<PAGE>   1

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 20549

                                    FORM 10-K

         ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                   FOR THE FISCAL YEAR ENDED DECEMBER 31, 2000

                        COMMISSION FILE NUMBER 000-23677

                               NEWMARK HOMES CORP.
             (Exact name of registrant as specified in its charter)

              Delaware*                                  76-0460831
   (State or other jurisdiction of            (IRS Employer Identification No.)
   incorporation or organization)

       1200 Soldiers Field Drive                     Sugar Land, TX  77479
(Address of principal executive offices)                 (Zip Code)

                                  281-243-0100
              (Registrant's telephone number, including area code)

          Securities registered pursuant to Section 12(b) of the Act:

                                      None

          Securities registered pursuant to Section 12(g) of the Act:

                               Title of Each Class

                          Common Stock, par value $.01

                             NASDAQ National Market

                   (name of each exchange on which registered)

Indicate by check mark whether the registrant: (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes [X]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein, and will not be contained, to the
best of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendments to
this Form 10-K. [X]

As of March 19, 2001, Registrant had outstanding 11,500,000 shares of common
stock. Of the total shares outstanding, 2,204,700 shares of common stock were
held by non-affiliates of the Registrant, having an aggregate market value on
that date of $23,700,525 (based on the closing sales price on the NASDAQ
National Market).



<PAGE>   2
Documents incorporated by reference:

<TABLE>
<CAPTION>
Related
Section                        Documents
-------   --------------------------------------------------------------------
<S>       <C>
III       Definitive Proxy Statement to be filed pursuant to Regulation 14A on
          or before April 30, 2001.
</TABLE>

*Subsequent to the fiscal year end, the Registrant completed a reincorporation
merger to change its domicile from Nevada to Delaware, such reincorporation
being completed March 22, 2001. The reincorporation was accomplished through a
merger of Newmark Homes Corp., a Nevada corporation, into a newly formed
Delaware subsidiary.

                                     PART I

ITEM 1.  BUSINESS

GENERAL

            Newmark Homes Corp. (the "Company"), a Delaware corporation, is the
holding company whose subsidiaries operate in the home building industry under
the names Newmark Home Corporation ("Newmark"), Westbrooke Communities, Inc. and
affiliated entities (collectively, "Westbrooke") and The Adler Companies, Inc.
("Adler"). The Company also owns a lot development company, Pacific United
Development Corp. Through its operating subsidiaries, the Company designs,
builds and sells single-family detached homes in ten major markets within the
Southwest and Southeast United States, including Houston, Austin, Dallas/Fort
Worth and San Antonio, Texas; Ft. Lauderdale, Palm Beach and Miami, Florida
("South Florida"); Nashville, Tennessee; and Charlotte and Greensboro/
Winston-Salem, North Carolina. Each of these markets has experienced population
and job growth above the national average over the last several years. The
Company operated in 89 subdivisions in these metropolitan areas and had 824
homes under construction at December 31, 2000. In addition, the Company is
actively engaged in residential land acquisition and lot development and as of
December 31, 2000, owned or had under option contracts 4,280 lots available for
future growth.

            In Texas, Tennessee and North Carolina, Newmark offers high-quality
homes, designed principally for the "move-up" and relocation market segments,
under the Newmark(R) trademark. Typically, Newmark(R) homes range in size from
1700 square feet to over 4500 square feet and range in price from $140,000 to
$400,000, with an average sales price of $254,000 for homes closed during 2000.
Newmark also offers custom homes under the Fedrick, Harris Estate Homes name
that range in size from 3500 square feet to over 7000 square feet and range in
price from $300,000 to over $1,000,000, with an average sales price of $475,000
for homes closed during 2000. Revenues generated from sales of Fedrick, Harris
Estate Homes were 16%, 16% and 14% of total homebuilding revenues of the Company
for 2000, 1999 and 1998, respectively. During 2000, Newmark established a new
division - Marksman Homes ("Marksman") to further penetrate home sales in its
more mature markets. Marksman's first models were constructed in Houston and are
designed to appeal to first-time buyers and married couples without children
living at home ("empty nesters"). The units are priced from $130,000 to
$160,000, and range in size from 1550 square feet to 2458 square feet with an
average sales price of $150,000 for homes closed during 2000.

            In the South Florida market, Westbrooke (which includes Adler
operations) offers high-quality homes ranging from first-time buyers to
homebuyers desiring to buy more expensive residences ("move-up" homebuyers).
These homes range in size from approximately 1350 square feet to over 3500
square feet and are priced from $125,000 to $351,000, with an average sales
price of $205,000 for homes closed in 2000. The Company closed the last home
marketed under the Adler name in October 2000.

            The Company's homebuilding operation is positioned to compete with
other high-volume builders by offering a broader selection of homes with more
amenities and greater design flexibility than typically offered by volume
builders. Homebuyers are given the ability to select various design features in
accordance with their personal preferences. Through a volume building approach,
the Company's custom homes generally offer more value than those offered by
local, lower-volume custom builders, primarily due to the Company's effective
purchasing, construction and marketing programs. While most design modifications
are significant to the homebuyer, they typically involve relatively minor
adjustments that allow the Company to maintain construction efficiencies and
result in greater



                                       2
<PAGE>   3

profitability due to increased sales prices and margins. The Company believes
that its ability to meet the design tastes of prospective homebuyers at
competitive prices distinguishes the Company from many of its competitors.

          The Company's predecessor was founded in Houston, Texas in 1983, and
was acquired by Pacific Realty Group, Inc. ("Pacific) in October 1993. Pacific's
interest in the predecessor was transferred to the Company in December 1994 when
the Company was formed. Westbrooke was acquired by the Company in January 1998
and has operated in the Miami, Florida area since 1976. Westbrooke's operations
were consolidated in 1998 with Adler, a company founded in Miami, Florida in
1990 and acquired by the Company in March 1995.

            The Company's initial public offering of its common stock was
completed in March 1998. On December 15, 1999, Technical Olympic USA, Inc.
("TOUSA") purchased 9,200,000 shares of the Company's common stock from Pacific,
such stock representing 80% of the outstanding common stock of the Company.
TOUSA, a Delaware corporation, is a wholly-owned subsidiary of Technical Olympic
(UK) PLC, an English company, which is a wholly-owned subsidiary of Technical
Olympic S.A., a Greek company.

            On March 6, 2001, the Company announced it is considering the
possible merger of the Company with Engle Holdings Corp. The Special Committee
of the Company's independent directors is reviewing and will make a
recommendation on the transaction to the Company's full board. The Special
Committee has engaged legal advisors and investment banks to assist in the
analysis and evaluation of the terms and fairness of the proposed merger. There
are no assurances that the Special Committee will recommend the merger or that
such a merger will be consummated. Any merger would also be subject to execution
of a definitive agreement and certain regulatory and other approvals as well as
the approval of various lenders of Engle Holdings Corp., the Company and TOUSA.
If the merger is consummated, it is contemplated that shares of Engle Holdings
Corp. would be exchanged for shares of the Company.

            Newmark and Westbrooke have achieved annual profitability due to
both innovative and disciplined approaches to home construction, land
acquisition and development as well as lot purchases. The Company believes that
the tenure and experience of its officers and key employees and its disciplined
approach to business have been key factors to the Company's success. There has
been virtually no turnover among officers and key employees since the inception
of both Newmark and Westbrooke.

            The Company's corporate offices are located in Houston. The
Company's divisions in Houston, Austin, Dallas/Ft. Worth, San Antonio,
Nashville, Charlotte and Greensboro/Winston-Salem are managed from the Houston
location. The Company's South Florida operations are primarily the
responsibility of Westbrooke management with support from, and oversight of, the
Company's corporate office.


STRATEGY

            The Company's objective is to provide its customers with homes that
offer both quality and value, while seeking to maximize its return on invested
capital. Management believes that a balanced and disciplined approach to home
construction, land purchases and marketing is essential to the Company's
anticipated growth. To achieve this objective, the Company has developed a
strategy that focuses on the following elements:

            GROWTH MARKETS. The Company's primary markets have each experienced
population and job growth in excess of the national average over the past
several years. The Company believes that growth opportunities remain in most of
these markets. The Company also continues to evaluate new markets that have
significant "move-up" and relocation segments that would satisfy the Company's
profitability, investment return and other criteria. While the Company
anticipates entering new markets primarily through start-up operations, it will
also consider the acquisition of homebuilding companies that have complementary
management styles as exemplified by the Company's acquisition of Westbrooke.
Entry into new markets is preceded by extensive due diligence and research
conducted by both management and third-party resources.

            SOPHISTICATED MARKETING. The Company employs sophisticated and
comprehensive marketing programs to attract potential homebuyers. This marketing
program includes extensive telemarketing, an Internet web site, and an




                                       3
<PAGE>   4

interactive software program. The Company retains a national marketing
consultant to develop its overall advertising strategy. The Company executes its
overall marketing strategy through advertising campaigns tailored to local
markets. Local marketing campaigns include coordination of realtor promotions,
subdivision grand openings, showcase presentations for custom homes, the
Company's newsletters, realtors' newsletters, product bulletins, billboards,
local newspaper advertisements and other direct sales activities. The Company's
web site, featuring a database of available inventory, allows a prospective
homebuyer to locate a home and view different floor plans, locate the various
subdivisions available in each market, and learn about neighborhood schools,
subdivision amenities and shopping as well as the Company's construction
process. The South Florida operation also utilizes an interactive software
program known as "Design Wizard" which enables a homebuyer to customize a home
that meets their needs and lifestyles. While sitting at a computer monitor
located in a sales center, the buyer responds to a series of general lifestyle
questions. Based on the buyer's responses, the interactive software program then
shows the buyer variations of a basic floor plan as well as the cost of the
proposed changes.

            MARKET FOCUS. In markets with a significant number of relocation
buyers, such as Texas, Tennessee and North Carolina, the Company aggressively
competes with resales of existing homes, primarily by making available to
potential buyers completed or nearly completed homes. In these relocation
markets, the Company believes that maintaining an inventory of completed or
nearly completed homes provides distinct competitive advantages by (i) allowing
home buyers to physically inspect their future home, in many instances easing
their decision to buy, (ii) providing homes which can be moved into in or close
to the same time frame as purchases of previously owned homes and (iii) allowing
homebuyers to avoid the significant time and monetary costs typically associated
with updating previously owned homes. In the South Florida market, the Company
primarily focuses on "move-up" homebuyers, and to a lesser extent, first-time
homebuyers. In this market, substantially all homes are sold prior to commencing
construction.

            MANAGEMENT TRAINING. The Company recruits and hires new management
trainees, typically with some construction experience, following graduation from
college and trains these new hires for increasing levels of responsibility
within the Company. Through continuous "on the job" experience and classroom
training, these associates become knowledgeable, experienced candidates for
middle management positions. The Company believes that one of its strengths is
its depth of middle management. This depth facilitates the Company's growth
strategy as more experienced management relocates to new markets to conduct
start-up operations while top performing middle managers are promoted to
increasing levels of responsibility for continuing expansion of existing
markets. The Company also actively seeks and employs qualified candidates for
sales and marketing positions and provides extensive training designed to
improve marketing skills and educate sales associates with respect to the
uniqueness of the Company's homes that allows them to emphasize product
differentiation in the sales process.

            DECENTRALIZED OPERATIONS WITH EXPERIENCED MANAGEMENT. The Company
believes that the in-depth knowledge of its experienced management in local
markets enables the Company to better serve its customers. The Company is
organized into operating divisions, each relating to a local market area. Local
management of each operating division is responsible for preliminary site
selection and negotiation of option contracts in accordance with Company
policies. Additionally, each operating division plans its homebuilding schedule,
selects the building plans and architectural scheme for its subdivisions,
obtains all building approvals, and develops a marketing plan for its homes.
With the exception of the South Florida operation, the Company's corporate
office retains responsibility for purchasing, accounting/consolidation, and
certain other management and administrative matters, including ultimate approval
of all lot contracts, final product selection, securing all financing and
marketing plan approval. With respect to the South Florida operation, management
of Westbrooke makes the majority of the decisions related to the
responsibilities described above with support from, and oversight of, the
Company's corporate office.

            CENTRALIZED PURCHASING. The Company utilizes centralized purchasing
to leverage its purchasing power into volume discounts, a practice that reduces
costs, ensures timely deliveries and reduces the risk of supply shortages due to
allocations of materials. The Company has negotiated favorable price
arrangements with high quality national and regional suppliers such as General
Electric, Rheem Manufacturing, Dupont Corian, Moen, Inc., Owens Corning, Mohawk
Industries, Dow Chemical, Royal Baths, Kwikset and Sherwin-Williams for
appliances, heating and air conditioning, counter tops, bathroom fixtures,
roofing and insulation products, floor coverings, and other housing



                                       4
<PAGE>   5

components. Major materials, such as lumber, sheetrock, concrete and brick, are
also centrally purchased to obtain volume discounts. There are no minimum
purchase requirements for these arrangements.

            COST MANAGEMENT. The Company controls construction costs through the
efficient design of its homes and by obtaining favorable pricing, where
possible, from subcontractors based on the high volume of work performed for the
Company. The Company controls its warranty costs through quality control that
ensures that the home has been totally finished prior to the buyer moving in,
thus enhancing customer satisfaction. The Company controls its advertising
expenses through sophisticated budgeting of expenses with extensive review of
all expenditures. Some of the Company's major suppliers and contractors also
contribute advertising dollars for special promotions of houses and products.
These campaigns feature the key suppliers' products and enhance the image of the
Company's homes through brand recognition. In addition, the Company seeks to
control its corporate overhead costs through efficiencies achieved through its
highly automated and integrated systems.

            STRATEGY TO LIMIT REAL ESTATE EXPOSURE. The Company seeks to
maximize its return on invested capital and limit its exposure to changes in
land valuation by obtaining options to purchase lots whenever feasible. The
Company will also directly acquire, where appropriate, quality residential
properties that are in high demand for use in its homebuilding operations and
for sale to third-party builders. The Company's executive management establishes
targeted levels of lot options and land for development based on its strategic
plan for the overall growth of the Company. The Company targets properties for
acquisition that are both suitable for its homebuilding product and in locations
that are anticipated to maintain the homebuyers' property values. The Company
believes this strategy improves inventory turnover and enables the Company to
develop and sell or utilize the developed lots typically within two to three
years. The Company does not acquire land that is not suitable for lot
development and residential construction and does not speculate on land values
by acquiring and holding land for resale or for future development.

            The Company seeks to limit its exposure to real estate inventory
risks by closely monitoring (i) its unsold inventory of new homes and the stage
of completion of homes under construction on an ongoing basis, (ii) the volume
of starts of new homes and (iii) local job market and demographic trends,
housing preferences and related economic developments, such as new job
opportunities, local growth initiatives and trends in work force median income
levels.


MARKETS

            The Company conducts homebuilding activities in ten markets within
four states, including Houston, Austin, Dallas/Fort Worth and San Antonio,
Texas; Ft. Lauderdale, Palm Beach and Miami, Florida; Nashville, Tennessee; and
Charlotte and Greensboro/Winston-Salem, North Carolina. The Company's operations
in each of its markets differ based on a number of market specific factors.




                                       5
<PAGE>   6
            The following table presents selected lot inventory and homebuilding
data for the Company's current markets:

<TABLE>
<CAPTION>
                                                                                           HOMEBUILDING/REVENUES/
                                                     LOT INVENTORY                              HOMES CLOSED
                                          ------------------------------------      ------------------------------------
                                                       DECEMBER 31,                        YEAR ENDED DECEMBER 31
                                          ------------------------------------      ------------------------------------
MARKET              COMMENCED              2000           1999          1998          2000          1999          1998
------              ---------             --------      --------      --------      --------      --------      --------
                                                                                        (Dollars in thousands/units)
<S>                   <C>                 <C>           <C>           <C>           <C>           <C>           <C>
Houston               1983                                                          $163,706      $171,066      $126,138
                                             1,328           800           632           616           631           482

Austin                1984                                                          $170,176      $115,724      $ 82,970
                                               518           571           697           611           511           386

Dallas/                                                                             $ 43,762      $ 45,794      $ 38,078
Fort Worth            1995                     384           208           292           142           171           159

San Antonio           1998                                                          $  9,544
                                               168           145           141            40            --            --

Fort Lauderdale,                                                                    $193,918      $108,100      $144,780
Palm Beach, Miami     1976                   1,475         1,864         2,401           946           581           814

Nashville             1997                                                          $ 38,499      $ 33,444      $ 12,116
                                               193           264           276            93            86            33

Charlotte             1998                                                          $  5,396      $    940            --
                                                32            42            16            20             3

Greensboro/Winston    1998                                                          $  9,486      $  2,038            --
Salem                                          182            35            34            31             6
                                          --------      --------      --------      --------      --------      --------
Total Lots/Revenue                           4,280         3,929(1)      4,489(1)   $634,487(2)    477,106(2)    404,082(2)
                                          ========      ==========    ==========    ========      ========      ========


Total Units Closed                                                                     2,499         1,989         1,874
                                                                                    ========      ========      ========
</TABLE>

----------

(1)         Includes 2,343, 2,559 and 3,521 lots under option contracts as of
            December 31, 2000, 1999 and 1998, respectively.

(2)         Does not include revenues from land sales of $6.0 million, $14.6
            million and $2.3 million in 2000, 1999 and 1998, respectively.

            Based on the results of market research and analysis performed by
and for the Company, the Company plans to focus its development activity based
primarily on the following factors: regional economic conditions, projected job
growth, land availability, the local land development process, consumer tastes,
competition from other builders of new homes and secondary home sales activity.



                                       6
<PAGE>   7
BACKLOG


            The following table sets forth the Company's sales backlog by market
for the periods indicated below:

<TABLE>
<CAPTION>
                                                                DECEMBER 31,
                                   ------------------------------------------------------------------------
                                          2000                     1999                     1998
                                    HOMES     SALES VALUE    HOMES     SALES VALUE     HOMES    SALES VALUE
                                   --------   -----------   --------   -----------   --------   -----------
                                                          (Dollars in thousands)
<S>                                <C>        <C>           <C>        <C>           <C>        <C>
Houston                                 109   $    31,098        121   $    33,532        175   $    44,915

Austin                                  194        56,497        295        72,396        184        40,712

Dallas/Fort Worth                        51        15,773         32         9,865         57        14,952

San Antonio                              13         3,349          1           250         --            --

Ft.Lauderdale, Palm Beach, Miami        453        95,411        531       106,636        315        61,733

Nashville                                20         7,773         12         5,770         22         8,090

Charlotte                                --            --          1           295         --            --

Greensboro/
Winston-Salem
                                          5         1,958          5         1,650         --            --
                                   --------   -----------   --------   -----------   --------   -----------

Total                                   845   $   211,859        998   $   230,394        753   $   170,402
                                   ========   ===========   ========   ===========   ========   ===========
</TABLE>

            Backlog represents home purchase contracts which have been executed
and for which earnest money deposits have been received, but for which the sale
has not yet closed. Home sales are not recorded as revenues until the closings
occur. Sales value is calculated as the number of homes for which earnest money
contracts have been received multiplied by the average home sales price for the
specific city for the period indicated.

            Consistent with historical experience, 96% and 100% of the homes in
backlog at December 31, 1999 and 1998, respectively, were closed in the
subsequent fiscal year. Based upon unit volume, contract cancellations were
approximately 15.4%, 15.0% and 12.5% of the home sales contracts signed during
the years ended December 31, 2000, 1999 and 1998, respectively. Although
cancellations can disrupt anticipated home closings, the Company believes that
cancellations have not had a material negative impact on operations or liquidity
of the Company during the last several years. The Company attempts to reduce
cancellations by reviewing each homebuyer's ability to obtain mortgage financing
early in the sales process and by closely monitoring the mortgage approval
process.



                                       7
<PAGE>   8
IDENTIFICATION OF NEW MARKETS

            The Company has developed a market expansion process designed to
identify and track growing homebuilding markets in the United States. The
Company's program is designed as an ongoing process and consists of three stages
which track economic and demographic activity in primary and secondary
metropolitan markets (Stage I), narrowing the focus on specific markets and
criteria (Stage II and Stage III) as they meet expansion objectives and timing.
As part of its screening process, the Company evaluates geographically diverse
markets because it believes that potential adverse economic conditions
associated with certain markets are often offset by more favorable economic
conditions in other operating areas. Consideration is also given to those
markets located near current operating markets, which could function as
satellite operations.


LAND POLICIES AND POSITION

            The Company provides lot positions for its homebuilding operations
by both acquiring lot options and by purchasing land for the development of
lots. When appropriate, developed lots are sold to third-party builders to
increase inventory turnover and to enhance earnings for the Company.
Historically, the Company has been able to option a major portion of its lot
positions in the Houston market due to the brand awareness of the Newmark(R) and
Fedrick, Harris Estate Homes names among both consumers and developers, in
addition to the willingness of developers in those markets to option available
lots. The Company also acquires lot options in the Austin, Dallas/Fort Worth,
San Antonio, Nashville, Charlotte and Greensboro/Winston-Salem markets. With the
continuing strength in the housing sector, the Company has been required to
acquire some of its developed lots under specific performance purchase
contracts. The Company has developed residential lots in the South Florida,
Houston, Dallas/Fort Worth, Austin and Nashville markets and intends to continue
to do so in the future. Additionally, residential land developments may be
purchased when the Company enters new markets. Prior to any land acquisitions,
the Company conducts extensive due diligence utilizing regional expertise,
including on-site inspection and soil testing.


DESIGN

            The Company's home designs and floor plans are prepared by outside
architects in each of the Company's markets to appeal to the local tastes and
preferences of the community. Using its design department and Design Wizard, the
Company has the capability to change its standard floor plans to accommodate the
individual homebuyer. While most design modifications are significant to the
homebuyer, they typically involve relatively minor adjustments that allow the
Company to maintain construction efficiencies and result in greater
profitability due to increased margins.


CONSTRUCTION

            Substantially all of the Company's construction work is performed by
subcontractors. The Company's construction superintendents monitor the
construction of each home, coordinate the activities of subcontractors and
suppliers, subject the work of subcontractors to quality and cost controls and
monitor compliance with zoning and building codes. Subcontractors typically are
retained pursuant to a contract that obligates the subcontractor to complete
construction in a workmanlike manner and that provides standard indemnifications
and warranties. Typically, the Company works with the same subcontractors in
each city. The Company's subcontractors are not subject to any collective
bargaining agreements. While the Company competes with other homebuilders for
qualified subcontractors, it has established long-standing relationships with
many of its subcontractors. To date, by providing both timely payments and
steady work assignments, the Company has not experienced any inability to obtain
qualified subcontractors.

            The Company's purchasing and cost accounting practices are designed
to facilitate construction flexibility. This process permits homebuyers to
modify their designs, while allowing the Company to monitor and maintain its
profitability. Construction time for the Company's homes depends on weather,
availability of labor, materials, supplies and other factors. The Company
typically completes the construction of a home within four to five months.



                                       8
<PAGE>   9

            The Company does not maintain significant inventories of
construction materials, except for work in process materials for homes under
construction. Typically, the construction materials used in the Company's
operations are readily available from numerous sources. The Company has
favorable price arrangements or contracts with suppliers of certain of its
building materials, but it is not under any specific purchasing requirements. In
recent years, the Company has not experienced any significant delays in
construction due to shortages of materials or labor.


MARKETING AND SALES

            The Company markets and sells its homes through commissioned
employees and cooperates with independent real estate brokers. Depending on the
specific market, the Company targets the "move-up" and relocation market
segments and employs sophisticated marketing techniques to attract potential
homebuyers through numerous avenues including its Internet web site, extensive
telemarketing, interactive software programs and other marketing programs. Home
sales are typically conducted from sales offices located in furnished model
homes used in each subdivision. At December 31, 2000, the Company owned 73 model
homes. The Company's sales personnel assist prospective buyers by providing them
with floor plans, price information, tours of model homes and the selection of
options and other custom features. Such personnel are trained by both the
Company and external independent experts in sales expertise. These sales and
marketing personnel are kept informed as to the availability of financing,
construction schedules and marketing and advertising plans. The Company has also
formed sales teams comprised of a sales person and other employees from
throughout the Company to provide sales support and motivation.

            In addition to using model homes, the speculative homes built in
most subdivisions enhance the Company's marketing and sales activities.
Construction of these speculative homes is also necessary to satisfy the
requirements of relocated personnel, "move-up" buyers, and independent brokers,
who often represent homebuyers requiring a completed home within sixty days. The
number of speculative homes the Company builds in any given subdivision is
influenced by local market factors, such as new employment opportunities,
significant job relocations, growing housing demand and the length of time the
Company has built in the market.

            The Company advertises through television, in newspapers and in real
estate and mortgage broker company publications, brochures, newsletters and
billboards. Because real estate brokers are important to sales, the Company
sponsors realtor breakfasts, contests and other events to increase awareness of
the Company's subdivisions and products. Certain of the Company's suppliers
participate with the Company in its advertising and promotional materials,
either through co-branding and cost-sharing or through rebates.

            Sales of the Company's homes generally are made pursuant to a
standard sales contract that requires a down payment of $1,000 to $5,000, or 5%
to 10% of the sales price, on custom homes. The contract includes a financing
contingency which permits the customer to cancel in the event mortgage financing
at prevailing interest rates is unobtainable within a specified period,
typically four to six weeks, and may include other contingencies, such as the
sale of an existing home. The Company includes a home sale in its backlog upon
execution of the sales contract and receipt of the initial down payment. The
Company does not recognize revenue until the home is closed and title passes to
the homebuyer. The Company estimates that the average period between the
execution of a sales contract for a home and closing is approximately four to
eight months for presold homes.

TITLE SERVICES

            In 1997, the Company acquired a 49% interest in Pacific Title, L.C.,
which serves as a title insurance agent and provides title insurance policies
and closing services to purchasers of homes built and sold by the Company in
Texas. The Company assumes no title insurance risk associated with these title
policies, which are issued by Stewart Title Guaranty Company, one of the oldest
title companies in Texas. Stewart Title Company owns the balance of the
interests of Pacific Title.



                                       9
<PAGE>   10
CUSTOMER FINANCING

            In 1997, the Company acquired a 49.99% limited partnership interest
in NHC Mortgage Group, L.P., a mortgage origination company owned jointly with
CTX Mortgage Ventures Corporation, one of the nation's largest mortgage
companies. NHC Mortgage has underwritten, originated and sold mortgages for the
homes the Company builds and for other homebuilders. The Company's capital is
not at risk in connection with these mortgages beyond its limited partner
interest.

            Subsequent to the fiscal year end, the Company acquired a 49.99%
limited partnership interest in Technical Mortgage, L.P., a mortgage origination
company owned jointly with Preferred Home Mortgage, an affiliate of TOUSA.
Preferred Home Mortgage Company underwrites, originates and sells mortgages for
homes the Company builds and for other homebuilders. The Company's capital is
not at risk in connection with these mortgages beyond its limited partner
interest.

CUSTOMER SERVICE AND QUALITY CONTROL

            The Company's operating divisions are responsible for both
pre-closing quality control inspections and responding to customer's
post-closing needs. The Company believes that the prompt, courteous response to
homebuyers' needs during and after construction reduces post-closing repair
costs, enhances the Company's reputation for quality and service, and ultimately
leads to significant repeat and referral business. The Company conducts
pre-closing inspections with homebuyers immediately prior to closing. In
conjunction with the inspections, a list of items for home completion is
created.

            After a sale, all warranty requests are processed through customer
service departments located in each of the markets. In most instances, a
customer service manager inspects the warranty request within 48 hours of
receipt. If appropriate, the repair work is scheduled to be approved by the
homeowner upon satisfactory completion. An integral part of the Company's
customer service program includes post-closing interviews. In most markets, a
customer service representative is sent into each home within 45 days of closing
to evaluate the homeowner's satisfaction with both their home and their
home-buying experience. The post-closing interview involves an analysis of the
homebuyer's experiences with the sales counselor, the title company, the
mortgage company and the construction department as well as their satisfaction
with the product. Typically, after a year, another interview is conducted with
the homeowner to determine their continued satisfaction. The subsequent
interview provides management a direct link to the customer's perception of the
entire buying experience as well as valuable feedback on the quality of the
product.

WARRANTY PROGRAM

            The Company provides up to a two-year limited warranty (one-year in
the case of its South Florida operations) of workmanship and materials with each
of its homes. The Company subcontracts its homebuilding work to subcontractors
who provide the Company with an indemnity and a certificate of insurance prior
to receiving payments for their work and, therefore, claims relating to
workmanship and materials are generally the primary responsibility of the
Company's subcontractors. In all markets except South Florida, the Company
provides an additional eight-year limited homeowners' warranty covering major
structural defects through a single national agreement with the Residential
Warranty Corporation. An appropriate warranty reserve is established to cover
anticipated warranty expenses not borne by the Company's subcontractors. The
Company's historical experience is such that warranty expenses generally fall
within the amount established for such reserve. The Company does not currently
have any material litigation or claims regarding warranties or latent defects
with respect to construction of homes. Current claims and litigation are
expected to be substantially covered by the Company's reserve or insurance.
Generally, warranty claims are handled by the construction superintendent who
built the particular home to ensure that the appropriate subcontractor takes
prompt and appropriate corrective action.




                                       10
<PAGE>   11
COMPETITION

            The development and sale of residential properties is highly
competitive and fragmented. The Company competes for residential sales on the
basis of a number of interrelated factors including location, reputation,
amenities, design, quality and price, with numerous large and small
homebuilders, including some homebuilders with nationwide operations and greater
financial resources and/or lower costs than the Company. The Company also
competes for residential sales with individual resales of existing homes,
available rental housing and, to a lesser extent, resales of condominiums. The
Company believes that it compares favorably to other builders in the markets in
which it operates, due primarily to: (i) its experience within its geographic
markets, which allows it to vary its product offerings to reflect changing
market conditions; (ii) its responsiveness to market conditions, enabling it to
capitalize on the opportunities for advantageous land acquisitions in desirable
locations; and (iii) its reputation for service and quality.

GOVERNMENT REGULATION AND ENVIRONMENTAL MATTERS

            Homes and residential communities built by the Company must comply
with federal, state and local regulations relating to, among other things,
zoning, treatment of waste, construction materials that must be used, density
requirements, certain aspects of building design and minimum elevation of
properties and other local ordinances. These include laws requiring use of
construction materials that reduce the need for energy-consuming heating and
cooling systems. These laws and regulations are subject to frequent change and
often increase construction costs. In some cases, there are laws that require
that commitments to provide roads and other offsite infrastructure be in place
prior to the commencement of new construction. The provisions of these laws are
usually administered by individual counties and municipalities and may result in
additional fees and assessments or building moratoriums. In addition, certain
new development projects, particularly in Southern Florida, are subject to
assessments for schools, parks, streets and highways and other public
improvements, the costs of which can be substantial.

            The residential homebuilding industry also is subject to a variety
of local, state and federal statutes, ordinances, rules and regulations
concerning the protection of health and the environment. Environmental laws and
conditions may result in delays, may cause the Company to incur substantial
compliance and other costs, and can prohibit or severely restrict homebuilding
activity in certain environmentally sensitive regions or areas. Additionally,
the climate and geology of some parts of Florida and Texas present risks of
natural disasters that could adversely affect the homebuilding industry in those
areas in general, and the Company's business in particular.

            The Company's title insurance affiliates must comply with applicable
insurance laws and regulations. The Company's mortgage origination affiliates
must comply with applicable real estate lending laws and regulations.


EMPLOYEES

            At December 31, 2000, the Company employed 543 persons, of whom 133
were sales and marketing personnel, 177 were executive, administrative and
clerical personnel, and 239 were involved with construction. None of the
Company's employees are covered by collective bargaining agreements. The Company
believes its relations with its employees are good.


ITEM 2.    PROPERTIES

            The Company owns a 16,000 square foot facility in Sugar Land, Texas,
which serves as the Company's headquarters and primary residential homebuilding
office. The Company leases an aggregate of approximately 27,415 square feet in
Dallas, Austin, San Antonio, Nashville, Charlotte/Greensboro and Miami for its
division operations. The Company has a 19,000 square foot facility under
construction in Sugar Land, Texas and construction is estimated to be completed
in August 2001. This facility will accommodate the Houston division operations,
architecture and design, mortgage company operations and title company
operations. The Company believes its existing facilities, including the facility
under construction, are adequate for the Company's current and planned levels of
operations.





                                       11
<PAGE>   12
ITEM 3.  LEGAL PROCEEDINGS

            The Company is involved in various claims and legal actions arising
in the ordinary course of business. In the opinion of the Company's management,
the ultimate disposition of these matters is not expected to have a material
adverse effect on the financial condition or results of operations of the
Company.

            Subsequent to the press release of the Company on March 5, 2001 of
a possible merger of Engle Holdings Corp. with the Company, the Company was
notified of the filing of two lawsuits, Case No. A431555; Barry Feldman v.
Michael J. Poulos, Yannis Delikanakis, Michael S. Stevens, Constantinos Stengos,
Georgios Stengos, Andreas Stengos, James M. Carr, William A. Hasler, Larry D.
Horner, Lonnie M. Fedrick, Engle Holdings Corp. and Newmark Homes Corp.; In the
District Court, Clark County, Nevada; and Cause No. 2001-14194; Michael Gormley
v. Michael J. Poulos, Yannis Delikanakis, Michael S. Stevens, Constantinos
Stengos, Georgios Stengos, Andreas Stengos, James M. Carr, William A. Hasler,
Larry D. Horner, Lonnie M. Fedrick, Engle Holdings Corp. and Newmark Homes Corp;
In the 80th Judicial District Court of Harris County, Texas, challenging any
transaction between the Company and Engle Holdings as a violation of fiduciary
duty. Given the fact that there is no transaction agreed to between the Company
and Engle, the Company believes the lawsuits are without merit, and the Company
intends to vigorously defend itself and its directors.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

          No matters were submitted during the fourth quarter of the fiscal year
covered by this report to a vote of security holders, through the solicitation
of proxies or otherwise.

                        EXECUTIVE OFFICERS OF THE COMPANY

<TABLE>
<CAPTION>
    Name                         Age                    Position
    ----                         ---                    --------
<S>                              <C>           <C>
Lonnie M. Fedrick                56            President, Chief Executive
                                                  Officer and Director
James M. Carr                    50            Executive Vice President and
                                                  Director
J. Eric Rome                     41            Executive Vice President --
                                                  Homebuilding
Terry C. White                   51            Senior Vice President, Chief
                                                  Financial Officer, Treasurer
                                                  and Secretary
J. Michael Beckett               41            Executive Vice President-
                                                  Purchasing/Product
                                                  Development (Newmark Home
                                                  Corporation)
</TABLE>

          Lonnie M. Fedrick has served as President and Chief Executive Officer
of the Company since 1997. Mr. Fedrick has also been President and Chief
Executive Officer of Newmark since 1994 and was Executive Vice President of
Newmark from 1984 to 1994. Mr. Fedrick co-founded Newmark in 1983 and has more
than 33 years experience in the homebuilding industry. Mr. Fedrick began his
career with Norwood Homes in 1967, most recently serving as the Vice President
of Construction. From 1974 to 1983, he served as Vice President of Operations of
Monarch Homes. He is a member of the board of directors of the Greater Houston
Builders Association.



                                       12
<PAGE>   13
          James M. Carr became an Executive Vice President and a Director of
the Company upon the closing of the acquisition of Westbrooke by the Company in
January 1998. Mr. Carr founded Westbrooke in 1976, and has served as Chairman,
Chief Executive Officer and President of Westbrooke since its inception. Mr.
Carr is a graduate of the University of Miami. He is the former Chairman of the
Baptist Hospital Foundation and a director of Baptist Health Systems.

          J. Eric Rome has served as Executive Vice President - Homebuilding of
the Company since 1997. Mr. Rome has served as President of the Texas Division
of Newmark since 1996 and was appointed the Chief Operating Officer of Newmark
in early 2000. He was Executive Vice President of Newmark's Central Texas
Division from 1995 to 1996, a Vice President from 1984 to 1994, and Construction
Manager of Newmark's Houston division from 1983 to 1984. From 1981 to 1983, Mr.
Rome was employed by Monarch Homes as a construction superintendent. He has also
served as an officer in various capacities with the Texas Capitol Area Builders
Association.

          Terry C. White has served as Chief Financial Officer and Treasurer of
the Company since 1997. Mr. White is also Senior Vice President, Chief Financial
Officer and Treasurer of Newmark, which he joined in 1984 as Controller. Prior
thereto, Mr. White was employed by Wood Bros. Homes as a division controller and
prior to that he served in various accounting and finance positions with Safeway
Stores, Inc. Mr. White is a certified public accountant and a graduate of the
University of North Texas.

          J. Mike Beckett became Executive Vice President-Purchasing/Product
Development for Newmark on January 1, 2000. Mr. Beckett was Senior Vice
President- Purchasing for Newmark from January 1, 1998 to December 31, 1999 and
was the Vice President of Purchasing from 1995 to 1998. Mr. Beckett graduated
from Bowling Green State University in 1982.

                                     PART II

ITEM 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

          The Company's Common Stock commenced trading on the NASDAQ National
Market System on March 12, 1998 under the trading symbol "NHCH". The range of
high and low closing sales prices per share by quarter for calendar year 1998,
1999 and 2000, as reported by the NASDAQ National Market, appear in the
following table. These prices may not be the prices that you would pay to
purchase a share of our common stock during the periods shown. These prices are
what a securities dealer would pay for a share of our common stock and do not
include any commissions you might have to pay or any retail mark-ups or
mark-downs.

<TABLE>
<CAPTION>
                           1999
-------------------------------------------------------------
            QUARTER        HIGH           LOW
-------------------------------------------------------------
<S>                       <C>            <C>
First                     $ 8.50         $ 6.25
-------------------------------------------------------------
Second                      6.75           5.00
-------------------------------------------------------------
Third                       8.13           5.25
-------------------------------------------------------------
Fourth                      7.50           5.00
-------------------------------------------------------------
<CAPTION>
                           2000
-------------------------------------------------------------
<S>                        <C>            <C>
First                      $6.50          $5.50
-------------------------------------------------------------
Second                      6.50          5.06
-------------------------------------------------------------
Third                       8.75          6.38
-------------------------------------------------------------
Fourth                     11.50          8.31
-------------------------------------------------------------
</TABLE>



                                       13
<PAGE>   14
            As of March 19, 2001, there were 41 shareholders of record. The
Company believes there are approximately 800 beneficial owners of its common
stock.

            The Company did not declare any cash dividends on its common stock
in fiscal year 2000. The Company's credit agreements generally contain covenants
that limit the amount of dividends or distributions it can pay on its common
stock and the amount of stock the Company can repurchase.

            Subsequent to the fiscal year end, the Company declared a dividend
on March 6, 2001 of $0.54 per share of common stock to record holders of March
31, 2001, such dividend to be paid May 15, 2001.


ITEM 6.  SELECTED FINANCIAL DATA

            The statement of operations data and statement of financial
condition data presented below have been derived from the historical financial
statements of the Company. The Company's consolidated financial statements for
the years ended December 31, 1997 and 1996, have been audited by KPMG LLP,
independent certified public accountants. The Company's consolidated financial
statements for the years ended December 31, 2000, 1999 and 1998 have been
audited by BDO Siedman, LLP, independent certified public accountants, except
for Westbrooke Acquisition Corp. (a consolidated subsidiary) for the year ended
December 31, 1998, which statements were audited by other auditors. The selected
financial data set forth below should be read in conjunction with and are
qualified by reference to the Company's consolidated financial statements and
notes thereto included elsewhere in this Form 10-K and "Management's Discussion
and Analysis of Financial Condition and Results of Operations."




                                       14
<PAGE>   15
<TABLE>
<CAPTION>
                                                                              SELECTED FINANCIAL DATA
                                                 --------------------------------------------------------------------------------
                                                    2000              1999(1)           1998(2)         1997            1996
                                                 ------------      ------------      ------------    ------------    ------------
                                                                (Dollars in thousands except per share amounts)
<S>                                              <C>               <C>               <C>             <C>             <C>
STATEMENT OF OPERATIONS DATA

          Revenues                               $    640,506      $    491,714      $    406,353    $    215,360    $    190,855
          Cost of Sales                               529,800           411,011           339,094         175,300         156,264
                                                 ------------      ------------      ------------    ------------    ------------

          Gross Profit                                110,706            80,703            67,259          40,060          34,591
          Equity in earnings
          from unconsolidated
          subsidiaries                                    769               725               812             465             792

          Selling, general and
          administrative
          expenses                                    (64,720)          (49,565)          (43,614)        (26,512)        (22,976)

          Depreciation and
          amortization                                 (4,016)           (3,996)           (3,287)         (1,669)         (1,524)
                                                 ------------      ------------      ------------    ------------    ------------

          Operating income                             42,739            27,867            21,170          12,344          10,883
          Interest Expense                             (3,282)           (1,845)           (1,939)         (1,987)         (1,238)
          Other income, net                             1,086             1,064             1,201             570             851
                                                 ------------      ------------      ------------    ------------    ------------

          Income before taxes                          40,543            27,086            20,432          10,927          10,496
          Income taxes                                 14,852             9,701             7,637           4,272           4,164
                                                 ------------      ------------      ------------    ------------    ------------

          Net income                             $     25,691      $     17,385      $     12,795    $      6,655    $      6,332
                                                 ------------      ------------      ------------    ------------    ------------

          Net income per
           common share                          $       2.23      $       1.51      $       1.16    $       0.72    $       0.69
                                                 ------------      ------------      ------------    ------------    ------------

          Weighted averages
            shares outstanding                     11,500,000        11,500,000        11,035,000       9,200,000       9,200,000
Operating Data:
   Units:
          New sales contracts,
          net of cancellations                          2,356             2,234             2,036             984             998
          Closings                                      2,499             1,989             1,874             972             902
          Backlog at end of
          period                                          845               998               753             279             267
          Average sales price
            per closing                          $        254      $        240      $        216    $        219    $        200
          Sales value of
            backlog at end of
            period                               $    211,859      $    230,394      $    170,402    $     60,048    $     50,657
          Gross profit as a
            percentage of
            revenues                                     17.3%             16.4%             16.6%           18.6%           18.1%
          Selling, general and
            administrative
            expenses as a
            percentage of
            revenues                                     10.1%             10.1%             10.7%           12.3%           12.0%
</TABLE>



                                       15
<PAGE>   16
<TABLE>
<CAPTION>
                                                       DECEMBER 31,
                                   ------------------------------------------------------

                                    2000         1999(1)      1998(2)    1997      1996
                                   --------     --------     --------  --------  --------
                                                       (Dollars in thousands)
<S>                                <C>          <C>          <C>       <C>       <C>
STATEMENT OF FINANCIAL
CONDITION DATA
          Inventories              $246,865     $255,576     $185,247  $102,547  $ 83,659
          Total assets              324,144      328,892      245,338   139,213   121,177
          Total construction debt   127,546      149,380      106,839    66,100    60,768
          Stockholders' equity      135,309      109,618       90,112    55,691    43,929
</TABLE>

----------

(1)         Reflects the operations of the Company on a full-year basis.

(2)         Reflects the operating data of Westbrooke subsequent to the
            Company's acquisition of the homebuilding assets of Westbrooke
            Communities, Inc. on January 1, 1998.

ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

SPECIAL STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS

            As a cautionary note, except for the historical information
contained herein, certain matters discussed in Item 7, "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and Item 7A
"Quantitative and Qualitative Disclosures About Market Risk", are
"forward-looking" statements within the meaning of the Private Securities
Litigation Reform Act of 1995. Such matters involve risks and uncertainties,
including the Company's exposure to certain market risks, changes in economic
conditions, tax and interest rates, increases in raw material and labor costs,
weather conditions, and general competitive factors, that may cause actual
results to differ materially.


GENERAL

            Since inception, the Company has sought to achieve profitability and
revenue growth by providing quality homes in markets that have experienced
population and job growth in excess of the national average during the past
several years. Newmark has served as the foundation to support the Company's
growth strategy, including expansion within existing markets, entry into three
new markets through start-up operations and the acquisition of a regional
homebuilder.

            During 2000, the Company experienced significant growth and
positioned itself to continue to expand its residential land and lot
acquisitions in its existing markets. However, the general slow down in the
national and some regional economies and the significant decline in consumer
confidence may have a negative influence on new home sales.

            The Company entered the Fort Lauderdale/Miami market through its
acquisition of Adler on March 1, 1995, and then significantly expanded its
market share in the South Florida market, including Palm Beach, by acquiring
Westbrooke on January 1, 1998. The Company also achieved synergies in its South
Florida operation by managing the remaining assets of Adler with Westbrooke's
operations in 1998.

            The Company recognizes revenue at the time of closing when title to,
and possession of, the property transfers to the buyer. The Company capitalizes
in inventory all homebuilding costs during the construction period, including




                                       16
<PAGE>   17

interest and maintenance, and charges those capitalized costs to cost of sales
as the related inventories are sold. Interest on completed inventory is expensed
as incurred. Accordingly, as the Company's completed inventory level rises and
falls, interest expense can vary significantly. Included in the Company's
depreciation and amortization expenses is amortization of goodwill of $1.5
million, $1.4 million and $1.4 million for the years ended December 31, 2000,
1999 and 1998, related to the Company's acquisitions of Newmark, Adler and
Westbrooke.

            Equity in earnings from unconsolidated subsidiaries includes
earnings from Pacific Title, L.C. ("Pacific Title"), a title service business in
which the Company owns a 49% interest, and NHC Mortgage Group, L.P. ("NHC
Mortgage"), a mortgage origination company, in which the Company owns a 49.99%
interest, each of which was formed in 1997. Additionally, equity in earnings
from unconsolidated subsidiaries includes earnings from a Florida homebuilding
partnership, owned 50% by the Company, which wound-up its home-building
operations in October 1997. Currently, all of the Company's South Florida
operations are conducted through wholly-owned subsidiaries and are included in
the Company's revenues rather than in equity in earnings of unconsolidated
subsidiaries.




                                       17
<PAGE>   18
RESULTS OF OPERATIONS

            The following table sets forth the homebuilding revenue and number
of home closings by market for the periods indicated:
<TABLE>
<CAPTION>
                                                            YEAR ENDED DECEMBER 31
                                                    -------------------------------------
                                                      2000           1999(2)     1998
                                                    ----------     ----------  ----------
                                                             (Dollars in thousands)
<S>                                                 <C>            <C>         <C>
Houston:
          Revenues                                  $  163,706     $  171,066  $  126,138
          Home Closings                                    616            631         482
Austin:
          Revenues                                  $  170,176     $  115,724  $   82,970
          Home Closings                                    611            511         386
Dallas/Fort Worth:
          Revenues                                  $   43,762     $   45,794  $   38,078
          Home Closings                                    142            171         159
San Antonio:
          Revenues                                  $    9,544             --          --
          Home Closings                                     40             --          --
Ft. Lauderdale/Palm Beach/Miami:
          Revenues                                  $  193,918     $  108,100  $  144,780
          Home Closings                                    946            581         814
Nashville:
          Revenues                                  $   38,499     $   33,444  $   12,116
          Home Closings                                     93             86          33
Charlotte:
          Revenues                                  $    5,396     $      940          --
          Home Closings                                     20              3          --
Greensboro/Winston-Salem:
          Revenues                                  $    9,486     $    2,038          --
          Home Closings                                     31              6          --
                                                    ----------     ----------  ----------

                    Total homebuilding revenues(1)  $  634,487     $  477,106  $  404,082
                                                    ----------     ----------  ----------

                    Total home closings                  2,499          1,989       1,874
                                                    ----------     ----------  ----------

Average sales price per home closed                 $      254     $      240  $      216
                                                    ----------     ----------  ----------
</TABLE>

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

(1)         Does not include revenues from land sales of $6.0 million, $14.6
            million and $2.3 million in 2000, 1999 and 1998, respectively.

(2)         Reflects the revenue and units closed on a full-year basis.




                                       18
<PAGE>   19
          The following table sets forth, as a percentage of revenue, certain
information in the Company's Statement of Operations for the periods indicated:

<TABLE>
<CAPTION>
                                                    YEAR ENDED DECEMBER 31
                                              ------------------------------------
                                                 2000         1999         1998
                                              ----------   ----------   ----------
<S>                                           <C>          <C>          <C>
Cost of sales                                       82.7%        83.6%        83.4%

Gross profit                                        17.3%        16.4%        16.6%

Selling, general and administrative expenses        10.1%        10.1%        10.7%

Income before income taxes                           6.3%         5.5%         5.0%

Income taxes (1)                                    36.6%        35.8%        37.4%

Net income                                           4.0%         3.5%         3.1%
</TABLE>

----------

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

YEAR ENDED DECEMBER 31, 2000 COMPARED TO YEAR ENDED DECEMBER 31, 1999.

           Revenues increased by 30.3% to $640.5 million in 2000 from $491.7
million in 1999 primarily due to an increase in the number of homes closed by
the Company which rose by 25.6% to 2,499 homes in 2000 from 1,989 homes in 1999.
The Company's average selling price of homes closed in 2000 was $254,000, an
increase of 5.9% from the $240,000 average selling price in 1999. The average
selling price of a Newmark(R) home closed in 2000 was $252,000, an increase of
5.6% from the $239,000 average selling price in 1999. The Fedrick Harris Estate
Homes average selling price of homes closed in 2000 was $475,000, an increase of
13.4% from the $419,000 average selling price in 1999. In the South Florida
market, Westbrooke's selling price of homes closed in 2000 was $205,000, an
increase of 10.2% from the $186,000 average selling price in 1999. Also,
revenues generated from sales of custom homes under Fedrick Harris Estate Homes
increased from $76.6 million in 1999 to $104.0 million in 2000, due primarily to
increased unit sales in Houston, Austin and Nashville. In addition, revenue from
land sales in 2000 decreased to $6.0 million from $14.6 million in 1999.

           Cost of sales increased by 28.9% to $529.8 million in 2000 from
$411.0 million in 1999 primarily due to increased revenues from home closings as
described above. Cost of land sales for 2000 decreased to $5.7 million from
$12.1 million in 1999. As a percentage of revenues, cost of sales for 2000
decreased slightly to 82.7% from 83.6% in 1999.

           Equity in earnings from unconsolidated subsidiaries increased
slightly to $769,000 in 2000 from $725,000 in 1999. The earnings are attributed
to Pacific Title, NHC Mortgage and Scofield SF, Ltd., a land development joint
venture.

           Selling, general and administrative (SG&A) expense increased by 30.6%
to $64.7 million in 2000 from $49.6 million in 1999. This increase was caused by
increased revenues and by the expansion into the new markets of Nashville,
Tennessee and Charlotte and Greensboro, North Carolina as well as the expansion
in the Company's Texas and Florida markets as indicated by the 30.3% increase in
the Company's revenues. As a percentage of revenues, SG&A expense remained
consistent at 10.1% in 2000 and 1999.



                                       19
<PAGE>   20
           Interest expense, net of interest capitalized, totaled $3.2 million
in 2000 compared to $1.8 million in the previous year. The Company follows a
policy of capitalizing interest only on inventory under construction or
development. During the years ended December 31, 1999 and 1998, the Company
expensed a portion of interest incurred and other financing costs on those
completed homes held in inventory. This expense increased due to the increase in
the average number of completed homes held in inventory for the year ending
December 31, 2000 compared to 1999. Capitalized interest and other financing
costs are included in cost of sales at the time of home closings.

           The Company's provision for income taxes increased as a percentage of
earnings before taxes to 36.6% for the year ended December 31, 2000 compared to
35.8% for fiscal year 1999. The increase was primarily a result of increased
state taxes resulting from increased earnings in the State of Florida. However,
federal income taxes have decreased as a percentage of earnings before taxes to
34.3% for the year ending December 31, 2000 compared to 35.6% for the year
ending December 31, 1999 primarily as a result of the increase in deductible
amortization of goodwill resulting from the election of the Internal Revenue
Code Section 338(h)(10). The Company recognized federal income tax expense of
$13.9 million for the year ended December 31, 2000 compared to $9.6 million for
the fiscal year 1999.

           Net income increased by 47.8% to $25.7 million for the year ended
December 31, 2000 from $17.4 million in the comparable period of 1999. The
increase was attributable to the increase in revenues in the Company's most
profitable markets.

YEAR ENDED DECEMBER 31, 1999 COMPARED TO YEAR ENDED DECEMBER 31, 1998

          As further explained in the information regarding the "Change in
Control of Ownership", certain adjustments have been made to the Company's
goodwill, acquisition notes payable and stockholders' equity accounts to reflect
the change of control transaction. As a result, the consolidated amounts of the
Company after December 15, 1999 are presented on a new basis of accounting
different from the financial statements of the Company prior to December 15,
1999 and, therefore, are not comparable in the aforementioned regards. However,
the full year is discussed for these comparative purposes.

          Revenues increased by 21.0% to $491.7 million in 1999 from $406.4
million in 1998 primarily due to an increase in the average selling prices from
an increased level of closings in the Company's higher priced markets. The
number of homes closed by the Company increased by 6.1% to 1,989 homes in 1999
from 1,874 homes in 1998. The Company's average selling price of homes closed in
1999 was $240,000, an increase of 11.1% from the $216,000 average selling price
in 1998. The average selling price of a Newmark(R) home closed in 1999 was
$239,000, an increase of 8.1% from the $221,000 average selling price in 1998.
The Fedrick, Harris Estate Homes average selling price of homes closed in 1999
was $419,000, an increase of 3.5% from the $405,000 average selling price in
1998. In the South Florida market, Westbrooke and Adler's selling price of homes
closed in 1999 was $186,000, an increase of 4.5% from the $178,000 average
selling price in 1998. Also, revenues generated from sales of custom homes under
Fedrick, Harris Estate Homes increased from $56 million in 1998 to $76 million
in 1999, due primarily to increased unit sales in Houston, Austin and Nashville.
In addition, revenue from land sales in 1999 increased to $14.6 million from
$2.3 million in 1998.

          Cost of sales increased by 21.2% to $411.0 million in 1999 from $339.1
million in 1998 primarily due to increased revenues from home closings as
described above. Cost of land sales for 1999 increased to $12.1 million from
$1.5 million in 1998. As a percentage of revenues, cost of sales for 1999
increased slightly to 83.6% from 83.5% in 1998

          Equity in earnings from unconsolidated subsidiaries decreased slightly
to $725,000 in 1999 from $812,000 in 1998. The earnings are attributed totally
to Pacific Title and NHC Mortgage.

          Selling, general and administrative (SG&A) expense increased by 13.8%
to $49.6 million in 1999 from $43.6 million in 1998. This increase was caused by
the expansion into the new markets of Nashville, Tennessee and Charlotte and
Greensboro, North Carolina as well as the expansion in the Company's Texas and
Florida markets as indicated by the 21% increase in the Company's revenues and
the 32.5% increase in the Company's backlog in 1999 from 1998. As a percentage
of revenues, SG&A expense decreased slightly to 10.1% in 1999 from 10.7% in
1998.



                                       20
<PAGE>   21
          Interest expense, net of interest capitalized, totaled $1.8 million in
1999 compared to $1.9 million in the previous year. The Company follows a policy
of capitalizing interest only on inventory under construction or development.
During the years ended December 31, 1999 and 1998, the Company expensed a
portion of interest incurred and other financing costs on those completed homes
held in inventory. This expense decreased due to the decrease in the average
number of completed homes held in inventory for the year ending December 31,
1999 compared to 1998. Capitalized interest and other financing costs are
included in cost of sales at the time of home closings.

          The Company's provision for income taxes decreased as a percentage of
earnings before taxes to 35.8% for the year ended December 31, 1999, compared to
37.4% for fiscal 1998. The decrease was attributable to a state income tax
benefit for Adler. The Company was included in the consolidated federal income
tax return of Pacific USA Holdings Corp. ("PUSA"), the parent company of
Pacific, through December 15, 1999. Under the former tax allocation agreement
with PUSA, (the "PUSA Tax Allocation Agreement") the Company was required to
both calculate its federal corporate income tax liability as if it filed a
separate federal income tax return for each period and to pay PUSA the sum of
which would result from such calculation if the Company were subject to federal
corporate income tax and filed a separate tax return. The Company recognized
federal income tax expense amounting to $9.7 million for the year ended December
31, 1999 compared to $7.6 million for fiscal 1998.

          Effective December 16, 1999, the Company is included in the
consolidated federal income tax return of TOUSA pursuant to a tax allocation
agreement with TOUSA.

          Net income increased by 35.9% to $17.4 million for the year ended
December 31, 1999 from $12.8 million for the corresponding period in 1998. The
increase was primarily attributable to the strong gains in revenues in the
Company's most profitable markets.

SEASONALITY AND UNAUDITED QUARTERLY RESULTS

            The homebuilding industry is seasonal, as generally there are more
sales in the spring and summer months, resulting in more home closings in the
fall. The Company operates in the Southwestern and Southeastern markets of the
United States, where weather conditions are more suitable to a year-round
construction process than other areas. The Company also believes its geographic
dispersion to be somewhat counter-cyclical, with adverse economic conditions
associated with certain of its markets often being offset by more favorable
economic conditions in other areas. The seasonality of school terms has an
impact on the Company's operations, but it is somewhat mitigated by the fact
that many of the Company's buyers at the higher end of the Company's price
range, including Fedrick, Harris Estate Homes, no longer have children in
school. As a result of these factors, among others, the Company generally
experiences more sales in the spring and summer months, and more closings in the
summer and fall months. Likewise, Westbrooke has experienced seasonality in its
revenues, generally completing more sales in the spring and summer months and
more closings in the fourth quarter.



                                       21
<PAGE>   22
            The following table presents selected unaudited quarterly operating
data of the Company for each of the eight quarters through the period ended
December 31, 2000. In the opinion of management, all necessary adjustments
(consisting of normal recurring adjustments) have been included to present
fairly the unaudited selected quarterly operating data. This data is not
necessarily indicative of the results of the operations of the Company for any
future period.

<TABLE>
<CAPTION>
                                                            QUARTER ENDED
                           -------------------------------------------------------------------------------------
                           DEC. 31,   SEPT. 30,  JUNE 30,   MARCH 31,  DEC. 31,   SEPT. 30,  JUNE 30,   MARCH 31,
                            2000       2000       2000       2000       1999       1999       1999       1999
                           --------   --------   --------   --------   --------   --------   --------   --------
                                                         (DOLLARS IN THOUSANDS)
<S>                        <C>        <C>        <C>        <C>        <C>        <C>        <C>        <C>
STATEMENT OF
  OPERATIONS DATA:
Revenues ................  $192,836   $146,207   $164,491   $136,972   $141,757   $126,745   $130,380   $ 92,832
Gross profit ............    32,184     26,580     28,644     23,298     23,264     22,794     20,152     14,493
Selling, general and
   administrative .......    18,033     16,358     16,764     13,565     12,804     13,566     12,863     10,324
Operating income ........    13,345      9,486     11,100      8,808      9,453      8,405      6,557      3,452
MARGIN ANALYSIS:
Gross margin ............      16.7%      18.2%      17.4%      17.0%      16.4%      18.0%      15.5%      15.6%
Selling, general and
   administrative .......       9.4%      11.2%      10.2%       9.9%       9.0%      10.7%       9.9%      11.1%
Operating income ........       6.9%       6.5%       6.7%       6.4%       6.7%       6.6%       5.0%       3.7%
OPERATING DATA:
Homes closed (units) ....       764        539        633        563        583        501        491        414
Average sales price of
   homes closed .........  $    250   $    268   $    258   $    240   $    239   $    247   $    248   $    224
</TABLE>

            The Company historically has experienced, and in the future expects
to continue to experience, variability in revenues on a quarterly basis. Factors
expected to contribute to the variability include, among others: (i) the timing
of home closings; (ii) the Company's ability to continue to acquire land and
options on acceptable terms; (iii) the timing of receipt of regulatory approvals
for the construction of homes; (iv) the condition of the real estate market and
general economic conditions; (v) the cyclical nature of the homebuilding
industry; (vi) prevailing interest rates and the availability of mortgage
financing; (vii) pricing policies of the Company's competitors; (viii) the
timing of the opening of new residential projects; (ix) weather; and (x) the
cost and availability of materials and labor. The Company's historical financial
performance is not necessarily a meaningful indicator of future results and the
Company expects its financial results to vary from project to project from
quarter to quarter.

LIQUIDITY AND CAPITAL RESOURCES

            The Company's financing needs depend primarily upon its sales
volume, inventory levels, inventory turnover and land acquisitions. During the
year ended December 31, 2000, cash provided by operations was $25.8 million
resulting from the 25.6% increase in home closings from the previous year. For
the years ended December 31, 1999 and 1998, the Company used cash in operations
of $34.9 million and $19.3 million, respectively. The significant use of cash in
operations of the Company has primarily been due to the increasing inventory
levels maintained by the Company as the Company continues to expand its
business. Historically, the Company has financed its operations primarily
through its earnings, borrowings from financial institutions, and, prior to the
Company's initial public offering on March 12, 1998, capital contributions and
borrowings from Pacific, primarily for residential land development
acquisitions.



                                       22
<PAGE>   23
            On June 27, 2000, Newmark entered into a syndicated $150 million
secured revolving credit facility with six banks which matures on June 27, 2003
with annual options for one-year extensions. This credit facility is being and
will be used to finance the acquisition and development of residential
subdivisions, the purchase of developed lots and the construction of homes in
the Texas, Tennessee and North Carolina markets. On December 31, 2000, the
Company had borrowings of $74.6 million outstanding under this facility.

            The Company has financed in the past, and intends to continue to
finance, its operations with cash from operations and borrowings under
construction and lot development credit facilities. Generally, these credit
agreements are with regional and national lenders. Each of the credit agreements
relates to specific markets and provides for financing residential land and lot
acquisition and construction. The agreements have restrictive covenants which,
among other things, limit speculative home building, debt to tangible net worth
ratios, dividends and set a minimum requirement for tangible net worth. The
agreements have various maturity dates and bear interest at rates based on Libor
and prime. At December 31, 2000, the Company had $28 million of available credit
under its existing credit facilities. The Company plans to renew these
facilities as they mature.

            With the exception of the South Florida operation and to the extent
possible, the Company utilizes lot options as a method of controlling its
investments in land. At December 31, 2000, the Company had 2,343 lots under
option. At December 31, 2000, the Company had no material capital commitments
with respect to specific performance lot purchase contracts. In the Ft.
Lauderdale, Palm Beach and Miami markets, the Company is limited in its ability
to acquire finished lots under option contracts, a factor which requires the
Company to make significant capital expenditures in order to maintain adequate
lot inventory in this market.

            At December 31, 2000 the Company had approximately $11.1 million
outstanding under promissory notes incurred in connection with the acquisition
of Westbrooke. The promissory notes are to be repaid in equal annual
installments from 2001 through 2003.

            The Company believes it will have adequate financial resources,
including availability under its credit facilities, to meet its working capital
and residential land acquisition and development plans under current market
conditions. However, there can be no assurance that the amounts available from
such sources will be sufficient. The Company's combined consolidated outstanding
debt was approximately $139 million at December 31, 2000. Accordingly, the
Company expects to incur interest charges on a consolidated basis at higher
levels than it has in the past. In addition, if the Company identifies
significant new acquisition opportunities outside of the Company's existing
markets, or if the Company's operations do not generate sufficient cash from
operations at levels currently anticipated, the Company may be required to seek
additional capital in the form of equity or debt financing from a variety of
potential sources, including additional bank financings or the issuance of debt
or equity securities. There can be no assurance that the amounts available from
such sources will be sufficient. The amount and types of indebtedness that the
Company may incur are limited by the terms of its existing financing agreements.
In addition, the incurrence of additional debt by the Company would increase its
debt service and interest obligations, which could have an adverse effect on the
Company's results of operations or financial condition. If the Company is not
successful in obtaining sufficient capital to fund its planned expansion and
other expenditures, new projects may be constrained. Any such delay or
abandonment could result in a reduction in sales and may adversely affect the
Company's future business and results of operations.

INFLATION

            The Company, as well as the homebuilding industry in general, may be
adversely affected during periods of high inflation, primarily because of higher
land and construction costs. In addition, higher mortgage interest rates may
significantly affect the affordability of permanent mortgage financing to
prospective purchasers. The Company attempts to pass through to its customers
any of its costs through increased sales prices. However, there is no assurance
that inflation will not have a material adverse impact on the Company's future
results of operations.




                                       23
<PAGE>   24
IMPACT OF NEW ACCOUNTING STANDARDS

            Derivative and Hedging Activities - In June 1998, the FASB issued
SFAS No. 133, "Accounting for Derivative Instruments and Hedging Activities"
("SFAS 133"). SFAS 133 requires companies to recognize all derivative contracts
as either assets or liabilities in the balance sheet and to measure them at fair
value. If certain conditions are met, a derivative may be specifically
designated as a hedge, the objective of which is to match the timing of gain or
loss recognition on the hedging derivative with the recognition of (i) the
changes in the fair value of the hedged asset or liability that are attributable
to the hedge risk or (ii) the earnings effect of the hedged forecasted
transaction. For a derivative not designated as a hedging instrument, the gain
or loss is recognized in income in the period of change. SFAS 133 is effective
for all fiscal quarters of fiscal years beginning after June 15, 2000.
Historically, the Company has not entered into derivative contracts either to
hedge existing risks or for speculative purposes. Accordingly, the Company does
not expect adoption of the new standard on January 1, 2001 to affect its
financial statements.

            FASB Amendments and Clarifications - In February 1999, the FASB
issued SFAS No. 135, Rescission of Financial Accounting Standards Board No. 75
("SFAS 75") and Technical Corrections. SFAS 135 rescinds SFAS 75 and amends SFAS
No. 35. SFAS 135 also amends other existing authoritative literature to make
various technical statements issued for fiscal years ending after February 15,
1999. The Company believes that the adoption of SFAS 135 will not have a
significant effect on its financial statements.

            In December 1999, the SEC staff released Staff Account Bulletin No.
101, "Revenue Recognition in Financial Statements" ("SAB 101"). SAB 101 provides
interpretive guidance on the recognition, presentation and disclosure of revenue
in the financial statements. SAB 101 must be applied to the financial statements
no later than the fourth quarter of fiscal years ending after December 15, 2000.
The Company adopted SAB 101 during the year ended December 31, 2000, and it had
no impact on the Company's financial position or results of operations and cash
flows.

            In March 2000, the Financial Accounting Standards Board issued
Interpretation No. 44 ("FIN 44"), Accounting for Certain Transactions Involving
Stock Compensation, an Interpretation of APB Opinion No. 25. FIN 44 clarifies
the application of APB No. 25 for (a) the definition of employee for purposes of
applying

CHANGE IN CONTROL OF OWNERSHIP

          The acquisition by TOUSA of the common stock of the Company held by
Pacific represented 80% of the outstanding stock of the Company. This
acquisition was accounted for as a purchase, and the purchase price was recorded
on the Company's books. The excess of purchase price over the fair value of the
assets acquired and the liabilities assumed approximated $46 million of which
approximately $2.1 million was directly attributed to the change in control
transaction.

          In connection with the acquisition by TOUSA of the common stock
previously owned by Pacific, the Company entered into a Services Agreement with
PUSA to continue to provide certain centralized support services to the Company,
including general advisory services, market expansion research services and
administrative support services. This Service Agreement was terminated December
31, 2000. In addition, the 1998 Tandem Stock Option/Stock Appreciation Rights
Plan and the options granted therein were terminated. There were no other
incentive awards outstanding or exercisable in fiscal year 1999 or thereafter.

          Pursuant to the stock purchase agreement entered into in connection
with the acquisition of Westbrooke in January 1998, certain additional
consideration, based on Westbrooke achieving specified income targets over a
five-year period, became due and payable to the prior majority owner and certain
key employees of Westbrooke upon a change of control. Westbrooke entered into an
Amendment to Stock Purchase Agreement ("Amendment") with the prior owner and
certain key employees of Westbrooke regarding the amount and timing of the
additional consideration as well as the acquisition of certain partnership
interests from the key employees. The amount of additional consideration
recorded in the transaction as a result of the change in control to the prior
majority owner was $4.6 million in the form of a promissory note. Additionally,
the Amendment adjusted the level of additional consideration payable to the key
employees from 6% to 7.5% of the net income before income taxes, all as defined
and



                                       24
<PAGE>   25

described in the Amendment. The Company will record such payments as
compensation expense in the periods in which they are earned. Subsequent to the
fiscal year end, the Company, prior owner and certain key employees entered into
the Second Amendment to Stock Purchase Agreement ("Second Amendment") regarding
the amount and timing of certain of the payments to the prior owner and certain
key employees of Westbrooke.

          The PUSA Tax Allocation Agreement between PUSA and the Company was
partially terminated whereby the Company would pay PUSA an amount equal to the
federal income taxes that the Company would owe (or refund that it would
receive) had it prepared its federal income tax return on a stand-alone basis.
Certain terms remain in effect with respect to tax periods ending prior to the
change in control.

          For tax purposes, the Company elected to treat the change in control
as a deemed taxable sale of assets resulting in a step-up in the tax basis of
assets in accordance with Internal Revenue Code Section 338(h)(10). By electing
Section 338(h)(10), the Company recognized taxable income of approximately $20
million, and $8 million of tax per the original tax sharing agreement, due to
the difference in the financial statement basis and the tax basis of the assets
immediately prior to the change in control. In terms of the purchase and sale
agreement between PUSA and TOUSA, the tax sharing agreement was modified to
exclude the gain and corresponding tax from this transaction from the
calculation of the tax payments by the Company to PUSA. Accordingly, the Company
recognized its income tax expense based on the taxable income generated from its
operations.

          As a result of the change of control transaction described above,
certain adjustments were made to the Company's goodwill, acquisition notes
payable and stockholders' equity accounts. As a result, the consolidated amounts
of the Company after December 15, 1999 are presented on a new basis of
accounting different from the financial statements of the Company prior to
December 15, 1999.


ITEM 7(A). QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

            The Company is exposed to market risk, which is the potential loss
arising from adverse changes in market prices and rates. The Company does not
enter into, or intend to enter into, derivative financial instruments for
trading or speculative purposes. The Company's exposure to market risks is
changes to interest rates related to the Company's construction loans. The
interest rates relative to the Company's construction loans fluctuate with the
prime and Libor lending rates, both upwards and downwards. (See Note 7 -
"Construction Loans Payable" of the Notes to Consolidated Financial Statements.)



ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

            Financial Statements are set forth in Item 14(a)(1) and (2), and are
incorporated herein by reference.


ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE

          None.

                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

            Information about the Company's directors is incorporated by
reference to the Company's definitive proxy statement, which will be filed with
the Securities and Exchange Commission not later than April 30, 2001 (120 days
after the end of the Company's fiscal year). Information regarding the executive
officers of the Company is included in Part I of this Form 10-K.




                                       25
<PAGE>   26
ITEM 11.  EXECUTIVE COMPENSATION

            The information called for by this item is incorporated by reference
to the Company's definitive proxy statement, which will be filed with the
Securities and Exchange Commission not later than April 30, 2001 (120 days after
the end of the Company's fiscal year).


ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

          The information called for by this item is incorporated by reference
to the Company's definitive proxy statement, which will be filed with the
Securities and Exchange Commission not later than April 30, 2001 (120 days after
the end of the Company's fiscal year).

ITEM 13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

            The information called for by this item is incorporated by reference
to the Company's definitive proxy statement, which will be filed with the
Securities and Exchange Commission not later than April 30, 2001 (120 days after
the end of the Company's fiscal year).

                                     PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

(a)       Financial Statements and Financial Statement Schedules

           1. Financial Statements:

          Reports of independent certified public accountants.
          Consolidated Statements of Financial Position as of December 31, 2000
               and 1999.
          Consolidated Statements of Operations for the year ended December 31,
               2000 for the Period from December 16, 1999 to December 31, 1999;
               for the Period from January 1, 1999 to December 15, 1999; and
               for the Year Ended December 31,1998.
          Consolidated Statements of Stockholders' for the year ended December
               31, 2000 Equity for the Period from December 16, 1999 to
               December 31, 1999; for the Period from January 1, 1999 to
               December 15, 1999; and for the Year ended December 31, 1998.
          Consolidated Statements of Cash Flows for the year ended December 31,
               2000 for the Period from December 16, 1999 to December 31, 1999;
               for the Period from January 1, 1999 to December 15, 1999; and
               for the Year Ended December 31, 1998.
          Notes to Consolidated Financial Statements.

          2. Financial Statement Schedules:

            Schedule I - Condensed Financial Information of Registrant Parent
                              Company Only - Statements of Financial Position
                              as of December 31, 2000 and 1999.
                         Condensed Financial Information of Registrant Parent
                              Company Only - Statements of Operations for the
                              year ended December 31, 2000 for the Period from
                              December 16, 1999 to December 31, 1999; for the
                              Period from January 1, 1999 to December 15, 1999;
                              and for the Year Ended December 31, 1998.
                         Condensed Financial Information of Registrant Parent
                              Company Only - Statements of Cash Flows for the
                              year ended December 31, 2000 for the Period from
                              December 16, 1999 to December 31, 1999; for the
                              Period from January 1, 1999 to December 15, 1999;
                              and for the Year Ended December 31,1998.
            Schedule II - Valuation and Qualifying Accounts for the Years Ended
                              December 31, 2000, 1999, and 1998.

          3. Exhibits required to be filed by Item 601 of Regulation S-K:



                                       26
<PAGE>   27

<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER     REF                  EXHIBIT
      ------     ---                  -------
<S>              <C>     <C>
        2.1      (1)     Stock Purchase Agreement dated January 15, 1998 among
                         James Carr, Westbrooke Communities, Inc., Westbrooke at
                         West Lake, Inc., Westbrooke at Winston Trails, Inc.,
                         Westbrooke at Pembroke Pines, Inc., Westbrooke at Oak
                         Ridge Inc., Harold L. Eisenacher, Leonard R. Chernys,
                         Diana Ibarria, The Westbrooke Partnership, Pacific USA
                         Holdings Corp., Newmark Homes Corp., and Westbrooke
                         Acquisition Corp.

      2.1(b)     (4)     Amendment to Stock Purchase Agreement dated December
                         15, 1999 among James Carr, Westbrooke Communities,
                         Inc., Westbrooke at West Lake, Inc., Westbrooke at
                         Winston Trails, Inc., Westbrooke at Pembroke Pines,
                         Inc., Westbrooke at Oak Ridge, Inc., Harold L.
                         Eisenacher, Leonard R. Chernys and Diana Ibarria, The
                         Westbrooke Partnership, Pacific USA Holdings Corp.,
                         Newmark Homes Corp. and Westbrooke Acquisition Corp.

      2.1(c)     (5)     Second Amendment to Stock Purchase Agreement dated
                         January 15, 2001 among James Carr, Westbrooke
                         Communities, Inc., Westbrooke at West Lake, Inc.,
                         Westbrooke at Winston Trails, Inc., Westbrooke at
                         Pembroke Pines, Inc., Westbrooke at Oak Ridge, Inc.,
                         Harold L. Eisenacher, Leonard R. Chernys and Dianna
                         Ibarria, The Westbrooke Partnership, Newmark Homes
                         Corp. and Westbrooke Acquisition Corp.

        2.3      (2)     Stock Purchase Agreement dated November 24, 1999
                         between Pacific Realty Group, Inc., Pacific USA
                         Holdings Corp., and Technical Olympic USA, Inc.

        2.4      (6)     Agreement and Plan of Merger dated February 12, 2001
                         among Newmark Homes Corp., a Delaware corporation, and
                         Newmark Homes Corp., a Nevada corporation.

        3.1      (6)     Articles of Incorporation.

        3.2      (6)     Bylaws.

       10.1      (1)     Form of Tax Allocation Agreement between Pacific USA
                         and various affiliates and subsidiaries, of Pacific
                         USA, including the Registrant, dated April 28. 1992.

       10.2      (1)     Form of Amendment to Tax Agreement.

       10.3      (4)     Tax Indemnity and Allocation Agreement dated December
                         15, 1999 among Pacific USA Holdings Corp., Pacific
                         Realty Group, Inc., Newmark Homes Corp. and Technical
                         Olympic USA, Inc.

       10.4      (1)     Employment Agreement between Newmark Homes Corp. and
                         Terry White dated January 1, 1998.

       10.5      (1)     Employment Agreement Between Newmark Homes Corp. and J.
                         Eric Rome dated January 1, 1998.

      10.6(a)    (4)     Second Amended and Restated Employment Agreement
                         Between Westbrooke Communities, Inc. and James Carr
                         dated December 15, 1999.

      10.6(b)    (4)     Amended and Restated Non-Competition Agreement dated
                         December 15, 1999 among Westbrooke Communities, Inc.,
                         Westbrooke at West Lake, Inc., Westbrooke at Winston
                         Trails, Inc., Westbrooke at Pembrook Pines, Inc.,
                         Westbrooke at Oak Ridge, Inc., The Westbrooke
                         Partnership, Westbrooke Acquisition Corp. and James
                         Carr.

       10.7      (4)     Amended and Restated Employment Agreement between
                         Newmark Home Corporation and J. Michael Beckett dated
                         March 1, 2000.

       10.8      (4)     Form of Tax Allocation Agreement between Technical
                         Olympic USA, Inc. and various affiliates and
                         subsidiaries, including Newmark Homes Corp. and its
                         subsidiaries.

       10.9      (3)     Credit Agreement among Newmark Homes, L.P. and Bank of
                         America, N.A. as Administrative Agent, Swing Line
                         Lender and Letter of Credit Issuing Lender and Other
                         Financial Institutions Party Hereto dated June 27,
                         2000.

       10.10     (3)     Guaranty Agreement among Newmark Homes Corp. and
                         Newmark Homes Corporation in favor of Bank of America,
                         N.A. and the Lenders under the Credit Agreement dated
                         June 27, 2000.

       10.11     (3)     Management Services Agreement between Newmark Homes
                         Corp. and Techolym, L.P. dated June 1, 2000.

       10.12     (3)     Amended and Restated Employment Agreement between
                         Newmark Homes Corporation and Lonnie M. Fedrick dated
                         May 12, 2000 effective January 1, 2000.
</TABLE>



                                       27
<PAGE>   28
<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER     REF                  EXHIBIT
      ------     ---                  -------
<S>              <C>     <C>
       11.1      (5)     Statement relating to computation of per share
                         earnings.

       12.1      (5)     Statement relating to computation of ratios.

       21.1      (5)     List of subsidiaries.
</TABLE>

     (1)  Filed as part of the Registrant's Registration Statement on Form S-1,
          Amendment Number 3, filed with the Securities and Exchange Commission
          on March 5, 1998, File No. 333-42213 and incorporated herein by
          reference.

     (2)  Filed as Exhibit 2.1 of Registrant's Current Report on Form 8K dated
          December 22, 1999 and incorporated herein by reference.

     (3)  Filed as part of the Registrant's Current Report on Form 10-Q, filed
          with the Securities and Exchange Commission on August 10, 2000 and
          incorporated herein by reference.

     (4)  Filed as part of the Registrant's Annual Report on Form 10-K, filed
          with the Securities and Exchange Commission on March 27, 2000, File
          No. 000-23677 and incorporated herein by reference.

     (5)  Filed herewith.

     (6)  Filed as part of the Registrant's Current Report on Form 8-K dated
          March 23, 2001 and incorporated herein by reference.

(b)       Reports on Form 8-K

            The Registrant filed a Current Report on Form 8-K dated November 22,
 2000 reporting the Registrant being advised that TOUSA, the holder of shares
 representing 80% of the Registrant's outstanding common stock, has pledged
 those shares in support of a commercial loan.



                                       28
<PAGE>   29
                                   SIGNATURES

          Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.

                                                 NEWMARK HOMES CORP.

March 27, 2001                         By: /s/ Lonnie M. Fedrick
Date                                       ------------------------------------
                                           Name:  Lonnie M. Fedrick
                                           Title: Chief Executive Officer
                                                  (Principal Executive Officer)

March 27, 2001                         By: /s/ Terry C. White
Date                                       ------------------------------------
                                           Name:  Terry C. White
                                           Title: Senior Vice President, Chief
                                                  Financial Officer, Treasurer
                                                  and Secretary (Principal
                                                  Financial and Accounting
                                                  Officer)

          Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities and on the dates indicated.

March 27, 2001                         By: /s/ Constantine Stengos
Date                                       ------------------------------------
                                           Name:  Constantine Stengos
                                           Title: Chairman of the Board of
                                                  Directors and Director

March 27, 2001                         By: /s/ Andreas Stengos
Date                                       ------------------------------------
                                           Name:  Andreas Stengos
                                           Title: Director

March 27, 2001                         By: /s/ George Stengos
Date                                       ------------------------------------
                                           Name:  George Stengos
                                           Title: Director

March 27, 2001                         By: /s/ Yannis Delikanakis
Date                                       ------------------------------------
                                           Name:  Yannis Delikanakis
                                           Title: Director

March 27, 2001                         By: /s/ William A. Hasler
Date                                       ------------------------------------
                                           Name:  William A. Hasler
                                           Title: Director

March 27, 2001                         By: /s/ Larry D. Horner
Date                                       ------------------------------------
                                           Name:  Larry D. Horner
                                           Title: Director

March 27, 2001                         By: /s/ Lonnie M. Fedrick
Date                                       ------------------------------------
                                           Name:  Lonnie M. Fedrick
                                           Title: Director

March 27, 2001                         By: /s/ James M. Carr
Date                                       ------------------------------------
                                           Name:  James M. Carr
                                           Title: Director




                                       29
<PAGE>   30


March 27, 2001                         By: /s/ Michael Stevens
Date                                       ------------------------------------
                                           Name:     Michael Stevens
                                           Title:    Director

March 27, 2001                        By:  /s/ Michael J. Poulos
Date                                       ------------------------------------
                                           Name:     Michael J. Poulos
                                           Title:    Director



                                       30
<PAGE>   31
                                                             NEWMARK HOMES CORP.
                                                                AND SUBSIDIARIES






                                               CONSOLIDATED FINANCIAL STATEMENTS
                                    YEARS ENDED DECEMBER 31, 2000, 1999 AND 1998


<PAGE>   32

                               NEWMARK HOMES CORP.
                                AND SUBSIDIARIES

                                                                        CONTENTS



<TABLE>
<S>                                                                        <C>
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS                         3-4


CONSOLIDATED FINANCIAL STATEMENTS

      Consolidated Statements of Financial Position                        5-6

      Consolidated Statements of Operations                                  7

      Consolidated Statements of Stockholders' Equity                        8

      Consolidated Statements of Cash Flows                               9-10


NOTES TO CONSOLIDATED FINANCIAL STATEMENTS                               11-31
</TABLE>





                                                                             2
<PAGE>   33
REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

The Board of Directors
Newmark Homes Corp.:

We have audited the accompanying consolidated statement of financial position of
Newmark Homes Corp. and subsidiaries (the "Successor Company"), a subsidiary of
Technical Olympic USA, Inc., as of December 31, 2000 and 1999, and the related
consolidated statements of operations, stockholders' equity and cash flows for
the year ended December 31, 2000 and for the period from commencement of its
operations on December 16, 1999 through December 31, 1999. We have also audited
the accompanying consolidated statements of operations, stockholders' equity,
and cash flows of Newmark Homes Corp. and subsidiaries (the "Predecessor
Company" as described in Note 2 of the financial statements), a subsidiary of
Pacific USA Holdings Corp., for the year ended December 31, 1998 and for the
period from January 1, 1999 to December 15, 1999. We have also audited the
schedules listed in the accompanying index. These consolidated financial
statements and schedules are the responsibility of the Company's management. Our
responsibility is to express an opinion on these consolidated financial
statements and schedules based on our audits. We did not audit the financial
statements of Westbrooke Acquisition Corp. (a consolidated subsidiary) for the
year ended December 31, 1998, which statements reflect total revenues
constituting 29% of the related consolidated totals for that year. Those
statements were audited by other auditors whose report has been furnished to us,
and our opinion, insofar as it relates to the amounts included for Westbrooke
Acquisition Corp., for the year ended December 31, 1998 is based solely on the
report of the other auditors.

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



                                                                               3
<PAGE>   34
In our opinion, the Successor Company's consolidated financial statements
referred to above, present fairly, in all material respects, the financial
position of the Company as of December 31, 2000 and 1999 and the results of its
operations and cash flows for the year ended December 31, 2000 and the period
from commencement of its operations on December 16, 1999 through December 31,
1999, in conformity with generally accepted accounting principles. Further in
our opinion, based on our audit and the report of the other auditors, the
Predecessor Company's consolidated financial statements, referred to above,
present fairly, in all material respects, the results of operations and cash
flows of the Predecessor Company for the year ended December 31, 1998, and for
the period from January 1, 1999 to December 15, 1999, in conformity with
accounting principles generally accepted in the United States of America.

As discussed in Note 2 of the financial statements, Technical Olympic USA, Inc.
acquired an 80% interest in the Predecessor Company on December 15, 1999, in a
business combination accounted for as a purchase. As a result, the consolidated
financial statements of the Successor Company are presented on a new basis of
accounting different from the financial statements of the Predecessor Company
and, therefore, are not comparable.

Also, in our opinion, the schedules present fairly, in all material respects,
the information set forth herein.


/s/ BDO SEIDMAN, LLP

Los Angeles, California
January 31, 2001




                                                                               4
<PAGE>   35
                                            NEWMARK HOMES CORP. AND SUBSIDIARIES


                                   CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
                                            (IN THOUSANDS, EXCEPT SHARE AMOUNTS)



<TABLE>
<CAPTION>
December 31,                                                2000        1999
                                                          ----------  ----------
<S>                                                       <C>         <C>
ASSETS

CASH                                                      $    4,774  $    8,080

RECEIVABLES
    Title companies                                           10,487       3,909
    Other                                                      4,291       5,297
                                                          ----------  ----------

Total receivables                                             14,778       9,206

INVENTORIES (Note 5 and 7)
    Single family residences                                 169,298     191,883
    Lots and land held for development                        77,567      63,693
                                                          ----------  ----------

Total inventories                                            246,865     255,576

INVESTMENT IN UNCONSOLIDATED SUBSIDIARIES (Note 6)             2,205         640

PROPERTY, PREMISES AND EQUIPMENT, net of accumulated
    depreciation of $4,728 and $3,503 in 2000 and 1999,
    respectively                                               5,884       5,946

DEFERRED TAX ASSET, net (Note 9)                                 515         155

OTHER ASSETS (Note 5)                                          3,769       3,637

GOODWILL, net of accumulated amortization of $1,594 and
    $67 in 2000 and 1999, respectively (Note 2, 4 and 9)      45,354      45,652
                                                          ----------  ----------

Total assets                                              $  324,144  $  328,892
                                                          ==========  ==========
</TABLE>

                    See accompanying notes to consolidated financial statements.




                                                                               5
<PAGE>   36
                                            NEWMARK HOMES CORP. AND SUBSIDIARIES


                                   CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
                                            (IN THOUSANDS, EXCEPT SHARE AMOUNTS)



<TABLE>
<CAPTION>
                                                                      2000        1999
                                                                   ----------  ----------
<S>                                                                <C>         <C>
LIABILITIES AND STOCKHOLDERS' EQUITY

CONSTRUCTION LOANS PAYABLE (Note 7)                                $  127,546  $  149,380

ACQUISITION NOTES PAYABLE (Note 2 and 4)                               11,055      14,473

PAYABLES TO AFFILIATES (Note 9)                                            13          --

INCOME TAX PAYABLE                                                        687       1,745

ACCOUNTS PAYABLE AND ACCRUED LIABILITIES (Note 3)                      33,837      36,639

CUSTOMER DEPOSITS (Note 10)                                            11,607      13,586

OTHER LIABILITIES                                                       4,090       3,451
                                                                   ----------  ----------

Total liabilities                                                     188,835     219,274
                                                                   ----------  ----------

COMMITMENTS AND CONTINGENCIES (Note 4, 7 and 10)

STOCKHOLDERS' EQUITY (Note 7)
   Common stock - $.01 par value; 30,000,000 shares
       authorized and 11,500,000 shares issued and outstanding            115         115
   Additional paid-in capital                                         106,855     106,855
   Retained earnings                                                   28,339       2,648
                                                                   ----------  ----------

Total stockholders' equity                                            135,309     109,618
                                                                   ----------  ----------

Total liabilities and stockholders' equity                         $  324,144  $  328,892
                                                                   ==========  ==========
</TABLE>


                    See accompanying notes to consolidated financial statements.




                                                                               6
<PAGE>   37


                                            NEWMARK HOMES CORP. AND SUBSIDIARIES


                                           CONSOLIDATED STATEMENTS OF OPERATIONS
                                        (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)


<TABLE>
<CAPTION>
                                                                               PERIOD FROM     Period from
                                                                                DECEMBER 16,    January 1,
                                                                                  1999            1999
                                                                 YEAR ENDED        TO              to          Year Ended
                                                                 DECEMBER 31,   DECEMBER 31,   December 15,   December 31,
                                                                     2000          1999           1999            1998
                                                                 ------------   ------------   ------------   ------------
                                                                                (SUCCESSOR)    (Predecessor)  (Predecessor)
<S>                                                              <C>            <C>            <C>            <C>
REVENUES                                                         $    640,506   $     44,252   $    447,462   $    406,353

COST OF SALES (Note 5)                                                529,800         37,047        373,964        339,094
                                                                 ------------   ------------   ------------   ------------

GROSS PROFIT                                                          110,706          7,205         73,498         67,259

   Equity in earnings from unconsolidated subsidiaries (Note 6)           769             39            686            812

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES                          (64,720)        (2,721)       (46,844)       (43,614)

DEPRECIATION AND AMORTIZATION                                          (4,016)          (277)        (3,719)        (3,287)
                                                                 ------------   ------------   ------------   ------------

OPERATING INCOME                                                       42,739          4,246         23,621         21,170

OTHER INCOME (EXPENSE):
   Interest expense (Note 5)                                           (3,282)          (124)        (1,721)        (1,939)
   Other income, net                                                    1,086             25          1,039          1,201
                                                                 ------------   ------------   ------------   ------------

INCOME BEFORE INCOME TAXES                                             40,543          4,147         22,939         20,432

INCOME TAXES (Note 9)                                                  14,852          1,499          8,202          7,637
                                                                 ------------   ------------   ------------   ------------

NET INCOME                                                       $     25,691   $      2,648   $     14,737   $     12,795
                                                                 ============   ============   ============   ============

EARNINGS PER COMMON SHARE:
   Basic                                                         $       2.23   $        .23   $       1.28   $       1.16
   Diluted                                                               2.23            .23           1.28           1.16
                                                                 ============   ============   ============   ============

WEIGHTED AVERAGE NUMBER OF SHARES OF
  COMMON STOCK EQUIVALENTS OUTSTANDING:
   Basic                                                           11,500,000     11,500,000     11,500,000     11,035,342
   Diluted                                                         11,500,000     11,500,000     11,500,000     11,035,342
                                                                 ============   ============   ============   ============
</TABLE>


                    See accompanying notes to consolidated financial statements.




                                                                               7
<PAGE>   38


                                            NEWMARK HOMES CORP. AND SUBSIDIARIES


                                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                                                                  (IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                Additional
                                                     Common      Paid-in      Retained
                                                     Stock       Capital      Earnings      Total
                                                    ----------  ----------   ----------   ----------
<S>                                                 <C>         <C>          <C>          <C>
PREDECESSOR COMPANY

BALANCE, January 1, 1997                            $       92  $   42,415   $    1,422   $   43,929

   Capital contribution                                     --       9,917           --        9,917
   Dividends paid                                           --        (167)      (4,643)      (4,810)
   Net income                                               --          --        6,655        6,655
                                                    ----------  ----------   ----------   ----------

BALANCE, December 31, 1997                                  92      52,165        3,434       55,691

   Initial public offering of common stock, net of
      issuance costs of $2,554                              20      18,426           --       18,446
   Issuance of common stock due to the exercise
      of underwriters over-allotment option, net
      of issuance costs of $271                              3       2,876           --        2,879
   Capital contribution                                     --         301           --          301
   Net income                                               --          --       12,795       12,795
                                                    ----------  ----------   ----------   ----------

BALANCE, December 31, 1998                                 115      73,768       16,229       90,112

   Net income for period January 1 to
      December 15, 1999                                     --          --       14,737       14,737
                                                    ----------  ----------   ----------   ----------
BALANCE, December 15, 1999                                 115      73,768       30,966      104,849
                                                    ==========  ==========   ==========   ==========

SUCCESSOR COMPANY

BALANCE, December 15, 1999                                 115      73,768       30,966      104,849

   Convert retained earnings to additional paid-in
      capital (Note 2)                                      --      30,966      (30,966)          --
   New goodwill directly resulting from change
      in control (Note 2)                                   --       2,121           --        2,121
   Net income for period December 16 to
      December 31, 1999                                     --          --        2,648        2,648
                                                    ----------  ----------   ----------   ----------

BALANCE, December 31, 1999                                 115     106,855        2,648      109,618

   Net income                                               --          --       25,691       25,691
                                                    ----------  ----------   ----------   ----------
BALANCE, December 31, 2000                          $      115  $  106,855   $   28,339   $  135,309
                                                    ==========  ==========   ==========   ==========
</TABLE>

                    See accompanying notes to consolidated financial statements.


                                                                               8

<PAGE>   39


                                            NEWMARK HOMES CORP. AND SUBSIDIARIES


                                           CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                  (IN THOUSANDS)


<TABLE>
<CAPTION>
                                                                                 PERIOD FROM     Period from
                                                                                  DECEMBER 16,    January 1,
                                                                                     1999           1999
                                                                    YEAR ENDED        TO             to         Year Ended
                                                                   DECEMBER 31,   DECEMBER 31,   December 15,   December 31,
                                                                       2000           1999           1999            1998
                                                                   ------------   ------------   ------------   ------------
                                                                                   (SUCCESSOR)   (Predecessor)  (Predecessor)
<S>                                                                <C>            <C>            <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES
   Net income                                                      $     25,691   $      2,648   $     14,737   $     12,795
   Adjustments to reconcile net income to net cash
     provided by (used in) operating activities:
      Depreciation and amortization                                       4,016            277          3,719          3,287

      Net (gain) loss on sale of property, premises and equipment           (24)            --            (36)            27
      Equity in earnings from unconsolidated subsidiaries                  (769)           (39)          (686)          (812)
      Deferred tax (benefit) expense                                       (360)            22           (362)           134
      Changes in operating assets and liabilities net of
        effects from purchase of Westbrooke Communities, Inc.:
            Inventory and land held for development, net                  8,711         (2,908)       (66,901)       (41,998)
            Receivables - title companies                                (6,578)            50          1,139         (1,451)
            Receivables - affiliates and other                            1,005           (143)        (3,289)        (2,247)
            Other assets                                                   (715)           (84)        (1,920)         1,417
            Payable to affiliates                                          (349)            --         (2,442)           667
            Accounts payable and accrued liabilities                     (2,802)           571         13,134          2,930
            Other liabilities                                            (1,340)           265          6,102          5,985
            Income tax payable                                             (696)         1,383            362             --
                                                                   ------------   ------------   ------------   ------------

Net cash provided by (used in) operating activities                      25,790          2,042        (36,443)       (19,266)
                                                                   ------------   ------------   ------------   ------------

CASH FLOWS FROM INVESTING ACTIVITIES
   Purchases of property, premises and equipment                         (2,070)            --         (2,286)        (2,134)
   Proceeds from sales of property, premises and equipment                  252             --            139             44
   Purchase of Westbrooke, net of cash acquired                              --             --             --          2,280
   Increase in goodwill                                                  (1,230)            --             --             --
   Investment in unconsolidated subsidiaries                             (1,249)            --           (345)          (255)
   Distributions from unconsolidated subsidiaries                           453             --            920            903
                                                                   ------------   ------------   ------------   ------------

Net cash provided by (used in) investing activities                      (3,844)            --         (1,572)           838
                                                                   ------------   ------------   ------------   ------------
</TABLE>



                                                                               9
<PAGE>   40


                                            NEWMARK HOMES CORP. AND SUBSIDIARIES


                                           CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                                  (IN THOUSANDS)


<TABLE>
<CAPTION>
                                                                                PERIOD FROM     Period from
                                                                                 DECEMBER 16,    January 1,
                                                                                    1999           1999
                                                                   YEAR ENDED        TO             to         Year Ended
                                                                  DECEMBER 31,   DECEMBER 31,   December 15,   December 31,
                                                                      2000           1999           1999            1998
                                                                  ------------   ------------   ------------   ------------
                                                                                   (SUCCESSOR)   (Predecessor)  (Predecessor)
<S>                                                                <C>            <C>            <C>            <C>

CASH FLOWS FROM FINANCING ACTIVITIES
   Net proceeds from initial public offering of common stock                --             --             --         18,446
   Net proceeds from underwriters over-allotment option                     --             --             --          2,879
   Capital contributions received                                           --             --             --            301
   Proceeds from advances on construction loans payable                307,718         12,860        337,506        279,694
   Principal payments on construction loans payable                   (329,552)       (12,902)      (296,737)      (261,263)
   Principal payments on acquisition notes payable                      (3,418)            --         (2,468)       (16,581)
                                                                  ------------   ------------   ------------   ------------

Net cash provided by (used in) financing activities                    (25,252)           (42)        38,301         23,476
                                                                  ------------   ------------   ------------   ------------

INCREASE (DECREASE) IN CASH                                             (3,306)         2,000            286          5,048

CASH, beginning of period                                                8,080          6,080          5,794            746
                                                                  ------------   ------------   ------------   ------------

CASH, end of period                                               $      4,774   $      8,080   $      6,080   $      5,794
                                                                  ============   ============   ============   ============

SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION
    Cash paid for:
      Interest                                                    $     15,592   $        541   $     12,436   $      9,501
      Income taxes                                                $     15,802   $         --   $     10,723   $      7,456
                                                                  ============   ============   ============   ============
</TABLE>

                    See accompanying Notes 2, 3, and 4 for supplemental
                    disclosure of noncash investing and financing activities.

                    See accompanying notes to consolidated financial statements.



                                                                              10
<PAGE>   41
1. ORGANIZATION              Newmark Homes Corp. (NHC or the Company) is an 80%
                             owned subsidiary of Technical Olympic USA, Inc.
                             (TOUSA) as of December 15, 1999. NHC was formed in
                             December 1994 to serve as a real estate holding
                             company.

                             NHC's primary subsidiaries are as follows:

<TABLE>
<CAPTION>
                                             SUBSIDIARY                                         NATURE OF BUSINESS
                              ------------------------------------------------------------------------------------------------------
<S>                                                                         <C>
                              Newmark Home Corporation (Newmark)            Single-family residential homebuilding in Texas,
                                                                                Tennessee and North Carolina-formed in 1983.

                              Westbrooke Communities, Inc.                  Single-family residential homebuilding and residential
                                  (Westbrooke)                                  lot developer in Florida-formed in 1976.

                              The Adler Companies, Inc. (Adler)             Single-family residential homebuilding in Florida-formed
                                                                                in 1990.

                              Pacific United Development                    Residential lot developer in Texas and
                                  Corporation                                Tennessee-formed (PUDC) in 1993.
                              ------------------------------------------------------------------------------------------------------
</TABLE>

2. CHANGE IN CONTROL         On December 15, 1999, TOUSA purchased 9,200,000
                             shares of the Company's Common Stock for $86
                             million in cash. The shares sold in this
                             transaction represent 80% of the Company's
                             outstanding Common Stock. TOUSA purchased the
                             shares from Pacific Realty Group, Inc. (PRG), a
                             Nevada corporation, which is a wholly-owned
                             subsidiary of Pacific USA Holdings Corp. (PUSA), a
                             Texas corporation and an indirect subsidiary of
                             Pacific Electric Wire & Cable, Ltd.

                             TOUSA, a Delaware corporation, is a wholly-owned
                             subsidiary of Technical Olympic (UK) PLC, an
                             English company, which is a wholly-owned subsidiary
                             of Technical Olympic S.A., a Greek company.




                                                                              11
<PAGE>   42


2.  CHANGE IN CONTROL        This acquisition by TOUSA is accounted for as a
    (CONTINUED)              purchase, and the purchase price is recorded on the
                             Company's books. The excess of purchase price over
                             the fair value of the assets acquired and the
                             liabilities assumed approximates $46 million, of
                             which approximately $2.1 million is directly
                             attributed to the cost of the transaction of change
                             in control.

                             In connection with the acquisition by TOUSA of the
                             Common Stock, the Company entered into a Services
                             Agreement with PUSA to provide certain centralized
                             support services to the Company, including general
                             advisory services, market expansion research
                             services and administrative support services. This
                             Services Agreement was terminated December 31,
                             2000.

                             The 1998 Tandem Stock Option/Stock Appreciation
                             Rights Plan was terminated, as follows: The Company
                             exercised its right to terminate the options upon a
                             change of control and to pay the spread between the
                             exercise price and the closing price of the Common
                             Stock on the date of the change of control,
                             December 15, 1999. There was no spread, and the
                             options expired and terminated on December 15,
                             1999. There were no other incentive awards
                             outstanding or exercisable in fiscal year 1999 (see
                             Note 12).

                             Pursuant to the stock purchase agreement entered
                             into in connection with the acquisition of
                             Westbrooke in 1998 (see Note 4), certain additional
                             consideration dependent upon Westbrooke achieving
                             specified income targets over a five year period
                             became due and payable to the prior majority owner
                             and key employees of Westbrooke upon a change of
                             control. Westbrooke entered into an Amendment to
                             Stock Purchase Agreement (Amendment) with the prior
                             owner and key employees of Westbrooke regarding the
                             amount and timing of the additional consideration
                             as well as the acquisition of certain partnership
                             interests from the key employees. The amount of
                             additional consideration recorded in the
                             transaction as a result of the change in control to
                             the prior majority owner was $4.6 million in the
                             form


                                                                              12
<PAGE>   43
2. CHANGE IN CONTROL         of a promissory note. Additionally, the Amendment
   (CONTINUED)               adjusted the level of additional consideration
                             payable to the key employees from 6% to 7.5% of the
                             net income before income taxes, all as defined in
                             the Amendment.

                             A former Tax Allocation Agreement (the Former Tax
                             Sharing Agreement) between PUSA and the Company was
                             partially terminated whereby the Company would pay
                             PUSA an amount equal to the federal income taxes
                             that the Company would owe (or refund that it would
                             receive) had it prepared its federal income tax
                             return on a stand-alone basis (see Note 10).

                             For tax purposes, the Company elected to treat the
                             change in control as a deemed taxable sale of
                             assets resulting in a step-up in the tax basis of
                             assets in accordance with Internal Revenue Code
                             Section 338(h)(10). By electing Section 338(h)(10),
                             the Company recognized taxable income of
                             approximately $20 million, and $8 million of tax
                             per the original tax sharing agreement, due to the
                             difference in the financial statement basis and the
                             tax basis of the assets immediately prior to the
                             change in control. In terms of the purchase and
                             sale agreement between PUSA and TOUSA, the Former
                             Tax Sharing Agreement was modified to exclude the
                             gain and corresponding tax from this transaction
                             from the calculation of the tax payments by the
                             Company to PUSA. Accordingly, the Company
                             recognized its income tax expense based on the
                             taxable income generated from its operations.

                             As a result, the consolidated amounts of the
                             Successor Company are presented on a new basis of
                             accounting different from the financial statements
                             of the Predecessor Company and, therefore, are not
                             comparable.




                                                                              13
<PAGE>   44

2. CHANGE IN CONTROL         The following table represents the operating
   (CONTINUED)               results of the Company on a full year basis for the
                             year ended December 31, 1999 (in thousands, except
                             per share data).

<TABLE>
<CAPTION>
                                                                                           Amount
                                                                                    ------------------
<S>                                                                                 <C>
                          Revenues                                                  $          491,714
                          Cost of sales                                                        411,011
                                                                                    ------------------
                          Gross profit                                                          80,703
                          Equity in earnings from unconsolidated subsidiaries                      725
                          Selling, general and administrative expenses                         (49,565)
                          Depreciation and amortization                                         (3,996)
                                                                                    ------------------
                          Operating income                                                      27,867
                          Other income (expense):
                              Interest expense                                                  (1,845)
                              Other income, net                                                  1,064
                                                                                    ------------------
                          Income before income taxes                                            27,086
                          Income taxes                                                           9,701
                                                                                    ------------------
                          Net income                                                $           17,385
                                                                                    ==================
                          Net income per common share                               $             1.51
                                                                                    ==================
</TABLE>

3. SUMMARY OF                The accounting and reporting policies of the
   SIGNIFICANT               Company conform to generally accepted accounting
   ACCOUNTING                principles and general practices within the
   POLICIES                  homebuilding industry. The following summarizes the
                             more significant of these policies.

                             BASIS OF PRESENTATION

                             The consolidated financial statements include the
                             accounts of NHC and its subsidiaries. All
                             significant intercompany balances and transactions
                             have been eliminated in the consolidated financial
                             statements.

                             USE OF ESTIMATES

                             The preparation of financial statements in
                             accordance with generally accepted accounting
                             principles requires management to make estimates
                             and assumptions that affect the amounts reported in
                             the financial statements and accompanying notes.
                             Actual results could differ from those estimates.



                                                                              14
<PAGE>   45
3. SUMMARY OF                ACCOUNTING FOR THE IMPAIRMENT OF LONG-LIVED ASSETS
   SIGNIFICANT
   ACCOUNTING                Statement of Financial Accounting Standards (SFAS)
   POLICIES                  No. 121 addresses the accounting for the impairment
   (CONTINUED)               of long-lived assets, certain identifiable
                             intangibles and goodwill when events or changes in
                             circumstances indicate that the carrying amount of
                             an asset may not be recoverable. Impairment is
                             evaluated by estimating future undiscounted cash
                             flows expected to result from the use of the asset
                             and its eventual disposition. If the sum of the
                             expected future cash flows is less than the
                             carrying amount of the assets, an impairment loss
                             is recognized. Fair value, for purposes of
                             calculating impairment, is measured based on
                             undiscounted future cash flows.

                             CONCENTRATION OF CREDIT RISK

                             The Company conducts business primarily in Texas,
                             Florida, Tennessee, and North Carolina.
                             Accordingly, the market value of the Company's
                             inventory is susceptible to changes in market
                             conditions that may occur in Texas, Florida,
                             Tennessee, and North Carolina.

                             The Company has accounts with various financial
                             institutions, which are insured by the FDIC.
                             Amounts exceeding the FDIC insured amounts are $2.8
                             million at December 31, 2000.

                             RECEIVABLES FROM TITLE COMPANIES

                             Receivables from title companies consist of sales
                             proceeds due for homes sold and closed, less
                             amounts withheld by the title companies for
                             disbursements to third parties.




                                                                              15
<PAGE>   46

3.  SUMMARY OF               INVENTORY
    SIGNIFICANT
    ACCOUNTING               Single family residences and lots and land held for
    POLICIES                 development are recorded at the lower of cost or
    (CONTINUED)              estimated net realizable value. Net realizable
                             value is defined as the estimated proceeds upon
                             disposition, less applicable future costs to
                             complete and sell. Construction costs are
                             accumulated during the period of construction. The
                             Company utilizes the specific identification method
                             of charging construction costs to cost of sales as
                             units are sold. Common construction project costs
                             are allocated to each individual home in the
                             various subdivisions based upon the total number of
                             homes to be constructed in each subdivision
                             community.

                             Interest cost and overhead related to construction
                             activities, primarily salaries and benefits of
                             supervisors and supporting staff, are capitalized
                             as construction costs during the construction
                             period and charged to cost of sales as the related
                             inventories are sold. Selling, general and
                             administrative costs are expensed at the time they
                             are incurred.

                             PROPERTY, PREMISES AND EQUIPMENT

                             Property, premises and equipment, consisting
                             primarily of office premises, transportation
                             equipment, office furniture and fixtures, and model
                             home furniture, are carried at cost net of
                             accumulated depreciation. Office premises and
                             transportation equipment are depreciated using the
                             straight-line method over thirty years and five
                             years, respectively. Furniture and fixtures and
                             model home furniture are depreciated over estimated
                             useful lives of three to seven years using the
                             declining balance method switching to the
                             straight-line method in the year that depreciation,
                             computed on the straight-line method, equals or
                             exceeds that determined under the declining-balance
                             method.




                                                                              16
<PAGE>   47


3. SUMMARY OF                PURCHASE OPTIONS
   SIGNIFICANT
   ACCOUNTING                The Company enters into lot option contracts and
   POLICIES                  contracts to purchase land for lot development.
   (CONTINUED)               When the Company does not exercise an option, its
                             liability is limited to the forfeiture of the
                             related deposit (Note 5). Consequently, the
                             Company's policy is to record the lots or land and
                             the related liabilities at the time such are
                             purchased and legal title has passed.

                             GOODWILL

                             At December 16, 1999, goodwill of approximately $46
                             million represents the combination of the goodwill
                             resulting from the change in control transaction
                             and the goodwill attributed to the 20% minority
                             interest immediately prior to the change in control
                             transaction. Starting from December 16, 1999,
                             goodwill is amortized on a straight-line basis over
                             thirty years. For the year ended December 31, 2000,
                             a charge of $1,500,000 related to an earn out
                             provision in the stock purchase agreement was
                             recorded to goodwill as an adjustment to the
                             purchase price. Periodically, the Company evaluates
                             goodwill for impairment by determining whether the
                             amortization of the balance over its remaining life
                             can be recovered through future undiscounted cash
                             flows of the Company.

                             REVENUE RECOGNITION

                             Revenue is recognized at the time of the closing of
                             the sale, when title to and possession of the
                             property transfers to the buyer.

                             ADVERTISING COSTS

                             As incurred, the Company expenses advertising
                             costs, consisting primarily of newspaper and trade
                             publications, signage and the cost of maintaining
                             an internet web-site. Advertising expense included
                             in selling, general and administrative expenses for
                             the years ended December 31, 2000, 1999 and 1998
                             was approximately $8.3 million, $7.6 million and
                             $6.7 million, respectively.



                                                                              17
<PAGE>   48

3. SUMMARY OF                REPORTING ON THE COSTS OF START-UP ACTIVITIES
   SIGNIFICANT
   ACCOUNTING                Statement of Position 98-5, "Reporting on the Costs
   POLICIES                  of Start-Up Activities" (SOP 98-5), issued by the
   (CONTINUED)               American Institute of Certified Accountants, is
                             effective for years after December 15, 1998. Early
                             adoption is permitted. SOP 98-5 requires that costs
                             of start-up activities be expensed as incurred. The
                             Company adopted SOP 98-5 on January 1, 1999 and
                             $259,000 of start-up costs were expensed during the
                             period from January 1 to December 15, 1999.

                             INCOME TAXES

                             The Company was included in the consolidated
                             federal income tax return of PUSA through December
                             15, 1999. Under the Former Tax Sharing Agreement
                             with PUSA, the Company was required to calculate
                             its federal income tax on a separate company basis
                             and pay to PUSA the amount of the liability. When
                             applicable, the Company was entitled to receive
                             payments from PUSA. Such payment was only
                             applicable to the extent the benefits calculated
                             could be utilized to offset prior separate company
                             income through carryback or, if carried forward, at
                             the time such benefits were utilized to offset
                             separate company income.

                             Effective December 16, 1999, the Company is
                             included in the consolidated federal income tax
                             return with TOUSA pursuant to a revised Tax
                             Allocation Agreement between the Company and TOUSA.

                             As a result of this revised Tax Allocation
                             Agreement, income taxes are accounted for using the
                             asset and liability method. Deferred tax assets and
                             liabilities are recognized for the future tax
                             consequences attributable to differences between
                             the financial statement carrying amounts of
                             existing assets and liabilities and their
                             respective tax basis. Deferred tax assets and
                             liabilities are measured using enacted tax rates
                             expected to apply to taxable income in the years in
                             which those temporary differences are expected to
                             be recovered or settled. The effect on deferred tax
                             assets and liabilities of a change in tax rates is
                             recognized in income in the period that includes
                             the enactment date.



                                                                              18
<PAGE>   49
3. SUMMARY OF                EARNINGS PER SHARE
   SIGNIFICANT
   ACCOUNTING                The Company presents earnings per share data in
   POLICIES                  accordance with the Provisions of Statement of
   (CONTINUED)               Financial Accounting Standards No. 128, "Earnings
                             Per Share" (SFAS No. 128). Basic EPS is computed by
                             dividing income available to common stockholders by
                             the weighted-average number of common shares
                             outstanding for the period.

                             Diluted earnings per share is computed based on the
                             weighted average number of shares of common stock
                             and dilutive securities outstanding during the
                             period. Dilutive securities are options that are
                             freely exercisable into common stock at less than
                             market exercise prices. Dilutive securities are not
                             included in the weighted average number of shares
                             when inclusion would increase the earnings per
                             share or decrease the loss per share.

                             The following tables reconcile the computation of
                             basic and diluted EPS for the years ended December
                             31, 2000, 1999 and 1998.

<TABLE>
<CAPTION>
                                                            Period from          Period from
                                                             December 16,         January 1,
                                                                1999                 1999
                                        YEAR ENDED               to                   to               Year Ended
                                       DECEMBER 31          December 31,         December 15,         December 31
                                           2000                 1999                 1999                 1998
                                     ------------------   ------------------   ------------------   ----------------
<S>                                  <C>                  <C>                  <C>                  <C>
       INCOME AVAILABLE TO COMMON
          SHAREHOLDERS
           (Numerator)               $       25,691,000   $        2,648,000   $       14,737,000   $     12,795,000
                                     ==================   ==================   ==================   ================

       WEIGHTED AVERAGE OF SHARES
          OUTSTANDING
           (Denominator)                     11,500,000           11,500,000           11,500,000         11,035,342
                                     ==================   ==================   ==================   ================

       BASIC AND DILUTED EPS         $             2.23   $              .23   $             1.28   $           1.16
                                     ==================   ==================   ==================   ================
</TABLE>




                                                                              19
<PAGE>   50
3. SUMMARY OF                FAIR VALUE OF FINANCIAL INSTRUMENTS
   SIGNIFICANT
   ACCOUNTING                Statement of Financial Accounting Standards No.
   POLICIES                  107, "Disclosures about Fair Value of Financial
   (CONTINUED)               Instruments", requires companies to disclose the
                             estimated fair value of their financial instrument
                             assets and liabilities. Fair value estimates are
                             made at a specific point in time, based upon
                             relevant market information about the financial
                             instrument. These estimates do not reflect any
                             premium or discount that could result from offering
                             for sale at one time the Company's entire holdings
                             of a particular instrument. The carrying values of
                             cash, other receivables, accounts payable and
                             accrued liabilities approximate their fair values
                             due to their short-term nature. The carrying value
                             of construction loans and notes payable
                             approximates its fair value as substantially all of
                             the debt has a fluctuating interest rate based upon
                             a current market index. The carrying amount of the
                             acquisition notes payable approximate their fair
                             value.

                             RECENT ACCOUNTING PRONOUNCEMENTS

                             Statement of Financial Accounting Standard No. 133
                             (SFAS 133), "Accounting for Derivative Instruments
                             and Hedging Activities," issued by the Financial
                             Accounting Standards Board is effective for all
                             fiscal quarters of fiscal years beginning after
                             June 15, 2000. This statement establishes
                             accounting and reporting standards for derivative
                             instruments, including certain derivative
                             instruments embedded in other contracts, and for
                             hedging activities. The Company does not expect
                             adoption to have any effect on its financial
                             position, results of operations and cash flows.

                             RECLASSIFICATION

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




                                                                              20
<PAGE>   51
4. ACQUISITIONS              WESTBROOKE ACQUISITION

                             Effective January 1, 1998, the Company, through its
                             wholly-owned subsidiary Westbrooke Acquisition
                             Corp., acquired all of the outstanding stock of
                             Westbrooke Communities, Inc. and its affiliated
                             entities, a single-family home builder in South
                             Florida. The initial purchase price for Westbrooke
                             was $18.9 million in the form of three promissory
                             notes. A note of $6.6 million bearing an interest
                             rate of 9%, was paid in full in December 1998. The
                             remaining notes are payable in annual installments
                             of $2.4 million beginning in January 1999. The
                             Company made its first installment of $2.4 million
                             in 1999. The remaining notes totaling $9.9 million
                             bear interest at 6.45% payable annually. As
                             indicated in Note 2, additional consideration paid
                             as a result of the change of control resulted in an
                             additional $4.6 million promissory note. During
                             2000, the Company made further payments on
                             acquisition loans of $3.4 million. The total
                             acquisition notes payable outstanding to
                             Westbrooke's prior majority owner at December 31,
                             2000 was $11 million (Note 2).

                             In January 1998, the Company agreed to continue to
                             pay additional consideration to certain of the
                             prior owners of Westbrooke equal to 6% of net
                             income before income taxes, as defined in the
                             amendment to the Stock Purchase Agreement. (As
                             discussed in Note 2, the Company modified the 6%
                             additional consideration amount to 7.5%.).

                             The 1998 acquisition was accounted for using the
                             purchase method and, accordingly, the operating
                             results of Westbrooke were included in the
                             Company's consolidated operating results since the
                             effective date of the acquisition.




                                                                              21
<PAGE>   52

4. ACQUISITIONS              As of January 1, 1998, the fair values of assets
   (CONTINUED)               acquired and liabilities assumed, exclusive of cash
                             acquired of $3,618,000 were as follows (in
                             thousands):

<TABLE>
<CAPTION>
                                                                             Amount
                                                                        --------------
<S>                                                                     <C>
                             Inventory                                  $       40,759
                             Receivables                                         1,540
                             Property and equipment                              1,980
                             Other assets                                        2,216
                             Goodwill                                           10,159
                             Construction loans payable                        (22,308)
                             Acquisition notes payable                         (28,922)
                             Other liabilities                                  (9,042)
                                                                        --------------
                                                                        $       (3,618)
                                                                        ==============
</TABLE>

                             Additional acquisition costs of $1.3 million were
                             incurred by the Company and recorded as goodwill.

5. INVENTORY                 The inventory of single family residences as of
                             December 31, 2000 and 1999 consists of the
                             following:

<TABLE>
<CAPTION>
                                                        Number of Homes            Carrying value
                                                   -----------------------   -----------------------
                                                         December 31,              December 31,
                                                   -----------------------   -----------------------
                                                      2000         1999         2000         1999
                                                   ----------   ----------   ----------   ----------
                                                                    (In thousands)
<S>                                                       <C>          <C>   <C>          <C>
                              Completed                   178          137   $   42,624   $   29,145
                              Under construction          824        1,038      107,959      142,975
                              Models                       73           80       18,715       19,763
                                                   ----------   ----------   ----------   ----------

                                                        1,075        1,255   $  169,298   $  191,883
                                                   ==========   ==========   ==========   ==========
</TABLE>


                                                                              22
<PAGE>   53
5. INVENTORY                 A summary of interest capitalized in inventory is
   (CONTINUED)               as follows (in thousands):

<TABLE>
<CAPTION>
                             Years ended December 31,                     2000      1999      1998
                                                                         -------   -------   -------
<S>                                                                      <C>       <C>       <C>
                             Interest capitalized, beginning of period   $ 6,266   $ 5,516   $ 2,572
                             Capitalized interest acquired in purchase
                               of Westbrooke                                  --        --     2,597
                             Interest incurred                            15,730    12,859    11,163
                             Less interest included in:
                                Cost of sales                             11,797    10,264     8,877
                                Interest expense                           3,282     1,845     1,939
                                                                         -------   -------   -------
                             Interest capitalized, end of period         $ 6,917   $ 6,266   $ 5,516
                                                                         =======   =======   =======
</TABLE>

                             In the ordinary course of business, the Company
                             enters into contracts to purchase lots and land
                             held for lot development. At December 31, 2000 and
                             1999, the Company had nonrefundable deposits
                             aggregating $1.8 million and $1.5 million,
                             respectively, included in other assets in the
                             accompanying consolidated statements of financial
                             position, for lots and land with a related purchase
                             price of approximately $98.2 million and $56.6
                             million, respectively. The Company's liability for
                             nonperformance under such contracts is limited to
                             forfeiture of the related deposits.

6. INVESTMENT IN             Included in the investments in unconsolidated
   UNCONSOLIDATED            subsidiaries is an acquired 49% interest in Pacific
   SUBSIDIARIES              Title L.L.C., a title agency, for $24,000 and a 50%
                             interest in NHC Mortgage, a mortgage finance
                             company, for $81,000. During 1998, the Company
                             acquired a 25% interest in Spicewood at Bull Creek,
                             a land development company, for $250,000. In 1999,
                             the Company acquired a 37.5% interest in Scofield
                             Farms, a land development company, for $300,000.
                             During 2000, the Company made an investment in
                             Spring Park Village, L.P., also a land development
                             company, for $1.1 million. The Company does not
                             have control of these entities and therefore has
                             accounted for its interests using the equity
                             method. The operations are immaterial to the
                             consolidated financial statements.



                                                                              23
<PAGE>   54
7. CONSTRUCTION              On June 27, 2000, the Company entered into a
   LOANS PAYABLE             syndicated $150 million secured revolving credit
                             facility with six banks which matures on June 27,
                             2003 with annual options for one year extensions.
                             This credit facility has been used to finance the
                             acquisition and development of residential
                             subdivisions, the purchase of developed lots and
                             the construction of homes in the Texas, Tennessee
                             and North Carolina markets.

                             Construction loans payable consist of the following
                             at December 31, 2000 and 1999 (in thousands):

<TABLE>
<CAPTION>
                                                                                     2000       1999
                                                                                    --------   --------
<S>                                                                                 <C>        <C>

                         Construction and lot loans with financial institutions,
                             collateralized by lots and single family residences
                             completed or under construction, bearing interest
                             at LIBOR plus 205 basis points to prime rate (8.69%
                             to 9.5% at December 31, 2000), maturing upon
                             completion and sale of the homes as defined in the
                             loan agreement                                         $ 97,132   $114,215

                         Development and land acquisition loans with
                             financial institutions, collateralized by deeds of
                             trust on property, with maturing dates ranging from
                             July 2000 through November 2003, bearing interest
                             at LIBOR plus 205 basis points to prime plus 1.5%
                             (8.69% to 11.0% at December 31, 2000)                    29,784     34,476

                         Promissory note with a bank, collateralized by property,
                             bearing interest at 7.45%, payable monthly,
                             maturing in March, 2008                                     630        689
                                                                                    --------   --------
                                                                                    $127,546   $149,380
                                                                                    ========   ========
</TABLE>



                                                                              24
<PAGE>   55
7. CONSTRUCTION LOANS
   PAYABLE (CONTINUED)       Maturities on construction loans payable at
                             December 31, 2000 are as follows (in thousands):

<TABLE>
<CAPTION>
                              December 31,                            Amount
                              ------------                       ---------------
<S>                                                              <C>
                                    2001                         $       126,991
                                    2002                                      75
                                    2003                                      81
                                    2004                                      87
                                    2005                                      93
                                    Thereafter                               219
                                                                 ---------------
                                    Total                        $       127,546
                                                                 ===============
</TABLE>

                             Construction and lot loans are generally repaid as
                             sales of individual homes are closed and therefore
                             are considered current at December 31, 2000. At
                             December 31, 2000, the Company had lines of credit
                             commitments for construction loans totaling
                             approximately $253.3 million, of which $28.5
                             million was available to draw down.

                             Certain of the Company's lenders require, among
                             other things, that the Company maintain minimum
                             tangible net worth levels and debt to tangible net
                             worth ratios. At December 31, 2000, the Company was
                             in compliance with such requirements. Certain debt
                             agreements of NHC's subsidiaries restrict the
                             subsidiaries' ability to pay dividends or advance
                             funds to NHC to the extent that the payment would
                             put the subsidiary in violation of debt covenants.


                                                                              25
<PAGE>   56

8. RELATED PARTY             While a subsidiary of PUSA, the Company purchased
   TRANSACTIONS              insurance policies from an affiliated insurance
                             broker. The affiliated entity earned commissions of
                             $155,000 and $152,000 in 1999 and 1998,
                             respectively, with respect to such policies. From
                             January 1, 2000 to December 15, 2000 the Company
                             continued to utilize the services of the PUSA
                             affiliate. As of December 15, 2000 the Company
                             purchased insurance under the TOUSA umbrella
                             policy. As a result, the Company currently makes
                             payments directly to an unaffiliated broker. Also,
                             while a subsidiary of PUSA, the Company purchased
                             demographic and economic research information
                             through an affiliate for $57,000 in 1999 (See Note
                             2).

                             During 2000, the Company entered into a purchasing
                             agreement with its parent, Technical Olympic S.A.
                             The agreement provided that Technical Olympic S.A.
                             would purchase certain of the materials and
                             supplies necessary for operations and sell them to
                             the Newmark entities, all in an effort to
                             consolidate the purchasing function. Although
                             Technical Olympic S.A. would incur certain
                             franchise tax expense, Newmark and its subsidiaries
                             would not be required to pay such additional
                             purchasing liability. Technical Olympic S.A.
                             purchased $50,969,000 of materials and supplies on
                             behalf of Newmark or its subsidiaries for the year
                             ended December 31, 2000.

9. INCOME TAXES              Components of income tax expense (benefit) consist
                             of (in thousands):

<TABLE>
<CAPTION>
                             Years ended December 31,     2000        1999        1998
                                                        --------    --------    --------
<S>                                                     <C>         <C>         <C>
                             Current:
                                 Federal                $ 14,247    $  9,984    $  7,183
                                 State                       965          57         320
                                                        --------    --------    --------
                                                          15,212      10,041       7,503
                                                        --------    --------    --------
                             Deferred:
                                 Federal                    (360)       (340)        134
                                 State                        --          --          --
                                                        --------    --------    --------
                                                            (360)       (340)        134
                                                        --------    --------    --------
                                                        $ 14,852    $  9,701    $  7,637
                                                        ========    ========    ========
</TABLE>



                                                                              26
<PAGE>   57
9. INCOME TAXES              The difference between total reported income taxes
   (CONTINUED)               and expected income tax expense computed using the
                             federal statutory income tax rate of 35% for 2000,
                             1999 and 1998 is reconciled as follows (in
                             thousands):

<TABLE>
<CAPTION>
                              Years ended December 31,                 2000        1999         1998
                                                                     ---------   ---------    ---------
<S>                                                                  <C>         <C>          <C>
                              Computed "expected" tax expense        $  14,190   $   9,481    $   7,151
                              Non-deductible goodwill amortization          --         208          216
                              State taxes, net of federal benefit          627          38          208
                              Other                                         35         (26)          62
                                                                     ---------   ---------    ---------

                              Income taxes                           $  14,852   $   9,701    $   7,637
                                                                     =========   =========    =========
</TABLE>

                             Significant temporary differences that give rise to
                             the deferred tax assets and liabilities are as
                             follows (in thousands):

<TABLE>
<CAPTION>
                              December 31,                               2000         1999
                                                                      ---------    ---------
<S>                                                                   <C>          <C>
                              Deferred tax assets:
                                  Warranty/advertising reserve        $     366    $      --
                                  Property, premises and equipment,
                                     principally due to differences
                                     in depreciation                         28
                                  Capitalized interest                      350           --
                                  Amortizable intangibles                    --          155
                                  Other                                     160           --
                                                                      ---------    ---------

                              Total gross deferred tax assets               904          155
                                                                      ---------    ---------

                              Deferred tax liabilities:
                                  Amortizable intangibles                  (381)          --
                                  Partnership investment                     (8)          --
                                                                      ---------    ---------

                              Total gross deferred tax liabilities         (389)          --
                                                                      ---------    ---------

                              Net deferred tax asset                  $     515    $     155
                                                                      =========    =========
</TABLE>




                                                                              27
<PAGE>   58
9. INCOME TAXES              Management of the Company believes that it is more
   (CONTINUED)               likely than not that the gross deferred tax assets
                             will be realized or settled due to the Company's
                             ability to generate taxable income exclusive of
                             reversing timing differences. Accordingly, no
                             valuation allowance was established at December 31,
                             2000 and 1999.

                             Included in income tax payable is $637,000 payble
                             to TOUSA at December 31, 2000 and $362,000 and
                             $1,383,000 payable to PUSA and TOUSA, respectively
                             at December 31, 1999 under the terms of the tax
                             sharing agreements. Payments of $15.3 million were
                             made to TOUSA for federal income taxes during 2000
                             and $10.7 million and $7.4 million, respectively,
                             to PUSA for federal income taxes during 1999 and
                             1998, under the aforementioned agreements.

                             The Internal Revenue Code Section 338(h)(10)
                             election discussed in Note 2 resulted in the
                             creation of amortizable goodwill for tax purposes
                             in excess of amortizable goodwill for financial
                             statement purposes. Accordingly, the Company
                             recognized a new deferred tax asset of
                             approximately $177,000 at December 16, 1999. From
                             December 16, 1999, the goodwill reflected in the
                             financial statements of approximately $46 million
                             will be amortized on a straight-line basis over a
                             period of thirty years; whereas, the goodwill for
                             tax purposes of approximately $46.5 million will be
                             amortized on a straight-line basis over a period of
                             fifteen years.

10. COMMITMENTS AND          The Company leases office premises and equipment
    CONTINGENCIES            under noncancellable operating leases. Future
                             minimum payments under these noncancellable
                             operating leases for the fiscal years ending on
                             December 31 are as follows (in thousands):

<TABLE>
<CAPTION>
                             December 31,                             Amount
                             ------------                          ------------
<S>                                                               <C>
                                   2001                            $        550
                                   2002                                     511
                                   2003                                     428
                                   2004                                     278
                                   2005                                     165
                                                                   ------------
                                                                   $      1,932
                                                                   ============
</TABLE>



                                                                              28
<PAGE>   59

10. COMMITMENTS AND          Rental expense for the year ended December 31,
    CONTINGENCIES            2000, 1999 and 1998 aggregated, $662,000, $425,000
    (CONTINUED)              and $327,000, respectively.

                             The Company is involved in various claims and legal
                             actions arising in the ordinary course of business.
                             In the opinion of management, the ultimate
                             disposition of these matters will not have a
                             material adverse effect on the Company's
                             consolidated financial position.

                             The Company provides homebuyers with a limited
                             warranty of workmanship and materials from the date
                             of sale for up to two years. The Company generally
                             has recourse against its subcontractors for claims
                             relating to workmanship and materials. The Company
                             also provides a ten-year homeowner's warranty
                             through a single national contract with a third
                             party. This warranty generally covers major
                             structural defects. Estimated warranty costs are
                             recorded at the time of sale. Total warranty
                             expense for the year ended December 31, 2000, 1999
                             and 1998 was $4.2 million, $3.2 million and $2.1
                             million, respectively. As of December 31, 2000 and
                             1999, the liability accrued by the Company for
                             warranty costs was $2.5 million and $1.2 million,
                             respectively, and was included in other
                             liabilities.

                             The Company has secured letter of credit facilities
                             which are used to issue letters of credit which
                             guarantee Westbrooke's performance of certain
                             development and construction obligations. At
                             December 31, 2000, letters of credit aggregating
                             $2.9 million were outstanding under this facility.
                             No additional amounts are available under this
                             facility.

11. EMPLOYEE                 The Company has a 401 (k) Profit Sharing Plan (the
    BENEFIT PLAN             Plan). Under the terms of the Plan, the Company
                             matches 50% of employee's voluntary contributions
                             up to a maximum of 6% of each participant's
                             earnings. The Company's matching contributions to
                             the Plan for the year ended December 31, 2000, 1999
                             and 1998 were $681,000, $299,000 and $446,000,
                             respectively. Effective December 16, 1999, this
                             plan is being sponsored by TOUSA.



                                                                              29
<PAGE>   60

12.  STOCK OPTIONS           Effective December 15, 1999, as part of the change
                             in control, all Tandem Stock Option/Stock
                             Appreciation Rights were terminated. As of December
                             31, 2000, the Company has not granted any
                             additional options (See Note 2).

                             During the year ended December 31, 1998, Tandem
                             Stock Option / Stock Appreciation Rights to acquire
                             682,000 shares at an exercise price of $10.50 with
                             market prices ranging from $7.00 to $11.13 in the
                             year, were granted to certain officers and
                             employees of the Company under the Company's stock
                             option plan. During this same period, no options
                             were exercised. During the period from January 1,
                             1999 to December 15, 1999, no options were
                             exercised.

                             The Company accounts for its stock option plan in
                             accordance with the provisions of Accounting
                             Principles Board ("APB") Opinion No. 25,
                             "Accounting for Stock Issued to Employees," and
                             related interpretations. As such, compensation
                             expense would be recorded on the date of grant only
                             if the current market price of the underlying stock
                             exceeded the exercise price.

                             FASB Statement 123, "Accounting for Stock-Based
                             Compensation," requires the Company to provide pro
                             forma information regarding net income and earnings
                             per share as if compensation cost for the Company's
                             stock option plans had been determined in
                             accordance with the fair value based method
                             prescribed in FASB Statement 123. The Company
                             estimates the fair value of each stock option,
                             using the Black Scholes method, at the
                             weighted-average assumption used for grants in
                             fiscal 1998 dividend yield of zero percent;
                             expected volatility of 21.5%; risk free interest
                             rate of 6%; and expected life of 10 years.





                                                                              30
<PAGE>   61

13. QUARTERLY RESULTS        Quarterly results for the years ended December 31,
    (UNAUDITED)              2000 and 1999 are reflected below (in thousands,
                             except per share amounts):

<TABLE>
<CAPTION>
                                                                  FOURTH            THIRD           SECOND            FIRST
                                                              -------------    -------------    -------------    -------------
<S>                                                           <C>              <C>              <C>              <C>
                               2000
                               ----
                               Revenue                        $     192,836    $     146,207    $     164,491    $     136,972
                               Operating income               $      13,345    $       9,486    $      11,100    $       8,808
                               Net income                     $       8,133    $       5,655    $       6,580    $       5,323
                               Basic earnings per share       $         .71    $         .49    $         .57    $         .46
                               Diluted earnings per share     $         .71    $         .49    $         .57    $         .46

                               1999
                               ----
                               Revenue                        $     141,757    $     126,745    $     130,380    $      92,832
                               Operating income               $       9,453    $       8,405    $       6,557    $       3,452
                               Net income                     $       5,869    $       5,330    $       4,191    $       1,995
                               Basic earnings per share       $         .51    $         .46    $         .36    $         .17
                               Diluted earnings per share     $         .51    $         .46    $         .36    $         .17
                                                              =============    =============    =============    =============
</TABLE>

                             Quarterly and year-to-date computations of per
                             share amounts are made independently. Therefore,
                             the sum of per share amounts for the quarters may
                             not agree with the per share amounts for the year.


                                                                              31
<PAGE>   62
                                   SCHEDULE I

                      NEWMARK HOMES CORP. AND SUBSIDIARIES

                  CONDENSED FINANCIAL INFORMATION OF REGISTRANT

              PARENT COMPANY ONLY STATEMENTS OF FINANCIAL POSITION

                           DECEMBER 31, 2000 AND 1999

                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                             2000       1999
                                                                                           --------   --------
<S>                                                                                        <C>        <C>
Cash and short-term investments ........................................................   $    120   $  1,096
Investments in and equity in net assets of subsidiaries ................................     96,258     71,429
Goodwill ...............................................................................     45,354     45,652
Other assets ...........................................................................        629        150
                                                                                           --------   --------
          Total assets .................................................................   $142,361   $118,327
                                                                                           ========   ========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Acquisition notes payable ..............................................................   $  6,650   $  7,600
Other liabilities ......................................................................        402      1,109
                                                                                           --------   --------
          Total liabilities ............................................................      7,052      8,709
                                                                                           --------   --------

Stockholders' Equity:
         Common stock ..................................................................        115        115
         Additional paid in capital ....................................................    106,855    106,855
         Retained earnings .............................................................     28,339      2,648
                                                                                           --------   --------

          Total Stockholders' Equity ...................................................    135,309    109,618
                                                                                           --------   --------

          Total Liabilities and Stockholders' Equity ...................................   $142,361   $118,327
                                                                                           ========   ========
</TABLE>



                  PARENT COMPANY ONLY STATEMENTS OF OPERATIONS

                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                      PERIOD FROM    PERIOD FROM
                                                      DECEMBER 16,   JANUARY 1,
                                                         1999           1999
                                       YEAR ENDED         TO             TO          YEAR ENDED
                                       DECEMBER 31,   DECEMBER 31,   DECEMBER 15,   DECEMBER 31,
                                           2000          1999           1999            1998
                                       ------------   ------------   ------------   ------------
<S>                                    <C>            <C>            <C>            <C>
Equity in earnings of subsidiaries
   (net of taxes) ..................   $     28,846   $      2,730   $     15,183   $     13,091
Other expenses .....................          3,155             82            446            296
                                       ------------   ------------   ------------   ------------
Net income .........................   $     25,691   $      2,648   $     14,737   $     12,795
                                       ============   ============   ============   ============
</TABLE>



<PAGE>   63

                      NEWMARK HOMES CORP. AND SUBSIDIARIES

                  CONDENSED FINANCIAL INFORMATION OF REGISTRANT

                  PARENT COMPANY ONLY STATEMENTS OF CASH FLOWS

              FOR THE YEARS ENDED DECEMBER 31, 2000, 1999, AND 1998

                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
                                                                                  PERIOD FROM   PERIOD FROM
                                                                                  DECEMBER 16,   JANUARY 1,
                                                                                     1999          1999
                                                                     YEAR ENDED       TO            TO          YEAR ENDED
                                                                    DECEMBER 31,  DECEMBER 31,   DECEMBER 15,   DECEMBER 31,
                                                                       2000          1999           1999            1998
                                                                   ------------   ------------   ------------   ------------
<S>                                                                <C>            <C>            <C>            <C>
CASH FLOWS FROM OPERATING ACTIVITIES:
   Net income ...................................................  $     25,691   $      2,648   $     14,737   $     12,795
   Adjustments to reconcile net income to cash from operating
   activities:
         Change in other assets .................................          (180)            (6)          (132)         1,781
         Change in other liabilities ............................          (707)            16            363         (1,073)
         Equity in undistributed earnings of subsidiaries .......       (28,846)        (2,730)       (15,183)       (13,091)
Net cash provided by (used in) operating activities .............        (4,042)           (72)          (215)           412
                                                                   ------------   ------------   ------------   ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
   Dividends from subsidiaries ..................................         8,583             --          2,880             --
   Capital contributions to subsidiaries ........................        (4,567)            --         (2,000)       (21,690)
                                                                   ------------   ------------   ------------   ------------
Net cash provided by (used in) investing activities .............         4,016             --            880        (21,690)
CASH FLOWS FROM FINANCING ACTIVITIES:
   Principal payments on acquisition loan .......................          (950)            --             --             --
   Net proceeds from initial public offering of common stock ....            --             --             --         18,446
   Net proceeds from underwriters over-allotment option .........            --             --             --          2,879
   Capital contributions from parent ............................            --             --             --            301
   Dividends paid to parent .....................................            --             --             --             --
                                                                   ------------   ------------   ------------   ------------
Net cash provided by (used in) financing activities .............          (950)            --             --         21,626

Net change in cash and short-term investments ...................          (976)            72            665            348

Cash at the beginning of the period .............................         1,096          1,024            359             11
                                                                   ------------   ------------   ------------   ------------
Cash at the end of the period ...................................  $        120   $      1,096   $      1,024   $        359
                                                                   ============   ============   ============   ============
</TABLE>





<PAGE>   64

                                   SCHEDULE II

                      NEWMARK HOMES CORP. AND SUBSIDIARIES

              VALUATION AND QUALIFYING ACCOUNTS (WARRANTY RESERVES)

                  YEARS ENDED DECEMBER 31, 2000, 1999, AND 1998

                             (DOLLARS IN THOUSANDS)

<TABLE>
<CAPTION>
=========================================================================================================
                                                    ADDITIONS
                                        -------------------------------
                         BALANCE AT       CHARGED TO       CHARGED TO                         BALANCE AT
                        BEGINNING OF      COSTS AND          OTHER           DEDUCTIONS --      END OF
        DESCRIPTION        PERIOD          EXPENSES         ACCOUNTS            PAYMENT         PERIOD
---------------------------------------------------------------------------------------------------------
<S>                   <C>              <C>             <C>                <C>                  <C>
  December 31, 2000        $1,222          $4,197             ---             $(2,884)          $2,535
=========================================================================================================
  December 31, 1999        $1,149          $2,827             ---             $(2,754)          $1,222
=========================================================================================================
  December 31, 1998        $  881          $2,138             ---             $(1,870)          $1,149
=========================================================================================================
</TABLE>

<PAGE>   65
                               INDEX TO EXHIBITS

<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER     REF                  EXHIBIT
      ------     ---                  -------
<S>              <C>     <C>
        2.1      (1)     Stock Purchase Agreement dated January 15, 1998 among
                         James Carr, Westbrooke Communities, Inc., Westbrooke at
                         West Lake, Inc., Westbrooke at Winston Trails, Inc.,
                         Westbrooke at Pembroke Pines, Inc., Westbrooke at Oak
                         Ridge Inc., Harold L. Eisenacher, Leonard R. Chernys,
                         Diana Ibarria, The Westbrooke Partnership, Pacific USA
                         Holdings Corp., Newmark Homes Corp., and Westbrooke
                         Acquisition Corp.

      2.1(b)     (4)     Amendment to Stock Purchase Agreement dated December
                         15, 1999 among James Carr, Westbrooke Communities,
                         Inc., Westbrooke at West Lake, Inc., Westbrooke at
                         Winston Trails, Inc., Westbrooke at Pembroke Pines,
                         Inc., Westbrooke at Oak Ridge, Inc., Harold L.
                         Eisenacher, Leonard R. Chernys and Diana Ibarria, The
                         Westbrooke Partnership, Pacific USA Holdings Corp.,
                         Newmark Homes Corp. and Westbrooke Acquisition Corp.

      2.1(c)     (5)     Second Amendment to Stock Purchase Agreement dated
                         January 15, 2001 among James Carr, Westbrooke
                         Communities, Inc., Westbrooke at West Lake, Inc.,
                         Westbrooke at Winston Trails, Inc., Westbrooke at
                         Pembroke Pines, Inc., Westbrooke at Oak Ridge, Inc.,
                         Harold L. Eisenacher, Leonard R. Chernys and Dianna
                         Ibarria, The Westbrooke Partnership, Newmark Homes
                         Corp. and Westbrooke Acquisition Corp.

        2.3      (2)     Stock Purchase Agreement dated November 24, 1999
                         between Pacific Realty Group, Inc., Pacific USA
                         Holdings Corp., and Technical Olympic USA, Inc.

        2.4      (6)     Agreement and Plan of Merger dated February 12, 2001
                         among Newmark Homes Corp., a Delaware corporation, and
                         Newmark Homes Corp., a Nevada corporation.

        3.1      (6)     Articles of Incorporation.

        3.2      (6)     Bylaws.

       10.1      (1)     Form of Tax Allocation Agreement between Pacific USA
                         and various affiliates and subsidiaries, of Pacific
                         USA, including the Registrant, dated April 28. 1992.

       10.2      (1)     Form of Amendment to Tax Agreement.

       10.3      (4)     Tax Indemnity and Allocation Agreement dated December
                         15, 1999 among Pacific USA Holdings Corp., Pacific
                         Realty Group, Inc., Newmark Homes Corp. and Technical
                         Olympic USA, Inc.

       10.4      (1)     Employment Agreement between Newmark Homes Corp. and
                         Terry White dated January 1, 1998.

       10.5      (1)     Employment Agreement Between Newmark Homes Corp. and J.
                         Eric Rome dated January 1, 1998.

      10.6(a)    (4)     Second Amended and Restated Employment Agreement
                         Between Westbrooke Communities, Inc. and James Carr
                         dated December 15, 1999.

      10.6(b)    (4)     Amended and Restated Non-Competition Agreement dated
                         December 15, 1999 among Westbrooke Communities, Inc.,
                         Westbrooke at West Lake, Inc., Westbrooke at Winston
                         Trails, Inc., Westbrooke at Pembrook Pines, Inc.,
                         Westbrooke at Oak Ridge, Inc., The Westbrooke
                         Partnership, Westbrooke Acquisition Corp. and James
                         Carr.

       10.7      (4)     Amended and Restated Employment Agreement between
                         Newmark Home Corporation and J. Michael Beckett dated
                         March 1, 2000.

       10.8      (4)     Form of Tax Allocation Agreement between Technical
                         Olympic USA, Inc. and various affiliates and
                         subsidiaries, including Newmark Homes Corp. and its
                         subsidiaries.

       10.9      (3)     Credit Agreement among Newmark Homes, L.P. and Bank of
                         America, N.A. as Administrative Agent, Swing Line
                         Lender and Letter of Credit Issuing Lender and Other
                         Financial Institutions Party Hereto dated June 27,
                         2000.

       10.10     (3)     Guaranty Agreement among Newmark Homes Corp. and
                         Newmark Homes Corporation in favor of Bank of America,
                         N.A. and the Lenders under the Credit Agreement dated
                         June 27, 2000.

       10.11     (3)     Management Services Agreement between Newmark Homes
                         Corp. and Techolym, L.P. dated June 1, 2000.

       10.12     (3)     Amended and Restated Employment Agreement between
                         Newmark Homes Corporation and Lonnie M. Fedrick dated
                         May 12, 2000 effective January 1, 2000.
</TABLE>



<PAGE>   66
<TABLE>
<CAPTION>
      EXHIBIT
      NUMBER     REF                  EXHIBIT
      ------     ---                  -------
<S>              <C>     <C>
       11.1      (5)     Statement relating to computation of per share
                         earnings.

       12.1      (5)     Statement relating to computation of ratios.

       21.1      (5)     List of subsidiaries.
</TABLE>

     (1)  Filed as part of the Registrant's Registration Statement on Form S-1,
          Amendment Number 3, filed with the Securities and Exchange Commission
          on March 5, 1998, File No. 333-42213 and incorporated herein by
          reference.

     (2)  Filed as Exhibit 2.1 of Registrant's Current Report on Form 8-K dated
          December 22, 1999 and incorporated herein by reference.

     (3)  Filed as part of the Registrant's Current Report on Form 10-Q, filed
          with the Securities and Exchange Commission on August 10, 2000 and
          incorporated herein by reference.

     (4)  Filed as part of the Registrant's Annual Report on Form 10-K, filed
          with the Securities and Exchange Commission on March 27, 2000, File
          No. 000-23677 and incorporated herein by reference.

     (5)  Filed herewith.

     (6)  Filed as part of the Registrant's Current Report on Form 8-K dated
          March 23, 2001 and incorporated herein by reference.