THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

M.D.C. Holdings, Inc. (MDC)

2/28/2006 Proxy Information

The Company leased its prior headquarters office space at 3600 S. Yosemite Street, Denver CO 80237 and leases its current headquarters office space at 4350 S. Monaco Street, Denver CO 80237. Approximately 7,000 square feet in the CompanyŐs prior office building at 3600 S. Yosemite were subleased by various affiliates of Mr. Mizel, for which they collectively paid rent, including parking, to the Company of approximately $22,750 through May of 2005. Approximately 5,437 square feet in the CompanyŐs current office building at 4350 S. Monaco are now leased by various affiliates of Mr. Mizel, for which they paid rent in 2005 to the Company of approximately $53,920, commencing in June of 2005. In addition, Mr. Mizel owns a building that was leased to the Company through June 2, 2005, for which the Company paid Mr. Mizel rent and common area fees of $29,400 in 2005.

Effective as of March 1, 2003, the Company entered into a two-year agreement with Gilbert Goldstein, P.C., of which Gilbert Goldstein, a Director, is the sole shareholder. By amendment dated July 26, 2004, the term of the agreement was extended to February 28, 2006. Pursuant to the agreement, Mr. Goldstein acts as a consultant to the Company on legal matters. In return, the Company has agreed that, from March 1, 2003 through February 28, 2006, the Company will pay Mr. GoldsteinŐs firm $21,000 per month for a minimum of 30 hours per week in legal services; and $180 per hour for services performed in excess of 120 hours in any month. Effective March 1, 2006, the Company has entered into a new agreement with Mr. GoldsteinŐs firm in which the Company has agreed that, from March 1, 2006 through February 28, 2008, it will pay Mr. GoldsteinŐs firm $30,000 per month. In the event that Mr. Goldstein retires from the practice of law, becomes disabled, dies or the consulting agreement with the Company is not renewed or extended during the term of the agreement, the Company will pay the firm or Mr. GoldsteinŐs estate, in lieu of any other payments, other benefits or services to be provided by the Company pursuant to the agreement, $15,000 per month for five years or the duration of Mr. GoldsteinŐs life, whichever is longer.

Pursuant to the terms of the consulting agreement, the Company also provides Mr. GoldsteinŐs firm with office space. Previously, the Company provided Mr. GoldsteinŐs firm with office space in its prior office building at 3600 S. Yosemite Street, which had an estimated annual rental value of $17,100. The Company now provides Mr. GoldsteinŐs firm with office space in the CompanyŐs current office building at 4350 S. Monaco Street, which has an estimated annual rental value of $6,500. Pursuant to the terms of the consulting agreement, the Company also provides Mr. GoldsteinŐs firm with the part-time services of a secretary (in 2005, this secretary received a salary of approximately $32,750, plus benefits), and reimburses actual expenses incurred related to services provided. Payment of $252,000 was made directly to Mr. GoldsteinŐs firm in 2005 for services performed. On February 20, 2006, the Board approved payment to Mr. GoldsteinŐs firm of a one-time cash bonus in the amount of $200,000 for additional services and exceptional value previously provided to the Company.

During 2005, the Company paid a firm owned by Carol Mizel, Mr. MizelŐs spouse, $120,000 for consulting services in connection with corporate and consumer marketing, merchandising, design work, human resources development, product development, and such other matters as were requested by the CompanyŐs senior management. The firm, Mizel Design and Decorating Company, provided these services under an Independent Contractor Agreement with the Company, dated as of January 1, 2005.

On February 24, 2005, effective as of January 1, 2005, Larry A. Mizel, Chief Executive Officer, and David D. Mandarich, President and Chief Operating Officer, each entered into a lease agreement with the Company and M.D.C. Land Corporation for use of Company aircraft when the aircraft are not required for Company business. The lease agreements require payment of the Incremental Expenses incurred by the Company for each flight, as defined in the lease agreements. The Incremental Expenses represent the maximum reimbursement permitted by the Federal Aviation Administration in Federal Aviation Regulation Part 91.501(d). Copies of the lease agreements are filed with the SEC on Form 8-K. For 2005, Mr. Mizel pre-paid $385,000 and Mr. Mandarich pre-paid $75,000 for future incremental expense lease payments. They each incurred, respectively, $309,625 and $38,779 in actual lease payments for 2005. Accordingly, they had remaining prepaid amounts owed to them at year end of $75,375 and $36,221, respectively.

Christopher Mandarich, the son of David D. Mandarich, is employed by one of the CompanyŐs subsidiaries as the regional president for Southern California and Nevada. In 2005, Christopher Mandarich was paid a salary of $215,000 and a performance bonus of $438,250 and was awarded $133,000 in shares of restricted Common Stock (vesting 25% per year over four years) and $8,250 in shares of unrestricted Common Stock. On December 1, 2005, the Company granted him a stock option covering 12,500 shares of Common Stock, exercisable as to 20% of the shares on each of the first through the fifth anniversary dates of the date of grant, with an exercise price of $67.88 per share, the closing price of the Common Stock on the date of grant. Carol Mandarich, the sister of David D. Mandarich, is employed by one of the CompanyŐs subsidiaries as a regional trade manager. In 2005, Carol Mandarich was paid a salary of $80,000 and bonus payments totaling $30,600.

In the ordinary course of its business, HomeAmerican originates mortgage loans to Company employees, including officers. Substantially all of the mortgage loans originated by HomeAmerican are sold to investors within 45 days of origination. Mortgage loans originated for Company employees are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons and did not involve more than the normal risk of collection or present other unfavorable features. In December 2005, the son of Paris G. Reece III, an employee of one of the CompanyŐs subsidiaries, purchased a Richmond American home for $269,065, on the same terms offered to the public, and obtained a mortgage loan from HomeAmerican. Mr. Reece is a co-borrower on the mortgage loan and also is on the property title.

During 2005, the Company committed to contributing $8.1 million in cash and/or Common Stock to the MDC/Richmond American Homes Foundation (the ŇFoundationÓ), formerly known as the M.D.C. Holdings, Inc. Charitable Foundation, a Delaware non-profit corporation that was incorporated on September 30, 1999. In January 2006, the Company contributed to the Foundation 125,562 shares of Common Stock, then valued at $8.1 million, in fulfillment of the 2005 commitment. During 2004, the Company contributed 115,296 shares of Common Stock, then valued at $6.3 million, to the Foundation, and during 2003, contributed 88,989 shares of Common Stock, then valued at $4.0 million, to the Foundation (the 2004 and 2003 share amounts being adjusted for the January 10, 2005 stock split and the prior stock dividends). The Company made no contributions to the Foundation in 2002.

The Foundation is a non-profit organization operated exclusively for charitable, educational and other purposes beneficial to social welfare within the meaning of Section 501(c)(3) of the Internal Revenue Code. As of December 31, 2005, the Foundation had a net worth of $26,434,000 and, since its formation in 1999, has made donations totaling $2,245,000. The following Directors and/or officers of the Company are the trustees of the Foundation, all of whom serve without compensation:

Name Title

Larry A. Mizel Trustee, President and Assistant Secretary Paris G. Reece III Trustee, Vice President and Secretary Steven J. Borick Trustee Gilbert Goldstein Trustee David D. Mandarich Trustee

The authority to vote all securities that the Foundation is entitled to vote is vested in the five member board of trustees and voting of the securities is determined by majority vote of the board of trustees. Accordingly, none of the trustees should be considered to beneficially own such securities. As permitted by the FoundationŐs Bylaws, the Trustees have established an Investment Committee, consisting of Trustees Borick and Mizel, to supervise the finances of and make investment decisions for the Foundation in furtherance of its purposes. Also as permitted by the Bylaws, the Trustees have established a Donations Committee, consisting of Trustees Borick, Mandarich and Mizel, to supervise donations and make donation decisions for the Foundation in furtherance of its purposes.

3/2/2005 Proxy Information

The Company leases its headquarters office space. Approximately 7,000 square feet in the CompanyŐs current Denver office building at 3600 S. Yosemite is subleased by various affiliates of Mr. Mizel, for which they collectively paid rent, including parking, to the Company of approximately $134,331 in 2004. The Company has entered into a lease for new headquarters office space, and it is anticipated that the affiliates of Mr. Mizel will sublease space in the new building. In addition, Mr. Mizel owns a building that is leased to the Company, for which the Company paid Mr. Mizel rent and common area fees of $62,664 in 2004.

Effective as of March 1, 2003, the Company entered into a new two-year agreement with Gilbert Goldstein, P.C., of which Gilbert Goldstein, a Director, is the sole shareholder. By amendment dated July 26, 2004, the term of the agreement was extended to February 28, 2006. Pursuant to the agreement, Mr. Goldstein acts as a consultant to the Company on legal matters. In return, the Company has agreed that, from March 1, 2003 through February 28, 2006, the Company will pay Mr. GoldsteinŐs firm $21,000 per month for a minimum of 30 hours per week in legal services; and $180 per hour for services performed in excess of 120 hours in any month. The Company also provides Mr. GoldsteinŐs firm with office space in the CompanyŐs leased office space, which has an estimated annual rental value of $17,100, provides one full-time secretary (in 2004, this secretary received a salary of approximately $28,000 plus benefits), and reimburses actual expenses incurred related to services provided. In the event that Mr. Goldstein retires from the practice of law, becomes disabled or dies during the term of the agreement, the Company will pay to Mr. Goldstein or his estate $10,000 per month during the remaining term of the agreement. Payment of $252,000 was made directly to Mr. GoldsteinŐs firm in 2004 for services performed.

During 2004, the Company paid a firm owned by Carol Mizel, Mr. MizelŐs spouse, $240,000 for consulting services in connection with corporate and consumer marketing, merchandising, design work, human resources development, product development, and such other matters as were requested by the CompanyŐs senior management. The firm, Mizel Design and Decorating Company, provided these services under an Independent Contractor Agreement with the Company, dated as of January 1, 2001, and has entered into a new agreement, dated as of January 1, 2005, reflecting reduced services and compensation.

On February 24, 2005, effective as of January 1, 2005, Larry A. Mizel, Chief Executive Officer, and David D. Mandarich, President and Chief Operating Officer, each entered into a Lease Agreement with the Company and M.D.C. Land Corporation for personal use of Company aircraft when the aircraft are not required for Company business. The Lease Agreements require payment of the Incremental Expenses, as defined in the Lease Agreements, incurred for each flight. Copies of the Lease Agreements are filed with the SEC on Form 8-K.

In the ordinary course of its business, HomeAmerican originates mortgage loans to Company employees, including officers. Substantially all of the mortgage loans originated by HomeAmerican are sold to investors within 45 days of origination. Mortgage loans originated for Company employees are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons and did not involve more than the normal risk of collection or present other unfavorable features.

During 2004, the Company contributed 115,296 shares (adjusted for the January 10, 2005 stock split and the prior stock dividends) of MDC common stock then valued at $6.3 million to the M.D.C. Holdings, Inc. Charitable Foundation (the ŇFoundationÓ), a Delaware not-for-profit corporation that was incorporated on September 30, 2000. During 2003, the Company contributed 88,989 shares (adjusted for the January 10, 2005 stock split and the prior stock dividends) of MDC Common Stock, then valued at $4.0 million to the Foundation. The Company made no contributions to the Foundation in 2002. The Foundation is a nonprofit organization operated exclusively for charitable, educational and other purposes beneficial to social welfare within the meaning of Section 501(c)(3) of the Internal Revenue Code. The following directors and/or officers of the Company are the trustees and/or officers of the Foundation:

Larry A. Mizel Trustee, President and Assistant Secretary Paris G. Reece III Trustee, Vice President and Secretary Steven J. Borick Trustee Gilbert Goldstein Trustee David D. Mandarich Trustee

The authority to vote all securities that the Foundation is entitled to vote is vested in the five member board of trustees and voting of the securities is determined by majority vote of the board of trustees. Accordingly, none of the trustees should be considered to beneficially own such securities.

3/9/2004 Proxy Information

The Company leases its headquarters office space. Approximately 7,000 square feet in the CompanyŐs Denver office building is subleased by various affiliates of Mr. Mizel, for which they collectively paid rent, including parking, to the Company of approximately $134,331 in 2003. In addition, Mr. Mizel owns a building that is leased to the Company for which the Company paid Mr. Mizel rent and common area fees of $73,866 in 2003.

Effective as of March 1, 2003, the Company entered into a new two-year agreement with Gilbert Goldstein, P.C., of which Gilbert Goldstein, a Director, is the sole shareholder. Pursuant to the agreement, Mr. Goldstein acts as a consultant to the Company on legal matters. In return, the Company has agreed that, from March 1, 2003 through February 28, 2005, the Company will pay Mr. GoldsteinŐs firm $21,000 per month for a minimum of 30 hours per week in legal services; and $180 per hour for services performed in excess of 120 hours in any month. The Company also provides Mr. GoldsteinŐs firm with office space in the CompanyŐs leased office space, which has an estimated annual rental value of $17,100, provides one full-time secretary (in 2003, this secretary received a salary of approximately $27,000 plus benefits), and reimburses actual expenses incurred related to services provided. In the event that Mr. Goldstein retires from the practice of law, becomes disabled or dies during the term of the agreement, the Company will pay to Mr. Goldstein or his estate $10,000 per month during the remaining term of the agreement. Payment of $240,000 was made directly to Mr. GoldsteinŐs firm in 2003 for services performed.

During 2003, the Company paid a firm owned by Carol Mizel, Mr. MizelŐs wife, $240,000 for consulting services in connection with corporate and consumer marketing, merchandising, design work, human resources development, product development, and such other matters as were requested by the CompanyŐs senior management. The firm, Mizel Design and Decorating Company, has an Independent Contractor Agreement with the Company, dated as of January 1, 2001.

On April 12, 1995, the Board of Directors adopted a program to permit the CompanyŐs key executive officers to increase their ownership of Common Stock and more closely align their interests with those of the CompanyŐs other shareowners by facilitating the exercise of options that would expire (the ŇOption Purchase ProgramÓ). All borrowings under the Option Purchase Program were secured by a pledge of 100% of the Common Stock acquired upon exercise (with a pro-rata release of collateral upon payment of principal), were full recourse to the borrower and bore interest at the average one-month LIBOR plus 1%, adjusted monthly. Principal and accrued interest were payable on April 1st of each year based on a 10-year amortization. Additional principal was due on each April 1st in an amount required to reduce the outstanding aggregate principal amount of the loans under the Option Purchase Program to each borrower in an amount depending on each borrowerŐs maximum permitted borrowings. The unpaid principal balance was due on the earlier of: (i) the fifth anniversary of the loan; (ii) 90 days after the borrowerŐs employment with the Company has been terminated for cause; or (iii) one year after the borrowerŐs employment with the Company has been terminated other than for cause.

The following table shows the number of shares exercised, the date of borrowings, the largest aggregate amount of indebtedness outstanding at any time during 2003 and the amount outstanding as of December 31, 2003, for the executive officers who have participated in the Option Purchase Program and had borrowings outstanding during 2003: Number of Largest Amount Shares Date of Outstanding Note Balance Shares Exercised Note during 2003 at 12/31/03

David D. Mandarich 175,000 5/19/98 $ 120,696 -0- David D. Mandarich 100,000 2/07/00 $ 688,180 -0- Paris G. Reece III 50,000 3/24/99 $ 203,374 -0-

In light of Section 402 of the Sarbanes-Oxley Act, the Board of Directors determined in August 2002 that no further loans would be permitted under this program and that no modifications would be authorized to existing loans until further action of the Board of Directors. As of December 31, 2003, there were no loans outstanding under this program.

In the ordinary course of its business, HomeAmerican originates mortgage loans to Company employees, including officers. Substantially all of the mortgage loans originated by HomeAmerican are sold to investors within 45 days of origination. Mortgage loans originated for Company employees are made on substantially the same terms, including interest rates and collateral, as those prevailing at the time for comparable transactions with other persons and did not involve more than the normal risk of collection or present other unfavorable features.

3/6/2003 Proxy Information

The Company leases its headquarters office space. Approximately 7,000 square feet in the CompanyŐs Denver office building is subleased by various affiliates of Mr. Mizel, for which they collectively paid rent, including for parking, to the Company of approximately $135,849 in 2002. In addition, Mr. Mizel owns a building that is leased to the Company for which the Company paid Mr. Mizel rent and common area fees of $78,653 in 2002.

Effective October 1, 1998, the Company entered into a two-year agreement with Gilbert Goldstein, P.C., of which Gilbert Goldstein, a Director of the Company, is the sole shareholder. Pursuant to the agreement, Mr. Goldstein acts as a consultant to the Company on legal matters. In return, the Company (i) from October 1, 1998 through September 30, 1999, paid Mr. GoldsteinŐs firm $18,000 per month for a minimum of 25 hours per week in legal services and, from October 1, 1999 through September 30, 2000, paid Mr. GoldsteinŐs firm $15,000 per month for a minimum of 20 hours per week in legal services; (ii) from October 1, 1998 through September 30, 1999, paid Mr. GoldsteinŐs firm $180 per hour for services performed in excess of 100 hours in any month; (iii) from October 1, 1999 through September 30, 2000, paid Mr. GoldsteinŐs firm $180 per hour for services performed in any month in excess of 80 hours; (iv) from October 1, 2000 through September 30, 2001 paid Mr. GoldsteinŐs firm $180 per hour for services performed in any month in excess of 80 hours; (v) provides office space with an estimated annual rental value of $17,110 in the Company's leased office space; (vi) provides one full-time secretary (in 2002, this secretary received a salary of approximately $30,000 plus benefits); and (vii) reimburses actual expenses incurred related to services provided. In the event that Mr. Goldstein retires from the practice of law, becomes disabled or dies during the term of the agreement, the Company will pay to Mr. Goldstein or his estate $7,000 per month during the remaining term of the agreement. Payment of $180,000 was made directly to Mr. GoldsteinŐs firm in 2002 for services performed. In October 2000, the agreement with Mr. GoldsteinŐs firm was amended to extend the term of the agreement until September 30, 2002. In October, 2001, the agreement was amended to extend the term until September, 2003.

During 2002, the Company paid a firm owned by Carol Mizel, Mr. MizelŐs wife, $240,000 for consulting services in connection with corporate and consumer marketing, merchandising, design work, human resources development, product development, and such other matters as were requested by the CompanyŐs senior management.

On April 12, 1995, the CompanyŐs Board of Directors adopted the Option Purchase Program. The purpose of the Option Purchase Program is to permit the CompanyŐs key executive officers to increase their ownership of Common Stock and more closely align their interests with those of the CompanyŐs other shareowners by facilitating the exercise of options that would expire. Pursuant to the Option Purchase Program, prior to November 4, 1997, Messrs. Mizel and Mandarich each were able to borrow up to $810,000 and Mr. Reece could borrow up to $243,000 for the purpose of paying two-thirds of the sum of the exercise price of options exercised and federal and state income taxes due (up to a maximum aggregate tax rate of 45%) as a result of the exercise of the options. On November 4, 1997 the CompanyŐs Board of Directors adopted Amendment Number 1 to the Option Purchase Program. This amendment added Michael Touff as an eligible participant to the program and increased the amount that each of Messrs. Mizel and Mandarich may borrow to $1,000,000 and the amount that each of Messrs. Reece and Touff may borrow to $300,000. All borrowings under the Option Purchase Program are secured by a pledge of 100% of the stock acquired upon exercise (with a pro-rata release of collateral upon payment of principal), are full recourse to the borrower and bear interest at the average one-month LIBOR plus 1%, adjusted monthly. Principal and accrued interest are payable on April 1st of each year based on a 10-year amortization. Additional principal is due on each April 1st in an amount required to reduce the outstanding aggregate principal amount of the loans under the Option Purchase Program to each borrower in an amount depending on each borrowerŐs maximum permitted borrowings. The unpaid principal balance is due on the earlier of: (i) the fifth anniversary of the loan; (ii) 90 days after the borrowerŐs employment with the Company has been terminated for cause; or (iii) one year after the borrowerŐs employment with the Company has been terminated other than for cause.