or any downgrading in the ratings that national rating agencies assign to our outstanding debt securities would increase the interest rates we must pay on our debt securities and any such ratings downgrade could also make it more difficult for us to sell our debt securities. If Our Potential Customers Are Not Able to Obtain Suitable Financing, Our Business May Decline. Our business and earnings also depend on the ability of our potential customers to obtain mortgages for the purchase of our homes. Increases in the cost of home mortgage financing could prevent our potential customers from purchasing our homes. In addition, where our potential customers must sell their existing homes in order to buy a home from us, increases in mortgage costs could prevent the buyers of our customers' existing homes from obtaining the mortgages they need to complete the purchase, which could result in our potential customers' inability to buy a home from us. If our potential customers or the buyers of our customers' existing homes are not able to obtain suitable financing, our sales and revenues could decline. Our Principal Stockholders May Effectively Exercise Control Over Matters Requiring Stockholder Approval. As of June 10, 2002, Robert I. Toll and his affiliates owned, directly or indirectly, approximately 20.9% of Toll Brothers, Inc.'s common stock, and his brother Bruce E. Toll and his affiliates owned, directly or indirectly, approximately 12.7% of Toll Brothers, Inc.'s common stock. To the extent they and their affiliates vote their shares in the same manner, their combined stock ownership may effectively give them the power to elect all of the directors and control the management, operations and affairs of Toll Brothers, Inc. Their ownership may discourage someone from making a significant equity investment in Toll Brothers, Inc., even if we needed the investment to operate our business. The large percentage of stock they own could also delay or prevent a change of control transaction that other stockholders may deem to be in their best interests, such as a transaction in which the other stockholders would receive a premium for their shares over their current trading prices. Our Business is Seasonal in Nature, So Our Quarterly Operating Results Fluctuate. Our quarterly operating results typically fluctuate with the seasons. A significant portion of our home purchase contracts are entered into with customers in the winter and spring months. Construction on a customer's home typically proceeds after signing the contract and can require twelve months or more to complete. Weather-related problems may occur in the late winter and early spring delaying starts or closings or increasing costs and reducing profitability. In addition, delays in opening new communities or new sections of existing communities could have an adverse impact on home sales and revenues. Because of these factors, our quarterly operating results may be uneven and may be marked by lower revenues and earnings in some quarters. 6 Future Terrorist Attacks Against the United States or Increased Domestic or International Instability Could Have an Adverse Effect On Our Operations. In the weeks following the September 11, 2001 terrorist attacks, we experienced a sharp decrease in the number of orders for new homes and cancellation of many existing orders. Although new home purchases stabilized and subsequently recovered in the months after that initial period, a generalized economic uncertainty persists. Adverse developments in the war on terrorism, future terrorist attacks against the United States, or increased domestic or international instability could adversely affect our business. 7 WHERE YOU CAN FIND MORE INFORMATION Toll Brothers, Inc. is subject to the informational requirements of the Securities Exchange Act of 1934. In accordance with those requirements, Toll Brothers, Inc. files annual, quarterly and special reports, proxy statements and other information with the SEC. You can read and copy any document Toll Brothers, Inc. files with the SEC at the SEC's public reference room at the following location: Judiciary Plaza 450 Fifth Street, N.W. Washington, D.C. 20549 You may obtain information on the operation of the SEC's public reference room by calling the SEC at 1-800-SEC-0330. The SEC filings of Toll Brothers, Inc. are also available to the public from the SEC's Internet website at http://www.sec.gov. In addition, the common stock of Toll Brothers, Inc. is listed on the New York Stock Exchange and similar information concerning Toll Brothers, Inc. can be inspected and copied at the New York Stock Exchange, 20 Broad Street, 7th Floor, New York, New York 10005. The common stock of Toll Brothers, Inc. is also listed on the Pacific Exchange, but the Pacific Exchange does not have a public reference room for review of SEC filings of its listed companies. The SEC allows us to "incorporate by reference" into this prospectus the information Toll Brothers, Inc. files with the SEC. This means that we are permitted to disclose important information to you by referring you to other documents Toll Brothers, Inc. has filed with the SEC. We incorporate by reference in two ways. First, we list certain documents that Toll Brothers, Inc. has filed with the SEC. The information in these documents is considered part of this prospectus. Second, Toll Brothers, Inc. expects to file additional documents with the SEC in the future. The information in these documents, when filed, will update and supersede the current information included in or incorporated by reference in this prospectus. You should consider any statement contained in this prospectus or in a document which is incorporated by reference into this prospectus to be modified or superseded to the extent that the statement is modified or superseded by another statement contained in a later dated document that constitutes a part of this prospectus or is incorporated by reference into this prospectus. You should consider any statement which is so modified or superseded to be a part of this prospectus only as so modified or superseded. We incorporate by reference in this prospectus all the documents listed below and any filings Toll Brothers, Inc. makes with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934 after the date of this prospectus and before all the securities offered by this prospectus have been sold or de-registered: o The annual report on Form 10-K of Toll Brothers, Inc. filed with the SEC for the fiscal year ended October 31, 2001; o The quarterly reports on Form 10-Q of Toll Brothers, Inc. filed with the SEC for the fiscal quarters ended January 31, 2002 and April 30, 2002; o The current reports on Form 8-K of Toll Brothers, Inc. filed with the SEC on November 29, 2001, December 6, 2001 and March 5, 2002; o The description of the common stock of Toll Brothers, Inc. contained in its registration statement filed with the SEC on a Form 8-A dated June 19, 1986 registering the common stock under Section 12 of the Securities Exchange Act of 1934; and o The description of preferred stock purchase rights contained in the registration statement of Toll Brothers, Inc. filed with the SEC on June 19, 1997 on Form 8-A, as the same was amended by an amendment filed with the SEC on August 21, 1998 on Form 8-A/A, registering the preferred stock purchase rights under Section 12 of the Securities Exchange Act of 1934. We will deliver, without charge, to anyone receiving this prospectus, upon written or oral request, a copy of any document incorporated by reference in this prospectus but not delivered with this prospectus, but the exhibits to those documents will not be delivered unless they have been specifically incorporated by reference. Requests for these documents should be made to: Director of Investor Relations, Toll Brothers, Inc., 3103 Philmont Avenue, Huntingdon Valley, PA 19006, (215) 938-8000. We will also make available to the holders of the 8 securities offered by this prospectus annual reports which will include audited financial statements of Toll Brothers, Inc. and its consolidated subsidiaries, including Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. We do not expect that Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. will be required to make filings with the SEC under Section 15(d) of the Securities Exchange Act of 1934. This prospectus is part of our "shelf" registration statement. Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. have filed the registration statement with the SEC under the Securities Act of 1933 to register the securities that any of them may offer by this prospectus, including any applicable prospectus supplement. Not all of the information in the registration statement appears in this prospectus, or will appear in any prospectus supplement. You should refer to the registration statement and to the exhibits filed with the registration statement for further information about Toll Brothers, Inc., its consolidated subsidiaries, including Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp., and the securities offered by this prospectus. USE OF PROCEEDS We intend to use the net proceeds from the sale of the securities offered by this prospectus for general corporate purposes, which may include the acquisition of residential development properties, the repayment of our outstanding indebtedness, working capital or for any other purposes as may be described in an accompanying prospectus supplement. RATIO OF EARNINGS TO FIXED CHARGES The following table shows the ratio of earnings to fixed charges of Toll Brothers, Inc. for the periods indicated:
Six Months Ended Year Ended October 31, April 30, ------------------------------------------------ --------------------------- 1997 1998 1999 2000 2001 2001 2002 ---- ---- ---- ---- ---- ------------ ----------- Ratio, including collateralized 3.81 4.35 3.89 4.53 4.92 4.24 3.98 mortgage financing(1)
- --------------------- (1) For purposes of computing the ratio of earnings to fixed charges, earnings consist of income before income taxes, extraordinary loss and change in accounting plus interest expense and fixed charges except interest incurred. Fixed charges consist of interest incurred (whether expensed or capitalized), the portion of rent expense that is representative of the interest factor, and amortization of debt discount and issuance costs. DESCRIPTION OF DEBT SECURITIES AND GUARANTEES Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. may issue debt securities from time to time in one or more series. Any series of debt securities offered by Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. will be offered together with the guarantees of Toll Brothers, Inc., which unless otherwise provided in the applicable prospectus supplement will be full and unconditional. One or more series of the debt securities of Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. may be issued under a single indenture. Alternatively, any series of debt securities may be issued under a separate indenture. The terms applicable to each series of debt securities will be stated in the indenture and may be modified by the resolution(s) authorizing that series of debt securities adopted by the board of directors, or an officer or committee of officers authorized by the board of directors, of both the issuer of the debt securities and Toll Brothers, Inc. under the applicable indenture. We refer in this prospectus to the resolution(s) authorizing a series of debt securities as an authorizing resolution. Each indenture under which any debt securities are issued, including the applicable authorizing resolution(s), is referred to in this prospectus as an "indenture," and collectively with any other indentures, as the "indentures." Each indenture will be entered into among Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp., as the obligor, Toll Brothers, Inc., as the issuer of the related guarantees, and Bank One Trust Company, NA, or another institution named in the applicable prospectus supplement, as trustee. 9 The following is a description of certain general terms and provisions of the debt securities we may offer by this prospectus. The name of the issuer and the particular terms of any series of debt securities we offer, including the extent to which the general terms and provisions may apply to that series of debt securities, will be described in a prospectus supplement relating to those debt securities. Except as otherwise indicated in this prospectus or in the applicable prospectus supplement, the following description of indenture terms is applicable to, and each reference to "the indenture" is a reference to, each indenture that Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. may enter into with respect to any series of debt securities we may offer by this prospectus, unless the context otherwise requires. All references to "Section" in the following description refer to the applicable Section of the indenture. The terms of any series of the debt securities include those stated in the applicable indenture. Holders of each series of the debt securities are referred to the indenture for that series, including the applicable authorizing resolution, for a statement of the terms. The respective forms of the indenture for the debt securities of Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. are filed as exhibits to the registration statement. Each indenture may be amended or modified for any series of debt securities by an authorizing resolution which will be described in an applicable prospectus supplement, and the applicable authorizing resolution relating to any series of debt securities offered pursuant to this prospectus will be filed as an exhibit to a report incorporated by reference in this prospectus. The following summary of certain provisions of the debt securities and the indenture is not complete. You should read all of the provisions of the indenture, including the definitions contained in the indenture which are not otherwise defined in this prospectus, and the applicable prospectus supplement. Wherever we refer to particular provisions or defined terms of the indenture, these provisions or defined terms are incorporated in this prospectus by reference. General The debt securities, when issued, will be obligations that constitute senior secured debt, senior unsecured debt, senior subordinated debt or subordinated debt of Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp., as the case may be. Toll Brothers, Inc. will guarantee the payment of the principal, premium, if any, and interest on the debt securities when due, whether at maturity, by declaration of acceleration, call for redemption or otherwise. This guarantee will be full and unconditional unless otherwise provided in the applicable prospectus supplement. See "Guarantee of Debt Securities." The total principal amount of debt securities which may be issued under the indenture will not be limited. Debt securities may be issued under the indenture from time to time in one or more series. Unless the applicable prospectus supplement relating to the original offering of a particular series of debt securities indicates otherwise, the issuer of that series of debt securities will have the ability to reopen the previous issue of that series of debt securities and issue additional debt securities of that series pursuant to an authorizing resolution, an officers' certificate or an indenture supplement. Because neither Toll Corp., First Huntingdon Finance Corp. nor Toll Finance Corp. has any independent operations or generates any operating revenues, the funds required to pay the principal, the premium, if any, and interest on the debt securities will come from Toll Brothers, Inc. and its other subsidiaries. Except as otherwise stated in the applicable prospectus supplement, there is no legal or contractual restriction on the ability of Toll Brothers, Inc. or the other subsidiaries of Toll Brothers, Inc. to provide these funds. If the debt securities of any series issued by Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. will be subordinated to any other indebtedness of that issuer, the indebtedness of that issuer to which that series will be subordinated will be referred to in the applicable authorizing resolution and prospectus supplement as senior indebtedness of Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp., as the case may be. The applicable authorizing resolution and prospectus supplement will define that senior indebtedness and describe the terms of the subordination. Unless otherwise stated in the applicable prospectus supplement, the payment of principal, premium, if any, and interest on any series of debt securities issued by Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. which is subordinated by its terms to other indebtedness of that issuer will be subordinated in right of payment, in the manner and to the extent described in the indenture under which that series is issued, to the prior payment in full of all senior indebtedness of the issuer, as defined in the applicable authorizing resolution and prospectus supplement, whether the senior indebtedness is outstanding on the date of the indenture or is created, incurred, assumed or guaranteed after the date of the indenture. 10 The prospectus supplement relating to any series of debt securities that are offered by this prospectus will name the issuer and describe the specific terms of that series of debt securities. The applicable prospectus supplement will describe, among other things, the following terms, to the extent they are applicable to that series of debt securities: o their title and, if other than denominations of $1,000 and any integral multiple thereof, the denominations in which they will be issuable; o their price or prices (expressed as a percentage of the respective aggregate principal amount of the debt securities) at which they will be issued; o their total principal amount and, if applicable, the terms on which the principal amount of the series may be increased by a subsequent offering of additional debt securities of the same series; o the interest rate (which may be fixed or variable and which may be zero in the case of certain debt securities issued at an issue price representing a discount from the principal amount payable at maturity), the date or dates from which interest, if any, will accrue and the circumstances, if any, in which the issuer may defer interest payments; o any special provisions for the payment of any additional amounts with respect to the debt securities; o any provisions relating to the seniority or subordination of all or any portion of the indebtedness evidenced by the securities to other indebtedness of the issuer; o the date or dates on which principal and premium, if any, are payable or the method of determining those dates; o the dates and times at which interest, if any, will be payable, the record date for any interest payment and the person to whom interest will be payable if other than the person in whose name the debt security is registered at the close of business on the record date for the interest payment; o the place or places where principal, premium, if any, and interest, if any, will be payable; o the terms applicable to any "original issue discount" (as defined in the Internal Revenue Code of 1986, as amended, and the related regulations), including the rate or rates at which the original issue discount will accrue, and any special federal income tax and other considerations; o the right or obligation, if any, of the issuer to redeem or purchase debt securities under any sinking fund or analogous provisions or at the option of a holder of debt securities, or otherwise, the conditions, if any, giving rise to the right or obligation and the period or periods within which, and the price or prices at which and the terms and conditions upon which, debt securities will be redeemed or purchased, in whole or in part, and any provisions for the marketing of the debt securities; o if the amount of payments of principal, premium, if any, and interest, if any, is to be determined by reference to an index, formula or other method, the manner in which these amounts are to be determined and the calculation agent, if any, with respect to the payments; o if other than the principal amount of the debt securities, the portion of the principal amount of the debt securities which will be payable upon declaration or acceleration of the stated maturity of the debt securities pursuant to an "Event of Default," as defined in the applicable indenture; o whether the debt securities will be issued in registered or bearer form and the terms of these forms; o whether the debt securities will be issued in certificated or book-entry form and, if applicable, the identity of the depositary; o any provision for electronic issuance or issuances in uncertificated form; o any listing of the debt securities on a securities exchange; o any events of default or covenants in addition to or in place of those described in this prospectus; 11 o the terms, if any, on which the debt securities will be convertible into or exchangeable for other debt or equity securities, including without limitation the conversion price, the conversion period and any other provisions in addition to or in place of those included in this prospectus; o the collateral, if any, securing payments with respect to the debt securities and any provisions relating to the collateral; o whether and upon what terms the debt securities may be defeased; and o any other material terms of that series of debt securities. (Section 2.03) Guarantee of Debt Securities Toll Brothers, Inc. will guarantee, fully and unconditionally unless otherwise provided in the applicable prospectus supplement, the payment of the principal, premium, if any, and interest on the debt securities as they become due, whether at maturity, by declaration of acceleration, call for redemption or otherwise. (Section 7.01). Unless otherwise provided in the applicable prospectus supplement or authorizing resolution, the payment of principal, premium, if any, and interest on the debt securities under the guarantees will be junior in right of payment to the prior payment in full of all senior indebtedness of Toll Brothers, Inc., in the manner and to the extent described in the indenture, whether the senior indebtedness is outstanding on the date of the indenture or is created, incurred, assumed or guaranteed after the date of the indenture. The senior indebtedness of Toll Brothers, Inc. is referred to in the indenture as "Senior Indebtedness of the Guarantor" and may be further defined in the applicable prospectus supplement and authorizing resolution. (Section 7.02). Unless otherwise provided in the applicable prospectus supplement, upon (1) the maturity of any senior indebtedness of Toll Brothers, Inc. by lapse of time, acceleration, unless waived, or otherwise or (2) any distribution of the assets of Toll Brothers, Inc. upon any dissolution, winding up, liquidation or reorganization of Toll Brothers, Inc., the holders of senior indebtedness of Toll Brothers, Inc. will be entitled to receive payment in full before the holders of any then outstanding debt securities of a series offered by this prospectus will be entitled to receive any payment on those debt securities pursuant to the guarantees. Except as otherwise provided in the applicable prospectus supplement, if in any of the situations referred to in (1) or (2) above, a payment is made to the trustee or to holders of the debt securities of a series offered by this prospectus before all senior indebtedness of Toll Brothers, Inc. has been paid in full or provision has been made for payment of all of the senior indebtedness of Toll Brothers, Inc., the payment to the trustee or holders must be paid over to the holders of the senior indebtedness of Toll Brothers, Inc. (Sections 7.03, 7.04). The assets of Toll Brothers, Inc. consist principally of the stock of its subsidiaries. Therefore, the rights of Toll Brothers, Inc. and the rights of its creditors, including the holders of debt securities fully and unconditionally guaranteed by Toll Brothers, Inc., to participate in the assets of any subsidiary other than the issuer of those debt securities upon liquidation, recapitalization or otherwise will be subject to the prior claims of that subsidiary's creditors except to the extent that claims of Toll Brothers, Inc. itself as a creditor of the subsidiary may be recognized. This includes the prior claims of the banks that have provided and are providing to First Huntingdon Finance Corp. a revolving credit facility and a term loan under agreements pursuant to which Toll Brothers, Inc. and its other subsidiaries, including Toll Corp. and Toll Finance Corp., have guaranteed or will guarantee the obligations owing to the banks under the revolving credit facility and the term loan. Conversion of Debt Securities Unless otherwise indicated in the applicable prospectus supplement, the debt securities will not be convertible into common stock of Toll Brothers, Inc. or into any other securities. The particular terms and conditions of the conversion rights of any series of convertible debt securities other than those described below will be described in the applicable prospectus supplement. Unless otherwise indicated in the applicable prospectus supplement, and subject, if applicable, to prior redemption at the option of the issuer of the debt securities, the holders of any series of convertible debt securities will be entitled to convert the principal amount or a portion of the principal amount which is an integral multiple of $1,000 at any time before the date specified in the applicable prospectus supplement for the series of debt 12 securities into shares of common stock of Toll Brothers, Inc. at the conversion price stated in the applicable prospectus supplement, subject to adjustment as described below. (Section 10.02). In the case of any debt security or portion of debt security called for redemption, conversion rights will expire at the close of business on the second business day preceding the redemption date. (Section 10.02). Toll Brothers, Inc. will not be required to issue fractional shares of common stock upon conversion of the debt securities of a convertible series. Instead, Toll Brothers, Inc. will pay a cash adjustment for any fractional interest in a share of its common stock. (Section 10.04). Convertible debt securities surrendered for conversion during the period from the close of business on a "Record Date," as defined in the applicable indenture, or the next preceding "Business Day," as defined in the applicable indenture, if the Record Date is not a Business Day, preceding any "Interest Payment Date," as defined in the applicable indenture, to the opening of business on that Interest Payment Date, other than convertible debt securities or portions of convertible debt securities called for redemption during the period, will be accompanied by payment in next-day funds or other funds acceptable to Toll Brothers, Inc. of an amount equal to the interest payable on the Interest Payment Date on the principal amount of the convertible debt securities then being converted. Except as described in the preceding sentence, no payment or adjustment will be made on convertible debt securities on account of interest accrued on the debt securities surrendered for conversion or for dividends on the common stock delivered on conversion. If an issuer of convertible debt securities defaults on the payment of interest for which payment is made upon the surrender of those convertible debt securities for conversion, the amount so paid will be returned to the party who made the payment. (Section 10.03). The conversion price of the debt securities of a convertible series will be subject to adjustment in certain events, including: o the issuance of common stock of Toll Brothers, Inc. as a dividend or distribution on common stock of Toll Brothers, Inc.; o the subdivision, combination or reclassification of the outstanding common stock of Toll Brothers, Inc.; o the issuance of rights or warrants, expiring within 45 days after the record date for issuance, to the holders of common stock of Toll Brothers, Inc. generally entitling them to acquire shares of common stock of Toll Brothers, Inc. at less than the common stock's then "Current Market Price" as defined in the indenture; o the distribution to holders of common stock of Toll Brothers, Inc. generally of evidences of indebtedness or assets of Toll Brothers, Inc., excluding cash dividends paid from retained earnings and dividends or distributions payable in stock for which adjustment is otherwise made; or o the distribution to the holders of common stock of Toll Brothers, Inc. generally of rights or warrants to subscribe for securities of Toll Brothers, Inc. other than those for which adjustment is otherwise made. (Section 10.05) There will be no upward adjustment in the conversion price except in the event of a reverse stock split. Toll Brothers, Inc. is not required to make any adjustment in the conversion price of less than 1%, but the adjustment will be carried forward and taken into account in the computation of any subsequent adjustment. (Section 10.05). A conversion price adjustment or the failure to make a conversion price adjustment may, under various circumstances, be deemed to be a distribution that could be taxable as a dividend under the Internal Revenue Code to holders of debt securities or to holders of common stock. There will be no adjustments to the conversion price of the debt securities of any convertible series as discussed above in the following situations: o any consolidation or merger to which Toll Brothers, Inc. is a party other than a merger or consolidation in which Toll Brothers, Inc. is the continuing corporation; o any sale or conveyance to another corporation of the property of Toll Brothers, Inc. as an entirety or substantially as an entirety; or 13 o any statutory exchange of securities with another corporation, including any exchange effected in connection with a merger of a third corporation into Toll Brothers, Inc. However, the holder of each convertible debt security outstanding at that time will have the right to convert the debt security into the kind and amount of securities, cash or other property which the holder would have owned or have been entitled to receive immediately after the transaction if the debt security was converted immediately before the effective date of the transaction. (Section 10.10). Form, Exchange, Registration, Conversion, Transfer and Payment Unless otherwise indicated in the applicable prospectus supplement: o each series of debt securities will be issued in registered form only, without coupons; o payment of principal, premium, if any, and interest, if any, on each series of the debt securities will be payable at the office or agency of the issuer of that series maintained for this purpose (Section 2.05); and o the exchange, conversion and transfer of each series of debt securities may be registered at the office or agency of the issuer of that series maintained for this purpose and at any other office or agency maintained for this purpose. (Section 2.05). Subject to various exceptions described in the indenture, the issuer of each series of debt securities will be entitled to charge a reasonable fee for the registration of transfer or exchange of the debt securities of that series, including an amount sufficient to cover any tax or other governmental charge imposed or expenses incurred in connection with the transfer or exchange. (Section 2.08). All payments made by the issuer of a series of debt securities to the trustee and paying agent for the payment of principal, premium, if any, and interest on the debt securities of that series which remain unclaimed for two years after the principal, premium, if any, or interest has become due and payable may be repaid to the issuer. Afterwards, the holder of the debt security may look only to the issuer or, if applicable, Toll Brothers, Inc., for payment. (Section 11.03). Registered Global Securities The registered debt securities of a series may be issued in whole or in part in the form of one or more registered global debt securities. A registered global security is a security, typically held by a depositary, that represents the beneficial interests of a number of purchasers of the security. Any registered global debt securities will be deposited with and registered in the name of a depositary or its nominee identified in the applicable prospectus supplement. In this case, one or more registered global securities will be issued, each in a denomination equal to the portion of the total principal amount of outstanding registered debt securities of the series to be represented by the registered global security. (Section 2.14). Unless and until a registered global security is exchanged in whole or in part for debt securities in definitive registered form, it may not be transferred except as a whole: o by the depositary for the registered global security to a nominee for the depository; o by a nominee of the depositary to the depositary or to another nominee of the depositary; or o by the depositary or its nominee to a successor depositary or a nominee of a successor depositary. (Section 2.14). The prospectus supplement relating to a particular series of debt securities will describe the specific terms of the depositary arrangement involving any portion of a series of debt securities to be represented by a registered global security. We anticipate that the following provisions will apply to all depositary arrangements for debt securities: o ownership of beneficial interests in a registered global security will be limited to persons that have accounts with the depositary for the registered global security (each a "participant" and, collectively, the "participants") or persons holding interests through the participants; 14 o after the issuer of a series of debt securities issues the registered global security for the series, the depositary will credit, on its book-entry registration and transfer system, the participants' accounts with the respective principal amounts of the debt securities of that series represented by the registered global security beneficially owned by the participants; o the underwriters, agents or dealers participating in the distribution of the debt securities will designate the accounts to be credited; o only a participant or a person that may hold an interest through a participant may be the beneficial owner of a registered global security; and o ownership of beneficial interests in the registered global security will be shown on, and the transfer of that ownership interest will be effected only through, records maintained by the depositary for the registered global security for interests of the participants, and on the records of the participants for interests of persons holding through the participants. The laws of some states may require that specified purchasers of securities take physical delivery of the securities in definitive form. These laws may limit the ability of those persons to own, transfer or pledge beneficial interests in registered global securities. So long as the depositary for a registered global security, or its nominee, is the registered owner of the registered global security, the depositary or its nominee, as the case may be, will be considered the sole owner or holder of the debt securities represented by the registered global security for all purposes under the indenture. Except as stated below, owners of beneficial interests in a registered global security: o will not be entitled to have the debt securities represented by a registered global security registered in their names; o will not receive or be entitled to receive physical delivery of the debt securities in definitive form; and o will not be considered the owners or holders of the debt securities under the indenture. Accordingly, each person owning a beneficial interest in a registered global security must rely on the procedures of the depositary for the registered global security and, if the person is not a participant, on the procedures of the participant through which the person owns its interests, to exercise any rights of a holder under the indenture applicable to the registered global security. We understand that under existing industry practices, if we request any action of holders, or if an owner of a beneficial interest in a registered global security desires to give or take any action which a holder is entitled to give or take under the indenture, the depositary for the registered global security would authorize the participants holding the relevant beneficial interests to give or take the action, and the participants would authorize beneficial owners owning through the participants to give or take the action or would otherwise act upon the instructions of beneficial owners holding through them. Principal, premium, if any, and interest payments on debt securities represented by a registered global security registered in the name of a depositary or its nominee will be made to the depositary or its nominee, as the case may be, as the registered owner of the registered global security. None of the issuer of a series of debt securities, Toll Brothers, Inc., the trustee under the indenture nor any agent of any of them will be responsible or liable for any aspect of the records relating to, or payments made on account of, beneficial ownership interests in the registered global security for the series or for maintaining, supervising or reviewing any records relating to the beneficial ownership interests. We expect that the depositary for any debt securities represented by a registered global security, upon receipt of any payment of principal, premium, if any, or interest in respect of the registered global security, will immediately credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of the registered global security as shown on the depositary's records. We also expect that payments by participants to owners of beneficial interests in a registered global security held through the participants will be governed by standing customer instructions and customary practices, as is now the case with the securities held for the accounts of customers in bearer form or registered in "street name," and will be the responsibility of the participants. 15 If the depositary for any debt securities represented by a registered global security is at any time unwilling or unable to continue as depositary or ceases to be a clearing agency registered under the Securities Exchange Act of 1934, Toll Brothers, Inc. will appoint an eligible successor depositary. If Toll Brothers, Inc. fails to appoint an eligible successor depositary within 90 days, the debt securities will be issued in definitive form in exchange for the registered global security. In addition, Toll Brothers, Inc. may at any time and in its sole discretion determine not to have any debt securities of a series represented by one or more registered global securities. In that event, debt securities of that series will be issued in definitive form in exchange for each registered global security representing the debt securities. Any debt securities issued in definitive form in exchange for a registered global security will be registered in such name or names as the depositary instructs the trustee. We expect that the instructions will be based upon directions received by the depositary from the participants with respect to ownership of beneficial interests in the registered global security. Events of Default, Notice and Waiver Unless otherwise indicated in the applicable prospectus supplement, each of the following events will be an "Event of Default" with respect to each series of debt securities issued under the indenture: o Toll Brothers, Inc. or the issuer of that series of debt securities fails to pay interest due on any debt securities of that series for 30 days; o Toll Brothers, Inc. or the issuer of that series of debt securities fails to pay the principal of any debt securities of that series when due; o Toll Brothers, Inc. or the issuer of that series of debt securities fails to perform any other agreements contained in the debt securities of that series or in the guarantee relating to that series of debt securities or contained in the indenture for that series of debt securities and applicable to that series for a period of 60 days after the issuer's receipt of notice of the default from the trustee under the indenture or from the holders of at least 25% in principal of the debt securities of that series; o default in the payment of indebtedness of the issuer of that series of debt securities, Toll Brothers, Inc. or any "Subsidiary" (as defined in the indenture) of Toll Brothers, Inc., including Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp., under the terms of the instrument evidencing or securing that indebtedness which permits the holder of that indebtedness to: o accelerate the payment of an aggregate of more than $10,000,000 in principal amount of the indebtedness, after the lapse of applicable grace periods; or o in the case of defaults other than payment defaults, accelerate the indebtedness and the acceleration is not rescinded or annulled within 10 days after the acceleration, provided that, subject to certain limitations described in the indenture, the term "indebtedness" does not include for this purpose an acceleration of or default on certain "Non-Recourse Indebtedness," as that term is defined in the indenture and described below; o a final judgment for the payment of money in an amount in excess of $10,000,000 is entered against the issuer of that series of debt securities, Toll Brothers, Inc. or any Subsidiary (as defined in the indenture) of Toll Brothers, Inc., including Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp., which remains undischarged for a period of 60 days after the date on which the right to appeal has expired, during which period execution is not effectively stayed, provided that the term "final judgment" will not include a "Non-Recourse Judgment," as that term is defined in the indenture and described below, unless the book value of all property, net of any previous write downs or reserves in respect of the property, subject to the Non-Recourse Judgment exceeds the amount of the Non-Recourse Judgment by more than $10,000,000; o an "Event of Default," as that term is defined in the indenture relating to Toll Corp.'s 8 3/4% Senior Subordinated Notes due 2006, 7 3/4% Senior Subordinated Notes due 2007, 8 1/8% Senior Subordinated Notes due 2009, 8% Senior Subordinated Notes due 2009, or 8 1/4% Senior Subordinated Notes due 2011 (each of these series of notes being referred to below as an "Outstanding Series"), occurs, provided that on the date of the occurrence, the outstanding principal amount of at least one Outstanding Series to which the occurrence relates exceeds $5,000,000; 16 o any one of various events of bankruptcy, insolvency or reorganization specified in the indenture occurs with respect to Toll Brothers, Inc. or the issuer of that series of debt securities; or o the guarantee of Toll Brothers, Inc. relating to that series of debt securities ceases to be in full force and effect for any reason other than in accordance with its terms. (Section 8.01). "Non-Recourse Indebtedness," as defined in the indenture, means indebtedness or other obligations secured by a lien on property to the extent that the liability for the indebtedness or other obligations is limited to the security of the property without liability on the part of Toll Brothers, Inc. or any subsidiary (other than the subsidiary which holds title to the property) for any deficiency. (Section 1.01). "Non-Recourse Judgment," as defined in the indenture, means a judgment in respect of indebtedness or other obligations secured by a lien on property to the extent that the liability for (1) the indebtedness or other obligations and (2) the judgment is limited to the property without liability on the part of Toll Brothers, Inc. or any subsidiary (other than the subsidiary which holds title to the property) for any deficiency. (Section 1.01). The trustee is required to give notice to the holders of any series of debt securities within 90 days of a default with respect to that series of debt securities under the indenture. However, the trustee may withhold notice to the holders of any series of debt securities, except in the case of a default in the payment of principal, premium, if any, or interest, if any, with respect to that series, if the trustee considers the withholding to be in the interest of the holders. (Section 9.05). If an Event of Default occurs and is continuing for a series of debt securities, other than an Event of Default resulting from certain events of bankruptcy, insolvency or reorganization with respect to Toll Brothers, Inc. or the issuer of that series of debt securities, either the trustee or the holders of at least 25% in principal amount of all of the outstanding debt securities of that series may, by giving an acceleration notice to the issuer of that series of debt securities, declare the unpaid principal of and accrued and unpaid interest on all of the debt securities of that series to be due and payable if, with respect to debt securities of that series (1) (a) no designated senior debt of Toll Brothers, Inc. or the issuer of that series of debt securities is outstanding, or (b) if the debt securities of that series are not subordinated to other indebtedness of the issuer of that series of debt securities, immediately; or (2) if designated senior debt of Toll Brothers, Inc. or the issuer of that series of debt securities is outstanding and the debt securities of that series are junior to other indebtedness of the issuer of that series of debt securities, upon the earlier of (A) ten days after the acceleration notice is received by the issuer of that series of debt securities or (B) the acceleration of any senior indebtedness of Toll Brothers, Inc. or the issuer of that series of debt securities. The designated senior debt of Toll Brothers, Inc. is referred to in the indenture as "Designated Senior Debt of the Guarantor" and the designated senior debt of Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp., as the case may be, is referred to in the indenture for that issuer's debt securities as "Designated Senior Debt of the Company," and each, as defined in the indenture, may be further defined in the applicable prospectus supplement. (Section 8.02). If an Event of Default occurs with respect to a series of debt securities as a result of certain events of bankruptcy, insolvency or reorganization with respect to Toll Brothers, Inc. or the issuer of that series of debt securities, then the unpaid principal amount of all of the debt securities of that series outstanding and any accrued and unpaid interest will automatically become due and payable immediately without any declaration or other act by the trustee or any holder of debt securities of that series. (Section 8.02). At any time after a declaration of acceleration with respect to debt securities of any series has been made, but before a judgment or decree based on acceleration has been obtained, the holders of a majority in principal amount of the outstanding debt securities of that series may rescind the acceleration, provided that, among other things, all Events of Default with respect to the particular series, other than payment defaults caused by the acceleration, have been cured or waived as provided in the indenture. (Section 8.02). The holders of a majority in outstanding principal amount of the debt securities of a particular series may generally waive an existing default with respect to that series and its consequences in accordance with terms and conditions provided in the indenture. However, these holders may not waive a default in the payment of the principal, any premium or any interest on the debt securities. (Section 8.04). 17 Toll Brothers, Inc. and any issuer of debt securities offered by this prospectus will be required to file annually with the trustee under the indenture a certificate, signed by an officer of Toll Brothers, Inc. and the issuer, stating whether or not the officer knows of any default under the terms of the indenture and providing a description of any default of which the officer has knowledge. (Section 4.03). Redemption The prospectus supplement relating to a series of redeemable debt securities will describe the rights or obligations of the issuer to redeem those debt securities and the procedure for redemption. (Section 3). Additional Provisions Subject to the duty of the trustee to act with the required standard of care during a default, the indenture provides that the trustee will be under no obligation to perform any duty or to exercise any of its rights or powers under the indenture, unless the trustee receives indemnity satisfactory to it against any loss, liability or expense. (Section 9.01). Subject to these provisions for the indemnification of the trustee and various other conditions, the holders of a majority in total principal amount of the outstanding debt securities of any series will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the trustee, or exercising any trust or power conferred on the trustee, with respect to the debt securities of that series. (Section 8.05). A holder of debt securities of a series will not have the right to pursue any remedy with respect to the indenture or the debt securities of that series, unless: o the holder gives to the trustee written notice of a continuing Event of Default; o the holders of not less than 25% in total principal amount of the outstanding debt securities of that series make a written request to the trustee to pursue the remedy; o the holder offers the trustee indemnity satisfactory to it against any loss, liability or expense; o the trustee fails to comply with the holder's request within 60 days after receipt of the written request and offer of indemnity; and o the trustee, during the same 60-day period, has not received from the holders of a majority in principal amount of the outstanding debt securities of that series a direction inconsistent with the aforementioned written request of holders. (Section 8.06). However, the holder of any debt security will have an absolute right to receive payment of the principal of and interest on that debt security on or after the respective due dates expressed in that debt security and to bring suit for the enforcement of any payment. (Section 8.07). Covenants The prospectus supplement relating to the debt securities of any series will describe any special covenants applicable to the issuer of the series or Toll Brothers, Inc. with respect to that series. (Section 4). Merger or Consolidation Neither Toll Brothers, Inc. nor the issuer of a series of debt securities offered by this prospectus may consolidate with or merge into, or transfer all or substantially all of its assets to, any other person without the written consent of the holders of a majority in outstanding principal amount of the debt securities of that series, unless: o the other person is a corporation organized and existing under the laws of the United States or a state thereof or the District of Columbia and expressly assumes by supplemental indenture all the obligations of Toll Brothers, Inc. or the issuer, as the case may be, under the indenture and either the guarantees or the debt securities, as the case may be; and 18 o immediately after giving effect to the transaction no "Default" or "Event of Default," as these terms are defined in the indenture, has occurred and is continuing. Afterwards, all of the obligations of the predecessor corporation will terminate. (Section 5.01). Modification of an Indenture The respective obligations of Toll Brothers, Inc. and the issuer of debt securities of any series offered by this prospectus and the rights of the holders of those debt securities under the indenture generally may be modified with the written consent of the holders of a majority in outstanding principal amount of the debt securities of all series under the indenture affected by the modification. However, without the consent of each affected holder of debt securities, no amendment, supplement or waiver may: o reduce the amount of debt securities whose holders must consent to an amendment, supplement or waiver; o reduce the rate or extend the time for payment of interest on the debt securities; o reduce the principal amount of, or premium on, the debt securities; o extend the maturity of any debt securities; o change the redemption provisions; o waive a default in the payment of the principal, premium, if any, or interest on any series of debt securities; o modify the subordination or guarantee provisions in a manner adverse to holders of any series of debt securities; o make the medium of payment other than that stated in the debt securities; o make a change that adversely affects the right to convert or the conversion price for any series of convertible debt securities; o make any change in the right of any holder of debt securities to receive payment of principal of, premium, if any, and interest on those debt securities, or to bring suit for the enforcement of any of these payments; and o change the provisions regarding modifications to the indenture or waiver of Defaults or Events of Default that will be effective against any holders of any series of debt securities. (Section 12.02). Governing Law The indenture, the debt securities and the guarantees will be governed by the laws of the State of New York. (Section 13.09). Satisfaction and Discharge of Indenture Unless otherwise provided in the applicable authorizing resolution and prospectus supplement, the indenture will be discharged: o upon payment of all the series of debt securities issued under the indenture; or o upon deposit with the trustee, within one year of the date of maturity or redemption of all of the series of debt securities issued under the indenture, of funds sufficient for (a) the payment of principal of and interest on the securities to maturity or (b) redemption of the securities. (Section 11.01). 19 Reports to Holders of Debt Securities Toll Brothers, Inc. and each issuer of the debt securities offered by this prospectus will file with the trustee copies of their annual reports and other information, documents and reports that they file with the SEC. So long as the obligation of Toll Brothers, Inc. to file these reports or information with the SEC is suspended or terminated, Toll Brothers, Inc. will provide the trustee with audited annual financial statements prepared in accordance with generally accepted accounting principles and unaudited condensed quarterly financial statements. These financial statements will be accompanied by management's discussion and analysis of the results of operations and financial condition of Toll Brothers, Inc. for the period reported upon in substantially the form required under the rules and regulations of the SEC then in effect. (Section 4.02). 20 DESCRIPTION OF CAPITAL STOCK The authorized capital stock of Toll Brothers, Inc. consists of 100,000,000 shares of common stock, $.01 par value per share, and 1,000,000 shares of preferred stock, $.01 par value per share; however, subject to the limitations and procedures described below, the stockholders of Toll Brothers, Inc. have authorized increases in the respective numbers of shares of common stock and preferred stock. In March 2001, the stockholders of Toll Brothers, Inc. authorized the filing by the Board of Directors, in its discretion, of one or more amendments to the Certificate of Incorporation from time to time on or before March 31, 2006 (1) to increase the authorized common stock by up to 155,000,000 additional shares in any combination of one or more 5,000,000-share increments and/or (2) to increase the authorized preferred stock by a single increment of 14,000,000 additional shares. On March 7, 2002, the Board of Directors filed an amendment to the Certificate of Incorporation, in accordance with this stockholder authorization, which amendment increased the authorized shares of common stock from 45,000,000 shares to 100,000,000 shares. If additional amendments increasing the authorized capital stock of Toll Brothers, Inc. to the maximum limits authorized by the stockholders are filed by March 31, 2006, the authorized common stock of Toll Brothers, Inc. will be increased to 200,000,000 shares and the authorized preferred stock of Toll Brothers, Inc. will be increased to 15,000,000 shares. The procedure was approved by stockholders to permit Toll Brothers, Inc. to reduce the amount of annual Delaware corporate franchise tax that it is required to pay, while giving the Board of Directors the flexibility to increase quickly the authorized shares of common or preferred stock without the necessity of further action by the stockholders. Common Stock Subject to the rights and preferences of any holders of the preferred stock of Toll Brothers, Inc., none of which is currently outstanding, the holders of the common stock of Toll Brothers, Inc. are entitled to one vote per share on all matters which require a vote of the common stockholders. In addition, the holders of the common stock of Toll Brothers, Inc. are entitled to receive dividends as legally may be declared by the board of directors and to receive pro rata the net assets of Toll Brothers, Inc. upon liquidation. There are no cumulative voting, preemptive, conversion or redemption rights applicable to the common stock of Toll Brothers, Inc. Persons casting a majority of the votes in the election of directors will be entitled to elect all of the directors. On June 12, 1997, the board of directors of Toll Brothers, Inc. adopted a Stockholder Rights Plan. This Stockholder Rights Plan originally provided for one right to attach to each share of the common stock of Toll Brothers, Inc. In March 2002, Toll Brothers, Inc. declared a 2-for-1 split of its common stock to be effected in the form of a stock dividend. In connection with the common stock split and in accordance with the terms of the Stockholder Rights Plan, the right associated with each share of common stock was adjusted so that one-half of a right will now attach to each share of common stock. Upon the occurrence of certain events, each right entitles the registered holder to purchase from Toll Brothers, Inc. a unit consisting of one one-thousandth of a share of Series A Junior Participating Preferred Stock of Toll Brothers, Inc. at a purchase price of $100 per unit. Initially the rights attach to all common stock certificates and no separate rights certificates will be distributed. The rights will separate from the common stock and a distribution date will occur upon the earlier of: o 10 days following a public announcement that a person or group of affiliated persons has acquired beneficial ownership of 15% or more of the outstanding shares of common stock of Toll Brothers, Inc.; or o 10 business days following the commencement of a tender offer that would result in a person or group beneficially owning 15% or more of the outstanding shares of common stock of Toll Brothers, Inc. The rights are not exercisable until the distribution date and will expire at the close of business on July 11, 2007. In the event any non-exempt person or group acquires 15% or more of the then outstanding shares of common stock, unless the acquisition is made pursuant to a tender offer for all outstanding shares at a price determined by a majority of the directors of Toll Brothers, Inc. who are not officers of Toll Brothers, Inc. to be fair and otherwise in the best interest of Toll Brothers, Inc. and its stockholders, each holder of a right will have the right to receive, upon exercise, common stock having a value equal to two times the exercise price of the right; except that the rights held by a non-exempt person or group become null and void upon that person or group acquiring 15% or more of the then outstanding shares of common stock. At any time until 10 days following the stock acquisition date, Toll Brothers, Inc. may redeem the rights at a price of $.001 per right. The 21 Rights Agreement establishing the Stockholder Rights Plan was filed with the SEC on June 19, 1997 as an exhibit to a registration statement on Form 8-A. An amendment to the Rights Agreement was filed with the SEC on August 21, 1998 as an exhibit to an amended registration statement on Form 8-A/A. This summary of the rights is not complete. For additional information, holders of the common stock of Toll Brothers, Inc. should read the Rights Agreement and the amendment to that agreement, which are incorporated by reference in this prospectus. The common stock of Toll Brothers, Inc. is traded on the New York Stock Exchange and the Pacific Exchange under the symbol "TOL." Preferred Stock General. Toll Brothers, Inc. may issue, from time to time, shares of one or more series of preferred stock. We have summarized below the general terms and provisions that will apply to any preferred stock that may be offered, except as otherwise described by the applicable prospectus supplement. When Toll Brothers, Inc. offers to sell a particular series of preferred stock, a prospectus supplement will describe the specific terms of that series of preferred stock. If any of the general terms and provisions described in this prospectus apply to the particular series of preferred stock, the applicable prospectus supplement will so indicate and will describe any alternative provisions that are applicable. The preferred stock will be issued under a certificate of designations relating to each series of preferred stock, and is also subject to the Toll Brothers, Inc. Certificate of Incorporation, as amended. The following summary of various provisions of the preferred stock is not complete. You should read Toll Brothers, Inc.'s Certificate of Incorporation, as amended, and each certificate of designations relating to a specific series of preferred stock for additional information. Each certificate of designations relating to a specific series of preferred stock will be filed as an exhibit to, or will be incorporated by reference in, the registration statement at or prior to the time of issuance of the particular series of preferred stock. The board of directors of Toll Brothers, Inc. is authorized to issue shares of preferred stock, in one or more series, and to fix for each series voting powers and the preferences and relative, participating, optional or other special rights and the qualifications, limitations or restrictions, that are permitted by the Delaware General Corporation Law. The board of directors of Toll Brothers, Inc. is authorized to determine the following terms for each series of preferred stock, which will be described in the applicable prospectus supplement: o the number of shares and their designation and title; o the dividend rate or the method of calculating the dividend rate, if applicable; o the priority as to payment of dividends; o the dividend periods or the method of calculating the dividend periods, if applicable; o the voting rights, if any; o the liquidation preference and the priority as to payment of the liquidation preference upon any liquidation or winding-up of Toll Brothers, Inc.; o whether and on what terms the shares will be subject to redemption or repurchase at the option of Toll Brothers, Inc.; o whether and on what terms the shares will be convertible into or exchangeable for other debt or equity securities; o whether the shares will be listed on a securities exchange; and o the other rights and privileges and any qualifications, limitations or restrictions relating to the shares. Dividends. Holders of preferred stock will be entitled to receive cash dividends if declared by the board of directors of Toll Brothers, Inc. out of funds which Toll Brothers, Inc. may legally use for payment. The applicable 22 prospectus supplement will identify the dividend rates and the dates on which Toll Brothers, Inc. will pay dividends. Unless otherwise described in the applicable prospectus supplement, each series of preferred stock will rank junior as to dividends to any series of preferred stock that may be issued in the future that is expressly senior as to dividends to the earlier series of the preferred stock. If at any time Toll Brothers, Inc. has failed to pay accrued dividends on any senior series of preferred stock at the time dividends are payable on a junior series of preferred stock, Toll Brothers, Inc. may not pay any dividend on the junior series of preferred stock or redeem or otherwise repurchase shares of the junior series of preferred stock until the accumulated but unpaid dividends on the senior series have been paid or set aside for payment in full by Toll Brothers, Inc. Unless otherwise described in the applicable prospectus supplement: o no dividends, other than in common stock or other capital stock ranking junior to the preferred stock of any series as to dividends and upon liquidation, may be declared or paid or set aside for payment; and o no distribution may be declared or made upon the common stock, or any other capital stock of Toll Brothers, Inc. ranking junior to or equally with the preferred stock of the particular series as to dividends. In addition, unless otherwise described in the applicable prospectus supplement, no common stock or any other capital stock of Toll Brothers, Inc. ranking junior to or equally with the preferred stock of the particular series as to dividends may be redeemed, purchased or otherwise acquired for any consideration and no monies may be paid to or made available for a sinking fund for the redemption of any shares of any such stock by Toll Brothers, Inc. except by conversion into or exchange for other capital stock of Toll Brothers, Inc. ranking junior to the preferred stock of the particular series as to dividends unless: o if the series of preferred stock has a cumulative dividend, full cumulative dividends on the preferred stock of the series have been or contemporaneously are declared and paid or declared and an amount sufficient for the payment of the dividends has been set apart for all past dividend periods and the then current dividend period; or o if the particular series of preferred stock does not have a cumulative dividend, full dividends on the preferred stock of the series have been or contemporaneously are declared and paid or declared and an amount sufficient for the payment of the dividends has been set apart for payment for the then current dividend period; provided, however, that any monies deposited up until that time in any sinking fund with respect to any preferred stock of Toll Brothers, Inc. in compliance with the provisions of the sinking fund may subsequently be applied to the purchase or redemption of the preferred stock in accordance with the terms of the sinking fund, regardless of whether at the time of the application full cumulative dividends upon shares of the preferred stock outstanding on the last dividend payment date have been paid or declared and set apart for payment; and provided, further, that any of the junior or equally-ranked classes of preferred stock or common stock of Toll Brothers, Inc. may be converted into or exchanged for stock of Toll Brothers, Inc. ranking junior to the series of preferred stock then senior to the junior or equally-ranked classes of preferred stock as to dividends. The amount of dividends payable for the initial dividend period or any period shorter than a full dividend period will be computed on the basis of a 360-day year of twelve 30-day months. Accrued but unpaid dividends will not bear interest. Convertibility. No series of preferred stock will be convertible or exchangeable for other securities or property unless otherwise stated in the applicable prospectus supplement. Redemption and Sinking Fund. Toll Brothers, Inc. will not have the right or obligation to redeem or pay into a sinking fund for the benefit of any series of preferred stock unless otherwise stated in the applicable prospectus supplement. Liquidation Rights. Unless otherwise stated in the applicable prospectus supplement, in the event of any liquidation, dissolution or winding-up of Toll Brothers, Inc., holders of each series of preferred stock will be entitled to receive the liquidation preference per share specified in the applicable prospectus supplement for that particular series of preferred stock plus any accrued and unpaid dividends. Toll Brothers, Inc. will pay these 23 amounts to the holders of each series of the preferred stock and all amounts owing on any preferred stock ranking equally with that series of preferred stock as to distributions. These payments will be made out of the assets of Toll Brothers, Inc. available for distribution to stockholders before any distribution is made to holders of common stock or any other shares of preferred stock of Toll Brothers, Inc. ranking junior to the series of preferred stock as to rights upon liquidation, dissolution or winding-up. In the event that there are insufficient funds to pay in full the amounts payable to all equally-ranked classes of preferred stock, Toll Brothers, Inc. will allocate the remaining assets equally among all series of equally-ranked preferred stock in proportion to the full respective preferential amounts to which they are entitled. Unless otherwise specified in a prospectus supplement for a series of preferred stock, after Toll Brothers, Inc. pays the full amount of the liquidation distribution to which they are entitled, the holders of shares of a series of preferred stock will not be entitled to participate in any further distribution of the assets of Toll Brothers, Inc. The consideration or merger of Toll Brothers, Inc. with another corporation or sale of securities will not be considered a liquidation, dissolution or winding-up of Toll Brothers, Inc. for these purposes. Voting Rights. Holders of preferred stock will not have any voting rights except as described in the applicable prospectus supplement or as otherwise from time to time required by law. Miscellaneous. When the preferred stock is issued, it will be fully paid and nonassessable. Holders of preferred stock will have no preemptive rights. If Toll Brothers, Inc. redeems or otherwise reacquires any shares of preferred stock, it will restore the shares to the status of authorized and unissued shares of preferred stock. These shares will not be a part of any particular series of preferred stock and Toll Brothers, Inc. may reissue the shares. There are no restrictions on repurchase or redemption of the preferred stock on account of any arrearage on sinking fund installments, except as may be described in an applicable prospectus supplement. Payment of dividends on any series of preferred stock may be restricted by loan agreements, indentures or other agreements entered into by Toll Brothers, Inc. The accompanying prospectus supplement will describe any material contractual restrictions on dividend payments. The prospectus supplement will also describe any material United States federal income tax considerations applicable to the preferred stock. No Other Rights. The shares of a series of preferred stock will not have any preferences, voting powers or relative, participating, optional or other special rights except for those described above or in the applicable prospectus supplement, the Certificate of Incorporation, as amended, or the applicable certificate of designations, or as otherwise required by law. Transfer Agent and Registrar. The prospectus supplement for each series of preferred stock will identify the transfer agent and registrar. 24 DESCRIPTION OF WARRANTS General Toll Brothers, Inc. may issue, together with other securities offered by this prospectus or separately, warrants for the purchase of the following: o debt securities of Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. with the guarantees of Toll Brothers, Inc.; o common stock of Toll Brothers, Inc.; or o preferred stock of Toll Brothers, Inc. Each series of warrants will be issued under a separate warrant agreement to be entered into between Toll Brothers, Inc. and a bank or trust company, as warrant agent. The terms of each warrant agreement will be discussed in the applicable prospectus supplement relating to the particular series of warrants. Copies of the form of agreement for each warrant, including the forms of certificates representing the warrants, reflecting the provisions to be included in these agreements for a particular offering will be, in each case, filed with the SEC as an exhibit to a document incorporated by reference in the registration statement of which this prospectus is a part prior to the date of any prospectus supplement relating to an offering of the particular warrant. We have summarized below the general terms and provisions that will apply to any warrants that may be offered, except as otherwise described by the applicable prospectus supplement. When Toll Brothers, Inc. offers to sell warrants, a prospectus supplement will describe the specific terms of that series of warrants. If any of the general terms and provisions described in this prospectus do not apply to the particular series of warrants being offered the applicable prospectus supplement will so indicate and will describe any alternative provisions that are applicable. The following summary of various provisions of the warrants, the warrant agreements and the warrant certificates is not complete. You should read all of the provisions of the applicable warrant agreement and warrant certificate, including the definitions contained in those documents of various terms, for additional important information concerning any series of warrants offered by this prospectus. Debt Warrants General. The prospectus supplement relating to any series of debt warrants that are offered by this prospectus will describe the specific terms of that series of debt warrants, any related debt warrant agreement and the debt warrant certificate(s) representing the debt warrants. The applicable prospectus supplement will describe, among other things, the following terms, to the extent they are applicable to that series of debt warrants: o the issuer of the debt securities which may be purchased upon exercise of the debt warrants, the designation, number, stated value and terms of those debt securities, the terms of the related guarantees and the procedures and conditions relating to the exercise of the debt warrants; o the designation and terms of any debt securities and related guarantees with which the debt warrants are issued and the number of the debt warrants issued with each debt security; o the date, if any, on and after which the debt warrants and the related debt securities will be separately transferable; o the principal amount of debt securities which may be purchased upon exercise of each debt warrant and the price at which the principal amount of debt securities may be purchased upon exercise of the debt warrant; o the date on which the right to exercise the debt warrants will begin and the date on which the right will expire; o a discussion of the material United States federal income tax considerations relevant to the exercise of the debt warrants; o whether the debt warrants represented by the debt warrant certificates will be issued in registered or bearer form, and, if registered, where they may be transferred and registered; 25 o call provisions, if any, of the debt warrants; and o any other material terms of the debt warrants. Debt warrant certificates will be exchangeable for new debt warrant certificates of different denominations. In addition, debt warrants may be exercised at the corporate trust office of the warrant agent or any other office indicated in the applicable prospectus supplement. A holder of a debt warrant will not have any of the rights of a holder of the debt securities which may be purchased by the exercise of the debt warrant before the debt securities are purchased by the exercise of the debt warrant. Accordingly, before a debt warrant is exercised, the holder will not be entitled to receive any payments of principal, premium, if any, or interest, if any, on the debt securities which may be purchased by the exercise of that debt warrant. Exercise of Debt Warrants. Each debt warrant will entitle the holder to purchase for cash the principal amount of debt securities described in the applicable prospectus supplement at the exercise price described or explained in the prospectus supplement. Debt warrants may be exercised at any time from the time they become exercisable, as described in the applicable prospectus supplement, up to the time on the date stated in the applicable prospectus supplement. Afterwards, unexercised debt warrants will become void. Debt warrants may be exercised in the manner described in the applicable prospectus supplement. When Toll Brothers, Inc. receives payment and the properly completed and duly executed debt warrant certificate at the corporate trust office of the warrant agent or any other office indicated in the applicable prospectus supplement, it will, as soon as practicable, forward the debt securities purchased upon the exercise of the debt warrants. If less than all of the debt warrants represented by the debt warrant certificate are exercised, Toll Brothers, Inc. will issue a new debt warrant certificate for the amount of debt warrants that remain exercisable. Common Stock Warrants General. The prospectus supplement relating to any series of common stock warrants that are offered by this prospectus will describe the specific terms of that series of common stock warrants, any related common stock warrant agreement and the common stock warrant certificate(s) representing the common stock warrants. The applicable prospectus supplement will describe, among other things, the following terms, to the extent they are applicable to that series of common stock warrants: o the procedures and conditions relating to the exercise of the common stock warrants; o the number of shares of common stock, if any, issued with the common stock warrants; o the date, if any, on and after which the common stock warrants and any related shares of common stock will be separately transferable; o the offering price, if any, of the common stock warrants; o the number of shares of common stock which may be purchased upon exercise of the common stock warrants and the price or prices at which the shares may be purchased upon exercise; o the date on which the right to exercise the common stock warrants will begin and the date on which the right will expire; o a discussion of the material United States federal income tax considerations applicable to the exercise of the common stock warrants; o call provisions, if any, of the common stock warrants; and o any other material terms of the common stock warrants. Common stock warrant certificates will be exchangeable for new common stock warrant certificates of different denominations. In addition, common stock warrants may be exercised at the corporate trust office of the warrant agent or any other office indicated in the applicable prospectus supplement. A holder of a common stock warrant will not have any of the rights of a holder of the common stock which may be purchased by the exercise of the common stock warrant before the common stock is purchased by the exercise of the common stock warrant. Accordingly, before a common stock warrant is exercised, the holder will not be entitled to receive any 26 dividend payments or exercise any voting or other rights associated with the shares of common stock which may be purchased when the common stock warrant is exercised. Exercise of Common Stock Warrants. Each common stock warrant will entitle the holder to purchase for cash the number of shares of common stock of Toll Brothers, Inc. at the exercise price that is described or explained in the applicable prospectus supplement. Common stock warrants may be exercised at any time from the time they become exercisable, as described in the applicable prospectus supplement, up to the time on the date stated in the applicable prospectus supplement. Afterwards, unexercised common stock warrants will become void. Common stock warrants may be exercised in the manner described in the applicable prospectus supplement. When Toll Brothers, Inc. receives payment and the properly completed and duly executed common stock warrant certificate at the corporate trust office of the warrant agent or any other office indicated in the applicable prospectus supplement, it will, as soon as practicable, forward a certificate representing the number of shares of common stock purchased upon exercise of the common stock warrants. If less than all of the common stock warrants represented by the common stock warrant certificate are exercised, Toll Brothers, Inc. will issue a new common stock warrant certificate for the amount of common stock warrants that remain exercisable. Preferred Stock Warrants General. The prospectus supplement relating to any series of preferred stock warrants that are offered by this prospectus will describe the specific terms of that series of preferred stock warrants, any related preferred stock warrant agreement and the preferred stock warrant certificate(s) representing the preferred stock warrants. The applicable prospectus supplement will describe, among other things, the following terms, to the extent they are applicable to that series of preferred stock warrants: o the designation and terms of the shares of preferred stock which may be purchased upon exercise of the preferred stock warrants and the procedures and conditions relating to the exercise of the preferred stock warrants; o the designation and terms of any related shares of preferred stock with which the preferred stock warrants are issued and the number of shares of the preferred stock, if any, issued with preferred stock warrants; o the date, if any, on and after which the preferred stock warrants and any related shares of preferred stock will be separately transferable; o the offering price, if any, of the preferred stock warrants; o the number of shares of preferred stock which may be purchased upon exercise of the preferred stock warrants and the initial price or prices at which the shares may be purchased upon exercise; o the date on which the right to exercise the preferred stock warrants will begin and the date on which the right will expire; o a discussion of the material United States federal income tax considerations relevant to the exercise of the preferred stock warrants; o call provisions, if any, of the preferred stock warrants; and o any other material terms of the preferred stock warrants. Preferred stock warrant certificates will be exchangeable for new preferred stock warrant certificates of different denominations. In addition, preferred stock warrants may be exercised at the corporate trust office of the warrant agent or any other office indicated in the applicable prospectus supplement. A holder of a preferred stock warrant will not have any of the rights of a holder of the preferred stock which may be purchased by the exercise of the preferred stock warrant before the preferred stock is purchased by the exercise of the preferred stock warrant. Accordingly, before a preferred stock warrant is exercised, the holder will not be entitled to receive any dividend payments or exercise any voting or other rights associated with the preferred stock which may be purchased when the preferred stock warrant is exercised. 27 Exercise of Preferred Stock Warrants. Each preferred stock warrant will entitle the holder to purchase for cash the number of shares of preferred stock of Toll Brothers, Inc. at the exercise price described or explained in the applicable prospectus supplement. Preferred stock warrants may be exercised at any time from the time they become exercisable, as described in the applicable prospectus supplement, up to the time on the date stated in the applicable prospectus supplement. Afterwards, unexercised preferred stock warrants will become void. Preferred stock warrants may be exercised in the manner described in the applicable prospectus supplement. When Toll Brothers, Inc. receives payment and the properly completed and duly executed preferred stock warrant certificate at the corporate trust office of the warrant agent or any other office indicated in the applicable prospectus supplement, it will, as soon as practicable, forward a certificate representing the number of shares of preferred stock purchased upon exercise of the preferred stock warrants. If less than all of the preferred stock warrants represented by the preferred stock warrant certificate are exercised, Toll Brothers, Inc. will issue a new preferred stock warrant certificate for the amount of preferred stock warrants that remain exercisable. CLASSIFIED BOARD OF DIRECTORS AND RESTRICTIONS ON REMOVAL Under the Certificate of Incorporation, as amended, of Toll Brothers, Inc., the board of directors is divided into three classes of directors serving staggered terms of three years each. Each class is to be as nearly equal in number as possible, with one class being elected each year. The Certificate of Incorporation, as amended, also provides that: o directors may be removed from office only for cause and only with the affirmative vote of 66 2/3% of the voting power of the voting stock; o any vacancy on the board of directors or any newly created directorship will be filled by the remaining directors then in office, though less than a quorum; and o advance notice of stockholder nominations for the elections of directors must be given in the manner provided by the By-Laws of Toll Brothers, Inc. The required 66 2/3% stockholder vote necessary to alter, amend or repeal these provisions of the Certificate of Incorporation, as amended, the related amendments to the By-Laws and all other provisions of the By-Laws, or to adopt any provisions relating to the classification of the board of directors and the other matters described above may make it more difficult to change the composition of the board of directors of Toll Brothers, Inc. and may discourage or make difficult any attempt by a person or group to obtain control of Toll Brothers, Inc. PLAN OF DISTRIBUTION Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp., or any of them, may offer and sell their respective securities to which this prospectus relates in any one or more of the following ways: o directly to purchasers; o to or through underwriters; o to or through dealers; or o to or through agents. Each time we sell securities, we will provide a prospectus supplement that will name any underwriter, dealer or agent involved in the offer and sale of the securities. The prospectus supplement will also set forth the terms of the offering, including the purchase price of the securities and the proceeds to the issuer(s) from the sale of the securities, any underwriting discounts and other items constituting underwriters' compensation, any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers and any securities exchanges on which the securities may be listed. The securities may be distributed from time to time in one or more transactions: o at a fixed price or prices, which may be changed; o at market prices prevailing at the time of sale; 28 o at prices related to prevailing market prices; or o at negotiated prices. Each time we sell securities, we will describe the method of distribution of the securities in the prospectus supplement relating to the transaction. If underwriters are used in the offer and sale of the securities being offered by this prospectus, the name of each managing underwriter, if any, and any other underwriters and the terms of the transaction, including any underwriting discounts and other items constituting compensation of the underwriters and dealers, if any, will be included in the prospectus supplement relating to the offering. The securities will be acquired by the underwriters for their own accounts and may be resold from time to time in one or more transactions, including negotiated transactions, at a fixed public offering price or at varying prices determined at the time of sale. Any initial public offering price and any discounts or concessions allowed or reallowed or paid to dealers may be changed from time to time. If a dealer is used in the sale of the securities being offered by this prospectus, the issuer(s) of the securities will sell those securities to the dealer, as principal. The dealer may then resell those securities to the public at varying prices to be determined by the dealer at the time of resale. The name of the dealer and the terms of the transaction will be identified in the applicable prospectus supplement. If an agent is used in an offering of securities being offered by this prospectus, the agent will be named and the terms of the agency will be described in the applicable prospectus supplement relating to the offering. Unless otherwise indicated in the prospectus supplement, an agent will act on a best efforts basis for the period of its appointment. Offers to purchase the securities offered by this prospectus may be solicited, and sales of the securities may be made, by the issuer(s) of those securities directly to institutional investors or others, who may be deemed to be underwriters within the meaning of the Securities Act of 1933 with respect to any resales of the securities. The terms of any offer made in this manner will be included in the prospectus supplement relating to the offer. If indicated in the applicable prospectus supplement, the issuer(s) of the securities to which the prospectus supplement relates will authorize underwriters or their other agents to solicit offers by certain institutional investors to purchase securities from the issuer(s) pursuant to contracts providing for payment and delivery at a future date. Institutional investors with which these contracts may be made include commercial and savings banks, insurance companies, pension funds, investment companies, educational and charitable institutions and others. In all cases, these purchasers must be approved by the issuer(s) of the securities. The obligations of any purchaser under any of these contracts will not be subject to any conditions except that (a) the purchase of the securities must not at the time of delivery be prohibited under the laws of any jurisdiction to which that purchaser is subject and (b) if the securities are also being sold to underwriters, the issuer(s) must have sold to these underwriters the securities not subject to delayed delivery. Underwriters and other agents will not have any responsibility in respect of the validity or performance of these contracts. In addition, the securities offered by this prospectus and an accompanying prospectus supplement may be offered and sold by the holders of the securities in one or more of the transactions described above, which transactions may be effected at any time and from time to time. Upon a sale of securities made in this manner, the respective holders of the securities and any participating broker, dealer or underwriter may be deemed to be underwriters within the meaning of Section 2(11) of the Securities Act of 1933, and any commissions, discounts or concessions upon the sale, or any profit on the resale of the securities, received in connection with the sale may be deemed to be underwriting commissions or discounts under the Securities Act of 1933. The compensation, including commissions, discounts, concessions and other profits, received by any broker, dealer or underwriter in connection with the sale of any of the securities, may be less than or in excess of customary commissions. Some of the underwriters, dealers or agents used by Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp., or any of them, in any offering of securities under this prospectus may be customers of, including borrowers from, engage in transactions with, and perform services for, Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp., or any of them, and/or one or more of their respective affiliates in the ordinary course of business. Underwriters, dealers, agents and other persons may 29 be entitled, under agreements which may be entered into with Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp., as the case may be, to indemnification against and contribution toward certain civil liabilities, including liabilities under the Securities Act of 1933 and to be reimbursed by Toll Brothers, Inc. and/or Toll Corp., Toll Finance Corp. or First Huntingdon Finance Corp. for certain expenses. Until the distribution of the securities offered by this prospectus is completed, rules of the SEC may limit the ability of the underwriters and certain selling group members, if any, to bid for and purchase the securities. As an exception to these rules, the representatives of the underwriters, if any, are permitted to engage in certain transactions that stabilize the price of the securities. These transactions may consist of bids or purchases for the purpose of pegging, fixing or maintaining the price of the securities. If underwriters create a short position in the securities in connection with the offering of the securities (i.e., if they sell more securities than are included on the cover page of the applicable prospectus supplement), the representatives of the underwriters may reduce that short position by purchasing securities in the open market. The representatives of the underwriters also may elect to reduce any short position by exercising all or part of the over-allotment option, if any, described in the applicable prospectus supplement. The representatives of the underwriters also may impose a penalty bid on certain underwriters and selling group members. This means that if the representatives purchase securities in the open market to reduce the underwriters' short position or to stabilize the price of the securities, they may reclaim the amount of the selling concession from the underwriters and selling group members who sold those securities as part of the offering of the securities. In general, purchases of a security for the purpose of stabilization or to reduce a syndicate short position could cause the price of the security to be higher than it might otherwise be in the absence of these types of purchases. The imposition of a penalty bid might have an effect on the price of a security to the extent that it were to discourage resales of the security by purchasers in the offering. Neither Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. nor any of the underwriters, if any, makes any representation or prediction as to the direction or magnitude of any effect that the transactions described above may have on the price of the securities. In addition, neither Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. nor any of the underwriters, if any, makes any representation that the representatives of the underwriters, if any, will engage in these transactions or that these transactions, once commenced, will not be discontinued without notice. The anticipated date of delivery of the securities offered by this prospectus will be described in the applicable prospectus supplement relating to the offering. The securities offered by this prospectus may or may not be listed on a national securities exchange or a foreign securities exchange. We cannot give any assurances that there will be a market for any of the securities offered by this prospectus and any prospectus supplement. We estimate that the total expenses we will incur in offering the securities to which this prospectus relates, excluding underwriting discounts and commissions, if any, will be approximately $1,300,000. LEGAL MATTERS Certain legal matters relating to the validity of the securities offered by this prospectus will be passed upon by Wolf, Block, Schorr and Solis-Cohen LLP, Philadelphia, Pennsylvania. EXPERTS Ernst & Young LLP, independent auditors, have audited our consolidated financial statements and schedule included in our Annual Report on Form 10-K for the fiscal year ended October 31, 2001, as set forth in their report, which is incorporated by reference in this prospectus and elsewhere in the registration statement. Our financial statements and schedule are incorporated by reference in reliance on Ernst & Young LLP's report, given on their authority as experts in accounting and auditing. 30 PART II INFORMATION NOT REQUIRED IN PROSPECTUS Item 14. Other Expenses of Issuance and Distribution. The following table sets forth an estimate of the costs and expenses, other than underwriting discounts and commissions, to be incurred by Toll Brothers, Inc. in connection with the issuance and distribution of the securities being registered. Securities and Exchange Commission registration fee...............$ 69,000 Printing and engraving............................................$ 150,000 Rating agency fees................................................$ 400,000 Blue Sky fees and expenses........................................$ 50,000 Legal fees and expenses...........................................$ 300,000 Accounting fees and expenses......................................$ 150,000 Trustee fees and expenses.........................................$ 40,000 Miscellaneous.....................................................$ 141,000 ============= Total.............................................................$ 1,300,000 All expenses, except the Securities and Exchange Commission registration fee, are estimated. Item 15. Indemnification of Directors and Officers. For information regarding provisions under which a director or officer of Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. or Toll Finance Corp. may be insured or indemnified in any manner against any liability which he may incur in his capacity as such, reference is made to Section 145 of the Delaware General Corporation Law, which provides in its entirety as follows: "(a) A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the corporation) by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys' fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by the person in connection with such action, suit or proceeding if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe the person's conduct was unlawful. The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which the person reasonably believed to be in or not opposed to the best interests of the corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that the person's conduct was unlawful. (b) A corporation shall have power to indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the corporation to procure a judgment in its favor by reason of the fact that the person is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against expenses (including attorneys' fees) actually and reasonably incurred by the person in connection with the defense or settlement of such action or suit if the person acted in good faith and in a manner the person reasonably believed to be in or not opposed to the best interests of the corporation and except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in II-1 view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper. (c) To the extent that a present or former director or officer of a corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding referred to in subsections (a) and (b) of this section, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys' fees) actually and reasonably incurred by such person in connection therewith. (d) Any indemnification under subsections (a) and (b) of this section (unless ordered by a court) shall be made by the corporation only as authorized in the specific case upon a determination that indemnification of the present or former director, officer, employee or agent is proper in the circumstances because the person has met the applicable standard of conduct set forth in subsections (a) and (b) of this section. Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (1) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (2) by a committee of such directors designated by majority vote of such directors, even though less than a quorum, or (3) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion, or (4) by the stockholders. (e) Expenses (including attorneys' fees) incurred by an officer or director in defending any civil, criminal, administrative or investigative action, suit or proceeding may be paid by the corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the corporation as authorized in this section. Such expenses (including attorneys' fees) incurred by former directors and officers or other employees and agents may be so paid upon such terms and conditions, if any, as the corporation deems appropriate. (f) The indemnification and advancement of expenses provided by, or granted pursuant to, the other subsections of this section shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person's official capacity and as to action in another capacity while holding such office. (g) A corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person's status as such, whether or not the corporation would have the power to indemnify such person against such liability under this section. (h) For purposes of this section, references to "the corporation" shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under this section with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued. (i) For purposes of this section, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on a person with respect to any employee benefit plan; and references to "serving at the request of the corporation" shall include any service as a director, officer, employee or agent of the corporation which imposes duties on, or involves services by, such director, officer, employee, or agent with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in II-2 the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner "not opposed to the best interests of the corporation" as referred to in this section. (j) The indemnification and advancement of expenses provided by, or granted pursuant to, this section shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the heirs, executors and administrators of such a person. (k) The Court of Chancery is hereby vested with exclusive jurisdiction to hear and determine all actions for advancement of expenses or indemnification brought under this section or under any bylaw, agreement, vote of stockholders or disinterested directors, or otherwise. The Court of Chancery may summarily determine a corporation's obligation to advance expenses (including attorneys' fees)." See also Article Six of Toll Brothers, Inc.'s Certificate of Incorporation, as amended, which obligates, and Article VII of Toll Brothers, Inc.'s By-Laws, as amended, which grants, Toll Brothers, Inc. the power to indemnify its directors, officers, employees and agents. In addition, Article VIII of each of the By-Laws, as amended, of Toll Corp., First Huntingdon Finance Corp., and Toll Finance Corp. obligates each of these entities to indemnify its directors, officers, employees and agents. See also the Underwriting Agreement Basic Provisions, filed as Exhibit 1 hereto, pursuant to which the Underwriters agree to indemnify the Registrants and their respective directors, officers and controlling persons against certain liabilities, including liabilities under the Securities Act. See Item 17 of this Part II for further information concerning indemnification of directors, officers and controlling persons of Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp. and Toll Finance Corp. Item 16. Exhibits 1 Form of Underwriting Agreement Basic Provisions.* 4.1 Form of Indenture among Toll Corp., as issuer, Toll Brothers, Inc., as guarantor, and Bank One Trust Company, NA, as Trustee.** 4.2 Form of Indenture among First Huntingdon Finance Corp., as issuer, Toll Brothers, Inc., as guarantor, and Bank One Trust Company, NA, as Trustee.** 4.3 Form of Indenture among Toll Finance Corp., as issuer, Toll Brothers, Inc., as guarantor, and Bank One Trust Company, NA, as Trustee.** 5 Opinion and Consent of Wolf, Block, Schorr and Solis-Cohen LLP.* 12 Statement re Computation of Ratios of Earnings to Fixed Charges.* 23.1 Consent of Wolf, Block, Schorr and Solis-Cohen LLP (included as part of Exhibit 5).* 23.2 Consent of Ernst & Young LLP.* 24 Powers of Attorney.** 25.1 Form T-1, Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 with respect to the debt securities of Toll Corp. and guarantees of Toll Brothers, Inc.** 25.2 Form T-1, Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 with respect to the debt securities of First Huntingdon Finance Corp. and guarantees of Toll Brothers, Inc.** 25.3 Form T-1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 with respect to the debt securities of Toll Finance Corp. and guarantees of Toll Brothers, Inc.** - --------------- * Filed electronically herewith. ** Previously filed. II-3 Additional exhibits to this registration statement will be filed with or incorporated by reference in this registration statement in connection with future amendments to, or supplements to, the prospectus forming a part of this registration statement. Item 17. Undertakings. (a) The undersigned registrants hereby undertake: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933; (ii) To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in the volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement; (iii) to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement; provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by the registrants pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 that are incorporated by reference in this registration statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (b) The undersigned registrants hereby undertake that, for purposes of determining any liability under the Securities Act of 1933, each filing of the registrants' annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in this registration statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (c) Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrants pursuant to the foregoing provisions, or otherwise, the registrants have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrants of expenses incurred or paid by a director, officer or controlling person of the registrants in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the Securities being registered, the registrants will, unless in the opinion of their counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue. (d) The undersigned registrants hereby undertake that: (1) For purposes of determining any liability under the Securities Act of 1933, the information omitted from the form of prospectus filed as part or this registration statement in reliance upon Rule 430A and contained II-4 in a form of prospectus filed by the registrants pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be part of this registration statement as of the time it was declared effective. (2) For the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment that contains a form of prospectus shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-5 SIGNATURES AND POWER OF ATTORNEY Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the Township of Lower Moreland, Commonwealth of Pennsylvania, on June 20, 2002. TOLL BROTHERS, INC. By: /s/ Zvi Barzilay ---------------------------------------- Zvi Barzilay, President Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 1 to the Registration Statement has been signed by the following persons in the capacities indicated on June 20, 2002.
Signature Title - --------- ----- * Chairman of the Board, Chief Executive Officer and - ------------------------------ Director (Principal Executive Officer) Robert I. Toll * Vice Chairman of the Board and Director - ------------------------------ Bruce E. Toll /s/ Zvi Barzilay President, Chief Operating Officer and Director - ------------------------------ Zvi Barzilay * Director - ------------------------------ Robert S. Blank * Director - ------------------------------ Edward G. Boehne * Director - ------------------------------ Richard J. Braemer * Director - ------------------------------ Roger S. Hillas * Director - ------------------------------ Carl B. Marbach * Executive Vice President, Treasurer, Chief Financial - ------------------------------ Officer and Director (Principal Financial Officer) Joel H. Rassman * Director - ------------------------------ Paul E. Shapiro /s/ Joseph R. Sicree Vice President and Chief Accounting Officer - ------------------------------ (Principal Accounting Officer) Joseph R. Sicree *By: /s/ Joseph R. Sicree ---------------------------- Joseph R. Sicree, Attorney-in-Fact pursuant to powers of attorney previously filed as Exhibit 24 to this registration statement
II-6 SIGNATURES AND POWER OF ATTORNEY Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the Township of Lower Moreland, Commonwealth of Pennsylvania, on June 20, 2002. TOLL CORP. By: /s/ Zvi Barzilay ---------------------------------------- Zvi Barzilay, President Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 1 to the Registration Statement has been signed by the following persons in the capacities indicated on June 20, 2002.
Signature Title - --------- ----- * Chairman of the Board, Chief Executive Officer and - ------------------------------- Director (Principal Executive Officer) Robert I. Toll /s/ Zvi Barzilay President, Chief Operating Officer, Secretary and - ------------------------------- Director Zvi Barzilay * Executive Vice President, Treasurer, Chief Financial - ------------------------------- Officer and Director (Principal Financial Officer) Joel H. Rassman /s/ Joseph R. Sicree Vice President and Chief Accounting Officer - ------------------------------- (Principal Accounting Officer) Joseph R. Sicree *By: /s/ Joseph R. Sicree ---------------------------- Joseph R. Sicree, Attorney-in-Fact pursuant to powers of attorney previously filed as Exhibit 24 to this registration statement
II-7 SIGNATURES AND POWER OF ATTORNEY Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the Township of Lower Moreland, Commonwealth of Pennsylvania, on June 20, 2002. FIRST HUNTINGDON FINANCE CORP. By: /s/ Zvi Barzilay -------------------------------------- Zvi Barzilay, President Pursuant to the requirements of the Securities Act of 1933, this Amendment No. 1 to the Registration Statement has been signed by the following persons in the capacities indicated on June 20, 2002.
Signature Title - --------- ----- * Chairman of the Board, Chief Executive Officer and - ------------------------------- Director (Principal Executive Officer) Robert I. Toll /s/ Zvi Barzilay President, Chief Operating Officer, Secretary and - ------------------------------- Director Zvi Barzilay * Executive Vice President, Treasurer, Chief Financial - ------------------------------- Officer and Director (Principal Financial Officer) Joel H. Rassman /s/ Joseph R. Sicree Chief Accounting Officer - ------------------------------- (Principal Accounting Officer) Joseph R. Sicree *By: /s/ Joseph R. Sicree ---------------------------- Joseph R. Sicree, Attorney-in-Fact pursuant to powers of attorney previously filed as Exhibit 24 to this registration statement
II-8 SIGNATURES AND POWER OF ATTORNEY Pursuant to the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Amendment No. 1 to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the Township of Lower Moreland, Commonwealth of Pennsylvania, on June 20, 2002. TOLL FINANCE CORP. By: /s/ Zvi Barzilay ----------------------------------- Zvi Barzilay, President Pursuant to the requirements of the Securities Act of 1933, this Amendment No. to the Registration Statement has been signed by the following persons in the capacities indicated on June 20, 2002.
Signature Title - --------- ------ * Chairman of the Board, Chief Executive Officer and - ------------------------------- Director (Principal Executive Officer) Robert I. Toll /s/ Zvi Barzilay President, Chief Operating Officer, Secretary and - ------------------------------- Director Zvi Barzilay * Executive Vice President, Treasurer, Chief Financial - ------------------------------- Officer and Director (Principal Financial Officer) Joel H. Rasman /s/ Joseph R. Sicree Chief Accounting Officer - ------------------------------- (Principal Accounting Officer) Joseph R. Sicree *By: /s/ Joseph R. Sicree ---------------------------- Joseph R. Sicree, Attorney-in-Fact pursuant to powers of attorney previously filed as Exhibit 24 to this registration statement
II-9 Index to Exhibits Exhibit Number Description - -------- ----------- 1 Form of Underwriting Agreement Basic Provisions.* 4.1 Form of Indenture among Toll Corp., as issuer, Toll Brothers, Inc., as guarantor, and Bank One Trust Company, NA, as Trustee.** 4.2 Form of Indenture among First Huntingdon Finance Corp., as issuer, Toll Brothers, Inc., as guarantor, and Bank One Trust Company, NA, as Trustee.** 4.3 Form of Indenture among Toll Finance Corp., as issuer, Toll Brothers, Inc., as guarantor, and Bank One Trust Company, NA, as Trustee.** 5 Opinion and Consent of Wolf, Block, Schorr and Solis-Cohen LLP.* 12 Statement re Computation of Ratios of Earnings to Fixed Charges.* 23.1 Consent of Wolf, Block, Schorr and Solis-Cohen LLP (included as part of Exhibit 5).* 23.2 Consent of Ernst & Young LLP.* 24 Powers of Attorney.** 25.1 Form T-1, Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 with respect to the debt securities of Toll Corp. and guarantees of Toll Brothers, Inc.** 25.2 Form T-1, Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 with respect to the debt securities of First Huntingdon Finance Corp. and guarantees of Toll Brothers, Inc.** 25.3 Form T-1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 with respect to the debt securities of Toll Finance Corp. and guarantees of Toll Brothers, Inc.** - --------------- * Filed electronically herewith. ** Previously filed. II-10 EX-1 3 ex1.txt EXHIBIT 1 EXHIBIT 1 TOLL BROTHERS, INC. Common Stock Preferred Stock TOLL CORP. Debt Securities Guaranteed by Toll Brothers, Inc. UNDERWRITING AGREEMENT BASIC PROVISIONS ________________, 200__ To the Representative or Representatives named in the Terms Agreement referred to below Toll Brothers, Inc., a Delaware corporation ("TB"), may issue and sell from time to time shares of its equity securities consisting of common stock, par value $.01 per share ("Common Stock"), or preferred stock, par value $.01 per share ("Preferred Stock"; the Common Stock and the Preferred Stock are hereinafter referred to collectively as the "Equity Securities"). Toll Corp., a Delaware corporation and wholly-owned subsidiary of TB ("TC"; TC and TB are hereinafter referred to collectively as the "Registrants"), may issue and sell from time to time its debt securities consisting of senior debt securities ("Senior Debt Securities"), senior subordinated debt securities ("Senior Subordinated Debt Securities") or subordinated debt securities ("Subordinated Debt Securities") the Senior Debt Securities, the Senior Subordinated Debt Securities and the Subordinated Debt Securities are hereinafter referred to collectively as the "Debt Securities"). The Equity Securities and the Debt Securities are registered under the registration statement referred to in Section 2(a) hereof. The Equity Securities may have varying designations, dividend rates, redemption provisions and selling prices. The Preferred Stock may be convertible, as described in its certificate of designation, into shares of Common Stock. The Debt Securities may have varying designations, denominations, interest rates and payment dates, maturities, redemption provisions and selling prices. The Debt Securities may be convertible or exchangeable, as described in the Indenture (as defined below), into or for shares of Common Stock. The Debt Securities will be issued under an indenture (the "Indenture") to be entered into among the Registrants and one or more trustees (the "Trustee"). Pursuant to the terms of the Indenture, TC's obligations under the Indenture and the Debt Securities will be unconditionally guaranteed (the "Guarantee") by TB. The basic provisions set forth herein are intended to be incorporated by reference in a terms agreement of the type referred to in Section 1 hereof relating to the type, designation and series of securities to be issued and sold by either TB or the Registrants pursuant thereto (the "Offered Securities") to the several underwriters named therein (the "Underwriters"). The terms agreement relating to the Offered Securities (the "Terms Agreement"), together with the provisions hereof incorporated therein by reference (which provisions shall not become effective until so incorporated by reference), is herein referred to as this "Agreement". If the Underwriters consist only of the firm or firms referred to in the Terms Agreement as Representative or Representatives, then the terms "Underwriters" and "Representatives," as used herein, shall each be deemed to refer to such firm or firms. The Equity Securities, the Debt Securities and the Guarantee are hereinafter referred to collectively as the "Securities". 1. Terms Agreement. The obligation of the Underwriters to purchase, and TB or the Registrants, as the case may be, to sell, the Offered Securities is evidenced by the Terms Agreement delivered at the time TB or the Registrants, as the case may be, determines to sell the Offered Securities. The Terms Agreement specifies the firm or firms which will be Underwriters, the amount of the Offered Securities to be purchased by each Underwriter, the purchase price to be paid by the Underwriters for the Offered Securities, the public offering price, if any, of the Offered Securities, whether the Underwriters are authorized to solicit institutional investors to purchase Offered Securities pursuant to Delayed Delivery Contracts (as hereinafter defined), certain terms thereof and the Underwriters' compensation therefor and any terms of the Offered Securities not otherwise specified in the Indenture or, in the case of Preferred Stock, certificate of designation (including, but not limited to, designations, denominations, conversion or exchange provisions, covenants, interest rates and payment dates, dividend rates and payment dates, maturity, redemption provisions and sinking fund requirements). The Terms Agreement specifies any details of the terms of the offering that should be reflected in a post-effective amendment to the Registration Statement or the Prospectus Supplement (each as hereinafter defined). 2. Representations and Warranties of the Registrants. The Registrants jointly and severally represent and warrant to and agree with each Underwriter that: (a) The Registrants meet the requirements for use of Form S-3 under the Securities Act of 1933, as amended (the "Act"), and have filed with the Securities and Exchange Commission (the "Commission") a registration statement on such form, including a prospectus, with respect to the Securities, which (i) has been prepared by the Registrants in conformity with the requirements of the Act and the rules and regulations (the "Rules and Regulations") of the Commission thereunder and (ii) has become effective. Such registration statement and prospectus may have been amended or supplemented from time to time prior to the date of this Agreement; any such amendment to the registration statement was so prepared and filed and any such amendment has become effective. A prospectus supplement, including a prospectus, relating to the Offered Securities (the "Prospectus Supplement") has been so prepared. The Prospectus Supplement and, if not previously filed, such prospectus will be filed pursuant to Rule 424 under the Act. Copies of such registration statement and prospectus, any such amendment or supplement, the Prospectus Supplement and all documents incorporated by reference therein which were filed with the Commission on or prior to the date of the Terms Agreement have been delivered to you (including one fully executed copy of the registration statement and of each amendment thereto for counsel for the Underwriters). Such registration statement and prospectus, as amended or supplemented to the date of the Terms Agreement and as supplemented by the Prospectus Supplement are herein referred to as the "Registration Statement" and the "Prospectus", respectively. Any reference herein to the Registration Statement or the Prospectus shall be deemed to refer to and include the documents incorporated by reference therein which were filed with the Commission on or prior to the date of the Terms Agreement and any reference to the terms "amend", "amendment" or "supplement" with respect to the Registration Statement or the Prospectus shall be deemed to refer to and include the filing of any document with the Commission deemed to be incorporated by reference therein after the date of the Terms Agreement and on or prior to the Closing Date (as hereinafter defined). -2- (b) The Registration Statement, at the time it became effective, any post-effective amendment thereto, at the time it became effective, the Registration Statement and the Prospectus, as of the date of the Terms Agreement and at the Closing Date, and any amendment or supplement thereto, conformed or will conform in all material respects to the requirements of the Act, the Trust Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the Rules and Regulations; and no such document included or will include an untrue statement of a material fact or omitted or will omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; provided, that the Registrants make no representation or warranty as to information contained in or omitted from the Registration Statement or the Prospectus in reliance upon and in conformity with written information furnished to the Registrants by or on behalf of any Underwriter specifically for inclusion therein. (c) The documents incorporated by reference in the Registration Statement or the Prospectus, when they became effective or were filed with the Commission, as the case may be, under the Securities Exchange Act of 1934, as amended (the "Exchange Act"), conformed, and any documents so filed and incorporated by reference after the date of the Terms Agreement and on or prior to the Closing Date will, when they are filed with the Commission, conform, in all material respects to the requirements of the Act and the Exchange Act, as applicable, and the Rules and Regulations. (d) The accountants who have certified or shall certify the financial statements filed or to be filed with the Commission as parts of the Registration Statement and the Prospectus are independent accountants as required by the Act. (e) The Registrants have been duly incorporated and are validly existing as corporations in good standing under the laws of the State of Delaware and have all requisite power and authority, and all necessary material authorizations, approvals, orders, licenses, certificates and permits of and from regulatory or governmental officials, bodies and tribunals, to own or lease their respective properties and to conduct their respective businesses as now being conducted and as described in the Prospectus, and the Registrants have not received any notice of proceedings relating to the revocation or modification of any such authorizations, approvals, orders, licenses, certificates and permits which, singly or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a materially adverse effect on the condition (financial or otherwise), earnings, business affairs or business prospects of TB and its subsidiaries considered as one enterprise, whether or not occurring in the ordinary course of business (a "Material Adverse Effect"); and the Registrants and each of their subsidiaries are complying with all applicable laws, the violation of which would have a Material Adverse Effect. (f) Since the respective dates as of which information is given in the Registration Statement and in the Prospectus, except as otherwise specifically stated therein, (a) there has been no material adverse change in the condition (financial or otherwise), earnings, business affairs or business prospects of TB and its subsidiaries considered as one enterprise, whether or not arising in the ordinary course of business (a "Material Adverse Change"), and (b) there has been no dividend or distribution of any kind declared, paid or made by TB on any class of its capital stock. -3- (g) The authorized, issued and outstanding capital stock of TB is as set forth in the Prospectus; all of the outstanding shares of Common Stock and Preferred Stock of TB and all other equity securities of TB have been duly authorized and are validly issued, fully paid and non-assessable; the stockholders of TB have no preemptive rights with respect to the Common Stock or Preferred Stock; no person has any rights to the registration of securities by reason of the Registrants filing the Registration Statement with the Commission or otherwise; and the Common Stock and Preferred Stock conform to the descriptions thereof in the Prospectus. (h) Neither TB nor any of its subsidiaries is in violation of its charter or by-laws or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, loan agreement, note, lease or other agreement or instrument to which TB or any of its subsidiaries is a party or by which it or any of them may be bound, or to which any of the property or assets of TB or any of its subsidiaries is subject, the effect of which default in performance or observance would have a Material Adverse Effect. (i) If Debt Securities are being offered, the Indenture has been duly authorized by the Registrants and, upon execution and delivery by the Registrants (assuming the due authorization, execution and delivery by the appropriate Trustee), will constitute a valid and binding agreement of each of the Registrants enforceable against each of the Registrants in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law) . (j) If Debt Securities are being offered, such Debt Securities, when executed by TC and authenticated by the appropriate Trustee in accordance with the terms of the Indenture (assuming the due authorization, execution and delivery of such Indenture by the appropriate Trustee), and delivered to and paid for by you in accordance with the terms of this Agreement (and, in the case of any Contract Securities (as hereinafter defined), as contemplated by the Delayed Delivery Contracts with respect thereto), will constitute valid and binding obligations of TC enforceable against TC in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law). (k) If Debt Securities are being offered, the Guarantee, upon endorsement on any such Debt Securities by TB and upon the execution of such Debt Securities by TC and authentication thereof by the appropriate Trustee in accordance with the terms of the Indenture (assuming the due authorization, execution and delivery of such Indenture by the appropriate Trustee), and delivery of such Debt Securities to, and payment therefor by, the Underwriters in accordance with the terms of this Agreement (and, in the case of any Contract -4- Securities, as contemplated by the Delayed Delivery Contracts with respect thereto), will constitute a valid and binding obligation of TB enforceable against TB in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law). (1) Any Offered Securities and, if Debt Securities are being offered, the Indenture have been duly authorized by TB or the Registrants, as the case may be, and will conform to the descriptions thereof in the Prospectus. (m) If convertible or exchangeable Debt Securities or convertible Preferred Stock is being offered, the shares of Common Stock issuable upon conversion or exchange of any convertible or exchangeable Offered Securities have been duly and validly authorized and reserved for issuance upon such conversion or exchange by all necessary corporate action and such shares, when issued upon such conversion or exchange, will be duly authorized and validly issued, fully paid and non-assessable, and the issuance of such shares upon such conversion or exchange will not be subject to preemptive or similar rights. (n) If Common Stock or Preferred Stock is being offered, such shares of Common Stock or Preferred Stock, as the case may be, have been duly authorized and are validly issued, fully paid and non-assessable, and the issuance of such shares is not subject to preemptive or similar rights. 3. Purchase, Sale and Delivery of Securities. The Offered Securities to be purchased by the Underwriters will be delivered by either TB or the Registrants, as the case may be, to you for the accounts of the several Underwriters at the office specified in the Terms Agreement against payment of the purchase price therefor by certified or official bank check or checks in New York Clearing House funds (or as otherwise specified in the Terms Agreement) payable to the order of TB or TC, as the case may be, on the date and at the times specified in the Terms Agreement, or at such other time not later than eight full business days thereafter as you and either TB or the Registrants, as the case may be, determine, such time being herein referred to as the "Closing Date." The Offered Securities will be prepared in definitive form and in such authorized amounts or denominations and registered in such names as you may require upon at least two business days' prior notice to TB or the Registrants, as the case may be, and will be made available for checking and packaging at the office at which they are to be delivered on the Closing Date (as specified for that purpose in the Terms Agreement) at least one business day prior to the Closing Date. It is understood that you, acting individually and not in a representative capacity, may (but shall not be obligated to) make payment to TB or TC, as the case may be, on behalf of any other Underwriter for the Offered Securities to be purchased by such Underwriter. Any such payment by you shall not relieve any such Underwriter of any of its obligations hereunder. TB or TC, as the case may be, will pay you on the Closing Date for the accounts of the Underwriters any fee, commission or other compensation specified in the Terms Agreement. Such payment will be made by certified or official bank check in New York Clearing House funds (or by such other method specified in the Terms Agreement). -5- If so authorized in the Terms Agreement, the Underwriters may solicit offers from investors of the types set forth in the Prospectus to purchase Offered Securities from TB or the Registrants, as the case may be, pursuant to delayed delivery contracts ("Delayed Delivery Contracts"). Such contracts shall be substantially in the form of Exhibit I hereto but with such changes therein as TB or the Registrants, as the case may be, may approve. Offered Securities to be purchased pursuant to Delayed Delivery Contracts are herein called "Contract Securities." When Delayed Delivery Contracts are authorized in the Terms Agreement, TB or the Registrants, as the case may be, will enter into a Delayed Delivery Contract in each case where a sale of Contract Securities arranged through you has been approved by TB or the Registrants, as the case may be, but, except as TB or the Registrants, as the case may be, may otherwise agree, such Delayed Delivery Contracts must be for at least the minimum amount of Contract Securities set forth in the Terms Agreement, and the aggregate amount of Contract Securities may not exceed the amount set forth in the Terms Agreement. You will advise TB or the Registrants, as the case may be, of the proposed sales of the Contract Securities not later than 10:00 A.M., New York City time, on the third full business day preceding the Closing Date (or at such later time as TB or the Registrants, as the case may be, may otherwise agree). TB or the Registrants, as the case may be, will advise you not later than 10:00 A.M., New York City time, the second full business day preceding the Closing Date (or at such later time as you may otherwise agree) of the sales of the Contract Securities which have been so approved. You and the other Underwriters will not have any responsibility in respect of the validity or performance of Delayed Delivery Contracts. The amount of Offered Securities to be purchased by each Underwriter as set forth in the Terms Agreement shall be reduced by an amount which shall bear the same proportion to the total amount of Contract Securities as the amount of Offered Securities set forth opposite the name of such Underwriter bears to the total amount of Offered Securities set forth in the Terms Agreement, except to the extent that you determine that such reduction shall be otherwise than in such proportion and so advise TB or the Registrants, as the case may be; provided, however, that the total amount of Offered Securities to be purchased by all Underwriters shall be the total amount of Offered Securities set forth in the Terms Agreement less the aggregate amount of Contract Securities. 4. Substitution of Underwriters. (a) TB or the Registrants, as the case may be, shall not be obligated to deliver any Offered Securities except upon payment for all the Offered Securities to be purchased hereunder or as hereinafter provided. (b) If any Underwriter or Underwriters shall fail to take up and pay for the amount of Offered Securities agreed to by such Underwriter or Underwriters to be purchased hereunder, upon tender of such Offered Securities in accordance with the terms hereof, and the amount of Offered Securities not purchased does not aggregate more than 10% of the total amount of the Offered Securities set forth in the Terms Agreement, the remaining Underwriters shall be obligated to take up and pay for (in proportion to their respective underwriting obligations hereunder as set forth in the Terms Agreement, except as may otherwise be determined by you) the Offered Securities which the withdrawing or defaulting Underwriters agreed but failed to purchase. -6- (c) If any Underwriter or Underwriters shall fail to take up and pay for the amount of Offered Securities agreed by such Underwriter or Underwriters to be purchased hereunder, upon tender of such Offered Securities in accordance with the terms hereof, and the amount of Offered Securities not purchased aggregates more than 10% of the total amount of Offered Securities set forth in the Terms Agreement, and arrangements satisfactory to you and TB or the Registrants, as the case may be, for the purchase of such Offered Securities by other persons are not made within 36 hours thereafter, this Agreement shall terminate. (d) In the event of a default by any Underwriter as set forth in this Section 4, the Closing Date shall be postponed for such period, not to exceed seven full business days, as you shall determine in order that the required changes in the Registration Statement and the Prospectus or in any other documents or arrangements may be effected. In the event of any such termination, TB or the Registrants, as the case may be, shall not be under any liability to any Underwriter (except to the extent provided in Sections 5(j), 6 and 9 hereof) nor shall any Underwriter (other than an Underwriter who shall have failed, otherwise than for some reason permitted under this Agreement, to purchase the amount of Offered Securities agreed by such Underwriter to be purchased under this Agreement) be under any liability to TB or the Registrants, as the case may be (except to the extent provided in Section 6 hereof). Nothing contained in this Agreement shall relieve any defaulting Underwriter of its liability, if any, to TB or the Registrants, as the case may be, and any non-defaulting Underwriter for damages occasioned by its default hereunder. 5. Covenants. The Registrants jointly and severally agree: (a) To furnish promptly to you and to counsel for the Underwriters a signed copy of the Registration Statement and the Prospectus (including all documents incorporated by reference therein) as originally filed, and each amendment thereto filed with the Commission, including all consents and exhibits filed therewith and all documents incorporated by reference therein. (b) To deliver promptly to you and to each Underwriter such number of conformed copies of the Registration Statement as originally filed and each amendment thereto (excluding exhibits other than this Agreement), the Prospectus and any amended or supplemented Prospectus as you may reasonably request. (c) To cause the Prospectus Supplement to be filed pursuant to Rule 424 under the Act and to notify you promptly of such filing. (d) Prior to filing with the Commission any amendment to the Registration Statement or subsequent supplement to the Prospectus, or to filing any prospectus pursuant to Rule 424 of the Act, to furnish a copy thereof to you and counsel for the Underwriters and obtain your consent to the filing. -7- (e) To advise you promptly (i) when any amendment to the Registration Statement has become effective or any subsequent supplement to the Prospectus has been filed, (ii) of any request or proposed request by the Commission for an amendment to the Registration Statement, a supplement to the Prospectus or for any additional information, (iii) of the issuance by the Commission of any stop order suspending the effectiveness of the Registration Statement or the initiation or threat of any stop order proceedings, (iv) of receipt by the Registrants of any notification with respect to the suspension of the qualification of the Offered Securities for sale in any jurisdiction or the initiation or threat of any proceeding for that purpose, and (v) of the happening of any event which makes untrue any statement of a material fact made in the Registration Statement or the Prospectus, or which requires the making of a change in the Registration Statement in order to make any material statement therein not misleading or in the Prospectus in order to make any material statement therein, in light of the circumstances then existing, not misleading. (f) Within the time during which a prospectus relating to the Offered Securities is required to be delivered under the Act, to comply as far as they are able with all requirements imposed upon them by the Act, as now and hereafter amended, and by the Rules and Regulations, as from time to time in force, so far as necessary to permit the continuance of sales of or dealings in the Offered Securities as contemplated by the provisions hereof and the Prospectus. If during such period any event occurs as a result of which the Prospectus as then amended or supplemented would include an untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in the light of the circumstances then existing, not misleading, or if during such period it is necessary to amend or supplement the Registration Statement or the Prospectus to comply with the Act, the Registrants will amend or supplement the Registration Statement or the Prospectus (at the expense of the Registrants) so as to correct such statement or omission or effect such compliance. (g) To make generally available to their security holders and to you as soon as practicable, but in any event not later than 15 months after the end of TB's current fiscal quarter, an earnings statement of TB and its subsidiaries (which need not be audited) covering a 12-month period beginning after the date upon which the Prospectus Supplement is filed pursuant to Rule 424 under the Act which shall satisfy the provisions of Section ll(a) of the Act. (h) So long as the Offered Securities are outstanding, to furnish to you copies of all public reports and all reports and financial statements furnished by the Registrants to any securities exchange pursuant to requirements of or agreements with any such exchange or to the Commission pursuant to the Exchange Act or any rule or regulation of the Commission thereunder. (i) To endeavor in all reasonable respects to qualify the Offered Securities for offer and sale under the securities laws of such jurisdictions as you may reasonably request; provided, that in no event shall either of the Registrants be obligated to qualify to do business in any jurisdiction where it is not now so qualified or to take any action which would subject it to taxation or general service of process in any jurisdiction where it is not now so subject. -8- (j) To pay all expenses incident to the performance of their obligations under this Agreement, including (i) the costs of the preparation, printing and filing under the Act of the Registration Statement and any amendments and exhibits thereto, (ii) the costs of printing and distributing to the Underwriters and any selected dealers the Registration Statement as originally filed and each amendment thereto and any post-effective amendments thereof (including exhibits), the Prospectus and any amendment or supplement to the Prospectus as provided in this Agreement, (iii) the costs of typing, printing and reproducing this Agreement and the Indenture, (iv) the fee of any filings with the National Association of Securities Dealers, Inc., (v) the fees paid to rating agencies in connection with the rating of the Offered Securities, (vi) the fees and expenses of qualifying the Offered Securities under the securities laws of the several jurisdictions as provided in Section 5(i) and of preparing, printing, reproducing and distributing a Blue Sky Memorandum (including the reasonable fees and disbursements of counsel for the Underwriters in connection therewith), (vii) the fees and disbursements of the Registrants counsel and accountants, (viii) the fees of the Trustee, and (ix) the cost of printing and engraving the certificates representing the Offered Securities. (k) If Debt Securities are being offered, TC will not, without your consent, offer or sell, or publicly announce its intention to offer or sell any debt securities having a maturity of more than one year (except under prior contractual commitments) during the period beginning on the date of the Terms Agreement and ending the business day following the Closing Date. If Equity Securities or convertible or exchangeable Debt Securities are being offered, TB will comply with any similar (or additional) restrictions on offers and sales of its Common Stock and Preferred Stock, or other equity securities or securities convertible into or exercisable for equity securities that may be specified in the Terms Agreement. The Registrants have not taken, and will not take, directly or indirectly, any action which might reasonably be expected to cause or result in the stabilization or manipulation of the price of any security to facilitate the sale or resale of the Offered Securities. (1) If convertible or exchangeable Debt Securities or convertible Preferred Stock is being offered, TB will reserve and keep available at all times, free of preemptive rights, sufficient shares of Common Stock for the purpose of enabling TB to satisfy any obligations to issue shares of Common Stock upon conversion or exchange of any Offered Securities. TB will use its best efforts to effect the listing of such shares of Common Stock issuable upon the conversion or exchange of any Offered Securities on the New York Stock Exchange and any other national securities exchange on which its Common Stock is then listed. 6. Indemnification. (a) TB and, if Debt Securities are offered, the Registrants jointly and severally agree to indemnify and hold harmless each Underwriter, its directors, officers and employees, and each person, if any, who controls any Underwriter within the meaning of Section 15 of the Act as follows: (i) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, arising out of any untrue statement or alleged untrue statement of a material fact contained in the Registration Statement (or any amendment thereto), or the omission or alleged omission therefrom of a material fact required to be stated therein or necessary to make the statements therein not misleading arising out of any untrue statement or alleged untrue statement of a material fact contained in the Prospectus (or any amendment or supplement thereto), or in any related preliminary prospectus supplement or the omission or alleged omission therefrom of a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; -9- (ii) against any and all loss, liability, claim, damage and expense whatsoever, as incurred, to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or of any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, if such settlement is effected with the written consent of the Registrants; and (iii) against any and all expenses whatsoever, as incurred (including subject to subsection (c) of this Section 6, the fees and disbursements of counsel chosen by the Underwriters), reasonably incurred in investigating, preparing or defending against any litigation, or any investigation or proceeding by any governmental agency or body, commenced or threatened, or any claim whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement or omission, to the extent that any such expense is not paid under (i) or (ii) above; provided, however, that this indemnity agreement shall not apply to any loss, liability, claim, damage or expense to the extent arising out of any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with information furnished to the Registrants by such Underwriter in writing expressly for use in the Registration Statement (or any amendment thereto) or the Prospectus (or any amendment or supplement thereto), or in any related preliminary prospectus supplement. This indemnity agreement is subject to the further condition that, insofar as it relates to any untrue statement or omission, or any alleged untrue statement or omission, made in a preliminary prospectus supplement but eliminated or remedied in the Prospectus, it shall not inure to the benefit of any Underwriter from whom the person asserting the claim purchased any Offered Securities (or to the benefit of any person who controls such Underwriter) if a copy of the Prospectus, excluding documents incorporated therein by reference, was not sent or given to such person at or prior to the time required by the Act and the claims asserted by such person do not include allegations of other untrue statements or omissions made in the Prospectus, which allegations are upheld by a final judgment. (b) Each Underwriter severally agrees to indemnify and hold harmless each of the Registrants, their directors, each of their officers who signed the Registration Statement, and each person, if any, who controls either of the Registrants within the meaning of Section l5 of the Act against any and all loss, liability, claim, damage and expense described in the indemnity contained in subsection (a) of this Section 6, as incurred, but only with -10- respect to untrue statements or omissions, or alleged untrue statements or omissions, made in the Registration Statement (or any amendment thereto) or the Prospectus (or any amendment or supplement thereto), or in any related preliminary prospectus supplement in reliance upon and in conformity with written information furnished to the Registrants by such Underwriter (it being understood that information specifically pertaining to any particular Underwriter shall be deemed not to have been furnished by the other Underwriters) expressly for use in the Registration Statement (or any amendment thereto) or the Prospectus (or any amendment or supplement thereto), or in any related preliminary prospectus supplement. (c) Each indemnified party shall give notice as promptly as reasonably practicable to each indemnifying party of any action commenced against it in respect of which indemnity may be sought hereunder, but failure to so notify an indemnifying party shall not relieve such indemnifying party from any liability which it may have otherwise than on account of this indemnity agreement. An indemnifying party may participate at its own expense in the defense of any such action. In no event shall the indemnifying parties be liable for fees and expenses of more than one counsel (in addition to any local counsel) separate from their own counsel for all indemnified parties in connection with any one action or separate but similar or related actions in the same jurisdiction arising out of the same general allegations or circumstances. (d) In order to provide for just and equitable contribution in circumstances in which the indemnity agreement provided for in Section 6 is for any reason held to be unenforceable by the indemnified parties although applicable in accordance with its terms, the Registrants and the Underwriters shall contribute to the aggregate losses, liabilities, claims, damages and expenses of the nature contemplated by said indemnity agreement incurred by the Registrants and the Underwriters, as incurred, in such proportions that the Underwriters are responsible for that portion represented by the percentage that the underwriting discount appearing on the cover page of the Prospectus bears to the initial public offering price appearing thereon and the Registrants are jointly and severally responsible for the balance; provided, however, that no person guilty of fraudulent misrepresentation (within the meaning of Section ll(f) of the Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation. For purposes of this Section, each director, officer and employee of an Underwriter, and each person, if any, who controls an Underwriter within the meaning of Section 15 of the Act, shall have the same rights to contribution as such Underwriter, and each director of the Registrants, each officer of the Registrants who signed the Registration Statement, and each person, if any, who controls either of the Registrants within the meaning of Section 15 of the Act, shall have the same rights to contribution as the Registrants. (e) All representations, warranties, and agreements contained in this Agreement, or contained in certificates of officers of the Registrants submitted pursuant hereto, shall remain operative and in full force and effect, regardless of any investigation made by or on behalf of any Underwriter or any controlling person, or by or on behalf of either of the Registrants, and shall survive delivery of and payment for any Offered Securities to the Underwriters. -11- 7. Effective Date of Agreement and Termination. (a) This Agreement shall become effective on the day on which this Agreement is executed. (b) The obligations of the Underwriters hereunder may be terminated by you, in your absolute discretion, by notice given to and received by TB or the Registrants, as the case may be, prior to delivery of and payment for the Offered Securities, if prior to that time (i) since the respective dates as of which information is given in the Registration Statement and the Prospectus, there has been a MATERIAL ADVERSE CHANGE, (ii) any outbreak or escalation of hostilities or other national or international calamity or crises, if the effect of such outbreak, escalation, calamity, or crisis would, in your judgment, make the offering or delivery of the Offered Securities impracticable, (iii) existing financial, political, economic or stock market conditions in Europe, the United States or elsewhere, or international monetary conditions, shall have undergone a material change which, in your judgment, materially and adversely affects the market for the Offered Securities or makes the offering or delivery of the Offered Securities impracticable; (iv) the suspension or material limitation of trading in securities on the New York Stock Exchange, the American Stock Exchange or the NADAQ National Market System or limitation on prices for securities on any such exchange or National Market System, (v) the enactment, publication, decree or other promulgation of any federal or state statute, regulation, rule or order of any court of other governmental authority which in your opinion will have a Material Adverse Effect, (vi) the declaration of a banking moratorium by either federal or New York State authorities or (vii) the taking of any action by any federal, state or local government or agency in respect of its monetary or fiscal affairs which in your opinion has a material adverse effect on the financial markets in the United States. 8. Conditions of the Underwriters' Obligations. The obligations of the Underwriters to purchase and pay for the Offered Securities as provided herein are subject to the accuracy, as of the date of the Terms Agreement and the Closing Date (as if made at the Closing Date) of the representations and warranties of the Registrants contained herein, to performance by the Registrants of their obligations hereunder and to each of the following additional terms and conditions: (a) No stop order suspending the effectiveness of the Registration Statement shall have been issued, and prior to that time no stop order proceeding shall have been initiated or threatened (and shall not have been withdrawn) by the Commission; any request by the Commission for inclusion of additional information in the Registration Statement or the Prospectus or otherwise shall have been complied with; and the Registrants shall not have filed with the Commission the Prospectus or any amendment or supplement to the Registration Statement or the Prospectus without the consent of the Representatives. (b) All corporate proceedings and other legal matters incident to the authorization and validity of this Agreement, the Terms Agreement, if Debt Securities are being offered, the Indenture and the authorization, form and validity of the Offered Securities and the shares of Common Stock issuable upon the conversion or exchange of any convertible or exchangeable Offered Securities and the form of the Registration Statement and the Prospectus, other than financial statements and other financial data, and all other legal matters relating to this Agreement and the transactions contemplated hereby shall be satisfactory in all respects to Cahill Gordon & Reindel, counsel for the Underwriters, and the Registrants shall have furnished to such counsel all documents and information that they may reasonably request to enable them to pass upon such matters. -12- (c) The Registrants shall have furnished to you the opinion of General Counsel to TB dated the Closing Date, to the effect that: (i) Each of TC, TB and the subsidiaries listed in Exhibit 22 to TB's most recent Annual Report has been duly incorporated and is validly existing as a corporation in good standing under the laws of the jurisdiction in which it is chartered or organized, with full corporate power and corporate authority to own its properties and conduct its business as described in the Prospectus, and is duly qualified to do business as a foreign corporation and is in good standing under the laws of each jurisdiction which requires such qualification and where the failure to so qualify would have a Material Adverse Effect. (ii) To the best knowledge of such counsel, all of the outstanding shares of Common Stock and Preferred Stock of TB and all other equity securities of TB have been duly authorized and are validly issued, fully paid and nonassessable; and the stockholders of TB have no preemptive rights with respect to the Common Stock or Preferred Stock. (iii) All the outstanding shares of capital stock of each subsidiary of TB have been duly and validly authorized and issued and are fully paid and nonassessable, and, except as otherwise set forth in the Registration Statement and the Prospectus, all outstanding shares of capital stock of such subsidiaries are owned by TB either directly or through wholly owned subsidiaries free and clear of any perfected security interest and, to the best knowledge of such counsel, any other security interests, claims, liens or encumbrances. (iv) There is no pending or, to the best of such counsel's knowledge, threatened action, suit or proceeding before any court or governmental agency, authority or body or any arbitrator involving TC, TB or any of its subsidiaries required to be disclosed in the Prospectus, which is not adequately disclosed in the Prospectus, and there is no franchise, contract or other document that is material to TB and its subsidiaries, considered as one enterprise, and required to be described in the Registration Statement or Prospectus, or to be filed as an exhibit, which is not described or filed as required. In rendering such opinion, such counsel may rely (A) as to matters involving the application of laws of any jurisdiction other than the Commonwealth of Pennsylvania or the federal law of the United States, to the extent such counsel deems proper and specified in such opinion, upon the opinion of other counsel of good standing whom such counsel believes to be reliable and who are reasonably satisfactory to counsel for the Underwriters and (B) as to matters of fact, to the extent such counsel deems proper, on representations or certificates of responsible officers of the Registrants and certificates of public officials. References to the Prospectus in this paragraph (c) include any supplements thereto at or prior to the Closing Date. -13- (d) The Registrants shall have furnished to you the opinion of Wolf, Block, Schorr and Solis-Cohen, counsel for the Registrants, dated the Closing Date, to the effect that: (i) Each of TC and TB has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware, with full corporate power and corporate authority to own its properties and conduct its business as described in the Prospectus, and, to the best knowledge of such counsel, is duly qualified to do business as a foreign corporation and is in good standing under the laws of each jurisdiction which requires such qualification and where the failure to so qualify would have a Material Adverse Effect. (ii) Based solely upon review of certificates executed by an officer or officers of the Registrants and to the extent of the actual knowledge of such counsel, there is no pending or threatened action, suit or proceeding before any court or governmental agency, authority or body or any arbitrator involving TC, TB or any of its subsidiaries required to be disclosed in the Prospectus, which is not adequately disclosed in the Prospectus, and there is no franchise, contract or other document that is material to TB and its subsidiaries, considered as one enterprise, and required to be described in the Registration Statement or Prospectus, or to be filed as an exhibit, which is not described or filed as required. (iii) The Registration Statement has become effective under the Act; any required filing of the Prospectus, and any supplements thereto, pursuant to Rule 424(b) has been made in the manner and within the time period required by Rule 424(b); to the best knowledge of such counsel, no stop order suspending the effectiveness of the Registration Statement has been issued, and no proceedings for that purpose have been instituted or threatened. (iv) Based on representations or certificates of officers of the Registrants regarding the factual matters contained in General Instruction I.A. and I.B.1 of Form S-3 under the Act, the Registrants meet the requirements for the use of Form S-3. (v) The Registration Statement and the Prospectus (other than the Statement of Eligibility and Qualification on Form T-1 (the "Form T-1") of the appropriate Trustee and the financial statements and other financial and statistical information contained therein as to which such counsel need express no opinion) comply as to form in all material respects with the applicable requirements of the Act and the Rules and Regulations; and the documents incorporated by reference therein comply as to form in all material respects with the requirements of the Exchange Act. (vi) This Agreement has been duly authorized, executed and delivered by the Registrants. -14- (vii) No consent, approval, authorization or order of any court or governmental agency or body is required for the consummation of the transactions contemplated herein, except such as have been obtained under the Act and the Trust Indenture Act and such as may be required under the blue sky laws of any jurisdiction in connection with the purchase and distribution of the Offered Securities by the Underwriters (as to which such counsel need express no opinion) and such other approvals (specified in such opinion) as have been obtained. (viii) Neither the issue and sale of any Offered Securities, the issue of shares of Common Stock upon conversion or exchange of any convertible or exchangeable Offered Securities, nor the consummation of any of the other transactions herein contemplated nor the fulfillment of the terms hereof will conflict with, result in a breach of, or constitute a default under the terms of any indenture or other agreement or instrument known to such counsel and to which either TC or TB or any of its subsidiaries is a party or bound (where such conflict, breach or default would have a Material Adverse Effect) or the charter or by-laws of either TC or TB or any order or regulation known to such counsel to be applicable to either TC or TB or any of its subsidiaries of any court, regulatory body, administrative agency, governmental body or arbitrator having jurisdiction over either TC or TB or any of its subsidiaries. (ix) The statements in the Prospectus (by incorporation by reference) relating to laws, regulations, legal or regulatory proceedings, environmental matters and contractual matters, insofar as they relate to statements of law or legal conclusions, have been reviewed by such counsel and are accurate in all material respects. (x) If Debt Securities are being offered, such Debt Securities have been duly authorized by TC for issuance and when executed by TC and authenticated by the appropriate Trustee in accordance with the Indenture (assuming the due authorization, execution and delivery of such Indenture by the appropriate Trustee) and delivered to and paid for by the Underwriters in accordance with the terms of this Agreement (and, in the case of any Contract Securities, as contemplated by the Delayed Delivery Contracts with respect thereto) will constitute valid and legally binding obligations of TC enforceable against TC in accordance with their terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law). (xi) If Debt Securities are being offered, the Guarantee has been duly authorized and, upon endorsement on such Debt Securities by TB and upon the execution of such Debt Securities by TC and authentication thereof by the appropriate Trustee in accordance with the Indenture (assuming the due authorization, execution and delivery of such Indenture by the appropriate Trustee), and delivery of -15- such Debt Securities to and payment therefor by the Underwriters in accordance with the terms of this Agreement (and, in the case of any Contract Securities, as contemplated by the Delayed Delivery Contracts with respect thereto), will be a valid and binding obligation of TB enforceable against TB in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law). (xii) If Debt Securities are being offered, the Indenture has been duly authorized by the Registrants and has been duly qualified under the Trust Indenture Act and, when duly executed and delivered by the Registrants (assuming the due authorization, execution and delivery by the appropriate Trustee), will constitute a valid and legally binding instrument of each of the Registrants enforceable against each of the Registrants in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium and similar laws affecting creditors' rights and remedies generally and subject, as to enforceability, to general principles of equity (regardless of whether enforcement is sought in a proceeding in equity or at law). (xiii) The Offered Securities, the Common Stock issuable upon conversion or exchange of any convertible or exchangeable Offered Securities and, if Debt Securities are being offered, the Indenture and the Guarantee each conform in all material respects to the description thereof in the Prospectus. (xiv) If the Offered Securities are convertible or exchangeable, the shares of Common Stock issuable upon conversion or exchange of such Offered Securities have been duly and validly authorized and reserved for issuance upon such conversion or exchange by all necessary corporate action and such shares, when issued upon such conversion or exchange, will be duly authorized and validly issued, fully paid and non-assessable, and the issuance of such shares upon such conversion or exchange will not be subject to preemptive or similar rights. (xv) If Common Stock or Preferred Stock is being offered, such shares of Common Stock or Preferred Stock, as the case may be, have been duly authorized and are validly issued, fully paid and non-assessable, and the issuance of such shares is not subject to preemptive or similar rights. In addition such counsel shall state that such counsel has participated in conferences with representatives of the Underwriters, officers and other representatives of the Registrants and representatives of the independent certified public accountants of the Registrants, at which conferences the contents of the Registration Statement and the Prospectus and related matters were discussed and, although such counsel does not pass upon and does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement and the Prospectus (except and only to the extent as set forth in clauses (x) and (xiv) of this Section 8(d)), on the basis of the foregoing (relying as to materiality to a large extent upon the -16- discussions with and representations and opinions of officers and other representatives of the Registrants), no facts have come to the attention of such counsel which lead such counsel to believe that the Registration statement at the time it became effective or as of the date of the Terms Agreement contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus, as of the date of the Terms Agreement or at the Closing Date, included an untrue statement of a material fact or omitted to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; provided further that such counsel does not express any comment with respect to (i) the Form T-1 and (ii) the financial statements including the notes thereto and supporting schedules, or any other financial and statistical data set forth or referred to in the Registration Statement or Prospectus. In rendering such opinion, such counsel may rely (A) as to matters involving the application of laws of any jurisdiction other than the Commonwealth of Pennsylvania or the federal law of the United States, to the extent they deem proper and specified in such opinion, upon the opinion of other counsel of good standing whom they believe to be reliable and who are reasonably satisfactory to counsel for the Underwriters and (B) as to matters of fact, to the extent they deem proper, on representations or certificates of responsible officers of the Registrants and certificates of public officials. References to the Prospectus in this paragraph (d) include any supplements thereto at or prior to the Closing Date. (e) The favorable opinion, dated as of the Closing Date, of Cahill Gordon & Reindel, counsel for the Underwriters, with respect to the matters set forth in clauses (iii), (v) (first clause only) (vi), (x), (xi), (xii), (xiii), (xiv) and (xv) of subsection (d) of this Section 8. In giving its opinion required by subsection (e) of this Section 8, Cahill Gordon & Reindel shall additionally state that such counsel has participated in conferences with officers and other representatives of the Registrants and representatives of the independent public accountants for the Registrants and representatives of the Underwriters at which the contents of the Registration Statement and the Prospectus and related matters were discussed and, although such counsel is not passing upon and does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement or the Prospectus, on the basis of the foregoing (relying as to materiality to a large extent upon the opinions of officers and other representatives of the Registrants), no facts have come to the attention of such counsel which lead such counsel to believe that the Registration Statement, at the time it became effective or as of the date of the Terms Agreement, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein not misleading or that the Prospectus as of the date of the Terms Agreement or at the Closing Date, contained or contains an untrue statement of a material fact or omitted or omits to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading (it being understood that such counsel need express no comment with respect to (i) the Form T-1 and (ii) the financial statements, including the notes thereto, supporting schedules or any financial or statistical data set forth or referred to in the Registration Statement or the Prospectus). -17- (f) The following conditions contained in clauses (i), (ii) and (iii) of this subsection (f) shall have been satisfied on and as of the Closing Date and the Registrants shall have furnished to the Underwriters a certificate of the Registrants, signed by the Chairman of the Board or the President and the principal financial or accounting officer of each of the Registrants, dated the Closing Date, to the effect that the signers of such certificate have carefully examined the Registration Statement, the Prospectus, any supplement to the Prospectus and this Agreement and that to the best of their knowledge: (i) The representations and warranties of the Registrants in this Agreement are true and correct in all material respects on and as of the Closing Date with the same effect as if made on the Closing Date and the Registrants have complied with all the agreements and satisfied all the conditions under this Agreement on their part to be performed or satisfied at or prior to the Closing Date. (ii) No stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or threatened. (iii) Since the date of the most recent financial statements included in the Prospectus (exclusive of any supplement thereto), there has been no Material Adverse Change. (g) At the Closing Date, Ernst & Young shall have furnished to the Underwriters a letter, dated as of the Closing Date, in form and substance reasonably satisfactory to the Underwriters, confirming that they are independent accountants within the meaning of the Act and the applicable published rules and regulations thereunder and stating in effect that: (i) In their opinion the audited financial statements and financial statement schedules included or incorporated in the Registration Statement, the Prospectus and the documents incorporated by reference therein, and reported on by them, comply in form in all material respects with the applicable accounting requirements of the Act and the Rules and Regulations. (ii) On the basis of a reading of the latest unaudited financial statements made available by TB and its subsidiaries; carrying out certain specified procedures (but not an examination in accordance with generally accepted auditing standards) which would not necessarily reveal matters of significance with respect to the comments set forth in such letter; a reading of the minutes of the meetings of the stockholders, directors and audit committees of TB and the subsidiaries; and inquiries of certain officials of TB who have responsibility for financial and accounting matters of TB and its subsidiaries as to transactions and events subsequent to the date of TB's most recent audited balance sheet included or incorporated by reference in the Prospectus, nothing came to their attention which caused them to believe that: -18- (1) any unaudited consolidated financial statements included or incorporated by reference in the Registration Statement and the Prospectus do not comply in form in all material respects with applicable accounting requirements of the Act and with the published rules and regulations of the Commission with respect to financial statements included or incorporated in quarterly reports on Form 10-Q under the Exchange Act; and said unaudited financial statements are not in conformity with generally accepted accounting principles applied on a basis substantially consistent with that of the audited financial statements included or incorporated in the Registration Statement and the Prospectus; or (2) with respect to the period subsequent to the date of TB's most recent balance sheet included or incorporated by reference in the Prospectus, that at a specified date not more than five business days prior to the date of the letter, there were any decreases in the capital stock or there were any increases in the long-term debt of TB and its subsidiaries or any decreases in the total consolidated assets, as compared with the amounts shown on such balance sheet, or for the period from the date of TB's most recent income statement included or incorporated by reference in the Prospectus to such specified date there were any decreases, as compared with the corresponding period in the preceding year, in consolidated net revenues or income before income taxes or in total or per share amounts of net income of TB and its subsidiaries, except in all instances for increases or decreases that the Registration Statement discloses have occurred or may occur; (iii) they have performed certain other specified procedures as a result of which they determined that certain information of an accounting, financial or statistical nature (which is limited to accounting, financial or statistical information derived from the general accounting records of TB and its subsidiaries) set forth in the Registration Statement and the Prospectus agrees with the accounting records of TB and its subsidiaries, or schedules prepared by TB and its subsidiaries and derived from such accounting records, excluding any questions of legal interpretation. References to the Prospectus in this subsection (g) include any supplement thereto at the date of the letter. (h) At the Closing Date, counsel for the Underwriters shall have been furnished with such information, certificates and documents as they may reasonably require for the purpose of enabling them to pass upon the issuance and sale of the Offered Securities as contemplated herein and related proceedings, or in order to evidence the accuracy of any of the representations or warranties, or the fulfillment of any of the conditions, herein contained; and all opinions and certificates mentioned above or elsewhere in this Agreement shall be reasonably satisfactory in form and substance to the Underwriters and counsel for the Underwriters. -19- 9. Expenses of Underwriters. If this Agreement is terminated by the Underwriters in accordance with the provisions of Section 7(b)(i) or Section 8, TB or the Registrants, as the case may be, shall reimburse the Underwriters for all of their reasonable out-of-pocket expenses, including the reasonable fees and disbursements of counsel for the Underwriters. 10. Notices. All notices or communications hereunder shall be sufficient if in writing and if sent to you shall be mailed, delivered or telegraphed and confirmed to you at your address set forth for that purpose in the Terms Agreement. Any notice by the Underwriters to the Registrants shall be sufficient if given in writing or by telegraph addressed to the Registrants c/o TB at 3103 Philmont Avenue, Huntingdon Valley, Pennsylvania 19006, Attention: Robert I. Toll, Chairman of the Board and Chief Executive Officer. 11. Parties. This Agreement shall inure to the benefit of and be binding upon the Underwriters, the Registrants and their respective successors. This Agreement and the terms and provisions hereof are for the sole benefit of only those persons, except that (a) the representations, warranties, indemnities and agreements of the Registrants contained in this Agreement shall also be deemed to be for the benefit of the person or persons, if any, who control any Underwriter within the meaning of Section 15 of the Act, and (b) the indemnity agreement of the Underwriters contained in Section 6 of this Agreement shall be deemed to be for the benefit of directors of the Registrants, officers of the Registrants who have signed the Registration Statement and any person controlling the Registrants. Nothing in this Agreement is intended or shall be construed to give any person other than the persons referred to in this Section ll any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision contained herein. 12. Certain Definitions. For purposes of this Agreement, (a) "business day" means any day on which the New York Stock Exchange, Inc. is open for trading and (b) "subsidiary" has the meaning set forth in Rule 405 of the Rules and Regulations. 13. Governing Law; Counterparts. This Agreement shall be governed by and construed in accordance with the laws of the State of New York. This Agreement may be executed in one or more counterparts, and if executed in more than one counterpart, the executed counterparts shall together constitute a single instrument. -20- TERMS AGREEMENT _________________, 200__ [TOLL BROTHERS, INC.] [TOLL CORP.] 3103 Philmont Avenue Huntingdon Valley, PA 19006 Attention: Dear Sirs: We (the "Representative(s)") understand that [Toll Corp., a Delaware corporation, proposes to issue and sell $______________ aggregate principal amount of its debt securities to be guaranteed by Toll Brothers, Inc.] [Toll Brothers, Inc., a Delaware corporation, proposes to issue and sell ________________ shares of its equity securities] (the "Underwritten Securities"). Subject to the terms and conditions set forth herein or incorporated by reference herein, the Underwriters named in the list attached hereto offer to purchase, severally and not jointly, the Underwritten Securities. The Closing Date shall be ___________, 200__, at ________A.M. at the offices of ________________________________. All the provisions contained in the Underwriting Agreement Basic Provisions dated _________________, 200__ (the "Basic Provisions"), a copy of which you have previously received, are herein incorporated by reference in their entirety and shall be deemed to be a part of this Terms Agreement to the same extent as if the Basic Provisions had been set forth in full herein. Terms defined in the Basic Provisions are used herein as therein defined. If the Underwritten Securities are Debt Securities, they shall have the following terms: Title: Maturity: Interest Rate: Interest payment dates: Redemption provisions: Purchase Price: _____% of the principal amount thereof Public Offering Price: _______% of the principal amount thereof Additional Terms: -21- If the Underwritten Securities are Preferred Stock, they shall have the following terms: Title: Liquidation Preference: $____ per share Dividend Rate: $____ per share Dividend payment dates: Redemption provisions: Purchase Price: $____ per share Public Offering Price: $____ per share Additional Terms: If the Underwritten Securities are Common Stock, they shall have the following terms: Purchase Price: $____ per share Public Offering Price: $____ per share Please accept this offer no later than _____________ o'clock __.M. on ________________, 200__, by signing a copy of this Terms Agreement in the space set forth below and returning the signed copy to us, or by sending us a written acceptance in the following form: -22- "We hereby accept your offer, set forth in the Terms Agreement, dated ___________, 200__, to purchase the Securities on the terms set forth therein. Very truly yours, By__________________________ Title: Address: Accepted: [TOLL BROTHERS, INC.] [TOLL CORP.] By_____________________________ Title: -23- EXHIBIT I [TOLL BROTHERS, INC.] [TOLL CORP.] [Insert specific title of securities*] DELAYED DELIVERY CONTRACT [Insert date of initial public offering]* [TOLL BROTHERS, INC.] [TOLL CORP.] c/o * Gentlemen: The undersigned hereby agrees to purchase from [Toll Brothers, Inc. (hereinafter called "TB")] [Toll Corp. (hereinafter called "TC")], and [TB] [TC] agrees to sell to the undersigned. [If one delayed closing, insert -- as of the date hereof, for delivery on , 20 ("Delivery Date")] [____________ shares of TB's [title of Securities] (the "Securities"), offered by TB's Prospectus relating thereto, receipt of a copy of which is hereby acknowledged, at a purchase price of $________ per share, and on the further terms and conditions set forth in this contract.] [$_________________ principal amount of TC's [title of Securities] (the "Securities"); offered by TC's Prospectus relating thereto, receipt of a copy of which is hereby acknowledged, at a purchase price of % of the principal amount thereof plus accrued interest, if any, and on the further terms and conditions set forth in this contract.] [If two or more delayed closings, insert the following: * To be completed when the Terms Agreement is executed by the parties thereto. -24- The undersigned will purchase from TC as of the date hereof, for delivery on the dates set forth below, Securities in the amounts set forth below: Delivery Date Amount ------------- ------ ----------------------- ------------------------- ----------------------- ------------------------- Each of such delivery dates is hereinafter referred to as a Delivery Date.] Payment for the Securities which the undersigned has agreed to purchase for delivery on [the] [each] Delivery Date shall be made to [TB] [TC] or its order by certified or official bank check in New York Clearing House funds (or as otherwise specified in the Terms Agreement) at the office of ________________at__ .M., time, on such Delivery Date upon delivery to the undersigned of the Securities to be purchased by the undersigned for delivery on such Delivery Date in definitive form and in such denominations and registered in such names as the undersigned may designate by written or telegraphic communication addressed to [TB] [TC] not less than five full business days prior to such Delivery Date. If no designation is received, the securities will be registered in the name of the undersigned and issued in a denomination equal to the aggregate amount of Securities to be purchased by the undersigned on such Delivery Date. The obligation of the undersigned to take delivery of, and make payment for, Securities on [the] [each] Delivery Date shall be subject only to the conditions that (1) investment in the Securities shall not at such Delivery Date be prohibited under the laws of any jurisdiction in the United States to which the undersigned is subject, which investment the undersigned represents is not prohibited on the date hereof and (2) [TB] [TC] shall have delivered to the Underwriters the amount of the Securities to be purchased by them pursuant to the Underwriting Agreement referred to in the Prospectus mentioned above and received payment therefor. The obligation of the undersigned to take delivery of and make payment for Securities hereunder, and the obligation of [TB] [TC] to sell and deliver Securities hereunder, shall not be affected by the failure of any purchaser to take delivery of and make payment for Securities pursuant to other contracts similar to this contract. As a material inducement to the acceptance of this offer by [TB] [TC], the undersigned represents and warrants to you that its investment in the Securities which the undersigned hereby offers to purchase is not, as of the date hereof, prohibited under the laws of any jurisdiction to which the undersigned in subject and which govern such investment, and the undersigned will, if the Securities are being purchased by the undersigned under a "basket" clause or similar authorization, use its best efforts to reserve an amount thereunder sufficient to permit such purchase on the Delivery Date. Promptly after completion of the sale to the Underwriters, [TB] [TC] will mail or deliver to the undersigned at its address set forth below notice to such effect, accompanied by a copy of the opinion of counsel for [TB] [TC] delivered to the Underwriters in connection therewith. -25- By the execution hereof, the undersigned represents and warrants to [TB] [TC] that all necessary corporate action for the due execution and delivery of this contract and the payment for and purchase of the Securities which the undersigned hereby offers to purchase has been taken by it and no further authorization or approval of any governmental or other regulatory authority is required for such execution, delivery, payment or purchase, and that, upon acceptance hereof by [TB] [TC] and mailing or delivery of a copy as provided below, this contract will constitute a valid and binding agreement of the undersigned in accordance with its terms. This contract will inure to the benefit of and be binding upon the parties hereto and their respective successors, but will not be assignable by either party hereto without the written consent of the other. It is understood that the acceptance of this contract and any other similar contracts is in [TB's] [TC's] sole discretion and, without limiting the foregoing, need not be on a first-come, first-served basis. If this contract is acceptable to [TB] [TC], it is requested that [TB] [TC] sign the form of acceptance below and mail or deliver one of the counterparts hereof to the undersigned at its address set forth below. This will become a binding contract between [TB] [TC] and the undersigned when such counterpart is mailed or delivered. -26- This contract shall be governed by, and construed in accordance with, the laws of the State of New York, Very truly yours, ----------------------------------- (Name of Purchaser) By --------------------------------- ----------------------------------- (Title of Signatory) ----------------------------------- ----------------------------------- (Address of Purchaser) Accepted, as of the above date. [TOLL BROTHERS, INC.] [TOLL CORP.] By ----------------------------- (Title of Signatory) -27- EX-5 4 b319003_ex5.txt EXHIBIT 5 EXHIBIT 5 WOLF, BLOCK, SCHORR AND SOLIS-COHEN LLP 1650 Arch Street Philadelphia, PA 19103-2097 June 20, 2002 Toll Brothers, Inc. Toll Corp. Toll Finance Corp. First Huntingdon Finance Corp. 3103 Philmont Avenue Huntingdon Valley, PA 19006 RE: Registration Statement on Form S-3 ---------------------------------- Gentlemen: As counsel for Toll Brothers, Inc., a Delaware corporation (the "Company"), and its wholly owned subsidiaries, Toll Corp., a Delaware corporation ("Toll"), Toll Finance Corp., a Delaware corporation ("TFC"), and First Huntingdon Finance Corp., a Delaware corporation ("FHFC"), we have assisted in the preparation of a Registration Statement on Form S-3 (together with all exhibits thereto and documents incorporated by reference therein, the "Registration Statement") in the form proposed to be filed by the Company, Toll, TFC and FHFC (collectively, the "Registrants") with the Securities and Exchange Commission (the "Commission"). The Registration Statement relates to the issuance and sale from time to time, pursuant to Rule 415 of the General Rules and Regulations of the Commission promulgated under the Securities Act of 1933, as amended (the "Securities Act"), of the following securities of the Registrants with an aggregate initial public offering price of up to $750,000,000 or the equivalent thereof in one or more foreign currencies or composite currencies: (i) debt securities of Toll ("Toll Debt Securities"), TFC ("TFC Debt Securities") and FHFC ("FHFC Debt Securities" and, collectively with the Toll Debt Securities and the TFC Debt Securities, the "Debt Securities"), which may be any of senior secured debt securities, senior unsecured debt securities, senior subordinated debt securities or subordinated debt securities, in one or more series, which in each case are to be issued under an indenture (an "Indenture" and, collectively with any other indentures relating to other Debt Securities and/or Additional Debt Securities (as defined), the "Indentures") to be entered into among the issuer of the Debt Securities, the Company and Banc One Trust Company, NA or another institution designated prior to the issuance of any Debt Securities under such Indenture to serve as trustee thereunder (a "Trustee" and, collectively with the trustees, if any, under other Indentures, the "Trustees"); (ii) the Company's unconditional and irrevocable guarantees of Debt Securities (the "Guarantees"); (iii) shares of the Company's Common Stock, $.01 par value (the "Common Stock"); (iv) shares of the Company's Preferred Stock, $.01 par value (the "Preferred Stock"), in one or more series; (v) warrants to purchase Debt Securities (the "Debt Warrants") to be issued pursuant to a warrant agreement relating to Debt Warrants and/or Additional Debt Warrants (as defined), as the case may be (the "Debt Warrant Agreement"), between the issuer of Debt Securities and/or the Additional Debt Securities, as the case may be, to which the Debt Warrants and/or the Additional Debt Warrants relate, the Company and a warrant agent (the "Debt Warrant Agent") to be appointed prior to the issuance of Debt Warrants or Additional Debt Warrants; (vi) warrants to purchase Common Stock (the "Common Stock Warrants") to be issued pursuant to a warrant agreement relating to Common Stock Warrants and/or Additional Common Stock Warrants (as defined), as the case may be (the "Common Stock Warrant Agreement"), between the Company and a warrant agent (the "Common Stock Warrant Agent") to be appointed prior to the issuance of Common Stock Warrants or Additional Common Stock Warrants; and (vii) warrants to purchase Preferred Stock (the "Preferred Stock Warrants", and, together with the Debt Warrants and the Common Stock Warrants, the "Warrants") to be issued pursuant to a warrant agreement relating to Preferred Stock Warrants and/or Additional Preferred Stock Warrants (as defined), as the case may be (the "Preferred Stock Warrant Agreement"), between the Company and a warrant agent (the "Preferred Stock Warrant Agent") to be appointed prior to the issuance of Preferred Stock Warrants or Additional Preferred Stock Warrants. The Debt Securities, the Guarantees, the Common Stock, the Preferred Stock and the Warrants are collectively referred to herein as the "Offered Securities." This opinion is being delivered in accordance with the requirements of Item 601(b)(5) of Regulation S-K promulgated under the Securities Act. For the purpose of rendering this opinion, we have examined (i) the Registration Statement relating to the Offered Securities; (ii) the respective forms of Indenture relating to the Toll Debt Securities and related Guarantees (the "Toll Indenture"), the TFC Debt Securities and related Guarantees (the "TFC Indenture") and the FHFC Debt Securities and related Guarantees (the "FHFC Indenture"), each of which is being filed as an exhibit to the Registration Statement; (iii) the Restated Articles of Incorporation of the Company, as amended to date (the "Articles of Incorporation"); (iv) the Bylaws of the Company as currently in effect (the "Bylaws"); and (v) certain resolutions adopted by the respective Boards of Directors of the Company (the "Company Board"), Toll (the "Toll Board"), TFC (the "TFC Board") and FHFC (the "FHFC Board" and, collectively with the Company Board, the Toll Board and the TFC Board, the "Registrants' Boards") relating to the issuance of the Offered Securities and the authorization of the filing of an additional registration statement (the "Additional Registration Statement") for the purpose of registering for issuance and sale an additional amount of Offered Securities pursuant to Rule 462(b) under the Securities Act (the "Additional Offered Securities"). The Additional Offered Securities may consist of one or more of the following: additional Debt Securities ("Additional Debt Securities"), which may consist of additional Toll Debt Securities ("Additional Toll Debt Securities"), additional TFC Debt Securities ("Additional TFC Debt Securities") or additional FHFC Debt Securities ("Additional FHFC Debt Securities"), additional Guarantees ("Additional Guarantees"), additional Common Stock ("Additional Common Stock"), additional Preferred Stock ("Additional Preferred Stock"), additional Debt Warrants ("Additional Debt Warrants"), additional Common Stock Warrants ("Additional Common Stock Warrants") and additional Preferred Stock Warrants ("Additional Preferred Stock Warrants"). We have also examined originals or copies, certified or otherwise identified to our satisfaction, of such records of the Registrants and such agreements, certificates of public officials, certificates of officers or other representatives of the Registrants and others and such other documents, certificates and records as we have deemed necessary or appropriate as a basis for the opinions set forth herein. In our examination, we have assumed without independent verification (i) the legal capacity of all natural persons, (ii) the genuineness of all signatures, (iii) the authenticity of all documents submitted to us as originals, (iv) the conformity to original documents of all documents submitted to us as certified, conformed or photostatic copies and the authenticity of the originals of such latter documents and (v) the power and authority of all persons other than the Registrants signing such documents to execute, deliver and perform such documents, and the valid authorization, execution and delivery of such documents by such other persons. As to any facts material to the opinions expressed herein which were not independently established or verified, we have relied upon oral or written statements and representations of officers or other representatives of the Registrants and others. We are admitted to practice before the bar in the Commonwealth of Pennsylvania and in the States of Delaware and New York and we do not express any opinion as to the laws of any other jurisdiction other than the federal laws of the United States of America to the extent referred to specifically herein. The Offered Securities and any Additional Offered Securities may be issued from time to time on a delayed or continuous basis, and this opinion is limited to the laws, including applicable rules and regulations, in effect on the date hereof. We assume no obligation to update this opinion. -2- Based upon and subject to the foregoing, such examinations of law and such other matters as we have deemed relevant under the circumstances, we are of the opinion that, as of the date hereof: 1. The form of Toll Indenture filed as an exhibit to the Registration Statement (the "Basic Toll Indenture") has been duly authorized by the Toll Board. The Basic Toll Indenture and each other Indenture in the form of the Basic Toll Indenture, as modified in accordance with duly adopted resolutions of the Toll Board and the Company Board (in each case, including any appropriate committee appointed thereby) to reflect the additional terms applicable to the Toll Debt Securities and/or any Additional Toll Debt Securities and Guarantees and/or any Additional Guarantees to which such Indenture relates, when executed and delivered by Toll and the Company, will be a valid and binding agreement, enforceable against Toll and the Company in accordance with its terms, except to the extent that enforcement thereof may be limited by (a) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or other similar laws now or hereafter in effect relating to or affecting creditors' rights generally, (b) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity) and (c) governmental authority to limit, delay or prohibit the making of payments outside the United States or in foreign currency or composite currency. 2. The form of TFC Indenture filed as an exhibit to the Registration Statement (the "Basic TFC Indenture") has been duly authorized by the TFC Board. The Basic TFC Indenture and each other Indenture in the form of the Basic TFC Indenture, as modified in accordance with duly adopted resolutions of the TFC Board and the Company Board (in each case, including any appropriate committee appointed thereby) to reflect the additional terms applicable to the TFC Debt Securities and/or any Additional TFC Debt Securities and Guarantees and/or any Additional Guarantees to which such Indenture relates, when executed and delivered by TFC and the Company, will be a valid and binding agreement, enforceable against TFC and the Company in accordance with its terms, except to the extent that enforcement thereof may be limited by (a) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or other similar laws now or hereafter in effect relating to or affecting creditors' rights generally, (b) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity) and (c) governmental authority to limit, delay or prohibit the making of payments outside the United States or in foreign currency or composite currency. 3. The form of FHFC Indenture filed as an exhibit to the Registration Statement (the "Basic FHFC Indenture") has been duly authorized by the FHFC Board. The Basic FHFC Indenture and each other Indenture in the form of the Basic FHFC Indenture, as modified in accordance with duly adopted resolutions of the FHFC Board and the Company Board (in each case, including any appropriate committee appointed thereby) to reflect the additional terms applicable to the FHFC Debt Securities and/or any Additional FHFC Debt Securities and Guarantees and/or any Additional Guarantees to which such Indenture relates, when executed and delivered by FHFC and the Company, will be a valid and binding agreement, enforceable against FHFC and the Company in accordance with its terms, except to the extent that enforcement thereof may be limited by (a) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or other similar laws now or hereafter in effect relating to or affecting creditors' rights generally, (b) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity) and (c) governmental authority to limit, delay or prohibit the making of payments outside the United States or in foreign currency or composite currency. -3- 4. With respect to any series of Debt Securities and/or Additional Debt Securities and the related Guarantees and/or Additional Guarantees (collectively, the "Offered Debt Securities"), when (i) if the Offered Debt Securities are to be sold pursuant to a firm commitment underwritten offering, the underwriting agreement with respect to the Offered Debt Securities (the "Debt Underwriting Agreement") has been duly authorized, executed and delivered by the issuer of the applicable Debt Securities and/or Additional Debt Securities, the Company and the other parties thereto; (ii) if the Offered Debt Securities are to be sold on an agency basis, the distribution agreement with respect to the Offered Debt Securities (the "Debt Distribution Agreement") has been duly authorized, executed and delivered by the issuer of the applicable Debt Securities and/or Additional Debt Securities, the Company and the other parties thereto; (iii) the Board of Directors of the issuer of the applicable Debt Securities and/or Additional Debt Securities and the Company Board, including in each case any appropriate committee appointed thereby, and appropriate officers of the issuer of the applicable Debt Securities and/or Additional Debt Securities and the Company have taken all necessary corporate action to approve the issuance and terms of the Offered Debt Securities and related matters; (iv) the terms of the Offered Debt Securities and of their issuance and sale have been duly established in conformity with the Indenture relating thereto so as not to violate any applicable law, the Articles of Incorporation or Bylaws of the issuer of the applicable Debt Securities and/or Additional Debt Securities or the Company or result in a default under or breach of any agreement or instrument binding upon the issuer of the applicable Debt Securities and/or Additional Debt Securities or the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the issuer of the applicable Debt Securities and/or Additional Debt Securities or the Company; (v) the applicable Indenture has been duly executed and delivered by the issuer of the applicable Debt Securities and/or Additional Debt Securities, the Company and the Trustee thereunder; and (vi) the Offered Debt Securities have been duly executed and authenticated in accordance with the provisions of the applicable Indenture and duly delivered to the purchasers thereof upon payment of the agreed-upon consideration therefor, the Offered Debt Securities, when issued and sold in accordance with the applicable Indenture and the related Debt Underwriting Agreement or Debt Distribution Agreement, if any, or any other duly authorized, executed and delivered applicable purchase agreement, will be valid and binding obligations of the issuer of the applicable Debt Securities and/or Additional Debt Securities and the Company, enforceable against the issuer of the applicable Debt Securities and/or Additional Debt Securities and the Company in accordance with their respective terms, except to the extent that enforcement thereof may be limited by (a) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or other similar laws now or hereafter in effect relating to or affecting creditors' rights generally, (b) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity) and (c) governmental authority to limit, delay or prohibit the making of payments outside the United States or in foreign currency or composite currency. We note that, as of the date hereof, a judgment for money in an action based on an Offered Debt Security denominated in a foreign currency, currency unit or composite currency in a federal or state court in the United States ordinarily would be enforced in the United States only in United States dollars. The date used to determine the rate of conversion of the foreign currency, currency unit or composite currency in which a particular Offered Debt Security is denominated into United States dollars will depend upon various factors, including which court renders the judgment. -4- 5. With respect to any shares of Common Stock and/or Additional Common Stock (collectively, the "Offered Common Stock"), when (i) if the Offered Common Stock is to be sold pursuant to a firm commitment underwritten offering, the underwriting agreement with respect to the Offered Common Stock (the "Common Stock Underwriting Agreement") has been duly authorized, executed and delivered by the Company and the other parties thereto; (ii) if the Offered Common Stock is to be sold on an agency basis, the distribution agreement with respect to the Offered Common Stock (the "Common Stock Distribution Agreement") has been duly authorized, executed and delivered by the Company and the other parties thereto; (iii) the Company Board, including any appropriate committee appointed thereby, and the appropriate officers of the Company have taken all necessary corporate action to approve the issuance and terms of issuance of the shares of Offered Common Stock in conformity with the Company's Articles of Incorporation and Bylaws, so as not to violate any applicable law, the Company's Articles of Incorporation or Bylaws or result in a default under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; and (iv) certificates representing the shares of the Offered Common Stock are duly executed, countersigned, registered and delivered upon payment of the agreed-upon consideration therefor, the shares of the Offered Common Stock, when issued and sold in accordance with the related Common Stock Underwriting Agreement or Common Stock Distribution Agreement, if any, or any other duly authorized, executed and delivered applicable purchase agreement, will be duly authorized, validly issued, fully paid and nonassessable, provided that the consideration therefor is not less than the par value thereof. 6. With respect to the shares of any series of Preferred Stock and/or Additional Preferred Stock (collectively, the "Offered Preferred Stock"), when (i) if the Offered Preferred Stock is to be sold pursuant to a firm commitment underwritten offering, the underwriting agreement with respect to the shares of the Offered Preferred Stock (the "Preferred Stock Underwriting Agreement") has been duly authorized, executed and delivered by the Company and the other parties thereto; (ii) if the Offered Preferred Stock is to be sold on an agency basis, the distribution agreement with respect to the Offered Preferred Stock (the "Preferred Stock Distribution Agreement") has been duly authorized, executed and delivered by the Company and the other parties thereto; (iii) the Company Board, including any appropriate committee appointed thereby, and the appropriate officers of the Company have taken all necessary corporate action to approve the issuance and terms of the shares of the Offered Preferred Stock and related matters, including the adoption of a certificate of designations for the Offered Preferred Stock in the form required by applicable law (the "Certificate of Designations"); (iv) the filing of the Certificate of Designations with the Secretary of State of the State of Delaware has duly occurred; (v) the terms of the Offered Preferred Stock and of their issuance and sale have been duly established in conformity with the Company's Articles of Incorporation, the Certificate of Designations and the Company's Bylaws, so as not to violate any applicable law, the Company's Articles of Incorporation, the Certificate of Designations or the Company's Bylaws or result in a default under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; and (vi) certificates representing the shares of the Offered Preferred Stock are duly executed, countersigned, registered and delivered upon payment of the agreed-upon consideration therefor, the shares of the Offered Preferred Stock, when issued and sold in accordance with the related Preferred Stock Underwriting Agreement or Preferred Stock Distribution Agreement, if any, or any other duly authorized, executed and delivered applicable purchase agreement, will be duly authorized, validly issued, fully paid and nonassessable, provided that the consideration therefor is not less than the par value thereof. -5- 7. With respect to any Debt Warrants and/or Additional Debt Warrants (collectively, the "Offered Debt Warrants"), when (i) if the Offered Debt Warrants are to be sold pursuant to a firm commitment underwritten offering, the Debt Underwriting Agreement with respect to the Offered Debt Warrants has been duly authorized, executed and delivered by the issuer of the Debt Securities and/or Additional Debt Securities to which the Offered Debt Warrants relate, the Company and the other parties thereto; (ii) if the Offered Debt Warrants are to be sold on an agency basis, the distribution agreement with respect to the Offered Debt Warrants (the "Debt Warrant Distribution Agreement") has been duly authorized, executed and delivered by the issuer of the Debt Securities and/or Additional Debt Securities to which the Offered Debt Warrants relate, the Company and the other parties thereto; (iii) the Board of Directors of the issuer of the Debt Securities and/or Additional Debt Securities to which the Offered Debt Warrants relate and the Company Board, including in each case any appropriate committee appointed thereby, and appropriate officers of the issuer of the Debt Securities and/or Additional Debt Securities to which the Offered Debt Warrants relate and the Company have taken all necessary corporate action to approve the issuance and terms of the Offered Debt Warrants and related matters; (iv) the terms of the Offered Debt Warrants and of their issuance and sale have been duly established in conformity with the Debt Warrant Agreement so as not to violate any applicable law, the Articles of Incorporation or the Bylaws of the issuer of the Debt Securities and/or Additional Debt Securities to which the Offered Debt Warrants relate or the Company or result in a default under or breach of any agreement or instrument binding upon the issuer of the Debt Securities and/or Additional Debt Securities to which the Offered Debt Warrants relate or the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the issuer of the Debt Securities and/or Additional Debt Securities to which the Offered Debt Warrants relate or the Company; (v) the Debt Warrant Agreement has been duly authorized, executed and delivered by the issuer of the Debt Securities and/or Additional Debt Securities to which the Offered Debt Warrants relate and the Company to the Debt Warrant Agent; (vi) the Debt Warrant Agreement has been duly authorized, delivered and executed by the Debt Warrant Agent; and (vii) the Offered Debt Warrants have been duly executed and authenticated in accordance with the provisions of the Debt Warrant Agreement and duly delivered to the purchasers thereof upon payment of the agreed-upon consideration therefor, the Offered Debt Warrants, when issued and sold in accordance with the Debt Warrant Agreement and the related Debt Underwriting Agreement or Debt Warrant Distribution Agreement, if any, or any other duly authorized, executed and delivered applicable purchase agreement, will be valid and binding obligations of the issuer of the Debt Securities and/or Additional Debt Securities to which the Offered Debt Warrants relate and the Company, enforceable against the issuer of the Debt Securities and/or Additional Debt Securities to which the offered Debt Warrants relate and the Company in accordance with their respective terms, except to the extent that enforcement thereof may be limited by (a) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or other similar laws now or hereafter in effect relating to or affecting creditors' rights generally, (b) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity) and (c) governmental authority to limit, delay or prohibit the making of payments outside the United States or in foreign currency or composite currency. We note that, as of the date hereof, a judgment for money in an action based on a Debt Warrant or an Additional Debt Warrant to purchase a Debt Security or an Additional Debt Security denominated in a foreign currency, currency unit or composite currency in a federal or state court in the United States ordinarily would be enforced in the United States only in United States dollars. The date used to determine the rate of conversion of the foreign currency, currency unit or composite currency in which a particular Debt Security or Additional Debt Security is denominated into United States dollars will depend upon various factors, including which court renders the judgment. -6- 8. With respect to any Common Stock Warrants and/or Additional Common Stock Warrants (collectively, the "Offered Common Stock Warrants"), when (i) if the Offered Common Stock Warrants are to be sold pursuant to a firm commitment underwritten offering, the Common Stock Underwriting Agreement with respect to the Offered Common Stock Warrants has been duly authorized, executed and delivered by the Company and the other parties thereto; (ii) if the Offered Common Stock Warrants are to be sold on an agency basis, the distribution agreement with respect to the Offered Common Stock Warrants (the "Common Stock Warrant Distribution Agreement") has been duly authorized, executed and delivered by the Company and the other parties thereto; (iii) the Company Board, including any appropriate committee appointed thereby, and appropriate officers of the Company have taken all necessary corporate action to approve the issuance and terms of the Offered Common Stock Warrants and related matters; (iv) the terms of the Offered Common Stock Warrants and of their issuance and sale have been duly established in conformity with the Common Stock Warrant Agreement so as not to violate any applicable law, the Company's Articles of Incorporation or Bylaws or result in a default under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; (v) the Common Stock Warrant Agreement has been duly authorized, executed and delivered by the Company to the Common Stock Warrant Agent; (vi) the Common Stock Warrant Agreement has been duly authorized, executed and delivered by the Common Stock Warrant Agent; and (vii) the Offered Common Stock Warrants have been duly executed and authenticated in accordance with the provisions of the Common Stock Warrant Agreement and duly delivered to the purchasers thereof upon payment of the agreed-upon consideration therefor, the Offered Common Stock Warrants, when issued and sold in accordance with the Common Stock Warrant Agreement and the related Common Stock Underwriting Agreement or Common Stock Warrant Distribution Agreement, if any, or any other duly authorized, executed and delivered applicable purchase agreement, will be valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except to the extent that enforcement thereof may be limited by (a) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or other similar laws now or hereafter in effect relating to or affecting creditors' rights generally and (b) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity), provided that the per share consideration payable upon the exercise of the Offered Common Stock Warrants is not less than the par value of the Common Stock. 9. With respect to any Preferred Stock Warrants and/or Additional Preferred Stock Warrants (collectively, the "Offered Preferred Stock Warrants"), when (i) if the Offered Preferred Stock Warrants are to be sold pursuant to a firm commitment underwritten offering, the Preferred Stock Underwriting Agreement with respect to the Offered Preferred Stock Warrants has been duly authorized, executed and delivered by the Company and the other parties thereto; (ii) if the Offered Preferred Stock Warrants are to be sold on an agency basis, the distribution agreement with respect to the Offered Preferred Stock Warrants (the "Preferred Stock Warrant Distribution Agreement") has been duly authorized, executed and delivered by the Company and the other parties thereto; (iii) the Company Board, including any appropriate committee appointed thereby, and appropriate officers of the Company have taken all necessary corporate action to approve the issuance and terms of the Offered Preferred Stock Warrants and related matters; (iv) the terms of the Offered Preferred Stock Warrants and of their issuance and sale have been duly established in conformity with the Preferred Stock Warrant Agreement so as not to violate any applicable law, the Company's Articles of Incorporation or Bylaws or result in a default under or breach of any agreement or instrument binding upon the Company and so as to comply with any requirement or restriction imposed by any court or governmental body having jurisdiction over the Company; (v) the Preferred Stock Warrant Agreement has been duly authorized, executed and delivered by the Company to the Preferred Stock Warrant Agent; (vi) the Preferred Stock Warrant Agreement has been duly authorized, executed and delivered by the Preferred Stock Warrant Agent; and (vii) the Offered Preferred Stock Warrants have been duly executed and authenticated in accordance with the provisions of the Preferred Stock Warrant Agreement and duly delivered to the purchasers thereof upon payment of the agreed-upon consideration therefor, the Offered Preferred Stock Warrants, when issued and sold in accordance with the Preferred Stock Warrant Agreement and the related Preferred Stock Underwriting Agreement or Preferred Stock Warrant Distribution Agreement, if any, or any other duly authorized, executed and delivered applicable purchase agreement, will be valid and binding obligations of the Company, enforceable against the Company in accordance with their respective terms, except to the extent that enforcement thereof may be limited by (a) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium or other similar laws now or hereafter in effect relating to or affecting creditors' rights generally and (b) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity), provided that the per share consideration payable upon the exercise of the Offered Preferred Stock Warrants is not less than the par value of the Preferred Stock. We hereby consent to the filing of this opinion with the Commission as an exhibit to the Registration Statement. We also consent to the reference to our firm under the heading "Legal Matters" in the Registration Statement. In giving this consent, we do not admit that we are in the category of persons whose consent is required under Section 7 of the Securities Act or the Rules and Regulations of the Commission. Very truly yours, /s/ WOLF, BLOCK, SCHORR AND SOLIS-COHEN LLP -7- EX-12 5 b319003_ex12.txt EXHIBIT 12 EXHIBIT 12 Computation of Ratios of Earnings to Fixed Charges
Six months ended Twelve months ended October 31, April 30, ----------------------------------------------------------------- ------------------------- 1997 1998 1999 2000 2001 2001 2002 ------------ ------------ ------------ ------------ ---------- ----------- ---------- Earnings: Income before income taxes and extraordinary (loss) and change in accounting $107,646 $134,293 $162,750 $230,966 $337,889 $135,546 $152,811 Homebuilding Interest expense 29,746 36,052 40,378 46,777 59,002 25,416 30,255 Rent expense 193 293 425 639 852 319 468 Amortization 667 610 618 635 897 405 519 Collateralized mortgage financing: Interest expense 233 184 119 39 36 18 12 ------------ ------------ ------------ ------------ ----------- ----------- ---------- $138,485 $171,432 $204,290 $279,056 $398,676 $161,704 $184,065 ============ ============ ============ ============ =========== =========== ========== Fixed charges: Homebuilding: Interest incurred: $35,242 $38,331 $51,396 $60,236 $79,209 $37,399 $45,242 Rent expense 193 293 425 639 852 319 468 Amortization 667 610 618 635 897 405 519 Collateralized mortgage financing: Interest incurred: 233 184 119 39 36 18 12 ------------ ------------ ------------ ------------ ----------- ----------- ---------- $36,335 $39,418 $52,558 $61,549 $80,994 $38,141 $46,241 ============ ============ ============ ============ =========== =========== ========== Ratio, including collateralized mortgage financing 3.81 4.35 3.89 4.53 4.92 4.24 3.98
EX-23 6 ex23_2.txt EXHIBIT 23.2 EXHIBIT 23.2 CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the caption "Experts" and to the incorporation by reference of our report dated December 11, 2001, with respect to the consolidated financial statements and schedule of Toll Brothers, Inc. included in the Annual Report (Form 10-K) of Toll Brothers, Inc. for the year ended October 31, 2001, in Amendment No. 1 to the Registration Statement (Form S-3 Nos. 333-85030, 333-85030-01, 333-85030-02 and 333-85030-03) and related Prospectus of Toll Brothers, Inc., Toll Corp., First Huntingdon Finance Corp., and Toll Finance Corp. for the registration of Debt Securities of Toll Corp., First Huntingdon Finance Corp., and Toll Finance Corp. and Common Stock, Preferred Stock, Warrants and Guarantees of Debt Securities of Toll Brothers, Inc. /s/ Ernst & Young LLP Philadelphia, Pennsylvania June 14, 2002 -----END PRIVACY-ENHANCED MESSAGE-----