EXHIBIT 10.1

AGREEMENT

This Agreement (the “Agreement”) is dated March 14, 2006 (the “Effective Date”)
and is by and among New Century Financial Corporation, a Maryland corporation
(the “Company”), and Greenlight Capital, L.P., a Delaware limited partnership
(“Greenlight LP”), Greenlight Capital L.L.C., a Delaware limited liability
company, Greenlight Capital, Inc., a Delaware corporation (“GCI”), DME Advisors,
L.P., a Delaware limited partnership, DME Advisors GP, L.L.C., a Delaware
limited liability company, Greenlight Capital Qualified, L.P., a Delaware
limited partnership, Greenlight Capital Offshore, Ltd., a British Virgin Islands
international business company, and David Einhorn, an individual (“Einhorn”)
(each a “Greenlight Party” and collectively the “Greenlight Parties”). Entering
into this agreement shall not be deemed to be an admission that the Greenlight
Parties are a “group” for the purposes of Section 13(d) of the Exchange Act (as
such term is hereinafter defined) and Regulation 13D-G thereunder. In
consideration of and reliance upon the mutual covenants and agreements contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:

Section 1. Defined Terms. For purposes of this Agreement:

1.1 The terms “Affiliate” and “Associate” shall have the meanings set forth in
Rule 12b-2 promulgated by the Securities and Exchange Commission (the “SEC”)
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

1.2 The term “Charter” shall mean the charter of the Company, as the same may be
amended from time to time.

1.3 The term “Controlled Affiliate” shall mean any Affiliate of a Person that
such Person possesses, directly or indirectly, the power to direct or cause the
direction of the management and policies of, whether through the ownership of
voting securities, by contract, or otherwise.

1.4 The term “Representatives” means and includes the directors, officers,
members, general partners, employees, agents, consultants, advisors or other
representatives, including legal counsel, accountants and financial advisors of
a Person.

1.5 Terms used but not defined herein shall have the respective meanings
assigned to such terms in the Charter in effect as of the Effective Date without
giving effect to the introductory phrase in Section 5.2(a) of the Charter.

Section 2. Representations and Warranties of the Company. As of the Effective
Date:

2.1 The Company hereby represents and warrants to the Greenlight Parties that
this Agreement has been duly authorized, executed and delivered by the Company,
and is a valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms.

2.2 The Company hereby represents and warrants to the Greenlight Parties that it
has taken all necessary action required under the Charter to comply with the
provisions of the Charter in connection with this Agreement and that the
Company’s execution, delivery and performance of this Agreement does not violate
the Charter.

2.3 The Company hereby represents and warrants to the Greenlight Parties that
the Board Documents (as such term is hereinafter defined) are substantially
similar to the documents that are required to be signed by all members of the
Company’s Board of Directors.

Section 3. Representations and Warranties of the Greenlight Parties. As of the
Effective Date:

3.1 Each Greenlight Party hereby represents and warrants to the Company that
this Agreement has been duly authorized, executed and delivered by such
Greenlight Party, and is a valid and binding obligation of such Greenlight
Party, enforceable against such Greenlight Party in accordance with its terms.

3.2 Each Greenlight Party hereby represents and warrants to the Company that
such Greenlight Party is the “beneficial owner” (as such term is defined in
Rule 13d-3 promulgated by the SEC under the Exchange Act) of only the number of
shares of the Company’s Capital Stock (including any direct or indirect rights,
options or agreements to acquire Capital Stock) as set forth on Schedule A
hereto, and that except as set forth on Schedule A neither such Greenlight Party
nor any of its Controlled Affiliates Beneficially Own or Constructively Own, or
have any rights, options or agreements to acquire or vote, any other Capital
Stock.

3.3 During the Standstill Period (as such term is hereinafter defined), each
Greenlight Party shall deliver an updated Schedule A to the Company on a
quarterly basis in arrears (no later than April 15, July 15, October 15 and
January 15 of each year) (each such date being the “Quarterly Date”); provided,
however, that no Greenlight Party will be required to provide such report to the
extent that the information otherwise required to be contained therein is
already reflected in a Schedule 13D or Form 3 or 4 filed with the SEC.

3.4 All of the representations and warranties set forth in the Tax
Representation Letter (as such term is hereinafter defined) are and will be
true, correct and complete as of the Effective Date and each Quarterly Date.

Section 4. Ownership Waiver.

4.1 The Board has adopted, declared advisable and recommends for stockholder
approval at the Company’s 2006 annual meeting of stockholders (the “2006 Annual
Meeting”) an amendment (the “Amendment”) to the Charter, in substantially the
form attached as Exhibit A hereto. If the Amendment is adopted by the requisite
vote of the stockholders of the Company, the Company shall cause the Amendment
to be promptly filed (and in any event filed no later than one (1) business day
after the date of the 2006 Annual Meeting) with the Maryland State Department of
Assessments and Taxation (the “SDAT”). If the Amendment is not approved and
filed with the Maryland State Department of Assessments and Taxation by the
Waiver Effective Date (as hereinafter defined), the Company’s Board of Directors
will, effective as of the Waiver Effective Date, reduce the Ownership Limit from
9.8% to the New Ownership Limit for all stockholders of the Company, except that
(i) the Greenlight Parties and their Controlled Affiliates will be granted an
Excepted Holder Limit equal to the Greenlight Limit pursuant to the terms and
conditions of this Agreement and (ii) any Person who then Beneficially Owns or
Constructively Owns Capital Stock in excess of the New Ownership Limit (each
such Person identified in this clause (ii), an “Excess Owner”), will pursuant to
Section 5.2(h) of the Charter, be subject to the New Ownership Limit only
prospectively, and the ability of such Excess Owner to own in excess of the New
Ownership Limit shall correspondingly be reduced as and to the extent such
Excess Owner’s percentage ownership in the Company decreases until such Excess
Owner’s percentage ownership in the Company is equal to the New Ownership Limit.
For purposes hereof, a Person and its Affiliates and Associates shall not be
treated as separate Excess Owners. The “New Ownership Limit” means, as of the
day immediately preceding the Waiver Effective Date, the greater of (i) 5% of
the lesser of the aggregate number or the aggregate value of the outstanding
shares of any class or series of Capital Stock or (ii) a percentage of the
lesser of the aggregate number or the aggregate value of the outstanding shares
of any class or series of Capital Stock where such percentage is the largest
percentage (if any) of the then outstanding Common Stock, that if utilized as
the New Ownership Limit for purposes of calculating the Greenlight Percentage
(as such term is hereinafter defined), would yield a Greenlight Percentage equal
to 19.6% taking into account the ownership of the top four beneficial owners as
of such date (other than the Greenlight Parties and their Controlled
Affiliates), where such share ownership is determined on the basis of the number
of shares of Common Stock which a Person Beneficially Owns or Constructively
Owns and a Person and its Affiliates and Associates are not treated as separate
owners.

4.2 Effective upon the earlier to occur of (a) the date of the filing of the
Amendment with the SDAT and (b) the close of business on May 11, 2006 (and
regardless of whether or not the Amendment is approved by the Company’s
stockholders) (the “Waiver Effective Date”), the Greenlight Parties, together
with their Controlled Affiliates, shall be collectively exempted from the
Ownership Limit as applied to the ownership of Common Stock, and the Greenlight
Parties, together with their Controlled Affiliates, shall be an Excepted Holder
of Common Stock, with an Excepted Holder Limit for the Greenlight Parties,
together with their Controlled Affiliates, in the aggregate equal to the
Greenlight Limit (as such term is hereinafter defined), so long as each
Greenlight Party executes and delivers on or prior to the Effective Date a tax
representation letter in the form attached as Exhibit B hereto (the “Tax
Representation Letter”) and the contents thereof are true, correct and complete
as of the date provided and the Waiver Effective Date (the “Waiver”); provided,
however, that: (a) the Greenlight Parties, together with their Controlled
Affiliates, collectively shall not Beneficially Own or Constructively Own in
excess of 19.6% in the aggregate or such lower percentage, as may be required to
calculate such percentage pursuant to Section 4.3 (the “Greenlight Percentage”)
in the lesser of the number of shares or value, of the outstanding shares of
Common Stock of the Company (the “Greenlight Limit”) or which, taking into
account any shares of Capital Stock of the Company of any other class or series
Beneficially Owned or Constructively Owned by the Greenlight Parties, together
with their Controlled Affiliates, would cause the Greenlight Parties, together
with their Controlled Affiliates, collectively to Beneficially Own or
Constructively Own, in the aggregate, in excess of the Greenlight Percentage, in
the lesser of the number of shares or value, of the outstanding shares of
Capital Stock of the Company; (b) the Greenlight Parties, together with their
Controlled Affiliates, shall not Beneficially Own or Constructively Own shares
of Common Stock which, taking into account any shares of Capital Stock of the
Company of any other class or series Beneficially Owned or Constructively Owned
by the Greenlight Parties, together with their Controlled Affiliates, would
result in the Company being “closely held” within the meaning of Section 856(h)
of the Code, or otherwise cause the Company to fail to qualify as a real estate
investment trust under the Code; (c) the Greenlight Parties, together with their
Controlled Affiliates, shall not Beneficially Own or Constructively Own an
interest in a tenant of the Company (or a tenant of any entity owned or
controlled by the Company) that would cause the Company to own, actually or
Constructively, more than a 9.9% interest (as set forth in Section 856(d)(2)(B)
of the Code) in such tenant, and (d) if at any time the Greenlight Parties,
together with their Controlled Affiliates, would Beneficially Own or
Constructively Own shares of Common Stock in violation of the conditions set
forth in clauses (a), (b) or (c) above or referred to in the Tax Representation
Letter or that would cause the representations and warranties contained in the
Tax Representation Letter to be untrue, any such shares of Common Stock
resulting in the violation of any of the conditions set forth in clauses (a),
(b) or (c) above or referred to in the Tax Representation Letter or that would
cause any of the representations and warranties contained in the Tax
Representation Letter to be untrue shall constitute Stock-in-Trust and be
treated as such as provided in and pursuant to Section 5.4 of the Charter or any
such purported Transfer shall be void ab initio.

4.3 Notwithstanding the foregoing, if the Amendment is not adopted by the
requisite vote of the stockholders of the Company and filed with the SDAT by the
Waiver Effective Date, then the Greenlight Percentage on effectiveness of the
Greenlight Waiver shall be the lesser of (x) 19.6% or (y) a percentage where the
number in such percentage is determined by subtracting from 49 the sum of the
percentage ownerships of the then outstanding Common Stock of the four owners
with the largest share ownership of shares of Common Stock as of the Waiver
Effective Date (other than the Greenlight Parties and their Controlled
Affiliates), where such share ownership is determined on the basis of the number
of shares of Common Stock which a Person Beneficially Owns or Constructively
Owns and a Person and its Affiliates and Associates are not treated as separate
owners and where if any of such four owners with the largest share ownership
owns less than the New Ownership Limit, such owner shall be deemed, for purposes
of this calculation to own an amount equal to the New Ownership Limit. From and
after the Waiver Effective Date, as and to the extent that the ownership
percentage of Common Stock Beneficially Owned or Constructively Owned of an
Excess Owner shall decrease (but limited to a decrease of ownership of Common
Stock to the New Ownership Limit), the Greenlight Percentage shall increase by
an amount equal to such decrease until such time as the Greenlight Percentage is
19.6%. In furtherance of this Section 4.3, the Company shall require each Person
who has obtained any such excess ownership on or prior to the Waiver Effective
Date to provide to the Company the information set forth in Section 5.2(e)(iii)
of the Charter prior to the Waiver Effective Date. If the Amendment is adopted
by the required vote of the Company’s stockholders after the Waiver Effective
Date and filed with the SDAT, then (I) the Greenlight Percentage shall be
increased upon the date of such filing to 19.6% and (II) to the extent permitted
by law and the Charter, including without limitation, Section 7.3 thereof, the
Company will use commercially reasonable efforts to adjust the Ownership Limit
to a percentage that would allow each of the Company’s stockholders to own the
maximum number of shares allowable under the Charter after giving effect to the
new Greenlight Limit and any other waivers then in effect.

4.4 The Waiver shall only be effective for so long as the Greenlight Parties and
their Controlled Affiliates are in compliance with the terms of this Agreement
(after giving effect to any cure period provided below) and the conditions
referred to in the Tax Representation Letter. If the Greenlight Parties or their
Controlled Affiliates shall breach any of their commitments or obligations under
this Agreement, and, if such breach is susceptible of cure, shall not have cured
such breach within ten (10) days after notice thereof from the Company, the
Waiver shall be immediately rescinded and any and all shares of Common Stock
that the Greenlight Parties and their Controlled Affiliates Beneficially Own or
Constructively Own in excess of the then existing Ownership Limit shall
constitute Stock-in-Trust and be treated as such as provided in and pursuant to
Section 5.4 of the Charter; provided, however, that any breach of the conditions
set forth in Section 4.2(a), (b) or (c) above or referred to or the
representations and warranties in the Tax Representation Letter shall not be
subject to cure or a notice period or any materiality qualifications. If the
Waiver is rescinded pursuant to the terms of the Agreement and the Amendment is
not in effect, then, to the extent permitted by law and the Charter, including
without limitation, Section 7.3 thereof, the Company will use commercially
reasonable efforts to cause the Ownership Limit to be automatically adjusted
concurrently with such rescission to a percentage that would allow each of the
Company’s stockholders to own the maximum number of shares allowable under the
Charter after giving effect to any other waivers then in effect (the
then-current Ownership Limit, as so adjusted (if applicable, the
“Post-Rescission Limit”). The Company acknowledges that only shares of Common
Stock owned by the Greenlight Parties or their Controlled Affiliates in excess
of the Post-Rescission Limit may be transferred to Trust pursuant to the Charter
in the event that the Greenlight Parties or their Controlled Affiliates cause
the rescission of the Waiver.

Section 5. Board Nomination. The Company agrees (i) to increase the size of its
Board of Directors to eleven (11) members, (ii) to increase the size of
Class III of its Board of Directors from three (3) to four (4) members, (iii) to
appoint Einhorn to its Board of Directors, as a Class III director, effective as
of March 31, 2006, to serve for the remainder of the term of the Class III
directors (which expires at the 2006 Annual Meeting) and until his successor is
duly elected and qualified, (iv) to include Einhorn in its Board of Directors’
slate of nominees for election as a Class III director of the Company at the
2006 Annual Meeting, (v) to nominate Einhorn as a member of the Company’s Board
of Directors at the 2006 Annual Meeting, (vi) not to take action to remove
Einhorn as a member of the Company’s Board of Directors other than for cause,
(vii) to cause the Company’s proxy statement for the 2006 Annual Meeting to
include a proposal to approve the Amendment and the recommendation of the Board
of Directors that the Amendment be approved, (viii) to cause all proxies
received by the Company to be voted in the manner specified by such proxies and
all proxies for which a vote is not specified to be voted for the election of
Einhorn as a member of the Company’s Board of Directors and for each other
proposal for which the Company’s Board of Directors recommends a vote in favor,
(ix) to use its commercially reasonable efforts to cause the 2006 Annual Meeting
to be held on May 10, 2006, (x) to use its commercially reasonable efforts to
ensure that the Company’s slate of directors is elected at the 2006 Annual
Meeting and each other proposal for which the Company’s Board of Directors
recommends a vote in favor are approved by the necessary stockholder vote at the
2006 Annual Meeting, and (xi) to cause its Controlled Affiliates and seek to
cause its Affiliates, to vote all shares of Common Stock over which they have
voting power in favor of the Company’s slate of directors and the Amendment,
clauses (i) through (v) above subject to Einhorn’s execution and delivery on or
prior to March 31, 2006 of the following documents, each of which has been
provided to Einhorn: (a) a Form 3, (b) a Power of Attorney (provided that the
Greenlight Parties will be provided any filing on the business day prior to the
proposed day for the filing thereof in order to review and comment), (c) the
Company’s Insider Trading Policy and acknowledgement form (it being agreed and
understood that the Greenlight Parties need only preclear the fact that the
Greenlight Parties may trade and not the specific terms of any trades with the
General Counsel or his designee), (d) the Company’s Code of Business Conduct and
Ethics and acknowledgement form, (e) the Company’s standard form of
Indemnification Agreement and (f) the Company’s standard form of director and
officer questionnaire (collectively with the documents described in clauses (a),
(b), (c), (d) and (e) above, the “Board Documents”). If at any time during the
Standstill Period, Einhorn is unable to serve, due to death or disability, as a
nominee or a director of the Company, the Greenlight Parties may select a
replacement nominee or director (a “Replacement Designee”), as the case may be,
subject to such Replacement Designee satisfying the Company’s Corporate
Governance Guidelines and completing the Board Documents.

Section 6. 2006 Annual Meeting. No Greenlight Party shall, each Greenlight Party
shall cause its Controlled Affiliates not to, and each Greenlight Party will not
authorize or knowingly permit its other Affiliates and Associates on its behalf
to, (i) solicit proxies or engage in a proxy contest with respect to the
election of directors or any other proposal to be considered at the 2006 Annual
Meeting or present any proposal for consideration at such annual meeting of
stockholders or (ii) encourage any other Person to solicit proxies or engage in
a proxy contest with respect to the election of directors or any other proposal
to be considered at the 2006 Annual Meeting or present any other proposal for
consideration at the 2006 Annual Meeting. In furtherance of the foregoing,
Greenlight LP hereby withdraws its letter dated February 16, 2006 (the
“Greenlight Notice”) providing notice to the Company of its intention to
nominate certain individuals for election as directors of the Company at the
2006 Annual Meeting (the “Stockholder Nomination”), and Greenlight LP and the
other Greenlight Parties shall immediately cease all efforts, direct or
indirect, in furtherance of the Stockholder Nomination and any related
solicitation, and any other action to obtain or influence control of the Company
(provided, that the restriction on actions to obtain or influence control of the
Company shall terminate on the ninetieth (90th) day following Einhorn joining
the Company’s Board of Directors), and shall not vote, deliver or otherwise use
any proxies heretofore obtained in connection with the Stockholder Nomination.
Unless the Company shall have breached any of its obligations under this
Agreement, and, if such breach is susceptible of cure, shall not have cured such
breach within ten (10) days after notice thereof from GCI, on behalf of the
Greenlight Parties, each Greenlight Party agrees to vote, and each Greenlight
Party shall cause its Controlled Affiliates to vote, all of its shares of
Capital Stock which it Beneficially Owns as of the record date for the 2006
Annual Meeting in favor of each of those individuals nominated for election as
directors at the 2006 Annual Meeting by the Company’s Board of Directors for
election at the 2006 Annual Meeting, in favor of the ratification of the
Company’s registered public accounting firm, in favor of the proposal to approve
the Amendment, in favor of the amendment to the Company’s 2004 Performance
Incentive Plan in substantially the form attached hereto as Exhibit C and in
favor of the amendment to the Charter to increase the number of authorized
shares of designated as preferred stock from 10,000,000 shares to 25,000,000
shares (each a “Proposal” and collectively the “Proposals”). Notwithstanding the
foregoing, the Company agrees that if the Company breaches its obligations set
forth in Section 4 or Section 5, and, if such breach is susceptible of cure,
such breach remains uncured for ten (10) days after GCI, on behalf of the
Greenlight Parties, provides the Company with notice thereof, in addition to any
other damages and injunctive relief to which the Greenlight Parties might be
entitled, the Greenlight Notice and the Stockholder Nomination will be
reinstated effective as of February 16, 2006.

Section 7. Standstill Period. Each Greenlight Party hereby agrees that, from the
date of this Agreement and continuing until the earlier of (i) 11:59 p.m.
Pacific time on the date of the Company’s 2009 annual meeting of stockholders,
(ii) the date Einhorn or a Replacement Designee, as the case may be, ceases to
serve on the Company’s Board of Directors or (iii) such date, if any, as the
Company shall have breached, and, if such breach is susceptible of cure, failed
to cure such breach within ten (10) days after notice thereof from GCI, on
behalf of the Greenlight Parties, any of its commitments or obligations
hereunder (such period, the “Standstill Period”), it shall not, and it shall
cause its Controlled Affiliates not to, and it shall not authorize or knowingly
permit its other Affiliates, Associates and Representatives on its behalf to
(and it shall not, and its Affiliates, Associates and Representatives on its
behalf shall not, assist or knowingly encourage others to), without the prior
written consent of the Company, in each instance, in any manner:

7.1 seek to have called, or cause to be called, any meeting of stockholders of
the Company, or seek or propose to influence or control the management or any
policies or actions of the Company (provided, that the restriction on seeking or
proposing to influence or control the management or any policies or actions of
the Company shall terminate on the ninetieth (90th) day following Einhorn
joining the Company’s Board of Directors) or to obtain additional representation
on the Company’s Board of Directors, or solicit or participate in the
solicitation of, any proxies or consents with respect to any securities of the
Company or seek to advise or influence any Person with respect to the voting of
any voting securities of the Company other than solicitations or acting as a
“participant” in support of all of the Company’s nominees (including Einhorn)
and the Proposals as contemplated by Section 5 with respect to the 2006 Annual
Meeting;

7.2 make or seek permission to make any public announcement with respect to any
of the matters contained in this Section 7 except as contemplated by this
Agreement;

7.3 enter into any discussions, negotiations, arrangements or understandings
with any third party with respect to any of the matters or activities described
in this Section 7, or deposit any securities of the Company in a voting trust or
subject any securities of the Company to any arrangement, understanding or
agreement with respect to the voting of such securities, or otherwise form, join
or in any way participate in a partnership, syndicate or other group (including,
without limitation, a “group” (as defined in Section 13(d)(3) of the Exchange
Act)) in connection with any of the matters or activities described in this
Section 7, or otherwise act in concert with any Person for the purpose of voting
any securities of the Company or for the purpose of taking any of the actions
described in this Section 7 other than solely with the other Greenlight Parties
or one or more of the Controlled Affiliates of any Greenlight Party; or

7.4 publicly disclose any intent, purpose, plan or proposal for the Company or
any of its Representatives to amend or waive any provision of this Section 7.

Notwithstanding the foregoing, nothing in this Agreement shall be deemed to in
any way to restrict or limit (a) Einhorn’s ability to discuss any matter
confidentially with the Company, the Company’s Board of Directors or any of its
members or (b) the Greenlight Parties’ ability to communicate, on a confidential
basis, with their Representatives.

Section 8. Non-Disparagement. During the Standstill Period, all of the parties
hereto agree not to, agree to cause their Controlled Affiliates not to, and
agree not to authorize or knowingly permit on its behalf their other Affiliates,
Associates and Representatives to, publicly take any action or make any
statement, written or oral, which disparages the other or its Affiliates,
Associates or Representatives, or prior to the ninetieth (90th) day following
Einhorn joining the Company’s Board of Directors, its business or practices or
the decisions of the Company’s Board of Directors, other than in connection with
confidential, non-public discussions between Einhorn and the Company; provided,
however, that at any time after the ninetieth (90th) day following Einhorn
joining the Company’s Board of Directors, this Section 8 shall not prevent
Einhorn from taking any action or making any statement, written or oral, which
may be deemed to disparage the Company, the Company’s business or practices or
the decisions of the Company’s Board of Directors.

Section 9. Termination of Confidentiality Agreement. The Company and GCI hereby
terminate that certain Confidentiality Agreement between the Company and GCI
dated as of September 9, 2005, effective upon the Effective Date. Such agreement
shall be of no further force and effect after the Effective Date, and neither
the Company nor GCI shall have any surviving obligations, rights, or duties
thereunder after the Effective Date.

Section 10. Role of Mr. Einhorn on the Board. Einhorn or a Replacement Designee,
as the case may be, upon election to the Company’s Board of Directors, will be
governed by the same protections and obligations regarding confidentiality,
conflicts of interests, fiduciary duties, trading and disclosure policies and
other governance guidelines, and shall have the same rights and benefits,
including (but not limited to) with respect to insurance, compensation and fees,
as are applicable to all independent directors of the Company. Subject to the
terms and conditions of the Company’s equity incentive plans and applicable law,
Einhorn or a Replacement Designee, as the case may be, may allocate any
compensation received in connection with serving on the Company’s Board of
Directors to any of the Greenlight Parties.

Section 11. Public Announcement; Filings.

11.1 The Company and the Greenlight Parties shall announce this Agreement and
the material terms hereof by means of a joint press release in the form of
Exhibit D hereto (the “Press Release”) as soon as practicable on or after the
date hereof. Neither the Company, the Greenlight Parties nor any of their
respective Controlled Affiliates shall issue, and shall not authorize or
knowingly permit on its behalf their other Affiliates, Associates and
Representatives to issue, any other press releases or make any filings with the
SEC concerning the terms hereof or the relationship between the parties without
the prior written consent of the other, which consent shall not be unreasonably
withheld, delayed or conditioned, except where such announcement is required by
applicable law, the rules of any applicable securities exchange or valid legal
process, in which case the parties shall consult with each other in advance to
the extent reasonably practicable. Notwithstanding the foregoing, the Company
acknowledges that the Greenlight Parties will, subject to the Company’s right to
be consulted pursuant to the foregoing sentence, file an amendment to their
Schedule 13D which may contain the Press Release and this Agreement as an
exhibit and explain that Greenlight LP is withdrawing the Greenlight Notice.

11.2 The Company agrees that the Company’s proxy statement for the 2006 Annual
Meeting and all other solicitation materials to be delivered to stockholders in
connection with the 2006 Annual Meeting will be prepared in accordance with, and
in furtherance of, this Agreement. The Company will provide the Greenlight
Parties with copies of any proxy materials or other solicitation materials at
least two (2) business days, in the case of proxy statements, and at least one
(1) business day, in the case of other solicitation materials, in advance of
filing such materials with the SEC or disseminating the same in order to permit
the Greenlight Parties a reasonable opportunity to review and comment on such
materials. The Greenlight Parties will provide as promptly as reasonably
practicable all information required under applicable law to be included in the
Company’s proxy statement for the 2006 Annual Meeting and any other solicitation
materials to be delivered to stockholders of the Company in connection with the
2006 Annual Meeting.

Section 12. No Impairment. The Company will not take any action, by amendment of
the Charter or its Bylaws, through reorganization, merger, dissolution or any
other voluntary action, to avoid or seek to avoid the observance or performance
of any of the terms of this Agreement, but will at all times in good faith
assist in the carrying out of all such terms and in the taking of all such
action as may be necessary or appropriate in order to protect the rights of the
Greenlight Parties against impairment. Without limiting the foregoing, the
Company will not (a) adopt a shareholder rights plan pursuant to which rights
would become exercisable as a result of the Greenlight Parties having Beneficial
Ownership of, or becoming the Beneficial Owners of, a percentage of shares of
Common Stock that is equal to or less than the Greenlight Limit, (b) elect to be
governed by the Maryland Business Combination Act (the “MBCA”) such that any of
the Greenlight Parties or their respective Affiliates would be an “interested
stockholder” under the MBCA, (c) elect to be governed by the Maryland Control
Share Acquisition Act (the “MCSAA”) such that a vote of stockholders under the
MCSAA would be required for any of the Greenlight Parties or their Affiliates to
have voting rights with respect to any of the shares of Common Stock held or
acquired by them up to the Greenlight Limit, (d) prior to the effective date of
the Amendment, issue any shares of Capital Stock to any Person that would be
included in the computation under Section 4.3 or (e) so long as the description
of Einhorn’s relationship to the Greenlight Parties set forth in the
Schedule 13D filed by Einhorn and certain other Greenlight Parties (as amended
through the date hereof) and in the Greenlight Notice remains accurate in all
material respects, assert that the condition set forth in Section 3(b) of the
Tax Representation Letter or Section 4.2(b) of this Agreement is breached as a
result of Einhorn’s Beneficial Ownership or Constructive Ownership of Common
Stock (but excluding ownership directly or indirectly under Section 542(a)(2) of
the Code, taking into account, for this purpose, constructive ownership
determined under Section 544 of the Code, as modified by Section 856(h)(1)(B) of
the Code).

Section 13. Miscellaneous. Each of the parties hereto hereby irrevocably and
unconditionally consent to submit to the jurisdiction of the courts of the State
of Maryland and the United States of America, for any actions, suits or
proceedings arising out of or relating to this Agreement and the transactions
contemplated hereby, and further agree that service of any process, summons,
notice or document by United States registered mail shall be effective service
of process for any action, suit or proceeding brought against such party in any
such court. Each of the parties hereto hereby irrevocably and unconditionally
waive, and will cause their respective Controlled Affiliates to waive, any
objection to the laying of venue of any action, suit or proceeding arising out
of this Agreement or the transactions contemplated hereby, in the courts of the
State of Maryland and the United States of America, and hereby further
irrevocably and unconditionally waive, and will cause their respective
Controlled Affiliates to waive, and agree not to plead or claim in any such
court that any such action, suit or proceeding brought in any such court has
been brought in an inconvenient forum. THIS AGREEMENT SHALL BE GOVERNED IN ALL
RESPECTS, INCLUDING VALIDITY, INTERPRETATION AND EFFECT, BY THE LAWS OF THE
STATE OF MARYLAND APPLICABLE TO CONTRACTS EXECUTED AND TO BE PERFORMED WHOLLY
WITHIN SUCH STATE WITHOUT GIVING EFFECT TO THE CHOICE OF LAW PRINCIPLES OF SUCH
STATE.

Section 14. Remedies. It is understood and agreed that money damages would not
be a sufficient remedy for any actual or threatened breach of this Agreement by
the Greenlight Parties or the Company and their respective Affiliates,
Associates or Representatives and that the Company and the Greenlight Parties
shall be entitled to equitable relief, including injunctions and specific
performance, as a remedy for any such breach and the Greenlight Parties and the
Company agree to waive, and to cause their Controlled Affiliates to waive, any
requirement for the securing or posting of any bond in connection with any such
remedy and agrees not to make a motion or demand therefor. Such remedies shall
not be deemed to be the exclusive remedies available to the Company or the
Greenlight Parties for a breach of this Agreement by the Greenlight Parties or
the Company, respectively, or any of their Affiliates, Associates or
Representatives, but shall be in addition to all other rights and remedies
otherwise available at law or equity to the Company.

Section 15. Assignment. None of the Greenlight Parties may transfer, assign,
pledge or hypothecate, by operation of law or otherwise, its rights and
obligations under this Agreement without the prior written consent of the
Company, except that a Greenlight Party may assign its rights and obligations
hereunder without prior written consent of the Company to any Controlled
Affiliate of a Greenlight Party, provided that no such assignment shall relieve
the assigning party of its obligations hereunder, and any such assignee must
execute and deliver to the Company a countersigned copy of the Tax
Representation Letter.

Section 16. Fees and Expenses. Within fifteen (15) business days after receiving
documentation thereof, the Company shall pay to GCI, on behalf of all of the
Greenlight Parties, the documented out-of-pocket fees and expenses, including
without limitation the fees and expenses of any Representatives, up to a maximum
of $300,000 (the “Cap”), incurred through the Effective Date by the Greenlight
Parties in connection with this Agreement, any discussions between the
Greenlight Parties and the Company after the filing of Amendment No. 3 to the
Greenlight Parties’ Schedule 13D filed with the SEC on April 28, 2005 and the
proxy contest referred to in the Greenlight Notice. All fees and expenses in
excess of the Cap, as well as all fees and expenses incurred by the Company,
including without limitation the fees and expenses of any Representatives, shall
be paid by the party incurring such fees and expenses.

Section 17. Notice. All notices and other communications hereunder shall be in
writing and shall be deemed given if delivered personally or by commercial
messenger or courier service, or mailed by registered or certified mail (return
receipt requested) or sent via facsimile (with acknowledgment of complete
transmission) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice); provided, however,
that notices sent by mail will not be deemed given until received:

17.1 if to the Company, to:

New Century Financial Corporation
18400 Von Karman, Suite 1000
Irvine, California 92612
Attention: Stergios Theologides, Esq.
Facsimile No.: (949) 440-7033

with a copy to:
O’Melveny & Myers LLP
610 Newport Center Drive, 17th Floor
Newport Beach, California 92660
Attention: David Krinsky, Esq.
Facsimile No: (949) 823-6994

and to:

O’Melveny & Myers LLP
Times Square Tower
7 Times Square
New York, New York 10036
Attention: Spencer Klein, Esq.
Facsimile No: (212) 326-2061

17.2 if to the Greenlight Parties, to:

Greenlight Capital, Inc.
2 Grand Central Tower
140 East 45th Street, 24th Floor
New York, New York 10017
Attention: Mr. Daniel Roitman
Facsimile No.: (212) 973-9219

with a copy to:

Akin Gump Strauss Hauer & Feld LLP
1700 Pacific Avenue, Suite 4100
Dallas, Texas 75201
Attention: Eliot D. Raffkind, Esq.
Facsimile No.: (214) 969-4343

Section 18. Counterparts. This Agreement may be executed in two or more
counterparts which together shall constitute a single agreement.

[Remainder of Page Intentionally Left Blank]

1

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
duly authorized signatories of the parties as of the Effective Date.

NEW CENTURY FINANCIAL CORPORATION

By: /s/ Brad A. Morrice

Name: Brad A. Morrice
Title: Vice Chairman, President and COO

GREENLIGHT CAPITAL, L.P.

By: Greenlight Capital, L.L.C.
its general partner

By: /s/ David Einhorn

Name: David Einhorn
Title: Senior Managing Member

GREENLIGHT CAPITAL L.L.C.

By: /s/ David Einhorn

Name: David Einhorn
Title: Senior Managing Member

GREENLIGHT CAPITAL, INC.

By: /s/ David Einhorn

Name: David Einhorn
Title: President

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
duly authorized signatories of the parties as of the Effective Date.

DME ADVISORS, L.P.

By: DME Advisors GP, L.L.C.
its general partner

By: /s/ David Einhorn

Name: David Einhorn
Title: Senior Managing Member

DME ADVISORS GP, L.L.C.

By: /s/ David Einhorn

Name: David Einhorn
Title: Senior Managing Member

GREENLIGHT CAPITAL QUALIFIED, L.P.

By: Greenlight Capital, L.L.C.
its general partner

By: /s/ David Einhorn

Name: David Einhorn
Title: Senior Managing Member

GREENLIGHT CAPITAL OFFSHORE, LTD.

By: Greenlight Capital, Inc.

its investment advisor

By: /s/ David Einhorn

Name: David Einhorn
Title: President

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the
duly authorized signatories of the parties as of the Effective Date.

DAVID EINHORN

/s/ David Einhorn

2

Schedule A

Share Ownership Information

For the purposes hereof, “beneficial ownership” has the meaning of such term
under Section 13(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), and Regulation 13D-G thereunder. Greenlight Capital, L.P. and
Greenlight Capital Qualified, L.P. (collectively the “Domestic Funds”) may be
deemed to “beneficially own” (within the meaning of such term under
Section 13(d) of the Exchange Act, and Regulation 13D-G thereunder) 613,000 and
1,902,300 shares of common stock (“Common Stock”) of New Century Financial
Corporation respectively. Greenlight Capital, L.L.C., as the general partner of
each of the Domestic Funds, directs the voting and disposition of the shares
owned by Domestic Funds and, therefore, may be deemed the “beneficial owner” of
any shares that may be beneficially owned by the Domestic Funds within the
meaning of Section 13(d) of the Exchange Act and Regulation 13D-G thereunder.
Greenlight Capital, Inc. is party to an investment advisory contract with
Greenlight Capital Offshore, Ltd., pursuant to which Greenlight Capital, Inc.
has sole voting and dispositive power over any shares that Greenlight Capital
Offshore, Ltd. owns. Greenlight Capital, Inc., as the investment manager of
Greenlight Capital Offshore, Ltd., may be deemed the “beneficial owner” of the
2,583,500 shares of Common Stock that may be beneficially owned by Greenlight
Capital Offshore, Ltd. within the meaning of Section 13(d) of the Exchange Act
and Regulation 13D-G thereunder. DME Advisors, L.P., as investment advisor to a
managed account, and its general partner, DME Advisors GP, L.L.C., may be deemed
the “beneficial owner” of the 400,800 shares of Common Stock that may be
beneficially owned by such managed account within the meaning of Section 13(d)
of the Exchange Act and Regulation 13D-G thereunder. As the Senior Managing
Member of Greenlight Capital, L.L.C. and DME Advisors GP, L.L.C. and the
President of Greenlight Capital, Inc., David Einhorn directs the voting and
disposition of all of the 5,500,000 shares of Common Stock described above and,
therefore, may be deemed the “beneficial owner” of all of such shares within the
meaning of Section 13(d) of the Exchange Act and Regulation 13D-G thereunder.
Each of David Einhorn, Greenlight Capital, L.L.C., Greenlight Capital, Inc., DME
Advisors GP, L.L.C. and DME Advisors, LP disclaims all beneficial ownership over
the shares owned by Greenlight Capital, L.P., Greenlight Capital Qualified,
L.P., Greenlight Capital Offshore, Ltd. and the managed account for which DME
Advisors, LP acts as investment advisor.

3

Exhibit A

Form of Amendment

“5.2 “Restrictions on Transfer and Ownership of Capital Stock.

Subsequent to the Initial Date (as defined below) and until the Restriction
Termination Date (as defined below), all Capital Stock of the Corporation shall
be subject to the following restrictions and limitations:

(a) Definitions. For purposes of this Article V and the interpretation of the
stock legends set forth herein, the following terms shall have the following
meanings:

“Acquire” shall mean the acquisition of Beneficial Ownership or Constructive
Ownership of Capital Stock, whether by a Transfer, Non-Transfer Event or by any
other means, including, without limitation, acquisition pursuant to the exercise
of the Acquisition Rights or any other option, warrant, pledge or other security
interest or similar right to acquire Capital Stock, but shall not include the
acquisition of any such rights unless, as a result, the acquirer would be
considered a Beneficial Owner or Constructive Owner, each as defined below.

“Acquisition Rights” shall mean, rights to Acquire Capital Stock pursuant to:
(i) the exercise of any option or warrant issued by the Corporation; or (ii) any
pledge of Capital Stock.

“Beneficial Ownership” shall mean ownership of Capital Stock by a Person who
would be treated as an owner of Capital Stock either directly or indirectly,
including directly or indirectly under Section 542(a)(2) of the Code, taking
into account, for this purpose, constructive ownership determined under
Section 544 of the Code, as modified by Section 856(h)(1)(B) of the Code (except
where expressly provided otherwise). The terms “Beneficial Owner,” “Beneficially
Owns” and “Beneficially Owned” shall have the correlative meanings.

“Business Day” shall mean any day, other than a Saturday or Sunday, that is
neither a legal holiday nor a day on which banking institutions in New York City
are authorized or required by law, regulation or executive order to close.

“Charitable Beneficiary” shall mean, with respect to any Trust, one or more
organizations described in each of Section 170(b)(1)(A) (other than clauses
(vii) or (viii) thereof) and Section 170(c)(2) of the Code that are named by the
Corporation as the beneficiary or beneficiaries of such Trust, in accordance
with the provisions of Section 5.4(a) hereof.

“Code” shall mean the Internal Revenue Code of 1986, as amended and in effect
from time to time, or any successor statute thereto, as interpreted by the
applicable regulations thereunder. Any reference herein to a specific section or
sections of the Code shall be deemed to include a reference to any corresponding
provision of future law.

“Constructive Ownership” shall mean ownership of Capital Stock by a Person who
would be treated as an owner of such Capital Stock either directly or
constructively through the application of Section 318 of the Code, as modified
by Section 856(d)(5) of the Code. The terms “Constructively Own,”
“Constructively Owned” and “Constructive Owner” shall have the correlative
meanings.

“Disqualified Organization” shall mean the United States, any state or political
subdivision thereof, any foreign government, any international organization, any
agency or instrumentality of any of the foregoing, any other tax-exempt
organization (other than a farmer’s cooperative that is described in Section 521
of the Code) that is both exempt from income taxation and exempt from taxation
under the unrelated business taxable income provisions of the Code, and any
rural electrical or telephone cooperative (all as referred to in
Section 860E(e)(5) of the Code).

“Excepted Holder” shall have the meaning set forth in Section 5.2(f).

“Excepted Holder Limit” shall mean, provided that the affected Excepted Holder
agrees to comply with the requirements established by the Board of Directors
pursuant to Section 5.2(f), and subject to adjustment pursuant to
Section 5.2(h), the percentage limit on Beneficial Ownership or Constructive
Ownership of shares of Capital Stock established by the Board of Directors
pursuant to Section 5.2(f).

“Initial Date” shall mean October 1, 2004.

“Market Price” on any date shall mean, with respect to any class or series of
outstanding shares of Capital Stock, the Closing Price for such Capital Stock on
such date. The “Closing Price” on any date shall mean the last sale price for
such  shares, regular way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, for such shares, in
either case as reported in the principal consolidated transaction reporting
system with respect to securities listed or admitted to trading on the NYSE or,
if such shares are not listed or admitted to trading on the NYSE, as reported on
the principal consolidated transaction reporting system with respect to
securities listed on the principal national securities exchange on which such
shares are listed or admitted to trading or, if such shares are not listed or
admitted to trading on any national securities exchange, the last quoted price,
or, if not so quoted, the average of the high bid and low asked prices in the
over-the-counter market, as reported by the National Association of Securities
Dealers, Inc., Automated Quotation System, or, if such system is no longer in
use, the principal other automated quotation system that may then be in use or,
if such shares are not quoted by any such organization, the average of the
closing bid and asked prices as furnished by a professional market maker making
a market in such shares selected by the Board of Directors or, in the event that
no trading price is available for such shares, the fair market value of the
shares, as determined in good faith by the Board of Directors.

“MGCL” shall mean the Maryland General Corporation Law, as amended from time to
time.

“NYSE” shall mean the New York Stock Exchange, Inc.

“Non-Transfer Event” shall mean an event other than a purported Transfer that
would cause any Person to Beneficially Own or Constructively Own Capital Stock
in excess of the Ownership Limit (or would cause the Corporation to fail to
qualify as a REIT), including, without limitation, a change in the capital
structure of the Corporation.

“Ownership Limit” shall mean not more than 9.8% of the lesser of the aggregate
number or the aggregate value of the outstanding shares of any class or series
of Capital Stock. The value of the outstanding shares of Capital Stock shall be
determined by the Board of Directors, which determination shall be conclusive
for all purposes hereof.

“Person” shall mean an individual, corporation, partnership, limited liability
company or partnership, estate, trust (including a trust qualified under Section
401(a) or 501(c)(17) of the Code), a portion of a trust permanently set aside
for or to be used exclusively for the purposes described in Section 642(c) of
the Code, association, private foundation within the meaning of Section 509(a)
of the Code, joint stock company or other entity and also includes a group as
that term is used for purposes of Section 13(d)(3) of the Securities Exchange
Act of 1934, as amended, provided, however, that this shall not include an
underwriter which participates in a registered public offering of the
Corporation’s Capital Stock (or securities convertible into or exchangeable for
Capital Stock) or an initial purchaser which participates in a private placement
of shares of the Corporation’s Capital Stock (or securities convertible into or
exchangeable for Capital Stock), but only for a period of ninety (90) days
following the date of purchase of shares of Capital Stock by the underwriter in
such public offering or the initial purchaser in such private placement and only
to the extent that purchases of shares of Capital Stock by such underwriter or
initial purchaser in such public offering or private placement are necessary to
facilitate such public offering or private placement.

“Prohibited Owner” shall mean, with respect to any purported Transfer, any
Person who, but for the provisions of Section 5.2(b), would Beneficially Own or
Constructively Own shares of Capital Stock, and if appropriate in the context,
shall also mean any Person who would have been the record owner of the shares
that the Prohibited Owner would have so owned.

“Restriction Termination Date” shall mean the first day after the Initial Date
on which the Corporation determines pursuant to Section 7.3 of this Charter that
it is no longer in the best interests of the Corporation to attempt to, or
continue to, qualify as a REIT or that compliance with the restrictions and
limitations on Beneficial Ownership, Constructive Ownership and Transfers of
shares of Capital Stock set forth herein is no longer required in order for the
Corporation to qualify as a REIT.

“Stock-in-Trust” shall mean any Capital Stock designated Stock-in-Trust pursuant
to Section 5.4(a).

“Transfer” (as a noun) shall mean any sale, transfer, gift, assignment, devise
or other disposition of Capital Stock or the right to vote or receive dividends
on Capital Stock (including without limitation (i) the granting of any option or
entering into any agreement for the sale, transfer or other disposition of
Capital Stock or the right to vote or receive dividends on Capital Stock or
(ii) the sale, transfer, assignment or other disposition or grant of any
Acquisition Rights or other securities or rights convertible into or
exchangeable for Capital Stock, or the right to vote or receive dividends on
Capital Stock), whether voluntary or involuntary, whether of record or
beneficially and whether by operation of law or otherwise. “Transfer” shall also
include any transfer of interests in other entities, and any change in
relationship between two or more Persons, that results in a change in Beneficial
Ownership or Constructive Ownership of Capital Stock, whether by operation of
law or otherwise. “Transfer” (as a verb) shall have a correlative meaning.

“Trust” shall mean any separate trust created pursuant to Section 5.4(a) below
and administered in accordance with the terms of Section 5.4 hereof, for the
exclusive benefit of any Charitable Beneficiary.

“Trustee” shall mean the trustee of the Trust, which is selected by the
Corporation but not affiliated with the Corporation or a Prohibited Owner, and
any successor trustee appointed by the Corporation.

(b) Ownership Limitation and Transfer Restrictions.

(i) Except as provided in Section 5.2(f) below, from and after the Initial Date
and prior to the Restriction Termination Date:

(v) no Disqualified Organization shall be a record holder of any shares of
Capital Stock;

(w) no Person shall Beneficially Own or Constructively Own Capital Stock in
excess of the Ownership Limit;

(x) no Person shall Acquire Capital Stock, if, as a result of such action, the
Capital Stock would be beneficially owned by fewer than 100 Persons (determined
without reference to any rules of attribution under the Code);

(y) no Person shall Acquire Capital Stock or any interest therein if, as a
result of such acquisition, the Corporation would be “closely held” within the
meaning of Section 856(h) of the Code or would otherwise fail to qualify as a
REIT, as the case may be; and

(z) no Person shall Acquire Capital Stock or any interest therein if, as a
result of such acquisition, the Corporation would Constructively Own 10% or more
of the ownership interests in a tenant of the Corporation’s real property,
within the meaning of Section 856(d)(2)(B) of the Code, or would otherwise fail
to qualify as a REIT, as the case may be.

(ii) Subject to Section 5.7, any Transfer that would result in a violation of
the restrictions in subsection (b)(i) above, shall be void ab initio as to the
purported Transfer of such number of shares of Capital Stock that would cause
the violation of the applicable restriction in subsection (b)(i), and the
Prohibited Owner or transferee, as applicable, shall acquire no rights in such
shares of Capital Stock.

(c) Automatic Transfer to Trust.

(i) If, notwithstanding the other provisions contained in this Article V but
subject to Section 5.7 below, at any time from and after the Initial Date and
prior to the Restriction Termination Date, there is a purported Transfer or
Non-Transfer Event such that any Person would either Beneficially Own or
Constructively Own Capital Stock in excess of the Ownership Limit, then, except
as otherwise provided in Section 5.2(f) below, (x) the Prohibited Owner shall
acquire no right or interest (or, in the case of a Non-Transfer Event, the
person holding record title to the  shares of Capital Stock Beneficially Owned
or Constructively Owned by such Beneficial Owner or Constructive Owner, shall
cease to own any right or interest) in such number of shares of Capital Stock
which would cause such Prohibited Owner to Beneficially Own or Constructively
Own Capital Stock in excess of the Ownership Limit (rounded up to the nearest
whole share), (y) such number of shares of Capital Stock in excess of the
Ownership Limit (rounded up to the nearest whole share) shall be designated
Stock-in-Trust and, in accordance with the provisions of Section 5.4(a) below,
transferred automatically and by operation of law to the Trust to be held in
accordance with Section 5.4 hereof, and (z) such Prohibited Owner shall submit
such number of shares of Capital Stock to the Trust for registration in the name
of the Trustee. Any Prohibited Owner shall acquire no right or interest (or, in
the case of a Non-Transfer Event, the person holding title to the shares
Beneficially Owned or Constructively Owned by such Beneficial Owner or
Constructive Owner, shall cease to own any right or interest) in such number of
shares which would cause such person to own shares in excess of the Ownership
Limit. Such transfer to a Trust and the designation of shares as Stock-in-Trust
shall be effective as of the close of business on the business day prior to the
date of the Transfer or Non-Transfer Event, as the case may be.

(ii) If, notwithstanding the other provisions contained in this Article V but
subject to Section 5.7 below, at any time from and after the Initial Date and
prior to the Restriction Termination Date, there is a purported Transfer or
Non-Transfer Event that, if effective, would (i) result in the Capital Stock
being beneficially owned by fewer than 100 persons (determined without reference
to any rules of attribution), (ii) result in the Corporation being “closely
held” within the meaning of Section 856(h) of the Code, (iii) cause the
Corporation to Constructively Own 10% or more of the ownership interests in a
tenant of the Corporation’s real property, within the meaning of
Section 856(d)(2)(B) of the Code, or (iv) cause the Corporation to otherwise
fail to qualify as a REIT, as the case may be, then (x) the Prohibited Owner
shall acquire no right or interest (or, in the case of a Non-Transfer Event, the
person holding record title to the Capital Stock with respect to which such
Non-Transfer Event occurred, shall cease to own any right or interest) in such
number of shares of Capital Stock, the ownership of which by such Prohibited
Owner would (A) result in the Capital Stock being beneficially owned by fewer
than 100 Persons (determined without reference to any rules of attribution),
(B) result in the Corporation being “closely held” within the meaning of Section
856(h) of the Code, (C) cause the Corporation to Constructively Own 10% or more
of the ownership interests in a tenant of the Corporation’s property, within the
meaning of Section 856(d)(2)(B) of the Code, or (D) would otherwise cause the
Corporation to fail to qualify as a REIT, as the case may be, (y)  such number
of  shares of Capital Stock (rounded up to the nearest whole share) shall be
designated Stock-in-Trust and, in accordance with the provisions of
Section 5.4(a) below, transferred automatically and by operation of law to the
Trust to be held in accordance with Section 5.4 hereof, and (z) the Prohibited
Owner shall submit such number of shares of Capital Stock to the Trust for
registration in the name of the Trustee.

(iii) If, notwithstanding the other provisions contained in this Article V but
subject to Section 5.7 below, at any time from and after the Initial Date, there
is a purported Transfer or other event that, if effective, would result in the
Capital Stock being owned by a Disqualified Organization as a record holder,
then (x) the Disqualified Organization shall acquire no right or interest (or,
in the case of such other event other than a Transfer, the person holding record
title to the Capital Stock with respect to which such other event has occurred,
shall cease to own any right or interest) in such number of shares of Capital
Stock, the ownership of which would result in the Capital Stock being owned by a
Disqualified Organization as a record holder, (y) such number of shares of
Capital Stock (rounded up to the nearest whole share) shall be designated
Stock-in-Trust and, in accordance with the provisions of Section 5.4(a) below,
transferred automatically and by operation of law to the Trust to be held in
accordance with Section 5.4 hereof, and (z) the Disqualified Organization (or,
in the case of such other event other than a Transfer, the person holding record
title to the Capital Stock with respect to which such other event has occurred)
shall submit such number of shares of Capital Stock to the Trust for
registration in the name of the Trustee.

(d) Remedies for Breach. If the Board of Directors or an authorized designee
shall at any time determine that a purported Transfer of Capital Stock has taken
place in violation of Section 5.2(b) above or that a Person intends to acquire
or has attempted to acquire beneficial ownership (determined without reference
to any rules of attribution), Beneficial Ownership or Constructive Ownership of
any Capital Stock of the Corporation in violation of Section 5.2(b) above, the
Board of Directors or an authorized designee shall take such action as it deems
advisable to refuse to give effect to or to prevent such Transfer or
acquisition, including, but not limited to, refusing to give effect to such
Transfer or acquisition on the books of the Corporation or instituting
proceedings to enjoin such Transfer or acquisition; provided, however, that any
Transfer, attempted Transfer, acquisition or attempted acquisition in violation
of Section 5.2(b)(i) above shall automatically result in the transfer described
in Section 5.2(c) above, irrespective of any action (or non-action) by the Board
of Directors, except as provided in Section 5.2(f) below.

(e) Notice of Restricted Transfer.

(i) Any Person who acquires or attempts to Acquire Capital Stock in violation of
Section 5.2(b) above, and any Person who is a Prohibited Owner of Capital Stock
that is transferred to a Trust under Section 5.2(c) above, shall immediately
give written notice to the Corporation of such event or, in the case of such a
proposed or attempted transaction, give at least 15 days prior written notice,
and shall provide to the Corporation such other information as the Corporation
may request in order to determine the effect, if any, of such Transfer or
attempted Transfer or such Non-Transfer Event on the Corporation’s status as a
REIT.

(ii) From and after the Initial Date and prior to the Restriction Termination
Date every Beneficial Owner or Constructive Owner of more than 5%, in the case
that the Corporation has 2,000 or more stockholders of record, or 1%, in the
case that the Corporation has more than 200 but fewer than 2,000 stockholders of
record, or such other percentage as may be provided from time to time in the
pertinent income tax regulations promulgated under the Code, of the number or
value of the outstanding shares of Capital Stock of the Corporation shall,
within 30 days after the end of each taxable year, give written notice to the
Corporation stating the name and address of such Beneficial Owner or
Constructive Owner, the number of  shares of Capital Stock Beneficially or
Constructively Owned, and a description of the manner in which such shares are
held. Each such Beneficial Owner or Constructive Owner shall provide to the
Corporation such additional information that the Corporation may reasonably
request in order to determine the effect, if any, of such Beneficial or
Constructive Ownership on the Corporation’s status as a REIT and to ensure
compliance with the Ownership Limit; and

(iii) From and after the Initial Date and prior to the Restriction Termination
Date, each Person who is a Beneficial Owner or Constructive Owner of Capital
Stock of the Corporation and each Person (including the stockholder of record)
who is holding Capital Stock of the Corporation for a Beneficial Owner or
Constructive Owner shall provide to the Corporation such information as the
Corporation may reasonably request in order to determine the Corporation’s
status as a REIT, to comply with the requirements of any taxing authority or
governmental agency or to determine any such compliance and to ensure compliance
with the Ownership Limit.

(f) Exemption. The Board of Directors may, but shall in no case be required to,
exempt a Person (the “Excepted Holder”) from the Ownership Limit and establish
an Excepted Holder Limit for such Excepted Holder, if the Board of Directors
concludes that no Person will, as the result of the ownership of Capital Stock
by the Excepted Holder, be considered to have Beneficial Ownership or
Constructive Ownership of an amount of Capital Stock that will violate the
restrictions contained in Sections 5.2(b)(i)(x), 5.2(b)(i)(y) or 5.2(b)(i)(z)
above; provided, that:

(i) the Board of Directors obtains such representations and undertakings from
each of the Excepted Holder and such other Persons as are reasonably necessary
to ascertain that no individual’s (as defined in Section 542(c)(2) of the Code)
Beneficial Ownership or Constructive Ownership of Capital Stock will violate the
Ownership Limit or the restrictions contained in Sections 5.2(b)(i)(x),
5.2(b)(i)(y) or 5.2(b)(i)(z);

(ii) each of the Excepted Holder and such other Persons does not own and
represents that it will not own, actually or Constructively, an interest in a
tenant of the Corporation (or a tenant of any entity owned or controlled by the
Corporation) that would cause the Corporation to own, actually or
Constructively, more than a 9.9% interest (as set forth in Section 856(d)(2)(B)
of the Code) in such tenant and the Board of Directors obtains such
representations and undertakings from such Person as are reasonably necessary to
ascertain this fact (for this purpose, a tenant from whom the Corporation (or an
entity owned or controlled by the Corporation) derives (and is expected to
continue to derive) a sufficiently small amount of revenue such that, in the
opinion of the Board of Directors, rent from such tenant would not adversely
affect the Corporation’s ability to qualify as a REIT, shall not be treated as a
tenant of the Corporation); and

(iii) the Excepted Holder agrees that any violation or attempted violation of
any conditions invoked by the Board of Directors will result in such transfer to
the Trust of Capital Stock pursuant to Section 5.2(c) hereof.

In making any determination to exempt a Person from the Ownership Limit, the
Board of Directors may, in its sole discretion, but shall be under no obligation
to, require a certified copy of a ruling from the Internal Revenue Service or an
opinion of counsel, both in form and substance satisfactory to the Board of
Directors.

Notwithstanding the receipt of any such ruling or opinion, the Board of
Directors may impose such conditions or restrictions as it deems appropriate in
connection with granting such exception.

Unless and until a Person is exempted from the Ownership Limit by the Board of
Directors, the Ownership Limit shall apply to such Person, notwithstanding the
fact that if such Person were otherwise to Acquire Capital Stock in excess of
the Ownership Limit, such Acquisition would not adversely affect the
Corporation’s qualification as a REIT under the Code.

(g) Legend. For so long as the Board of Directors deems appropriate, each
certificate for shares of Capital Stock shall bear substantially the following
legend:

“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO RESTRICTIONS ON
BENEFICIAL AND CONSTRUCTIVE OWNERSHIP AND TRANSFER FOR THE PURPOSE OF THE
CORPORATION’S MAINTENANCE OF ITS STATUS AS A REAL ESTATE INVESTMENT TRUST
(“REIT”) UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”).
SUBJECT TO CERTAIN FURTHER RESTRICTIONS AND EXCEPT AS EXPRESSLY PROVIDED IN THE
CHARTER, (I) NO PERSON MAY BENEFICIALLY OR CONSTRUCTIVELY OWN SHARES OF ANY
CLASS OR SERIES OF THE CORPORATION’S CAPITAL STOCK IN EXCESS OF 9.8% (AS MAY BE
ADJUSTED FROM TIME TO TIME BY THE BOARD OF DIRECTORS) OF THE LESSER OF THE
AGGREGATE NUMBER OR THE AGGREGATE VALUE OF THE OUTSTANDING SHARES OF ANY CLASS
OR SERIES OF CAPITAL STOCK OF THE CORPORATION UNLESS SUCH PERSON IS AN EXCEPTED
HOLDER (IN WHICH CASE THE EXCEPTED HOLDER LIMIT SHALL BE APPLICABLE); (II) NO
PERSON MAY BENEFICIALLY OR CONSTRUCTIVELY OWN SHARES OF CAPITAL STOCK THAT WOULD
RESULT IN THE CORPORATION BEING “CLOSELY HELD” UNDER SECTION 856(hH) OF THE CODE
OR OTHERWISE CAUSE THE CORPORATION TO FAIL TO QUALIFY AS A REIT; AND (III) NO
PERSON MAY TRANSFER SHARES OF CAPITAL STOCK IF SUCH TRANSFER WOULD RESULT IN THE
CAPITAL STOCK OF THE CORPORATION BEING OWNED BY FEWER THAN 100 PERSONS; (IV) NO
PERSON MAY TRANSFER SHARES OF CAPITAL STOCK IF SUCH TRANSFER WOULD RESULT IN THE
CORPORATION CONSTRUCTIVELY OWNING 10% OR MORE OF THE OWNERSHIP INTERESTS IN A
TENANT OF THE CORPORATION’S REAL PROPERTY, WITHIN THE MEANING OF SECTION
856(D)(2)(B) OF THE CODE, OR WOULD OTHERWISE FAIL TO QUALIFY AS A REIT; AND
(V) NO DISQUALIFIED ORGANIZATION SHALL BE A RECORD HOLDER OF ANY SHARES OF
CAPITAL STOCK. ANY PERSON WHO BENEFICIALLY OR CONSTRUCTIVELY OWNS OR ATTEMPTS TO
BENEFICIALLY OR CONSTRUCTIVELY OWN SHARES OF CAPITAL STOCK WHICH CAUSES OR WILL
CAUSE A PERSON TO BENEFICIALLY OR CONSTRUCTIVELY OWN SHARES OF CAPITAL STOCK IN
EXCESS OR IN VIOLATION OF THE ABOVE LIMITATIONS MUST IMMEDIATELY NOTIFY THE
CORPORATION. IF ANY OF THE RESTRICTIONS ON TRANSFER OR OWNERSHIP ARE VIOLATED,
THE SHARES OF CAPITAL STOCK REPRESENTED HEREBY WILL BE AUTOMATICALLY TRANSFERRED
TO A TRUSTEE OF A TRUST FOR THE BENEFIT OF ONE OR MORE CHARITABLE BENEFICIARIES.
IN ADDITION, UPON THE OCCURRENCE OF CERTAIN EVENTS, ATTEMPTED TRANSFERS IN
VIOLATION OF THE RESTRICTIONS DESCRIBED ABOVE MAY BE VOID AB INITIO. ALL TERMS
IN THIS LEGEND HAVE THE MEANINGS DEFINED IN THE CHARTER, AS THE SAME MAY BE
AMENDED FROM TIME TO TIME, A COPY OF WHICH, INCLUDING THE RESTRICTIONS ON
TRANSFER AND OWNERSHIP, WILL BE FURNISHED TO EACH HOLDER OF CAPITAL STOCK OF THE
CORPORATION ON REQUEST AND WITHOUT CHARGE.”

(h) Modification of Ownership Limit. Subject to Section 7.3, the Board of
Directors may from time to time increase or decrease the Ownership Limit;
provided, however, that any decrease shall only be made prospectively as to
subsequent holders of Capital Stock, unless the decrease is as a result of a
retroactive change in existing law, in which case such decrease shall be
effective immediately; provided, further, that no increase shall be made if,
after giving effect to such increase, the Corporation would otherwise fail to
qualify as a REIT; provided, further, that prior to the modification of the
ownership limitations, the Board of Directors may require such opinions of
counsel, affidavits, undertakings or agreements as it may deem necessary or
advisable in order to determine or ensure the Corporation’s status as a REIT.”

4

Exhibit B

Form of Tax Representation Letter

Greenlight Capital, L.P.
Greenlight Capital, L.L.C.
Greenlight Capital, Inc.
DME Advisors, L.P.
DME Advisors GP, L.L.C.
Greenlight Capital Qualified, L.P.
Greenlight Capital Offshore, Ltd.
David Einhorn
2 Grand Central Tower
140 East 45th Street
Floor 24
New York, New York 10017

March __, 2006

New Century Financial Corporation

18400 Von Karman Avenue, Suite 1000

Irvine, California 92612

Ladies and Gentlemen:

In connection with the grant by the Board of Directors or a committee thereof
(the “Board”) of New Century Financial Corporation (the “Company”) of an
exemption (the “Exemption”) from the limit on the ownership of the outstanding
Common Stock (the “Common Stock”) of the Company (as set forth in Article V of
the Company’s Articles of Amendment and Restatement (the “Articles of
Incorporation”), the “Ownership Limit”) to Greenlight Capital, L.P.; Greenlight
Capital, L.L.C.; Greenlight Capital, Inc.; DME Advisors, L.P.; DME Advisors GP,
L.L.C.; Greenlight Capital Qualified, L.P.; Greenlight Capital Offshore, Ltd.;
and David Einhorn (each a “Greenlight Party” and collectively, the “Greenlight
Parties”), together with their Controlled Affiliates (within the meaning set
forth in the Agreement by and among the Company and the Greenlight Parties,
dated of even date herewith (the “Settlement Agreement”)) in connection with the
ownership of the Common Stock of the Company by the Greenlight Parties, together
with their Controlled Affiliates, in excess of the Ownership Limit, each
Greenlight Party hereby certifies to you that the following statements are true,
correct and complete:

1. The Greenlight Parties, each of whose address is 2 Grand Central Tower, 140
East 45th Street, Floor 24, New York, New York 10017, are funds (the “Greenlight
Funds”) and investment advisors that manage the Greenlight Funds and advise
private and institutional clients.

2. None of David Einhorn, any individual investor in a Greenlight Fund or any
individual who maintains an account with any Greenlight Party or a Controlled
Affiliate of any Greenlight Party has a beneficial ownership or Constructive
Ownership interest in Common Stock that exceeds the Ownership Limit as of the
date hereof. For purposes of this paragraph 2, “beneficial ownership” shall mean
ownership directly or indirectly under Section 542(a)(2) of the Internal Revenue
Code of 1986, as amended (the “Code”), taking into account, for this purpose,
constructive ownership determined under Section 544 of the Code, as modified by
Section 856(h)(1)(B) of the Code.

3. Each Greenlight Party understands that the Exemption is conditioned on the
following:

(a) the Greenlight Parties, together with their Controlled Affiliates,
collectively may not Beneficially Own or Constructively Own shares of Common
Stock in excess of the Greenlight Limit (as defined in the Settlement Agreement)
at any time, as per the terms of the Settlement Agreement;

(b) none of David Einhorn, any direct, indirect or constructive individual
investor in a Greenlight Fund or any individual who maintains an account with or
has any direct, indirect or constructive interest in any Greenlight Party or any
Controlled Affiliate of any Greenlight Party may at any time Beneficially Own or
Constructively Own an interest in the Common Stock that would, as a result of
the ownership of the Common Stock by the Greenlight Parties together with their
Controlled Affiliates, exceed the Ownership Limit;

(c) none of David Einhorn, any direct, indirect or constructive individual
investor in a Greenlight Fund or any individual who maintains an account with or
has any direct, indirect or constructive interest in any Greenlight Party or any
Controlled Affiliate of any Greenlight Party may Beneficially Own or
Constructively Own the outstanding Common Stock to the extent such ownership
would, as a result of the ownership of the Common Stock by the Greenlight
Parties together with their Controlled Affiliates, cause the Company to be
closely held (within the meaning of Section 856(h) of the Code) or otherwise
fail to qualify as a real estate investment trust (“REIT”); and

(d) no Greenlight Party or any Controlled Affiliate of any Greenlight Party, may
own, actually or Constructively, an interest in a tenant of the Company that
would, as a result of the ownership of the Common Stock by the Greenlight
Parties together with their Controlled Affiliates, cause the Company to own,
actually or Constructively, more than a 9.9% interest (as set forth in Section
856(d)(2)(B) of the Code) in such tenant.

4. The Greenlight Parties understand that the Exemption will be automatically
revoked to the extent that any of the conditions listed in the preceding
paragraph 3 or Sections 4.2(a), (b) or (c) of the Settlement Agreement is
breached or violated.

5. The Greenlight Parties understand and agree that any violation of any of the
conditions listed in paragraph 3 will result in a transfer to a trust of the
shares of Common Stock Beneficially Owned or Constructively Owned by the
Greenlight Parties and their Controlled Affiliates in excess of the Ownership
Limit pursuant to Section 5.2(c) of the Articles of Incorporation.

6. The Greenlight Parties understand that for purposes of this Exemption and
this letter the term “individual” shall mean (i) a natural person; (ii) an
organization described in Section 501(c)(17) or 509(a) of the Code; (iii) a
qualified trust described in Section 401(a) of the Code if one or more
disqualified persons (as defined in Section 4975(e)(2) of the Code, without
regard to subparagraphs (B) and (I) thereof) with respect to such qualified
trust hold in the aggregate 5 percent or more in value of the interests in the
Company and the Company has accumulated earnings and profits attributable to any
period for which it did not qualify as a real estate investment trust; or (iv) a
portion of a trust permanently set aside or to be used exclusively for the
purposes described in Section 642(c) of the Code or a corresponding provision of
a prior income tax law.

7. The Greenlight Parties understand that the Exemption is granted solely to the
Greenlight Parties, together with their Controlled Affiliates, and relates
solely to the Common Stock. For the avoidance of doubt, and subject to paragraph
3 and the Settlement Agreement, the assignment of shares of Common Stock by a
Greenlight Party to another Greenlight Party or a Controlled Affiliate of any
Greenlight Party shall not affect the Exemption.

8. The Greenlight Parties understand that in no event shall this Exemption
permit any individual’s Beneficial Ownership or Constructive Ownership of
Capital Stock to exceed, at any time, the Ownership Limit.

9. The Greenlight Parties understand that the Board retains the right to revoke
or modify the Exemption in order to prevent disqualification of the Company as a
REIT under the Code, but the Company would notify and consult with the
Greenlight Parties as soon as possible prior to any such revocation or
modification.

10. The Greenlight Parties agree to cooperate with the Company if the Company
reasonably requests information from the Greenlight Parties or their Controlled
Affiliates regarding the number of shares of Common Stock or any preferred stock
of the Company owned by the Greenlight Parties or their Controlled Affiliates.

11. The Greenlight Parties understand that the Company will rely on the truth
and accuracy of the statements contained in this letter in granting the
Exemption. In addition, the Greenlight Parties authorize O’Melveny & Myers LLP
(and/or other outside tax counsel to the Company) to rely on the truth and
accuracy of the statements contained in this letter in preparing its opinion
regarding the effect of the Exemption on the Company’s continued qualification
as a REIT.

12. Written notices or inquiries to the Company should be directed to:

New Century Financial Corporation

18400 Von Karman Avenue, Suite 1000

Irvine, California 92612

Attn: Stergios Theologides, Esq.

Telephone: 800-967-7623

Fax: 949-440-7030

13. Written notices or inquiries to the Greenlight Parties should be directed
to:

Greenlight Capital, Inc.

2 Grand Central Tower

140 East 45th Street, Floor 24

New York, New York 10017

Attn: Daniel Roitman

Telephone: 212-973-1900

Fax: 212-973-9219

14. All terms used but not defined herein shall have the meanings assigned to
them in the Settlement Agreement.

Very truly yours,

GREENLIGHT CAPITAL, L.P.

By: Greenlight Capital, L.L.C.
its general partner

By:
Name:
Its:

GREENLIGHT CAPITAL, L.L.C.

By:
Name:
Its:

5

GREENLIGHT CAPITAL, INC.

By:
Name:
Its:

DME ADVISORS, L.P.

By: DME Advisors GP, L.L.C.
its general partner

By:
Name:
Its:

DME ADVISORS GP, L.L.C.

By:
Name:
Its:

GREENLIGHT CAPITAL QUALIFIED, L.P.

By: Greenlight Capital, L.L.C.
its general partner

By:
Name:
Its:

GREENLIGHT CAPITAL OFFSHORE, LTD.

By: Greenlight Capital, Inc.

its investment advisor

By:
Name:
Its:

DAVID EINHORN

By:

6

Exhibit C

Form of Amendment to 2004 Incentive Performance Plan

NEW CENTURY FINANCIAL CORPORATION
2004 PERFORMANCE INCENTIVE PLAN

(Composite Plan Document Reflecting Proposed Amendment)

1. PURPOSE OF PLAN

The purpose of this New Century Financial Corporation 2004 Performance Incentive
Plan (this “Plan”) of New Century Financial Corporation, a Maryland corporation
(the “Corporation”) is to promote the success of the Corporation and to increase
stockholder value by providing an additional means through the grant of awards
to attract, motivate, retain and reward selected employees and other eligible
persons.

2. ELIGIBILITY

The Administrator (as such term is defined in Section 3.1) may grant awards
under this Plan only to those persons that the Administrator determines to be
Eligible Persons. An “Eligible Person” is any person who is either: (a) an
officer (whether or not a director) or employee of the Corporation or one of its
Subsidiaries or Affiliates; (b) a member of the Board; or (c) an individual
consultant or advisor who renders or has rendered bona fide services (other than
services in connection with the offering or sale of securities of the
Corporation or one of its Subsidiaries or Affiliates in a capital-raising
transaction or as a market maker or promoter of securities of the Corporation or
one of its Subsidiaries or Affiliates) to the Corporation or one of its
Subsidiaries or Affiliates and who is selected to participate in this Plan by
the Administrator; provided, however, that a person who is otherwise an Eligible
Person under clause (c) above may participate in this Plan only if such
participation would not adversely affect the Corporation’s compliance with
applicable laws. An Eligible Person who has been granted an award (a
“participant”) may, if otherwise eligible, be granted additional awards if the
Administrator shall so determine. As used herein, “Subsidiary” means any
corporation or other entity a majority of whose outstanding voting stock or
voting power is beneficially owned directly or indirectly by the Corporation;
“Affiliate” means any corporation or other entity a significant portion of the
equity of which is beneficially owned directly or indirectly by the Corporation
(regardless of whether such entity qualifies as a Subsidiary), as determined by
the Administrator; and “Board” means the Board of Directors of the Corporation.

3. PLAN ADMINISTRATION

  3.1   The Administrator. This Plan shall be administered by and all awards
under this Plan shall be authorized by the Administrator. The “Administrator”
means the Board or one or more committees appointed by the Board or another
committee (within its delegated authority) to administer all or certain aspects
of this Plan. Any such committee shall be comprised solely of one or more
directors or such number of directors as may be required under applicable law. A
committee may delegate some or all of its authority to another committee so
constituted. The Board or a committee comprised solely of directors may also
delegate, to the extent permitted by applicable law, to one or more officers of
the Corporation, its powers under this Plan (a) to designate the officers and
employees of the Corporation and its Subsidiaries and Affiliates who will
receive grants of awards under this Plan, and (b) to determine the number of
shares subject to, and the other terms and conditions of, such awards. The Board
may delegate different levels of authority to different committees with
administrative and grant authority under this Plan. Unless otherwise provided in
the Bylaws of the Corporation or the applicable charter of any Administrator:
(a) a majority of the members of the acting Administrator shall constitute a
quorum, and (b) the vote of a majority of the members present assuming the
presence of a quorum or the unanimous written consent of the members of the
Administrator shall constitute action by the acting Administrator.

With respect to awards intended to satisfy the requirements for
performance-based compensation under Section 162(m) of the Internal Revenue Code
of 1986, as amended (the “Code”), this Plan shall be administered by a committee
consisting solely of two or more outside directors (as this requirement is
applied under Section 162(m) of the Code); provided, however, that the failure
to satisfy such requirement shall not affect the validity of the action of any
committee otherwise duly authorized and acting in the matter. Award grants, and
transactions in or involving awards, intended to be exempt under Rule 16b-3
under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), must
be duly and timely authorized by the Board or a committee consisting solely of
two or more non-employee directors (as this requirement is applied under
Rule 16b-3 promulgated under the Exchange Act). To the extent required by any
applicable listing agency, this Plan shall be administered by a committee
composed entirely of independent directors (within the meaning of the applicable
listing agency).

  3.2   Powers of the Administrator. Subject to the express provisions of this
Plan, the Administrator is authorized and empowered to do all things necessary
or desirable in connection with the authorization of awards and the
administration of this Plan (in the case of a committee or delegation to one or
more officers, within the authority delegated to that committee or person(s)),
including, without limitation, the authority to:

  (a)   determine eligibility and, from among those persons determined to be
eligible, the particular Eligible Persons who will receive an award under this
Plan;

  (b)   grant awards to Eligible Persons, determine the price at which
securities will be offered or awarded and the number of securities to be offered
or awarded to any of such persons, determine the other specific terms and
conditions of such awards consistent with the express limits of this Plan,
establish the installments (if any) in which such awards shall become
exercisable or shall vest (which may include, without limitation, performance
and/or time-based schedules), or determine that no delayed exercisability or
vesting is required, establish any applicable performance targets, and establish
the events of termination or reversion of such awards;

  (c)   approve the forms of award agreements (which need not be identical
either as to type of award or among participants);

  (d)   construe and interpret this Plan and any agreements defining the rights
and obligations of the Corporation, its Subsidiaries and Affiliates, and
participants under this Plan, further define the terms used in this Plan, and
prescribe, amend and rescind rules and regulations relating to the
administration of this Plan or the awards granted under this Plan;

  (e)   cancel, modify, or waive the Corporation’s rights with respect to, or
modify, discontinue, suspend, or terminate any or all outstanding awards,
subject to any required consent under Section 8.6.5;

  (f)   accelerate or extend the vesting or exercisability or extend the term of
any or all such outstanding awards (in the case of options or stock appreciation
rights, within the maximum ten-year term of such awards) in such circumstances
as the Administrator may deem appropriate (including, without limitation, in
connection with a termination of employment or services or other events of a
personal nature) subject to any required consent under Section 8.6.5;

  (g)   adjust the number of shares of Common Stock subject to any award, adjust
the price of any or all outstanding awards or otherwise change previously
imposed terms and conditions, in such circumstances as the Administrator may
deem appropriate, in each case subject to Sections 4 and 8.6, and provided that
in no case (except due to an adjustment contemplated by Section 7 or any
repricing that may be approved by stockholders) shall such an adjustment
constitute a repricing (by amendment, cancellation and regrant, exchange or
other means) of the per share exercise or base price of any option or stock
appreciation right;

  (h)   determine the date of grant of an award, which may be a designated date
after but not before the date of the Administrator’s action (unless otherwise
designated by the Administrator, the date of grant of an award shall be the date
upon which the Administrator took the action granting an award);

  (i)   determine whether, and the extent to which, adjustments are required
pursuant to Section 7 hereof and authorize the termination, conversion,
substitution or succession of awards upon the occurrence of an event of the type
described in Section 7;

  (j)   acquire or settle (subject to Sections 7 and 8.6) rights under awards in
cash, stock of equivalent value, or other consideration; and

  (k)   determine the fair market value of the Common Stock or awards under this
Plan from time to time and/or the manner in which such value will be determined.

  3.3   Binding Determinations. Any action taken by, or inaction of, the
Corporation, any Subsidiary or Affiliate, or the Administrator relating or
pursuant to this Plan and within its authority hereunder or under applicable law
shall be within the absolute discretion of that entity or body and shall be
conclusive and binding upon all persons. Neither the Board nor any Board
committee, nor any member thereof or person acting at the direction thereof,
shall be liable for any act, omission, interpretation, construction or
determination made in good faith in connection with this Plan (or any award made
under this Plan), and all such persons shall be entitled to indemnification and
reimbursement by the Corporation in respect of any claim, loss, damage or
expense (including, without limitation, attorneys’ fees) arising or resulting
therefrom to the fullest extent permitted by law and/or under any directors and
officers liability insurance coverage that may be in effect from time to time.

  3.4   Reliance on Experts. In making any determination or in taking or not
taking any action under this Plan, the Board or a committee, as the case may be,
may obtain and may rely upon the advice of experts, including employees and
professional advisors to the Corporation. No director, officer or agent of the
Corporation, or any of its Subsidiaries or Affiliates, shall be liable for any
such action or determination taken or made or omitted in good faith.

  3.5   Delegation. The Administrator may delegate ministerial,
non-discretionary functions to individuals who are officers or employees of the
Corporation or any of its Subsidiaries or Affiliates.

4. SHARES OF COMMON STOCK SUBJECT TO THE PLAN; SHARE LIMITS

  4.1   Shares Available. Subject to the provisions of Section 7.1, the capital
stock that may be delivered under this Plan shall be shares of the Corporation’s
authorized but unissued Common Stock and any shares of its Common Stock held as
treasury shares. For purposes of this Plan, “Common Stock” shall mean the common
stock of the Corporation and such other securities or property as may become the
subject of awards under this Plan, or may become subject to such awards,
pursuant to an adjustment made under Section 7.1.

  4.2   Share Limits. The maximum number of shares of Common Stock that may be
delivered pursuant to awards granted to Eligible Persons under this Plan (the
“Share Limit”) is equal to the sum of (a) 3,244,279 shares, plus (b) the number
of any shares subject to stock options granted under the Corporation’s 1995
Stock Option Plan (the “1995 Plan”) and outstanding as of the date the Board
approved this amended version of the Plan (the “Board Approval Date”) which
expire, or for any reason are cancelled or terminated, after the Board Approval
Date without being exercised; provided that in no event shall the Share Limit
exceed 6,108,450 shares (which is the sum of the 3,244,279 shares set forth
above, plus the maximum number of shares subject to options previously granted
and outstanding under the 1995 Plan as of the Board Approval Date).(1) The
following limits also apply with respect to awards granted under this Plan:

  (a)   The maximum number of shares of Common Stock that may be delivered
pursuant to options qualified as incentive stock options granted under this Plan
is 450,000 shares, subject to the Plan limit set forth above.

  (b)   The maximum number of shares of Common Stock subject to those options
and stock appreciation rights that are granted during any calendar year to any
individual under this Plan is 750,000 shares.

  (c)   The maximum number of shares of Common Stock that may be delivered
pursuant to awards granted under this Plan, other than pursuant to those
described in the next sentence, is 1,400,000. This limit does not apply,
however, to (1) shares delivered in respect of compensation earned but deferred,
(2) except as expressly provided in Section 5.1.1 (which generally requires that
shares delivered in respect of “discounted” stock options be charged against
this limit), shares delivered in respect of stock option grants, and (3) except
as expressly provided in Section 5.1.2 (which generally requires that shares
delivered in respect of “discounted” stock appreciation right grants be charged
against this limit), shares delivered in respect of stock appreciation right
grants.

  (d)   Additional limits with respect to Performance-Based Awards are set forth
in Section 5.2.3.

Each of the foregoing numerical limits is subject to adjustment as contemplated
by Section 4.3, Section 7.1, and Section 8.10.

(1) As of the Board Approval Date, the aggregate share limit was 1,994,279
shares, as previously adjusted and subject to future adjustment pursuant to
clause (b) of the first sentence of Section 4.2. Stockholders are being asked to
approve an amendment to the Plan that would increase the aggregate share limit
by an additional 1,250,000 shares so that the new aggregate share limit for the
Plan would be 3,244,279 shares, subject to adjustment as contemplated by clause
(b) of the first sentence of Section 4.2.

  4.3   Awards Settled in Cash, Reissue of Awards and Shares. To the extent that
an award is settled in cash or a form other than shares of Common Stock, the
shares that would have been delivered had there been no such cash or other
settlement shall not be counted against the shares available for issuance under
this Plan. In the event that  shares of Common Stock are delivered in respect of
a dividend equivalent right, only the actual number of shares delivered with
respect to the award shall be counted against the share limits of this Plan. To
the extent that shares of Common Stock are delivered pursuant to the exercise of
a stock appreciation right or stock option, the number of underlying shares as
to which the exercise related shall be counted against the applicable share
limits under Section 4.2, as opposed to only counting the shares actually
issued. (For purposes of clarity, if a stock appreciation right relates to
100,000 shares and is exercised at a time when the payment due to the
participant is 15,000 shares, 100,000 shares shall be charged against the
applicable share limits under Section 4.2 with respect to such exercise.) Shares
that are subject to or underlie awards which expire or for any reason are
cancelled or terminated, are forfeited, fail to vest, or for any other reason
are not paid or delivered under this Plan shall again be available for
subsequent awards under this Plan. Refer to Section 8.10 for application of the
foregoing share limits with respect to assumed awards. The foregoing adjustments
to the share limits of this Plan are subject to any applicable limitations under
Section 162(m) of the Code with respect to awards intended as performance-based
compensation thereunder.

  4.4   Reservation of Shares; No Fractional Shares; Minimum Issue. The
Corporation shall at all times reserve a number of shares of Common Stock
sufficient to cover the Corporation’s obligations and contingent obligations to
deliver shares with respect to awards then outstanding under this Plan
(exclusive of any dividend equivalent obligations to the extent the Corporation
has the right to settle such rights in cash). No fractional shares shall be
delivered under this Plan. The Administrator may pay cash in lieu of any
fractional shares in settlements of awards under this Plan. No fewer than 100
shares may be purchased on exercise of any award (or, in the case of stock
appreciation or purchase rights, no fewer than 100 rights may be exercised at
any one time) unless the total number purchased or exercised is the total number
at the time available for purchase or exercise under the award.

5. AWARDS

  5.1   Type and Form of Awards. The Administrator shall determine the type or
types of award(s) to be made to each selected Eligible Person. Awards may be
granted singly, in combination or in tandem. Awards also may be made in
combination or in tandem with, in replacement of, as alternatives to, or as the
payment form for grants or rights under any other employee or compensation plan
of the Corporation or one of its Subsidiaries or Affiliates. The types of awards
that may be granted under this Plan are:

5.1.1 Stock Options. A stock option is the grant of a right to purchase a
specified number of shares of Common Stock during a specified period as
determined by the Administrator. An option may be intended as an incentive stock
option within the meaning of Section 422 of the Code (an “ISO”) or a
nonqualified stock option (an option not intended to be an ISO). The award
agreement for an option will indicate if the option is intended as an ISO,
otherwise it will be deemed to be a nonqualified stock option. The maximum term
of each option (ISO or nonqualified) shall be ten (10) years. The per share
exercise price for each option shall be not less than 100% of the fair market
value of a share of Common Stock on the date of grant of the option, except as
follows: (a) in the case of a stock option granted retroactively in tandem with
or as a substitution for another award, the per share exercise price may be no
lower than the fair market value of a share of Common Stock on the date such
other award was granted (to the extent consistent with Sections 422 and 424 of
the Code in the case of options intended as incentive stock options); and (b) in
any other circumstances, a nonqualified stock option may be granted with a per
share exercise price that is less than the fair market value of a share of
Common Stock on the date of grant, provided that any shares delivered in respect
of such option shall be charged against the limit of Section 4.2(c) (the limit
on full-value awards) as well as any other applicable limit under Section 4.2.
When an option is exercised, the exercise price for the shares to be purchased
shall be paid in full in cash or such other method permitted by the
Administrator consistent with Section 5.5.

5.1.2 Additional Rules Applicable to ISOs. To the extent that the aggregate fair
market value (determined at the time of grant of the applicable option) of stock
with respect to which ISOs first become exercisable by a participant in any
calendar year exceeds $100,000, taking into account both Common Stock subject to
ISOs under this Plan and stock subject to ISOs under all other plans of the
Corporation or one of its Subsidiaries (or any parent or predecessor corporation
to the extent required by and within the meaning of Section 422 of the Code and
the regulations promulgated thereunder), such options shall be treated as
nonqualified stock options. In reducing the number of options treated as ISOs to
meet the $100,000 limit, the most recently granted options shall be reduced
first. To the extent a reduction of simultaneously granted options is necessary
to meet the $100,000 limit, the Administrator may, in the manner and to the
extent permitted by law, designate which  shares of Common Stock are to be
treated as shares acquired pursuant to the exercise of an ISO. ISOs may only be
granted to employees of the Corporation or one of its subsidiaries (for this
purpose, the term “subsidiary” is used as defined in Section 424(f) of the Code,
which generally requires an unbroken chain of ownership of at least 50% of the
total combined voting power of all classes of stock of each subsidiary in the
chain beginning with the Corporation and ending with the subsidiary in
question). There shall be imposed in any award agreement relating to ISOs such
other terms and conditions as from time to time are required in order that the
option be an “incentive stock option” as that term is defined in Section 422 of
the Code. No ISO may be granted to any person who, at the time the option is
granted, owns (or is deemed to own under Section 424(d) of the Code) shares of
outstanding Common Stock possessing more than 10% of the total combined voting
power of all classes of stock of the Corporation, unless the exercise price of
such option is at least 110% of the fair market value of the stock subject to
the option and such option by its terms is not exercisable after the expiration
of five years from the date such option is granted.

5.1.3 Stock Appreciation Rights. A stock appreciation right or “SAR” is a right
to receive a payment, in cash and/or Common Stock, equal to the excess of the
fair market value of a specified number of shares of Common Stock on the date
the SAR is exercised over the fair market value of a share of Common Stock on
the date the SAR was granted (the “base price”) as set forth in the applicable
award agreement except as follows: (a) in the case of a SAR granted
retroactively or in tandem with or as substitution for another award, the base
price may be no lower than the fair market value of a share of Common Stock on
the date such other award was granted; and (b) in any other circumstances, a SAR
may be granted with a base price that is less than the fair market value of a
share of Common Stock on the date of grant, provided that any shares actually
delivered in respect of such award shall be charged against the limit of
Section 4.2(c) (the limit on full-value awards) as well as any other applicable
limit under Section 4.2. The maximum term of an SAR shall be ten (10) years.

5.1.4 Other Awards. The other types of awards that may be granted under this
Plan include: (a) stock bonuses, restricted stock, performance stock, stock
units, phantom stock, dividend equivalents, or similar rights to purchase or
acquire  shares, whether at a fixed or variable price or ratio related to the
Common Stock, upon the passage of time, the occurrence of one or more events, or
the satisfaction of performance criteria or other conditions, or any combination
thereof; (b) any similar securities with a value derived from the value of or
related to the Common Stock and/or returns thereon; or (c) cash awards granted
consistent with Section 5.2 below.

  5.2   Section 162(m) Performance-Based Awards. Without limiting the generality
of the foregoing, any of the types of awards listed in Section 5.1.4 above may
be, and options and SARs granted with an exercise or base price not less than
the fair market value of a share of Common Stock at the date of grant
(“Qualifying Options” and “Qualifying SARS,” respectively) typically will be,
granted as awards intended to satisfy the requirements for “performance-based
compensation” within the meaning of Section 162(m) of the Code
(“Performance-Based Awards”). The grant, vesting, exercisability or payment of
Performance-Based Awards may depend (or, in the case of Qualifying Options or
Qualifying SARs, may also depend) on the degree of achievement of one or more
performance goals relative to a pre-established targeted level or level using
one or more of the Business Criteria set forth below (on an absolute or relative
basis) for the Corporation on a consolidated basis or for one or more of the
Corporation’s subsidiaries, segments, divisions or business units, or any
combination of the foregoing. Any Qualifying Option or Qualifying SAR shall be
subject only to the requirements of Section 5.2.1 and 5.2.3 in order for such
award to satisfy the requirements for “performance-based compensation” under
Section 162(m) of the Award. Any other Performance-Based Award shall be subject
to all of the following provisions of this Section 5.2.

5.2.1 Class; Administrator. The eligible class of persons for Performance-Based
Awards shall be officers and employees of the Corporation and its Subsidiaries.
The Administrator approving Performance-Based Awards or making any certification
required pursuant to Section 5.2.4 must be constituted as provided in
Section 3.1 for awards that are intended as performance-based compensation under
Section 162(m) of the Code.

5.2.2 Performance Goals. The specific performance goals for Performance-Based
Awards (other than Qualifying Options and Qualifying SARs) shall be, on an
absolute or relative basis, established based on one or more of the business
criteria set forth on Appendix A hereto (“Business Criteria”) as selected by the
Administrator in its sole discretion. To qualify awards as performance-based
under Section 162(m), the applicable Business Criterion (or Business Criteria,
as the case may be) and specific performance goal or goals (“targets”) must be
established and approved by the Administrator during the first 90 days of the
performance period (and, in the case of performance periods of less than one
year, in no event more than 25% of the performance period has elapsed) and while
performance relating to such target(s) remains substantially uncertain within
the meaning of Section 162(m) of the Code. Performance targets shall be adjusted
to mitigate the unbudgeted impact of material, unusual or nonrecurring gains and
losses, accounting changes or other extraordinary events not foreseen at the
time the targets were set unless the Administrator provides otherwise at the
time of establishing the targets. The applicable performance measurement period
may not be less than three months nor more than 10 years.

5.2.3 Form of Payment; Maximum Performance-Based Award. Grants or awards under
this Section 5.2 may be paid in cash or shares of Common Stock or any
combination thereof. Grants of Qualifying Options and Qualifying SARs to any one
participant in any one calendar year shall be subject to the limit set forth in
Section 4.2(b). The maximum number of shares of Common Stock which may be
delivered pursuant to Performance-Based Awards (other than Qualifying Options
and Qualifying SARs, and other than cash awards covered by the following
sentence) that are granted to any one participant in any one calendar year shall
not exceed 750,000 shares, either individually or in the aggregate, subject to
adjustment as provided in Section 7.1. In addition, the aggregate amount of
compensation to be paid to any one participant in respect of all
Performance-Based Awards payable only in cash and not related to  shares of
Common Stock and granted to that participant in any one calendar year shall not
exceed $10,000,000.00. Awards that are cancelled during the year shall be
counted against these limits to the extent permitted by Section 162(m) of the
Code.

5.2.4 Certification of Payment. Before any Performance-Based Award under this
Section 5.2 (other than Qualifying Options and Qualifying SARs) is paid and to
the extent required to qualify the award as performance-based compensation
within the meaning of Section 162(m) of the Code, the Administrator must certify
in writing that the performance target(s) and any other material terms of the
Performance-Based Award were in fact timely satisfied.

5.2.5 Reservation of Discretion. The Administrator will have the discretion to
determine the restrictions or other limitations of the individual awards granted
under this Section 5.2 including the authority to reduce awards, payouts or
vesting or to pay no awards, in its sole discretion, if the Administrator
preserves such authority at the time of grant by language to this effect in its
authorizing resolutions or otherwise.

5.2.6 Expiration of Grant Authority. As required pursuant to Section 162(m) of
the Code and the regulations promulgated thereunder, the Administrator’s
authority to grant new awards that are intended to qualify as performance-based
compensation within the meaning of Section 162(m) of the Code (other than
Qualifying Options and Qualifying SARs) shall terminate upon the first meeting
of the Corporation’s stockholders that occurs in the fifth year following the
year in which the Corporation’s stockholders first approve this Plan.

  5.3   Award Agreements. Each award shall be evidenced by a written award
agreement in the form approved by the Administrator and executed on behalf of
the Corporation and, if required by the Administrator, executed by the recipient
of the award. The Administrator may authorize any officer of the Corporation
(other than the particular award recipient) to execute any or all award
agreements on behalf of the Corporation. The award agreement shall set forth the
material terms and conditions of the award as established by the Administrator
consistent with the express limitations of this Plan.

  5.4   Deferrals and Settlements. Payment of awards may be in the form of cash,
Common Stock, other awards or combinations thereof as the Administrator shall
determine, and with such restrictions as it may impose. The Administrator may
also require or permit participants to elect to defer the issuance of shares or
the settlement of awards in cash under such rules and procedures as it may
establish under this Plan. The Administrator may also provide that deferred
settlements include the payment or crediting of interest or other earnings on
the deferral amounts, or the payment or crediting of dividend equivalents where
the deferred amounts are denominated in shares.

  5.5   Consideration for Common Stock or Awards. The purchase price for any
award granted under this Plan or the Common Stock to be delivered pursuant to an
award, as applicable, may be paid by means of any lawful consideration as
determined by the Administrator, including, without limitation, one or a
combination of the following methods:

  •   services rendered by the recipient of such award;

  •   cash, check payable to the order of the Corporation, or electronic funds
transfer;

  •   notice and third party payment in such manner as may be authorized by the
Administrator;

  •   the delivery of previously owned shares of Common Stock;

  •   by a reduction in the number of shares otherwise deliverable pursuant to
the award; or

  •   subject to such procedures as the Administrator may adopt, pursuant to a
“cashless exercise” with a third party who provides financing for the purposes
of (or who otherwise facilitates) the purchase or exercise of awards.

In no event shall any shares newly-issued by the Corporation be issued for less
than the minimum lawful consideration for such shares or for consideration other
than consideration permitted by applicable state law. In the event that the
Administrator allows a participant to exercise an award by delivering shares of
Common Stock previously owned by such participant and unless otherwise expressly
provided by the Administrator, any shares delivered which were initially
acquired by the participant from the Corporation (upon exercise of a stock
option or otherwise) must have been owned by the participant at least six months
as of the date of delivery. Shares of Common Stock used to satisfy the exercise
price of an option shall be valued at their fair market value on the date of
exercise. The Corporation will not be obligated to deliver any shares unless and
until it receives full payment of the exercise or purchase price therefor and
any related withholding obligations under Section 8.5 and any other conditions
to exercise or purchase have been satisfied. Unless otherwise expressly provided
in the applicable award agreement, the Administrator may at any time eliminate
or limit a participant’s ability to pay the purchase or exercise price of any
award or shares by any method other than cash payment to the Corporation.

  5.6   Definition of Fair Market Value. For purposes of this Plan, “fair market
value” shall mean, unless otherwise determined or provided by the Administrator
in the circumstances, the last price for a share of Common Stock as furnished by
the National Association of Securities Dealers, Inc. (the “NASD”) through the
NASDAQ National Market Reporting System (the “National Market”) for the date in
question or, if no sales of Common Stock were reported by the NASD on that date,
the last price for a share of Common Stock as furnished by the NASD through the
National Market for the next preceding day on which sales of Common Stock were
reported by the NASD. The Administrator may, however, provide with respect to
one or more awards that the fair market value shall equal the last price for a
share of Common Stock as furnished by the NASD through the National Market
available on the date in question or the average of the high and low trading
prices of a share of Common Stock as furnished by the NASD through the National
Market for the date in question or the most recent trading day. If the Common
Stock is no longer listed or is no longer actively traded on the National Market
as of the applicable date, the fair market value of the Common Stock shall be
the value as reasonably determined by the Administrator for purposes of the
award in the circumstances. The Administrator also may adopt a different
methodology for determining fair market value with respect to one or more awards
if a different methodology is necessary or advisable to secure any intended
favorable tax, legal or other treatment for the particular award(s) (for
example, and without limitation, the Administrator may provide that fair market
value for purposes of one or more awards will be based on an average of closing
prices (or the average of high and low daily trading prices) for a specified
period preceding the relevant date).

5.7 Transfer Restrictions.

5.7.1 Limitations on Exercise and Transfer. Unless otherwise expressly provided
in (or pursuant to) this Section 5.7, by applicable law and by the award
agreement, as the same may be amended, (a) all awards are non-transferable and
shall not be subject in any manner to sale, transfer, anticipation, alienation,
assignment, pledge, encumbrance or charge; (b) awards shall be exercised only by
the participant; and (c) amounts payable or shares issuable pursuant to any
award shall be delivered only to (or for the account of) the participant.

5.7.2 Exceptions. The Administrator may permit awards to be exercised by and
paid to, or otherwise transferred to, other persons or entities pursuant to such
conditions and procedures, including limitations on subsequent transfers, as the
Administrator may, in its sole discretion, establish in writing. Any permitted
transfer shall be subject to compliance with applicable federal and state
securities laws.

5.7.3 Further Exceptions to Limits on Transfer. The exercise and transfer
restrictions in Section 5.7.1 shall not apply to:

(a) transfers to the Corporation,

  (b)   the designation of a beneficiary to receive benefits in the event of the
participant’s death or, if the participant has died, transfers to or exercise by
the participant’s beneficiary, or, in the absence of a validly designated
beneficiary, transfers by will or the laws of descent and distribution,

  (c)   subject to any applicable limitations on ISOs, transfers to a family
member (or former family member) pursuant to a domestic relations order if
approved or ratified by the Administrator,

  (d)   if the participant has suffered a disability, permitted transfers or
exercises on behalf of the participant by his or her legal representative, or

  (e)   the authorization by the Administrator of “cashless exercise” procedures
with third parties who provide financing for the purpose of (or who otherwise
facilitate) the exercise of awards consistent with applicable laws and the
express authorization of the Administrator.

  5.8   International Awards. One or more awards may be granted to Eligible
Persons who provide services to the Corporation or one of its Subsidiaries or
Affiliates outside of the United States. Any awards granted to such persons may
be granted pursuant to the terms and conditions of any applicable sub-plans, if
any, appended to this Plan and approved by the Administrator.

6. EFFECT OF TERMINATION OF SERVICE ON AWARDS

  6.1   General. The Administrator shall establish the effect of a termination
of employment or service on the rights and benefits under each award under this
Plan and in so doing may make distinctions based upon, inter alia, the cause of
termination and type of award. If the participant is not an employee of the
Corporation or one of its Subsidiaries or Affiliates and provides other services
to the Corporation or one of its Subsidiaries or Affiliates, the Administrator
shall be the sole judge for purposes of this Plan (unless a contract or the
award otherwise provides) of whether the participant continues to render
services to the Corporation or one of its Subsidiaries or Affiliates and the
date, if any, upon which such services shall be deemed to have terminated.

  6.2   Events Not Deemed Terminations of Service. Unless the express policy of
the Corporation or one of its Subsidiaries or Affiliates, or the Administrator,
otherwise provides, the employment relationship shall not be considered
terminated in the case of (a) sick leave, (b) military leave, or (c) any other
leave of absence authorized by the Corporation or one of its Subsidiaries or
Affiliates or the Administrator; provided that unless reemployment upon the
expiration of such leave is guaranteed by contract or law, such leave is for a
period of not more than 90 days. In the case of any employee of the Corporation
or one of its Subsidiaries or Affiliates on an approved leave of absence,
continued vesting of the award while on leave from the employ of the Corporation
or one of its Subsidiaries or Affiliates may be suspended until the employee
returns to service, unless the Administrator otherwise provides or applicable
law otherwise requires. In no event shall an award be exercised after the
expiration of the term set forth in the award agreement.

  6.3   Effect of Change of Subsidiary Status. For purposes of this Plan and any
award, if an entity ceases to be a Subsidiary or other Affiliate of the
Corporation, as determined by the Administrator, a termination of employment or
service shall be deemed to have occurred with respect to each Eligible Person in
respect of such Subsidiary or other Affiliate who does not continue as an
Eligible Person in respect of the Corporation or another of its Subsidiaries or
Affiliates that continues as such, as determined by the Administrator, after
giving effect to the transaction or other event giving rise to the change in
status.

7. ADJUSTMENTS; ACCELERATION

  7.1   Adjustments. Upon or in contemplation of: any reclassification,
recapitalization, stock split (including a stock split in the form of a stock
dividend) or reverse stock split (“stock split”); any merger, combination,
consolidation, or other reorganization; any spin-off, split-up, or similar
extraordinary dividend distribution in respect of the Common Stock (whether in
the form of securities or property); any exchange of Common Stock or other
securities of the Corporation, or any similar, unusual or extraordinary
corporate transaction in respect of the Common Stock; or a sale of all or
substantially all the business or assets of the Corporation as an entirety; then
the Administrator shall, in such manner, to such extent (if any) and at such
time as it deems appropriate and equitable in the circumstances:

  (a)   proportionately adjust any or all of (1) the number and type of  shares
of Common Stock (or other securities) that thereafter may be made the subject of
awards (including the specific share limits, maximums and numbers of  shares set
forth elsewhere in this Plan), (2) the number, amount and type of  shares of
Common Stock (or other securities or property) subject to any or all outstanding
awards, (3) the grant, purchase, or exercise price (which term includes the base
price of any SAR or similar right) of any or all outstanding awards, (4) the
securities, cash or other property deliverable upon exercise or payment of any
outstanding awards, or (5) (subject to Sections 7.8 and 8.8.3(a)) the
performance standards applicable to any outstanding awards, or

  (b)   make provision for a cash payment or for the assumption, substitution or
exchange of any or all outstanding share-based awards or the cash, securities or
property deliverable to the holder of any or all outstanding share-based awards,
based upon the distribution or consideration payable to holders of the Common
Stock upon or in respect of such event.

The Administrator may adopt such valuation methodologies for outstanding awards
as it deems reasonable in the event of a cash or property settlement and, in the
case of options, SARs or similar rights, but without limitation on other
methodologies, may base such settlement solely upon the excess if any of the per
share amount payable upon or in respect of such event over the exercise or base
price of the award. With respect to any award of an ISO, the Administrator may
make such an adjustment that causes the option to cease to qualify as an ISO
without the consent of the affected participant.

In any of such events, the Administrator may take such action prior to such
event to the extent that the Administrator deems the action necessary to permit
the participant to realize the benefits intended to be conveyed with respect to
the underlying shares in the same manner as is or will be available to
stockholders generally. In the case of any stock split or reverse stock split,
if no action is taken by the Administrator, the proportionate adjustments
contemplated by clause (a) above shall nevertheless be made.

  7.2   Automatic Acceleration of Awards. Upon a dissolution of the Corporation
or other event described in Section 7.1 that the Corporation does not survive
(or does not survive as a public company in respect of its Common Stock), then
each then-outstanding option and SAR shall become fully vested, all shares of
restricted stock then outstanding shall fully vest free of restrictions, and
each other award granted under this Plan that is then outstanding shall become
payable to the holder of such award; provided that such acceleration provision
shall not apply, unless otherwise expressly provided by the Administrator, with
respect to any award to the extent that the Administrator has made a provision
for the substitution, assumption, exchange or other continuation or settlement
of the award, or the award would otherwise continue in accordance with its
terms, in the circumstances.

  7.3   Possible Acceleration of Awards. Without limiting Section 7.2, in the
event of a Change in Control Event (as defined below), the Administrator may, in
its discretion, provide that any outstanding option or SAR shall become fully
vested, that any share of restricted stock then outstanding shall fully vest
free of restrictions, and that any other award granted under this Plan that is
then outstanding shall be payable to the holder of such award. The Administrator
may take such action with respect to all awards then outstanding or only with
respect to certain specific awards identified by the Administrator in the
circumstances. For purposes of this Plan, “Change in Control Event” means any of
the following:

  (a)   The acquisition by any individual, entity or group (within the meaning
of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a “Person”)) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 25% or more of either (1) the then-outstanding shares of common stock of the
Corporation (the “Outstanding Company Common Stock”) or (2) the combined voting
power of the then-outstanding voting securities of the Corporation entitled to
vote generally in the election of directors (the “Outstanding Company Voting
Securities”); provided, however, that, for purposes of this definition, the
following acquisitions shall not constitute a Change in Control Event; (A) any
acquisition directly from the Corporation, (B) any acquisition by the
Corporation, (C) any acquisition by any employee benefit plan (or related trust)
sponsored or maintained by the Corporation or any affiliate of the Corporation
or a successor, or (D) any acquisition by any entity pursuant to a transaction
that complies with Sections (c)(1), (2) and (3) below;

  (b)   Individuals who, as of the Effective Date, constitute the Board (the
“Incumbent Board”) cease for any reason to constitute at least a majority of the
Board; provided, however, that any individual becoming a director subsequent to
the Effective Date whose election, or nomination for election by the
Corporation’s stockholders, was approved by a vote of at least two-thirds of the
directors then comprising the Incumbent Board (including for these purposes, the
new members whose election or nomination was so approved, without counting the
member and his predecessor twice) shall be considered as though such individual
were a member of the Incumbent Board, but excluding, for this purpose, any such
individual whose initial assumption of office occurs as a result of an actual or
threatened election contest with respect to the election or removal of directors
or other actual or threatened solicitation of proxies or consents by or on
behalf of a Person other than the Board;

  (c)   Consummation of a reorganization, merger, statutory share exchange or
consolidation or similar corporate transaction involving the Corporation or any
of its Subsidiaries, a sale or other disposition of all or substantially all of
the assets of the Corporation, or the acquisition of assets or stock of another
entity by the Corporation or any of its Subsidiaries (each, a “Business
Combination”), in each case unless, following such Business Combination, (1) all
or substantially all of the individuals and entities that were the beneficial
owners of the Outstanding Company Common Stock and the Outstanding Company
Voting Securities immediately prior to such Business Combination beneficially
own, directly or indirectly, more than 50% of the then-outstanding shares of
common stock and the combined voting power of the then-outstanding voting
securities entitled to vote generally in the election of directors, as the case
may be, of the entity resulting from such Business Combination (including,
without limitation, an entity that, as a result of such transaction, owns the
Corporation or all or substantially all of the Corporation’s assets directly or
through one or more subsidiaries (a “Parent”)) in substantially the same
proportions as their ownership immediately prior to such Business Combination of
the Outstanding Company Common Stock and the Outstanding Company Voting
Securities, as the case may be, (2) no Person (excluding any entity resulting
from such Business Combination or a Parent or any employee benefit plan (or
related trust) of the Corporation or such entity resulting from such Business
Combination or Parent) beneficially owns, directly or indirectly, 25% or more
of, respectively, the then-outstanding shares of common stock of the entity
resulting from such Business Combination or the combined voting power of the
then-outstanding voting securities of such entity, except to the extent that the
ownership in excess of 25% existed prior to the Business Combination, and (3) at
least a majority of the members of the board of directors or trustees of the
entity resulting from such Business Combination or a Parent were members of the
Incumbent Board at the time of the execution of the initial agreement or of the
action of the Board providing for such Business Combination; or

  (d)   Approval by the stockholders of the Corporation of a complete
liquidation or dissolution of the Corporation other than in the context of a
transaction that does not constitute a Change in Control Event under clause (c)
above.

  7.4   Early Termination of Awards. Any award that has been accelerated as
required or contemplated by Section 7.2 or 7.3 (or would have been so
accelerated but for Section 7.5, 7.6 or 7.7) shall terminate upon the related
event referred to in Section 7.2 or 7.3, as applicable, subject to any provision
that has been expressly made by the Administrator, through a plan of
reorganization or otherwise, for the survival, substitution, assumption,
exchange or other continuation or settlement of such award and provided that, in
the case of options and SARs that will not survive, be substituted for, assumed,
exchanged, or otherwise continued or settled in the transaction, the holder of
such award shall be given reasonable advance notice of the impending termination
and a reasonable opportunity to exercise his or her outstanding options and SARs
in accordance with their terms before the termination of such awards (except
that in no case shall more than ten days’ notice of accelerated vesting and the
impending termination be required and any acceleration may be made contingent
upon the actual occurrence of the event).

  7.5   Other Acceleration Rules. Any acceleration of awards pursuant to this
Section 7 shall comply with applicable legal requirements and, if necessary to
accomplish the purposes of the acceleration or if the circumstances require, may
be deemed by the Administrator to occur a limited period of time not greater
than 30 days before the event. Without limiting the generality of the foregoing,
the Administrator may deem an acceleration to occur immediately prior to the
applicable event and/or reinstate the original terms of an award if an event
giving rise to an acceleration does not occur. The Administrator may override
the provisions of Section 7.2, 7.3, 7.4 and/or 7.6 by express provision in the
award agreement and may accord any Eligible Person a right to refuse any
acceleration, whether pursuant to the award agreement or otherwise, in such
circumstances as the Administrator may approve. The portion of any ISO
accelerated in connection with a Change in Control Event or any other action
permitted hereunder shall remain exercisable as an ISO only to the extent the
applicable $100,000 limitation on ISOs is not exceeded. To the extent exceeded,
the accelerated portion of the option shall be exercisable as a nonqualified
stock option under the Code.

  7.6   Possible Rescission of Acceleration. If the vesting of an award has been
accelerated expressly in anticipation of an event or upon stockholder approval
of an event and the Administrator later determines that the event will not
occur, the Administrator may rescind the effect of the acceleration as to any
then outstanding and unexercised or otherwise unvested awards.

  7.7   Golden Parachute Limitation. Notwithstanding anything else contained in
this Section 7 to the contrary, in no event shall an award be accelerated under
this Plan to an extent or in a manner which would not be fully deductible by the
Corporation or one of its Subsidiaries or Affiliates for federal income tax
purposes because of Section 280G of the Code, nor shall any payment hereunder be
accelerated to the extent any portion of such accelerated payment would not be
deductible by the Corporation or one of its Subsidiaries or Affiliates because
of Section 280G of the Code. If a participant would be entitled to benefits or
payments hereunder and under any other plan or program that would constitute
“parachute payments” as defined in Section 280G of the Code, then the
participant may by written notice to the Corporation designate the order in
which such parachute payments will be reduced or modified so that the
Corporation or one of its Subsidiaries or Affiliates is not denied federal
income tax deductions for any “parachute payments” because of Section 280G of
the Code. Notwithstanding the foregoing, if a participant is a party to an
employment or other agreement with the Corporation or one of its Subsidiaries or
Affiliates, or is a participant in a severance program sponsored by the
Corporation or one of its Subsidiaries or Affiliates, that contains express
provisions regarding Section 280G and/or Section 4999 of the Code (or any
similar successor provision), the Section 280G and/or Section 4999 provisions of
such employment or other agreement or plan, as applicable, shall control as to
any awards held by that participant (for example, and without limitation, a
participant may be a party to an employment agreement with the Corporation or
one of its Subsidiaries or Affiliates that provides for a “gross-up” as opposed
to a “cut-back” in the event that the Section 280G thresholds are reached or
exceeded in connection with a change in control and, in such event, the
Section 280G and/or Section 4999 provisions of such employment agreement shall
control as to any awards held by that participant).

  7.8   Section 162(m) Limitations. To the extent limited by Section 162(m) of
the Code in the case of an award intended as performance-based compensation
thereunder and necessary to assure the deductibility of the compensation payable
under the award, the Administrator shall have no discretion under this Plan
(a) to increase the amount of compensation or the number of shares that would
otherwise be due upon the attainment of the applicable performance target or the
exercise of the option or SAR, or (b) to waive the achievement of any applicable
performance goal as a condition to receiving a benefit or right under the award.

8. OTHER PROVISIONS

  8.1   Compliance with Laws. This Plan, the granting and vesting of awards
under this Plan, the offer, issuance and delivery of shares of Common Stock, the
acceptance of promissory notes and/or the payment of money under this Plan or
under awards are subject to compliance with all applicable federal and state
laws, rules and regulations (including but not limited to state and federal
securities law, federal margin requirements) and to such approvals by any
listing, regulatory or governmental authority as may, in the opinion of counsel
for the Corporation or one of its Subsidiaries or Affiliates, be necessary or
advisable in connection therewith. The person acquiring any securities under
this Plan will, if requested by the Corporation or one of its Subsidiaries or
Affiliates, provide such assurances and representations to the Corporation or
one of its Subsidiaries or Affiliates as the Administrator may deem necessary or
desirable to assure compliance with all applicable legal and accounting
requirements.

  8.2   Employment Status. No person shall have any claim or rights to be
granted an award (or additional awards, as the case may be) under this Plan,
subject to any express contractual rights (set forth in a document other than
this Plan) to the contrary.

  8.3   No Employment/Service Contract. Nothing contained in this Plan (or in
any other documents under this Plan or in any award) shall confer upon any
Eligible Person or other participant any right to continue in the employ or
other service of the Corporation or one of its Subsidiaries or Affiliates,
constitute any contract or agreement of employment or other service or affect an
employee’s status as an employee at will, nor shall interfere in any way with
the right of the Corporation or one of its Subsidiaries or Affiliates to change
a person’s compensation or other benefits, or to terminate his or her employment
or other service, with or without cause. Nothing in this Section 8.3, however,
is intended to adversely affect any express independent right of such person
under a separate employment or service contract other than an award agreement.

  8.4   Plan Not Funded. Awards payable under this Plan shall be payable in
shares or from the general assets of the Corporation, and no special or separate
reserve, fund or deposit shall be made to assure payment of such awards. No
participant, beneficiary or other person shall have any right, title or interest
in any fund or in any specific asset (including shares of Common Stock, except
as expressly otherwise provided) of the Corporation by reason of any award
hereunder. Neither the provisions of this Plan (or of any related documents),
nor the creation or adoption of this Plan, nor any action taken pursuant to the
provisions of this Plan shall create, or be construed to create, a trust of any
kind or a fiduciary relationship between the Corporation or one of its
Subsidiaries or Affiliates and any participant, beneficiary or other person. To
the extent that a participant, beneficiary or other person acquires a right to
receive payment pursuant to any award hereunder, such right shall be no greater
than the right of any unsecured general creditor of the Corporation.

  8.5   Tax Withholding. Upon any exercise, vesting, or payment of any award or
upon the disposition of shares of Common Stock acquired pursuant to the exercise
of an ISO prior to satisfaction of the holding period requirements of
Section 422 of the Code, the Corporation or one of its Subsidiaries or
Affiliates shall have the right at its option to:

  (a)   require the participant (or the participant’s personal representative or
beneficiary, as the case may be) to pay or provide for payment of at least the
minimum amount of any taxes which the Corporation or one of its Subsidiaries or
Affiliates may be required to withhold with respect to such award event or
payment; or

  (b)   deduct from any amount otherwise payable in cash to the participant (or
the participant’s personal representative or beneficiary, as the case may be)
the minimum amount of any taxes which the Corporation or one of its Subsidiaries
or Affiliates may be required to withhold with respect to such cash payment.

In any case where a tax is required to be withheld in connection with the
delivery of shares of Common Stock under this Plan, the Administrator may in its
sole discretion (subject to Section 8.1) grant (either at the time of the award
or thereafter) to the participant the right to elect, pursuant to such rules and
subject to such conditions as the Administrator may establish, to have the
Corporation reduce the number of shares to be delivered by (or otherwise
reacquire) the appropriate number of shares, valued in a consistent manner at
their fair market value or at the sales price in accordance with authorized
procedures for cashless exercises, necessary to satisfy the minimum applicable
withholding obligation on exercise, vesting or payment. In no event shall the
shares withheld exceed the minimum whole number of shares required for tax
withholding under applicable law. The Corporation may, with the Administrator’s
approval, accept one or more promissory notes from any Eligible Person in
connection with taxes required to be withheld upon the exercise, vesting or
payment of any award under this Plan; provided that any such note shall be
subject to terms and conditions established by the Administrator and the
requirements of applicable law.

8.6 Effective Date, Termination and Suspension, Amendments.

8.6.1 Effective Date. This Plan is effective as of March 5, 2004, the date of
its approval by the Board (the “Effective Date”). This Plan shall be submitted
for and subject to stockholder approval no later than twelve months after the
Effective Date. Unless earlier terminated by the Board, this Plan shall
terminate at the close of business on the day before the tenth anniversary of
the Effective Date. After the termination of this Plan either upon such stated
expiration date or its earlier termination by the Board, no additional awards
may be granted under this Plan, but previously granted awards (and the authority
of the Administrator with respect thereto, including the authority to amend such
awards) shall remain outstanding in accordance with their applicable terms and
conditions and the terms and conditions of this Plan.

8.6.2 Board Authorization. The Board may, at any time, terminate or, from time
to time, amend, modify or suspend this Plan, in whole or in part. No awards may
be granted during any period that the Board suspends this Plan.

8.6.3 Stockholder Approval. To the extent then required by applicable law or any
applicable listing agency or required under Sections 162, 422 or 424 of the Code
to preserve the intended tax consequences of this Plan, or deemed necessary or
advisable by the Board, any amendment to this Plan shall be subject to
stockholder approval.

8.6.4 Amendments to Awards. Without limiting any other express authority of the
Administrator under (but subject to) the express limits of this Plan, the
Administrator by agreement or resolution may waive conditions of or limitations
on awards to participants that the Administrator in the prior exercise of its
discretion has imposed, without the consent of a participant, and (subject to
the requirements of Sections 3.2 and 8.6.5) may make other changes to the terms
and conditions of awards. Any amendment or other action that would constitute a
repricing of an award is subject to the limitations set forth in Section 3.2(g).

8.6.5 Limitations on Amendments to Plan and Awards. No amendment, suspension or
termination of this Plan or change of or affecting any outstanding award shall,
without written consent of the participant, affect in any manner materially
adverse to the participant any rights or benefits of the participant or
obligations of the Corporation under any award granted under this Plan prior to
the effective date of such change. Changes, settlements and other actions
contemplated by Section 7 shall not be deemed to constitute changes or
amendments for purposes of this Section 8.6.

  8.7   Privileges of Stock Ownership. Except as otherwise expressly authorized
by the Administrator or this Plan, a participant shall not be entitled to any
privilege of stock ownership as to any shares of Common Stock not actually
delivered to and held of record by the participant. No adjustment will be made
for dividends or other rights as a stockholder for which a record date is prior
to such date of delivery.

8.8 Governing Law; Construction; Severability.

8.8.1 Choice of Law. This Plan, the awards, all documents evidencing awards and
all other related documents shall be governed by, and construed in accordance
with the laws of the State of Maryland.

8.8.2 Severability. If a court of competent jurisdiction holds any provision
invalid and unenforceable, the remaining provisions of this Plan shall continue
in effect.

8.8.3 Plan Construction.

  (a)   Rule 16b-3. It is the intent of the Corporation that the awards and
transactions permitted by awards be interpreted in a manner that, in the case of
participants who are or may be subject to Section 16 of the Exchange Act,
qualify, to the maximum extent compatible with the express terms of the award,
for exemption from matching liability under Rule 16b-3 promulgated under the
Exchange Act. Notwithstanding the foregoing, the Corporation shall have no
liability to any participant for Section 16 consequences of awards or events
under awards if an award or event does not so qualify.

  (b)   Section 162(m). Awards under Section 5.1.4 to persons described in
Section 5.2 that are either granted or become vested, exercisable or payable
based on attainment of one or more performance goals related to the Business
Criteria, as well as Qualifying Options and Qualifying SARs granted to persons
described in Section 5.2, that are approved by a committee composed solely of
two or more outside directors (as this requirement is applied under Section
162(m) of the Code) shall be deemed to be intended as performance-based
compensation within the meaning of Section 162(m) of the Code unless such
committee provides otherwise at the time of grant of the award. It is the
further intent of the Corporation that (to the extent the Corporation or one of
its Subsidiaries or awards under this Plan may be or become subject to
limitations on deductibility under Section 162(m) of the Code) any such awards
and any other Performance-Based Awards under Section 5.2 that are granted to or
held by a person subject to Section 162(m) will qualify as performance-based
compensation or otherwise be exempt from deductibility limitations under Section
162(m).

  8.9   Captions. Captions and headings are given to the sections and
subsections of this Plan solely as a convenience to facilitate reference. Such
headings shall not be deemed in any way material or relevant to the construction
or interpretation of this Plan or any provision thereof.

  8.10   Stock-Based Awards in Substitution for Stock Options or Awards Granted
by Other Corporation. Awards may be granted to Eligible Persons in substitution
for or in connection with an assumption of employee stock options, SARs,
restricted stock or other stock-based awards granted by other entities to
persons who are or who will become Eligible Persons in respect of the
Corporation or one of its Subsidiaries or Affiliates, in connection with a
distribution, merger or other reorganization by or with the granting entity or
an affiliated entity, or the acquisition by the Corporation or one of its
Subsidiaries or Affiliates, directly or indirectly, of all or a substantial part
of the stock or assets of the employing entity. The awards so granted need not
comply with other specific terms of this Plan, provided the awards reflect only
adjustments giving effect to the assumption or substitution consistent with the
conversion applicable to the Common Stock in the transaction and any change in
the issuer of the security. Any shares that are delivered and any awards that
are granted by, or become obligations of, the Corporation, as a result of the
assumption by the Corporation of, or in substitution for, outstanding awards
previously granted by an acquired company (or previously granted by a
predecessor employer (or direct or indirect parent thereof) in the case of
persons that become employed by the Corporation or one of its Subsidiaries or
Affiliates in connection with a business or asset acquisition or similar
transaction) shall not be counted against the Share Limit or other limits on the
number of shares available for issuance under this Plan.

  8.11   Non-Exclusivity of Plan. Nothing in this Plan shall limit or be deemed
to limit the authority of the Board or the Administrator to grant awards or
authorize any other compensation, with or without reference to the Common Stock,
under any other plan or authority.

  8.12   No Corporate Action Restriction. The existence of this Plan, the award
agreements and the awards granted hereunder shall not limit, affect or restrict
in any way the right or power of the Board or the stockholders of the
Corporation to make or authorize: (a) any adjustment, recapitalization,
reorganization or other change in the capital structure or business of the
Corporation or any subsidiary or affiliate, (b) any merger, amalgamation,
consolidation or change in the ownership of the Corporation or any subsidiary or
affiliate, (c) any issue of bonds, debentures, capital, preferred or prior
preference stock ahead of or affecting the capital stock (or the rights thereof)
of the Corporation or any subsidiary or affiliate, (d) any dissolution or
liquidation of the Corporation or any subsidiary or affiliate, (e) any sale or
transfer of all or any part of the assets or business of the Corporation or any
subsidiary or affiliate, or (f) any other corporate act or proceeding by the
Corporation or any subsidiary or affiliate. No participant, beneficiary or any
other person shall have any claim under any award or award agreement against any
member of the Board or the Administrator, or the Corporation or any employees,
officers or agents of the Corporation or any subsidiary or affiliate, as a
result of any such action.

  8.13   Other Company Benefit and Compensation Programs. Payments and other
benefits received by a participant under an award made pursuant to this Plan
shall not be deemed a part of a participant’s compensation for purposes of the
determination of benefits under any other employee welfare or benefit plans or
arrangements, if any, provided by the Corporation or one of its Subsidiaries or
Affiliates, except where the Administrator expressly otherwise provides or
authorizes in writing. Awards under this Plan may be made in addition to, in
combination with, as alternatives to or in payment of grants, awards or
commitments under any other plans or arrangements of the Corporation or one of
its Subsidiaries or Affiliates.

7

APPENDIX A

BUSINESS CRITERIA

The Business Criteria referred to in Section 5.2.2 of the Plan shall mean any
one or a combination of the following terms. These terms are used as applied
under generally accepted accounting principles or in the Corporation’s financial
reporting. The Business Criteria applicable to an award may be established with
respect to the Corporation (on either a stand-alone or consolidated basis) or
any applicable Subsidiary, division, segment, or unit.

Before-Tax Net Income. “Before-Tax Net Income” means net income from operations
before reduction for income taxes with the following adjustments: (a) benefits
payable under the company’s employee incentive compensation plans for the
applicable performance period to employees of that entity (other than employees
who participate in this Plan for that performance period) shall be deducted, but
any cash benefits payable under this Plan shall not be deducted unless otherwise
expressly provided by the Administrator at the time of grant of the Award;
(b) any income or loss derived from discontinued operations shall be excluded
(unless the Administrator expressly provides in the applicable award agreement
that such income or loss shall not be excluded with respect to the related
award); and (c) any income or loss derived from new or acquired operations shall
be excluded (unless the Administrator expressly provides in the applicable award
agreement that such income or loss shall not be excluded with respect to the
related award).

Cash Flow. “Cash Flow” means cash and cash equivalents derived from either:
(a) net cash flow from operations, or (b) net cash flow from operations,
financings and investing activities, as determined by the Administrator at the
time of grant and set forth in the applicable award agreement.

Corporate Overhead Costs. “Corporate Overhead Costs” means an entity’s allocable
share of the company’s corporate overhead shared services including human
resources, accounting, legal, information technology and compliance services.

Delinquency Rates. “Delinquency Rates” means the percentage of borrowers whose
loans are serviced by the company who have not made a payment on or before its
due date.

Earnings Per Share. “Earnings Per Share” means earnings per share of Common
Stock on a fully diluted basis (giving effect to the dilutive effects of stock
options, restricted stock, and other dilutive instruments) determined by
dividing: (a) net earnings, by (b) the weighted average number of common shares
and common share equivalents outstanding.

Economic Profit. “Economic Profit” means the company’s net operating profit
after tax less a capital charge. The capital charge is calculated by multiplying
the company’s operating capital by the company’s weighted average cost of
capital.

Employees. “Employees” means the entity’s aggregate number of employees, or the
number performing a specific function (such as loan officers, account
executives, telemarketers, etc.).

Gain on Sale of Loans. “Gain on Sale of Loans” means the total gain recognized
on loans sold through whole loan transactions or through securitizations, net of
premiums paid to acquire such loans and net of expenses associated with the sale
of such loans.

Liquidity Management. “Liquidity Management” means the company’s cash and
borrowing capacity under its credit commitments.

Loan Losses. “Loan Losses” means sales of loans for less than the loan amount or
sales of REOs for less than the loan amount at the time of foreclosure plus
expenses and other advances in maintaining and selling the REO.

Loan Production Volume. “Loan Production Volume” means the aggregate volume of
loans funded during any given period or the volume of a type or category of
loans funded during any given period, as specified by the Administrator in the
award agreement.

Loan Quality. “Loan Quality” means a mathematical score based on the number of
loans originated in accordance with the company’s underwriting policies and
procedures, loans sold, either individually, through bulk sales transactions, or
through securitizations, at a premium price as a percentage of total loans sold,
and various other measures.

Operating Margin. “Operating Margin” means, on a percentage basis, the net
execution of all whole loan sales during the performance period, plus net
interest earned on unsold inventory, less loan acquisition costs.

Origination Expenses. “Origination Expenses” means the aggregate points and fees
paid to mortgage brokers or correspondents, commission expenses and other direct
origination-related expenses paid by an entity in connection with loan
originations over a specified period.

Origination Revenues. “Origination Revenues” means the aggregate points and fees
and other revenues received by an Entity from borrowers in connection with loan
originations over a specified period.

Residual Performance. “Residual Performance” means the performance of residual
interests in the company’s loan securitization transactions as compared with the
projected performance used by the company in recording the book value of the
residual interests.

Return on Assets. “Return on Assets” means the company’s consolidated net income
(less any preferred dividends), divided by the company’s average assets.

Return on Capital Invested. “Return on Capital Invested” means the company’s
consolidated net income (less any preferred dividends), divided by the company’s
invested capital.

Return on Equity. “Return on Equity” means consolidated net income of the
company (less any preferred dividends), divided by the average consolidated
common stockholders equity.

Return on Sales/Revenue. “Return on Sales/Revenue” means the company’s
consolidated net income (less any preferred dividends), divided by the company’s
total sales or revenue, as applicable.

Stock Price. “Stock Price” means the stock price or market value of the Common
Stock of the Corporation.

Total Stockholders’ Equity. “Total Stockholders’ Equity” means the company’s
total stockholders’ equity as shown on the company’s audited financial
statements as of the first day of a performance period, increased for equity
issued during the performance period and decreased for equity reacquired during
the performance period in the manner described in the next two sentences. The
amount of any such increase shall be equal to the amount of equity issues during
the performance period multiplied by a fraction, the numerator of which is the
number of days remaining in the performance period and the denominator of which
is the total number of days is 365. The amount of any such decrease shall be
equal to the amount of equity reacquired by the company during the performance
period multiplied by a fraction, the numerator of which is the number of days
remaining in the performance period and the denominator of which is the total
number of days is 365.

Total Stockholder Return. “Total Stockholder Return” means, with respect to the
Corporation or other entities (if measured on a relative basis): (a) the change
in the market price of its common stock (as quoted on the principal market on
which it is traded as of the beginning and ending of the period) plus dividends
and other distributions paid, divided by (b) the beginning quoted market price
for the common stock, all of which is adjusted for any changes in equity
structure, including but not limited to stock splits and stock dividends.

8

Exhibit D

Form of Press Release

FOR ADDITIONAL INFORMATION CONTACT:
New Century Financial Corporation
18400 Von Karman, Suite 1000
Irvine, CA 92612

Carrie Marrelli, VP, Investor Relations
(949) 224-5745

Erin Freeman, VP, Corporate Communications
(949) 862-7624

Hugh Burns/Dan Gagnier, Citigate Sard
Verbinnen (212) 687-8080

Greenlight Capital, Inc.
2 Grand Central Tower
140 East 45 Street, Floor 24
New York, NY 10017

Daniel Roitman, COO
(212) 973-1900

Steve Bruce, The Abernathy MacGregor Group
(212) 371-5999

9

NEW CENTURY FINANCIAL CORPORATION AND GREENLIGHT CAPITAL REACH
AGREEMENT TO END PROXY CONTEST

David Einhorn To Join Board of Directors

Irvine, Calif. and New York, NY, March [X], 2006, New Century Financial
Corporation (NYSE: NEW), a real estate investment trust (REIT) and parent
company of one of the nation’s premier mortgage finance companies, and
Greenlight Capital, Inc. (“Greenlight”) today announced that they have reached
an agreement under which Greenlight will cease its efforts to run a slate of
three director nominees for election to the New Century Board of Directors.

Under the terms of the agreement, New Century will increase the size of its
Board to eleven members and David Einhorn, President of Greenlight, will be
appointed to serve as a Class III director effective March 31, 2006. Mr. Einhorn
will stand for reelection at the company’s 2006 Annual Meeting of Stockholders,
scheduled for May 10, 2006. Greenlight has also agreed that it will not initiate
a proxy contest against the company while Mr. Einhorn is serving as a director
and that it will vote its shares in favor of the three incumbent directors who
are up for reelection at the 2006 Annual Meeting of Stockholders.

In addition, New Century will provide Greenlight an exception to its current
9.8 percent shareholding limit, permitting Greenlight to increase its ownership
to as much as 19.6 percent of the company’s outstanding common stock.

“Since Greenlight notified the company of its intention to nominate a slate of
directors, the parties have engaged in constructive dialogue across a number of
issues. We believe this dialogue has given us a framework under which we can
work together to continue building value for all New Century stockholders. We
look forward to Mr. Einhorn’s active participation in his new capacity as a
member of our Board,” said Fredric J. Forster, Lead Independent Director of New
Century.

“Our discussions with the company over the last few weeks have been very
productive. New Century is a unique and valuable franchise. I look forward to
sharing my perspective as the Board oversees effective allocation of the
company’s capital to the most attractive risk-adjusted opportunities, and to
working with the other Board members to enhance per share value for all
stockholders,” said Mr. Einhorn.

About New Century Financial Corporation

Founded in 1995 and headquartered in Irvine, California, New Century Financial
Corporation is a real estate investment trust and one of the nation’s premier
mortgage finance companies, providing mortgage products to borrowers nationwide
through its operating subsidiaries, New Century Mortgage Corporation and Home123
Corporation. The company offers a broad range of mortgage products designed to
meet the needs of all borrowers. New Century is committed to serving the
communities in which it operates with fair and responsible lending practices. To
find out more about New Century, please visit www.ncen.com.

As of December 31, 2005, New Century originated loans through 222 sales offices
operating in 35 states and 35 regional processing centers operating in 18 states
and employed approximately 7,200 Associates.

About Greenlight Capital, Inc.

Founded in 1996 and headquartered in New York, Greenlight Capital is a
value-oriented investment management firm established to invest principally in
publicly traded U.S. corporate debt and equity securities. Greenlight’s
investment philosophy is to combine the analytical discipline of determining
fair value with a practical understanding of markets. Greenlight believes that
an investment approach that emphasizes intrinsic value will achieve consistent
absolute investment returns and safeguard capital regardless of market
conditions. Greenlight manages through its affiliates over $3 billion of assets
in a variety of pooled investment vehicles.

Safe Harbor Regarding Forward-Looking Statements

Certain statements contained in this press release may be deemed to be
forward-looking statements under federal securities laws and the company intends
that such forward-looking statements be subject to the safe-harbor created
thereby. Such forward-looking statements include, but are not limited to:
(i) the company’s belief that its dialogue with Greenlight has given it a
framework under which it can continue building value for all of the company’s
stockholders and (ii) the goal of effectively allocating the company’s capital
to the most attractive risk-adjusted opportunities and enhancing per share value
for all stockholders. The company cautions that these statements are qualified
by important factors that could cause actual results to differ materially from
those reflected by the forward-looking statements. Such factors include, but are
not limited to: (i) the condition of the U.S. economy and financial system;
(ii) the interest rate environment; (iii) the effect of increasing competition
in the company’s sector; (iv) the condition of the markets for whole loans and
mortgage-backed securities; (v) the stability of residential property values;
(vi) the company’s ability to comply with the requirements applicable to REITs;
(vii) the impact of more vigorous and aggressive enforcement actions by federal
or state regulators; (viii) the company’s ability to grow its loan portfolio;
(ix) the company’s ability to continue to maintain low loan acquisition costs;
(x) the potential effect of new state or federal laws and regulations; (xi) the
company’s ability to maintain adequate credit facilities to finance its
business; (xii) the outcome of litigation or regulatory actions pending against
the company; and (xiii) the assumptions underlying the company’s risk management
practices. Additional information on these and other factors is contained in the
company’s Annual Report on Form 10-K for the year ended December 31, 2004 and
the other periodic filings of the company with the Securities and Exchange
Commission. The company assumes no, and hereby disclaims any, obligation to
update the forward-looking statements contained in this press release.

10