Edgar Filing: NEWMARK HOMES CORP

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SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

|X| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2001

|_| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ___________

COMMISSION FILE NUMBER: 000-23677

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

Delaware 76-0460831
------------------------------- -------------------
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)

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)

Not applicable
-----------------------------------------------------
(Former name, former address, and former fiscal year,
if changed since last report)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No ____

APPLICABLE ONLY TO REGISTRANTS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS:

Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.
Yes ____ No ____

APPLICABLE ONLY TO CORPORATE REGISTRANTS

Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.

Title Outstanding
Common Stock, par value $.01 11,500,000 shares as of March 31, 2001

NEWMARK HOMES CORP.
INDEX

PAGE
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PART I. Financial Information....................................................... 3

ITEM 1. Financial Statements........................................................ 3

Condensed Consolidated Statements of Financial Position..................... 3
Condensed Consolidated Statements of Operations............................. 4
Condensed Consolidated Statements of Stockholders' Equity................... 6
Condensed Consolidated Statements of Cash Flows............................. 7
Notes to the Condensed Consolidated Financial Statements.................... 8

ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of
Operations.................................................................. 9

ITEM 3. Changes in Information About Market Risk.................................... 13

PART II. Other Information........................................................... 13

ITEM 1. Legal Proceedings........................................................... 13

ITEM 2. Changes in Securities....................................................... 13

ITEM 3. Defaults Upon Senior Securities............................................. 13

ITEM 4. Submission of Matters to a Vote of Security Holders......................... 13

ITEM 5. Other Information........................................................... 13

ITEM 6. Exhibits and Reports on Form 8-K............................................ 14

Exhibits.................................................................... 14

Reports on Form 8-K......................................................... 14

Signatures.................................................................. 15

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PART I. FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

NEWMARK HOMES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)

ASSETS MARCH 31, DECEMBER 31,
2001 2000
----------- ------------
(unaudited)

Cash................................................................. $ 9,332 $ 4,774
Receivables.......................................................... 15,731 14,778
Inventory............................................................ 251,982 246,865
Investment in unconsolidated subsidiaries............................ 2,275 2,205
Other assets, net.................................................... 12,273 10,168
Goodwill, net of accumulated amortization of $1,980 and $1,594 in
2001 and 2000, respectively..................................... 44,969 45,354
-------- --------
Total assets....................................... $336,562 $324,144
======== ========

LIABILITIES AND STOCKHOLDERS' EQUITY

Construction loans payable........................................... $142,341 $127,546
Acquisition notes payable............................................ 7,370 11,055
Other payables to affiliates......................................... 3,224 700
Accounts payable and accrued liabilities............................. 26,042 33,837
Dividends payable.................................................... 6,210 --
Other liabilities.................................................... 17,223 15,697
-------- --------
Total liabilities.................................. $202,410 $188,835
-------- --------

Stockholders' equity:
Common stock -- $.01 par value; 30,000,000 shares authorized,
11,500,000 shares issued and outstanding................ 115 115
Additional paid-in capital...................................... 106,855 106,855
Retained earnings............................................... 27,182 28,339
-------- --------

Total stockholders' equity......................... 134,152 135,309
-------- --------

Total liabilities and stockholders' equity......... $336,562 $324,144
======== ========

See accompanying notes to the condensed consolidated
financial statements.

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NEWMARK HOMES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE AMOUNTS)
(UNAUDITED)

THREE MONTHS
ENDED MARCH 31,
------------------------------
2001 2000
---------- ----------

Revenues............................................................. $132,816 $136,426
Cost of sales........................................................ 106,964 113,209
---------- ----------

Gross profit......................................................... 25,852 23,217
Equity in earnings from unconsolidated subsidiaries.................. 155 122
Selling, general and administrative expenses......................... (15,972) (13,566)
Depreciation and amortization........................................ (1,183) (1,048)
---------- ----------

Operating income................................................ 8,852 8,725
Other income (expense):
Interest expense................................................ (1,075) (744)
Other income, net............................................... 8 348
---------- ----------
Income before income taxes................................. 7,785 8,329
Income taxes......................................................... 2,732 3,005
---------- ----------
Net income................................................. $5,053 $5,324
========== ==========
Earnings per common share:

Basic........................................................... $ 0.44 $ 0.46
========== ==========

Diluted......................................................... $ 0.44 $ 0.46
========== ==========
Weighted average number of shares of common
stock equivalents outstanding:

Basic....................................................... 11,500,000 11,500,000
========== ==========

Diluted..................................................... 11,500,000 11,500,000
========== ==========

See accompanying notes to the condensed consolidated
financial statements.

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NEWMARK HOMES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
(UNAUDITED)

Additional
Common Paid-In Retained
Stock Capital Earnings Total
----------- ------------- --------------- --------------

Balance, December 31, 2000........................ $ 115 $106,855 $28,339 $135,309

Net Income........................................ - - 5,053 5,053

Dividends declared ($0.54 per share).............. - - (6,210) (6,210)
----------- ------------- --------------- --------------
Balance, March 31, 2001
$ 115 $106,855 $27,183 $134,152
=========== ============= =============== ==============

See accompanying notes to the condensed consolidated
financial statements.

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NEWMARK HOMES CORP. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(IN THOUSANDS)
(UNAUDITED)

Three Months
Ended March 31,
------------------------------
2001 2000
-------- --------

Cash flows from operating activities:
Net income....................................................... $ 5,053 $ 5,324
Adjustments to reconcile net income to net cash used in operating
activities:
Depreciation and amortization.................................. 1,183 1,048
Net (gain) loss on sale of property, premises and equipment.... 46 (19)
Equity in earnings from unconsolidated subsidiaries............ (155) (122)
Changes in operating assets and liabilities:
Inventory and land held for development, net............... (5,117) (6,489)
Receivables................................................ (953) (196)
Other assets............................................... (1,635) (877)
Payable to affiliates...................................... 2,524 1,428
Accounts payable and accrued liabilities................... (7,795) (4,687)
Other liabilities.......................................... 1,526 1,592
------- -------
Net cash provided (used) in operating activities........... (5,323) (2,998)
------- -------

Cash flows from investing activities:
Purchases of property, premises and equipment.................... (1,403) (396)
Proceeds from sales of property, premises and equipment.......... 88 61
Decrease in goodwill............................................. 0 270
Investment in unconsolidated subsidiaries........................ (100) (93)
Distributions from unconsolidated subsidiaries................... 186 103
------- -------
Net cash used in investing activities...................... (1,229) (55)
------- -------

Cash flows from financing activities:
Proceeds from advances on construction loans payable............. 65,323 89,436
Principal payments on construction loans payable................. (50,528) (84,176)
Principal payments on acquisition notes payable.................. (3,685) (3,418)
------- -------
Net cash provided by financing activities.................. 11,110 1,842
------- -------
Increase (decrease) in cash......................................... 4,558 (1,211)
Cash, beginning of period........................................... 4,774 8,080
Cash, end of period................................................. $ 9,332 $ 6,869
======= =======

Supplemental disclosures of cash flow information:
Cash paid for:
Interest....................................................... $ 4,363 $ 4,288
======= =======
Income taxes................................................... $ 313 $ 1,540
======= =======

Noncash
The Company declared dividends of $6.2 million at March 31, 2001
which were paid subsequent to the quarter end.

See accompanying notes to the condensed consolidated
financial statements.

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NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

ORGANIZATION

Newmark Homes Corp. and subsidiaries (the "Company") is an 80% owned subsidiary
of Technical Olympic USA, Inc. ("TOUSA") as of December 15, 1999. The Company
was formed in December 1994 to serve as a real estate holding company.

The Company's primary subsidiaries are as follows:

SUBSIDIARY NATURE OF BUSINESS
------------ --------------------

Newmark Home Corporation ("Newmark")............... Single-family residential homebuilding in Texas,
Tennessee and North Carolina - formed in 1983.

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

Pacific United Development Corporation ("PUDC").... Residential lot development in Texas and Tennessee -
formed in 1993.

BASIS OF PRESENTATION

The consolidated financial statements include the accounts of the Company and
its subsidiaries. The accounting and reporting policies of the Company conform
to generally accepted accounting principles and general practices within the
homebuilding industry. All significant intercompany balances and transactions
have been eliminated in the consolidated financial statements.

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.

INTERIM PRESENTATION

The accompanying condensed consolidated financial statements have been prepared
by the Company and are unaudited. Certain information and footnote disclosures
normally included in financial statements presented in accordance with generally
accepted accounting principles have been omitted from the accompanying
statements. The Company's management believes the disclosures made are adequate
to make the information presented not misleading. However, the financial
statements included as part of this 10-Q filing should be read in conjunction
with the financial statements and notes thereto included in the Company's
December 31, 2000 Annual Report on Form 10-K. The accompanying unaudited
consolidated financial statements reflect all adjustments that, in the opinion
of the management of the Company, are considered necessary for a fair
presentation of the financial position, results from operations and cash flows
for the periods presented. Results of operations achieved through March 31, 2001
are not necessarily indicative of those which may be achieved for the year ended
December 31, 2001.

EARNINGS PER SHARE

Basic Earnings Per Share is computed by dividing earnings attributable to common
shareholders by the weighted average number of common shares outstanding for the
period. Diluted Earnings Per Share reflects the potential dilution that could
occur if securities or other contracts to issue common stock were exercised or
converted into common stock or resulted in the issuance of common stock that
then shared in the earnings of the Company. The following table reconciles the
computation of basic and diluted Earnings Per Share for the three months ended
March 31, 2001 and 2000 (in thousands, except per share amounts):

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THREE MONTHS ENDED MARCH 31,
---------------------------------------
2001 2000
-------------- ----------------

Income available to common shareholders
(Numerator)................................ $5,053 $5,324

Weighted average of shares outstanding
(Denominator).............................. 11,500 11,500

Basic and diluted Earnings Per Share....... $ .44 $ .46
-------------- ----------------

Diluted Earnings Per Share................. $ .44 $ .46
============== ================

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NOTE 2. INVENTORY

Inventory balances as of March 31, 2001 and December 31, 2000 consist of the
following:

Carrying Value
Number of Homes (in thousands)
------------------------------- --------------------------------
March 31, December 31, March 31, December 31,
2001 2000 2001 2000
--------- ------------ --------- ------------

Completed .................................. 186 178 $44,961 $42,624
Under construction ......................... 909 824 112,863 107,959
Models ..................................... 74 73 18,841 18,715
Residential lots............................. - - 75,317 77,567
--------- ------------ --------- -----------
Total......................... 1,169 1,075 $251,982 $246,865
========= ============ ========= ===========

NOTE 3. CAPITALIZED INTEREST

A summary of interest capitalized in inventory is as follows (in thousands):

THREE MONTHS ENDED
MARCH 31,
-------------------------------
2001 2000
-------------- -------------

Interest capitalized, beginning of period.... $6,917 $6,266
Interest incurred ........................... 3,690 3,904
Less interest included in:
Cost of sales........................... 2,256 2,553
Other income (expense)................. 1,075 744
-------------- -------------
Interest capitalized, end of period ......... $7,276 $6,873
============== =============

NOTE 4. COMMITMENTS AND CONTINGENCIES

The Company is subject to certain pending or threatened litigation and other
claims. Management, after review and consultation with legal counsel, believes
the Company has meritorious defenses to these matters and that any potential
liability from these matters would not materially affect the Company's
consolidated financial statements.

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS

This Quarterly Report on Form 10-Q may contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as amended, Section
21E of the Securities Exchange Act of 1934, as amended and 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.

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RESULTS OF OPERATIONS

The following tables set forth certain operating and financial data for the
Company:

NEW SALES CONTRACTS, HOMES IN
NET OF CANCELLATIONS HOME CLOSINGS SALES BACKLOG
-------------------- ------------------- ----------------
THREE MONTHS THREE MONTHS AS OF
ENDED MARCH 31, ENDED MARCH 31, MARCH 31,
------------------- ------------------- ----------------
2001 2000 2001 2000 2001 2000
---- ---- ---- ---- ---- ----

Houston............................ 201 165 121 128 189 158
Austin............................. 107 187 133 165 168 317
Dallas/Ft. Worth................... 46 38 34 29 63 41
San Antonio........................ 26 12 12 4 27 9
Ft. Lauderdale,
Palm Beach, Miami............ 290 173 139 210 604 494
Nashville.......................... 53 31 24 17 49 26
Charlotte.......................... 4 5 1 4 3 2
Greensboro/Winston-Salem........... 5 6 4 6 6 5
--- --- --- --- ----- -----
Total ............................. 732 617 468 563 1,109 1,052
=== === === === ===== =====

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As a Percentage of Revenue
Three Months
--------------------------
Ended March 31,
--------------------------
2001 2000
----- -----

Cost of sales................................. 80.5% 83.0%
Gross profit.................................. 19.5% 17.0%
Selling, general and administrative expenses.. 12.0% 9.9%
Income before income taxes.................... 5.9% 6.1%
Income taxes (1) ............................. 35.1% 36.1%
Net income.................................... 3.8% 3.9%

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

THREE MONTHS ENDED MARCH 31, 2001 COMPARED TO THREE MONTHS ENDED MARCH 31, 2000

Revenues decreased by 2.6% to $132.8 million in the three months ending March
31, 2001 from $136.4 million in the three months ending March 31, 2000 due to
the net effect of a decrease in units closed, an increase in the average selling
price and an increase in land sales. The number of homes closed by the Company
decreased by 16.9% to 468 homes in the three months ending March 31, 2001 from
563 homes in the three months ending March 31, 2000. The Company's average
selling price of homes closed in the three months ending March 31, 2001 was
$265,038, an increase of 10.2% from the $240,449 average selling price in the
three months ending March 31, 2000 due to product mix within the subdivisions
closing homes. The average selling price of a Newmark (R) home closed in the
three months ending March 31, 2001 was $261,662, an increase of 7.7% from the
$242,914 average selling price in the three months ending March 31, 2000. The
Fedrick, Harris Estate Homes average selling price of homes closed in the three
months ending March 31, 2001 was $479,228, an increase of 7.8% from the $444,253
average selling price in the three months ending March 31, 2000. In the South
Florida market, Westbrooke's average selling price of homes closed in the three
months ending March 31, 2001 was $207,290, an increase of 4.2% from the $198,913
average selling price in the three months ending March 31, 2000. In addition,
revenue from land sales in the three months ending March 31, 2001 increased to
$8.8 million from $1.1 million in the three months ending March 31, 2000.

New net sales contracts increased 18.6% to 732 homes for the three months ended
March 31, 2001 from 617 homes for the three months ended March 31, 2000. The
dollar amount of new net sales contracts increased 15.1% to $188.2 million.

The Company was operating in 79 subdivisions at March 31, 2001 compared to 77
subdivisions at March 31, 2000. As of March 31, 2001, the Company's backlog of
sales contracts was 1,109 homes, a 5.4% increase over comparable figures at
March 31, 2000.

Cost of sales decreased by 5.5% to $107.0 million in the three months ended
March 31, 2001 from $113.2 million in the comparable period of 2000. The
decrease was attributable to the decrease in revenues as described above. Cost
of land sales for the three months ended March 31, 2001 increased to $6.0
million from $.9 million for the comparable period of 2000. As a percentage of
revenues, cost of sales for the three months ended March 31, 2001 decreased to
80.5% in 2001 from 83.0% in 2000.

Selling, general and administrative ("SG&A") expense increased by 17.7% to $16.0
million in the three months ended March 31, 2001, from $13.6 million in the
comparable period of 2000. The increase was primarily caused by increased
construction and sales activity in the new markets of Nashville, Tennessee;
Charlotte and Greensboro, North Carolina as well as in the Company's existing
Texas and Florida markets, as indicated by the increase in the backlog and the
10.3% increase in the homes under construction at the end of March 2001 versus
March 2000. As a percentage of revenues, SG&A expense increased to 12.0% in the
three months ended March 31, 2001 from 9.9% in the comparable period of 2000.

Interest expense, net of interest capitalized, totaled $1.1 million in the three
months ended March 31, 2001 compared to $.7 million in the comparable period of
2000. The Company follows a policy of capitalizing interest only on inventory
under construction or development. During the three months ended March 31, 2001
and 2000, the Company expensed a portion of interest incurred and other
financing costs on those

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completed homes held in inventory. This expense increased due to the increase in
the average number of completed homes held in inventory for the quarter ending
March 31, 2001. Capitalized interest and other financing costs are included in
cost of sales at the time of home closings. In addition, interest on certain
acquisition notes has increased pursuant to the Second Amendment to Stock
Purchase Agreement and the related Amended and Restated Note Agreements.

The Company's provision for income taxes decreased as a percentage of earnings
before taxes to 35.1% for the three months ending March 31, 2001 compared to
36.1% for the three months ending March 31, 2000. The Company recognized federal
income tax expense amounting to $2.5 million for the three months ending March
31, 2001 compared to $2.9 million for the three months ending March 31, 2000.
The decrease in income taxes is primarily due to reduced earnings for the three
months ending March 31, 2001 compared to the three months ending March 31, 2000.

Net income decreased by 5.12% to $5.1 million in the three months ended March
31, 2001, from $5.3 million in the comparable period of 2000. The decrease was
attributable to the decrease in revenues as described above.

FINANCIAL CONDITION, LIQUIDITY AND CAPITAL RESOURCES

At March 31, 2001, the Company had available cash and cash equivalents of $9.3
million. Inventories (including finished homes and construction in progress,
developed residential lots and other land) at March 31, 2001 increased by $5.1
million from $246.9 million at December 31, 2000 due to a general increase in
business activity and the expansion of operations in the newer market areas.
Because of increased business activity and expansion of operations in the newer
markets, the Company's ratio of construction loans payable to total capital
assets increased to 55.0% at March 31, 2001 from 50.5% at December 31, 2000. The
equity to total assets ratio decreased during the three months to 39.9% at March
31, 2001 from 41.7% at December 31, 2000 primarily due to the dividends declared
of $6.2 million at March 31, 2001.

The Company's financing needs depend upon the results of its operations, sales
volume, inventory levels, inventory turnover, and acquisitions. The Company has
financed its operations through borrowings from financial institutions and
through funds from earnings.

At March 31, 2001, the Company had lines of credit commitments for construction
loans totaling approximately $253.0 million, of which $19.0 million is available
to draw down.

The Company's growth requires significant amounts of cash. It is anticipated
that future home construction, lot and land purchases and acquisitions will be
funded through internally generated funds and new and existing borrowing
relationships. The Company continuously evaluates its capital structure and, in
the future, may seek to further increase secured debt and obtain additional
equity to fund ongoing operations as well as to pursue additional growth
opportunities.

Except for ordinary expenditures for the construction of homes and, to a limited
extent, the acquisition of land and lots for development and sale of homes, at
March 31, 2001, the Company had no material commitments for capital
expenditures.

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SEASONALITY AND 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 diversity 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 markets. The seasonality of school terms has an impact on the Company
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.

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 and from quarter to quarter.

ITEM 3. CHANGES IN INFORMATION ABOUT MARKET RISK

The Company is exposed to market risk primarily related to potential adverse
changes in interest rates as discussed below. 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.

PART II. OTHER INFORMATION

ITEM 1. 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 effect
on the financial condition or results of operations of the Company.

ITEM 2. CHANGES IN SECURITIES

None. No disclosure required.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

None. No disclosure required

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

None. No disclosure required

ITEM 5. OTHER INFORMATION

None. No disclosure required.

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ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K

(a.) Exhibits.

Exhibit Number Exhibit
------- ------ -------

10.1 First Amendment to the Credit Agreement among
Newmark Homes, L.P. and Bank of America, N.A. as
Administrative Agent, Swing Line leader and Letter of
Credit Issuing Lender and Other Financial
Institutions Party Hereto dated January 1, 2001

(b) Reports on Form 8-K.

Report on Form 8-K dated as of March 23, 2001 pertaining to the
Registrant's Agreement and Plan of Merger between Newmark-Nevada and
Newmark Homes Corp.

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

NEWMARK HOMES CORP.

May 15, 2001 By: /s/ Terry C. White
-------------------------------------------------
Terry C. White, Senior Vice President, Chief
Financial Officer, Treasurer and Secretary

INDEX TO EXHIBITS

Exhibit Number Exhibit
-------------- -------