Executive Officer Cash Bonus Plan
                          (As Proposed to be Amended)
   The Toll Brothers Inc. Executive Officer Cash Bonus Plan, as amended (the
"Plan") is designed to reward executive officers of Toll Brothers, Inc. (the
"Company") for achieving corporate performance objectives. The Plan is
intended to provide an incentive for superior work and to motivate
participating officers toward even higher achievement and business results, to
increase stockholder value, to tie their goals and interests to those of the
Company and its stockholders, and to enable the Company to attract and retain
highly qualified executive officers. The Plan is also intended to secure the
full deductibility under the provisions of Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code") of the bonus compensation paid
under the Plan to the Company's Covered Employees (as hereinafter defined).
Article I -- Definitions
   1.1  "Board" shall mean the Board of Directors of the Company.
   1.2  "Code" shall mean the Internal Revenue Code of 1986, as amended (the
   1.3  "Committee" shall mean the Compensation and the Stock Based
Compensation Committee for Key Executives and Non- Employee Directors.
   1.4  "Company" shall mean Toll Brothers, Inc.
   1.5  "Covered Employee" shall mean, with respect to any fiscal year of the
Company, each officer, other than the chief executive officer, whose
compensation for such fiscal year is required to be disclosed to stockholders
in the proxy statement relating to the annual meeting of stockholders of the
Company held during the next fiscal year pursuant to the executive
compensation disclosure rules promulgated by the Securities and Exchange
Commission under the Securities Exchange Act of 1934, as amended.
   1.6  "Participant" shall mean, with respect to each Performance Period, each
executive officer, other than the chief executive officer, who has been
designated by the Committee as a Participant in the Plan for such Performance
   1.7  "Performance Goal" shall mean, with respect to a Performance Period, an
objective performance goal or goals that have been established by the
Committee, consistent with the express terms of the Plan, which must be met in
order for any bonus payments to be payable to any Participant in the Plan with
respect to such Performance Period.
   1.8  "Performance Period" shall mean the Plan Year or such other period as
may be established as a Performance Period by the Committee from time to time.
   1.9  "Plan" shall mean the Toll Brothers, Inc. Executive Officer Bonus Plan
as set forth herein and as may be amended from time to time.
   1.10  "Plan Year" shall mean the Company's fiscal year, beginning on
November 1 and ending on October 31.
Article II - Eligibility and Participation
   2.1  Those executive officers of the Company who are officers at the level
of vice president or above and who are designated as Participants in the Plan
from time to time by the Committee shall be eligible to participate in the
Plan. Prior to or at the time performance objectives are established for a
specified Performance Period, the Committee shall, at its sole discretion,
designate in writing which executive officers are to be Participants in the
Plan with respect to such Performance Period.
   2.2  If no specific designation with respect to participation in the Plan is
made by the Committee at the time performance goals are established for a
specified Performance Period, those officers who participated in the Plan with
respect to the immediately prior Performance Period shall be deemed to have
been designated as Participants by the Committee.
Article III -- Performance Goals
   3.1  Prior to or within the first ninety (90) days of a Performance Period
the Committee shall establish in writing with respect to such Performance
Period, one or more specific Performance Goals and an objective formula or
method for computing the amount of bonus compensation payable to each
Participant if the specified Performance Goals are attained. Notwithstanding
the foregoing sentence, the Performance Goals for any Performance Period may
not be established after 25 percent of the period of service represented by
the Performance Period has elapsed.
   3.2  Performance goals shall be based upon one or more of the following
business criteria for the Company as a whole or any of its subsidiaries,
operating divisions or other operating units: Stock price, market share, gross
revenue, net revenue, pretax income, operating income, cash flow, earnings per
share, return on equity, return on invested capital or assets, cost reductions
and savings, return on revenues or productivity, or any variations of the
preceding business criteria, which may be modified at the discretion of the
Committee, to take into account extraordinary items or which may be adjusted
to reflect such costs or expense as the Committee deems appropriate and the
opening or expanding of new geographic regions, developing of new business
lines, hiring personnel and training of personnel. In addition, to the extent
consistent with the goal of providing for deductibility under Section 162(m)
of the Code,performance goals may be based upon a Participant's attainment of
personal objectives with respect to any of the foregoing performance goals or
implementing policies and plans, negotiating transactions and sales,
developing long-term business goals or exercising managerial responsibility.
Measurements of the Company's or a Participant's performance against the
Performance Goals established by the Committee shall be objectively
determinable and shall be determined according to generally accepted
accounting principles as in existence on the date on which the Performance
Goals are established and without regard to any changes in such principles
after such date.
   3.3  The establishment of performance goals under the Plan shall in all
cases be implemented in a manner consistent with the requirements of Section
162(m) of the Code and Treasury Regulations promulgated thereunder.
Article IV -- Determination of Bonus Awards
   4.1  As soon as practicable following the end of a Performance Period, the
Committee shall determine whether and to what extent the Company and/or the
Participants have achieved the Performance Goal or Performance Goals
established for such Performance Period, including the specific target
objective or objectives and the satisfaction of any other material terms of
the bonus award, and shall certify such determination in writing, which
certification may take the form of minutes of the Committee documenting such
determination. In addition, the Committee shall calculate the amount of each
Participant's bonus for such Performance Period based upon the levels of
achievement of the relevant Performance Goals and the objective formula or
formulae established for such purposes with respect to such Performance
Period. The Committee shall have no discretion to increase the amount any
Participant's bonus payable under the Plan, but may, notwithstanding anything
contained herein to the contrary, reduce the amount of or totally eliminate
such bonus, if it determines, in its absolute and sole discretion, that such a
reduction or elimination is appropriate in order to reflect the Participant's
individual performance or to take into account any other factors the Committee
deems appropriate.
   4.2  No Participant shall be entitled to receive a bonus or bonuses during
any one Plan Year in an amount that is, in the aggregate, in excess of three
hundred fifty percent (350%) of such
Participant's base annual salary as in effect as of the first day of such Plan
Year or three million five hundred thousand dollars ($3,500,000), whichever is
   4.3  In no event shall the aggregate amount of all bonuses payable in any
Plan Year under this Plan exceed ten percent (10%) of the Company's average
annual income before taxes for the preceding five fiscal years of the Company.
Article V -- Payment of Awards
   5.1  Approved bonus awards shall be payable by the Company in cash to each
Participant, or to his estate in the event of his death, in a single payment
or in installments, after the end of each Performance Period and after the
Committee has certified in writing pursuant to Section 3.1 that the relevant
performance goals were achieved, except that the Committee may elect to pay
such bonus in one or more installments over a period ending no later than the
end of the seventh month following the Committee's certification of the
achievement of the relevant performance goals, and may require that the
payment of any such installment be subject to the Participant's continued
employment by the Company.
   5.2  A bonus award that would otherwise be payable to a Participant who is
not employed by the Company or one of its subsidiaries on the last day of a
Performance Period shall be prorated, or not paid, as follows:
     (a) Terminated due to disability: Prorated based on active service during
Performance Period.
     (b) Retirement in accordance with the Company's retirement policies or
with the approval of the Committee: Prorated based on active service during
Performance Period.
     (c) Voluntary or involuntary resignation or termination prior to
retirement without mutual written agreement: No award.
     (d) Resignation pursuant to mutual written agreement: Prorated based on
active service during Performance Period.
     (e) Leave of absence: Prorated based on active service during Performance
     (f) Death of Participant: Prorated based on active service during
Performance Period.
Article VI -- Other Terms and Conditions
   6.1  No bonus awards shall be paid under the Plan unless and until the
material terms (within the meaning of Section 162(m)(4)(C) of the Code) of the
Plan, including the business criteria described in Section 2.3 of the Plan,
are disclosed to and approved by the Company's stockholders by a majority of
votes cast in a separate vote, either in person or by proxy, including
abstentions to the extent abstentions are counted as voting under applicable
state law.
   6.2  No person shall have any legal claim to be granted an award under the
Plan and the Committee shall have no obligation to treat Participants
uniformly. Except as may be otherwise required by law, bonus awards under the
Plan shall not be subject in any manner to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, charge, garnishment, execution, or
levy of any kind, either voluntary or involuntary. Bonuses awarded under the
Plan shall be payable from the general assets of the Company and no
Participant shall have any claim with respect to any specific assets of the
   6.3  Neither the Plan nor any action taken under the Plan shall be construed
as giving any employee the right to be retained in the employ of the Company
or any subsidiary or to maintain any Participant's compensation at any level.
   6.4  The Company or any of its subsidiaries may deduct from any award any
applicable withholding taxes or any amounts owed by the employee to the
Company or any of its subsidiaries.
Article VII -- Administration
   7.1  All members of the Committee shall be persons who qualify as "outside
directors" as defined under Section 162(m) of the Code. Until changed by the
Board, the Compensation and Stock Based Compensation Committee for Key
Employees and Non-Employee Directors shall constitute the Committee hereunder.
   7.2  The Committee shall have full power and authority to administer and
interpret the provisions of the Plan and to adopt such rules, regulations,
agreements, guidelines and instruments for the administration of the Plan and
for the conduct of its business as the Committee deems necessary or advisable.
   7.3  Except with respect to matters which under Section 162(m)(4)(C) of the
Code are required to be determined in the sole and absolute discretion of the
Committee, the Committee shall have full power to delegate to any officer or
employee of the Company the authority to administer and interpret the
procedural aspects of the Plan, subject to the Plan's terms, including
adopting and enforcing rules to decide procedural and administrative issues.
   7.4  The Committee may rely on opinions, reports or statements of officers
or employees of the Company or any subsidiary thereof and of Company counsel
(inside or retained counsel), public accountants and other professional or
expert persons.
   7.5  The Board reserves the right to amend or terminate the Plan in whole or
in part at any time. Unless otherwise prohibited by applicable law, any
amendment required to conform the Plan to the requirements of Section 162(m)
of the Code may be made by the Committee. No amendment may be made to the
class of individuals who are eligible to participate in the Plan, the
performance criteria specified in Section 2.3 or the maximum bonus payable to
any Participant as specified in Section 3.2 without stockholder approval
unless stockholder approval is not required in order for bonuses paid to
Covered Employees to constitute qualified performance-based compensation under
Section 162(m) of the Code.
   7.6  No member of the Committee shall be liable for any action taken or
omitted to be taken or for any determination made by him or her in good faith
with respect to the Plan, and the Company shall indemnify and hold harmless
each member of the Committee against any cost or expense (including counsel
fees) or liability (including any sum paid in settlement of a claim with the
approval of the Committee) arising out of any act or omission in connection
with the administration or interpretation of the Plan, unless arising out of
such person's own fraud or bad faith.
   7.7  The place of administration of the Plan shall be in the State of
Pennsylvania, and the validity, construction, interpretation, administration
and effect of the Plan and of its rules and regulations, and rights relating
to the Plan, shall be determined solely in accordance with the laws of the
State of Pennsylvania.