The management of the Group of TECHNICAL OLYMPIC announces that TECHNICAL OLYMPIC USA INC. (TOUSA), its listed in NYSE USA subsidiary, updated the lenders to the Transeastern joint venture on the financial position of the joint venture and the Florida housing market conditions. TOUSA?s management reported that when the joint venture was formed in August of 2005, Transeastern had more than 3.000 homes in backlog and projected 2006 deliveries of approximately 3.500 homes. Since that time, the Florida housing market has become more challenging, characterized by weak demand, an over supply of new and existing inventory homes, increased competition and an overall lack of buyer urgency. These conditions have caused elevated cancellation rates and downward pressure on margins due to increased sales incentives and higher advertising and broker commissions. Although we anticipated a gradual slowdown in the Florida housing market, these conditions have been more severe than anticipated and have negatively impacted the joint venture s ability to meet its projections. The joint venture has implemented several initiatives to reduce costs, streamline its operations and increase efficiencies but these initiatives have not been able to fully offset the reduction in profitability caused by the current market conditions. Currently, the joint venture s revised sales and delivery projections are not adequate to support the existing capital structure. The joint venture is exploring options to provide sufficient liquidity including, requesting waivers from its lenders regarding potential defaults and permitting future advances under the revolving credit facility and restructuring land bank obligations. At this time, the joint venture partners do not intend to contribute capital under the existing capital structure. Additionally, the parent company TECHNICAL OLYMPIC S.A informs that the Transeastern joint venture is an independent joint venture and no collateral has been provided for its loan liabilities (non-recourse financing) by the Greek parent company TECHNICAL OLYMPIC S.A or by its USA subsidiary Technical Olympic USA Inc. (TOUSA).