AMENDED AND RESTATED EMPLOYMENT AGREEMENT

EXHIBIT 10.2

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This Amended and Restated Employment Agreement (“Agreement”) is effective as of October 30, 2006 (the “Effective Date”) between New Century Financial Corporation, a Maryland corporation (the “Company”), and Patti M. Dodge (“Executive”).

WHEREAS, Executive and the Company are currently parties to an Employment Agreement which was effective as of July 16, 2004 (the “2004 Employment Agreement”); and

WHEREAS, Executive and the Company desire to continue Executive’s employment with the Company on different terms and conditions that are mutually satisfactory to the parties.

NOW, THEREFORE, in consideration of the mutual covenants and agreements set forth herein, Executive and the Company agree that from and after the Effective Date hereof, the 2004 Employment Agreement shall be amended and restated to provide as follows:

ARTICLE I

EMPLOYMENT

The Company hereby employs Executive and Executive accepts employment with the Company upon the terms and conditions herein set forth.

(a) The Company employs Executive, and Executive agrees to serve, as of November 15, 2006, in the position of Executive Vice President, Investor Relations, reporting to the Chief Executive Officer and President of New Century Financial Corporation, with the understanding that Executive’s position and duties are subject to change at the discretion of the Chief Executive Officer and President of the Company at any time. Executive agrees to perform such usual and customary duties of such office as may be delegated to Executive from time to time by Executive Management or the Board of Directors.

(b) Executive shall devote Executive’s best efforts to the performance of Executive’s duties and responsibilities for the Company. Executive will not, without the prior written approval of the Chief Executive Officer, engage in any other activity for any competitor of the Company, or which would unreasonably interfere with the performance of Executive’s duties, services, and responsibilities hereunder, or which is in violation of policies established from time to time by the Company.

1.2 Term. Where used, “Term” shall refer to entire period of employment of Executive by the Company beginning on the Effective Date of this Agreement, and ending immediately upon the earliest to occur of the following and ending on the earliest of:

(d) The date of Executive’s death.

1.3 Extension of Agreement : Unless this Agreement has been terminated pursuant to Section 1.2 above (and the corresponding provisions of this Agreement), the Term of this Agreement shall be automatically extended for additional one-year periods unless and until 30 days written notice is given either by Executive or the Company to cease the automatic renewal of this Agreement (the “Notice of Non-Renewal”). The parties agree, covenant and represent that Executive and the Company each may decide, in either’s sole and unfettered discretion, to issue the Notice of Non-Renewal with or without cause, and with or without prior notice.

ARTICLE II
COMPENSATION

2.1 Base Salary. During the term of this Agreement, the Company shall pay to Executive a base salary in the gross amount of $315,000.00 per year, payable in bi-weekly installments less standard and authorized withholdings and deductions, pursuant to the Company’s then-existing payroll policies and procedures. Executive’s Base Salary shall be reviewed annually for increases in accordance with Company policy and practice and at the discretion of the Company. However, Executive has no right to any increase in her rate of Base Salary from the level set forth above.

2.2 Bonuses. Executive shall be eligible to participate in a discretionary Incentive Bonus Plan (the “Plan”) as established and modified by the Company from time to time, according to the following schedule:

Executive does not earn any bonus payment until the date it is paid. Accordingly, notwithstanding any other provision of this Agreement or the Plan, it is a mandatory condition precedent to any bonus payment to which Executive may from time to time become entitled, that Executive be actively employed by the Company on a continuing full-time basis, in good standing on the date the bonus is actually paid to earn and receive the bonus. Executive acknowledges that, among other things, the bonus is designed primarily as an incentive for Executive to remain in the Company’s employ during succeeding bonus periods. Bonus amounts shall remain discretionary and bonuses shall not be prorated or apportioned regardless of the manner in which Executive’s employment terminates. The Company at all times maintains the right and the discretion to change existing bonus plans, introduce new bonus plans, change the timing of bonus payouts, and/or eliminate bonus plans.

2.3 Reimbursement of Expenses. Executive shall be entitled to receive reimbursement of all reasonable expenses incurred by Executive in performing services hereunder, including all reasonable expenses of travel and reasonable living expenses while away from home on business at the request of, or in the service of, the Company, provided that such expenses are incurred and accounted for in accordance with the policies and procedures established by the Company.

2.4 Benefits. Executive shall be entitled to participate in all health, insurance, pension, disability insurance and other employee plans and benefits that the Company may from time to time, and in its sole discretion, provide to employees in comparable positions (collectively referred to herein as the “Company Benefit Plans”), subject to meeting applicable eligibility requirements. Executive shall also be eligible to participate in the Long Term Incentive Compensation Plan (the “LTIC Plan”) offered by the Company with the type or types of each such grant (stock option, restricted stock, or otherwise, or any combination thereof) to be determined by the Company and each such grant to be subject to vesting requirements and the other terms and conditions as established by the Company with respect to each particular grant. The Company at all times maintains the right and the discretion to change the existing LTIC Plan, introduce a new LTIC Plan, and/or eliminate any existing LTIC Plan.

Executive acknowledges and agrees that she has received all compensation and benefits (including, without limitation, bonuses and long-term equity and other incentive grants) due to her through and including the date hereof (other than accrued and unpaid salary for the current pay period and accrued and unpaid vacation of approximately 40 days).

2.5 Vacations and Holidays. During Executive’s employment with the Company, Executive shall be entitled to an annual vacation leave at full pay, such vacation to be at the rate of 30 days (six weeks) in each year of the term hereof. Any vacation exceeding 4 consecutive weeks shall require prior approval by the Chief Executive Officer. Executive shall be entitled to such holidays as are established by the Company for all employees. The maximum vacation accrual that Executive may have at any time shall equal 60 days (twelve weeks). If Executive’s earned but unused vacation time accrual reaches the maximum, Executive shall not continue to accrue any additional vacation time until Executive’s usage lowers available vacation to a level below the maximum.

2.6 Automobile Expenses . For as long as the Company provides a monthly automobile allowance to other senior executives of the Company generally, the Company will provide Executive with an automobile allowance of $500 per month.

2.7 Withholding. The Company shall deduct from all payments made to Executive pursuant to this Agreement all federal and state withholding taxes, old age and survivors and other social security payments, state disability and other insurance premium payments required to be withheld by applicable law or as otherwise agreed between the Company and Executive.

ARTICLE III
NON-COMPETITION, CONFIDENTIALITY AND NONDISCLOSURE

3.1 Confidentiality Agreement. Concurrently with the execution and delivery of this Agreement, and as part of the consideration for the promises and undertakings by the Company in this Agreement, Executive shall execute and deliver the Confidentiality Agreement attached as Exhibit “A” hereto and incorporated herein by reference (the “Confidentiality Agreement”).

3.2 No Violation of Other Agreements. Executive represents that, to the best of Executive’s knowledge, performance of all the terms of this Agreement and as an employee of the Company does not and will not breach any obligation of Executive:

ARTICLE IV
TERMINATION

4.1 Definitions. For purposes of this Article IV, the following definitions shall apply to the terms set forth below:

(a)  Cause . The Company at all times reserves the right to terminate Executive’s employment for “Cause,” which shall be defined as follows:

(i) Executive’s conviction for, indictment regarding (or its procedural equivalent), or the entering of a guilty plea (or plea of nolo contendere ) to, any crime with respect to which imprisonment is a possible punishment (whether or not actually imposed), which involves moral turpitude or which might, in the opinion of the Company, cause embarrassment to the Company;

(ii) Actions by Executive during the term of this Agreement involving willful malfeasance or gross negligence in the performance of Executive’s duties hereunder which could be materially and demonstrably injurious to the Company;

(iii) Executive’s refusal to perform the duties of Executive’s position as proscribed by the Chief Executive Officer or Executive Management of the Company, and/or Executive’s failure to perform the duties of Executive’s position in a manner deemed satisfactory by the Executive Management of the Company;

(iv) Executive’s commission of an act of fraud, embezzlement, theft or dishonesty against the Company or any of its affiliates, or the discovery that such misconduct has occurred in the past;

(v) Executive’s breach of any material term of this Agreement or failure or refusal to perform any material obligation or duty as required by this Agreement;

(vi) Executive’s violation of any reasonable rule or regulation of the Company applicable to Executive;

(vii) Executive’s (i) obstruction or impediment of, (ii) endeavors to influence, obstruct or impede, or (iii) failure to materially cooperate with, any investigation authorized by the Board of Directors of the Company or any governmental or self regulatory entity (“Investigation”); provided, however, Executive’s failure to waive attorney-client privilege relating to communications with Executive’s attorney in connection with an Investigation shall not constitute “Cause”; or

(viii) Executive’s removal, concealment, destruction or purposeful withholding, alteration or falsification of any material that is requested in connection with an Investigation.

(b)  Change in Control . “Change in Control” shall mean the occurrence of a “Change in Control Event” as such term is defined in the Company’s Change in Control Severance Policy.

(c)  Disability. For purposes of this Agreement, “Disabled” and “Disability” shall mean a physical or mental impairment that, even with reasonable accommodation, prevents Executive from performing the essential functions of Executive’s job for a period of 60 consecutive days or for shorter periods aggregating 90 days or more during the Term of this Agreement.

(d)  Good Reason. For purposes of this Agreement, “Good Reason” shall mean the occurrence of one or more of the following without the Executive’s written consent:

(i) a material breach of this Agreement by the Company; or

(ii) a material diminution in the Executive’s responsibilities, duties, authority (when viewed together, in the aggregate) including, without limitation, any change in title; or

(iii) the failure of the Company to obtain the assumption in writing of its obligations to perform this Agreement by any successor to all or substantially all of the assets or business of the Company within fifteen (15) days upon a merger, consolidation, sale or similar transaction; or

(iv) the assignment of the Executive to duties that would require Executive to relocate or transfer Executive’s principal place of residence to a location outside of Southern California, or that would make the continuance of Executive’s principal place of residence in Southern California unreasonably difficult;

provided , however , that none of the events specified in this Section 4.1(d) shall constitute Good Reason unless the Executive shall have notified the Company in writing describing the events which constitute Good Reason and the Company shall have failed to cure such event within a reasonable period, not to exceed ten (10) days, after the Company’s actual receipt of such written notice. For purposes of clarity, a termination of the Executive’s employment for Cause or due to the Executive’s death, Disability or retirement shall not constitute Good Reason. Furthermore, Executive acknowledges and agrees that no events or circumstances that occurred prior to and including the execution of this Agreement (including, without limitation, the parties negotiating and entering into this Agreement to reflect Executive’s new position and responsibilities for the Company) constituted or shall constitute “Good Reason.”

4.2 Termination by Company Without Cause. In addition to its rights to terminate Executive’s employment hereunder by giving a Notice of Non-Renewal pursuant to Section 1.3 above, or immediately for Cause, the Company at all times has the right to terminate Executive’s employment without Cause and without prior notice. Executive and Company understand and acknowledge that Executive’s employment with Company is at will, meaning that Executive and the Company may terminate this employment relationship with or without good cause and with or without notice. Nothing in this Agreement shall diminish or restrict either Executive’s right to resign from employment, or the Company’s right to discharge Executive at any time, with or without Cause, and with or without written notice. The at-will nature of Executive’s employment may only be altered by a written agreement signed by the Chief Executive Officer of the Company.

4.3 Benefits Received Upon Termination . Except as expressly provided below, in the event of a termination of Executive’s employment with the Company: (1) Executive shall not be entitled to any form of severance payment or other compensation, (2) the Company shall have no further obligations to Executive under this Agreement, and (3) without limiting the generality of the foregoing, the Company shall have no obligation to pay any unearned bonus or other benefit of employment.

(a)  Non-Renewal or Termination for Cause . If Executive’s employment terminates by reason of Executive’s death, pursuant to a Notice of Non-Renewal, or for Cause, then the Company shall pay Executive (or Executive’s estate) Executive’s Base Salary (in effect as of the date of termination) through the effective date of such termination plus an amount equal to the Base Salary equivalent of any vacation earned but not taken.

(b)  Termination Without Cause . If Executive’s employment is terminated by the Company without Cause and not pursuant to a Notice of Non-Renewal:

(i) The Company will pay to Executive Executive’s Base Salary (in effect as of the date of termination) through the effective date of such termination plus an amount equal to the Base Salary equivalent of any vacation earned but not taken; and

(ii) The Company shall pay to Executive as severance pay (a) an aggregate amount equal to one times the Executive’s annualized rate of Executive’s 2006 Base Salary, plus (b) one-half (50%) of the amount of Executive’s incentive bonus awarded for the year 2006. Such payments are to be made in a series of substantially equal installment payments (each equal to a fraction of the aggregate severance pay to be provided), not less frequently than monthly, in accordance with the Company’s usual payroll practices over a period of one (1) year following the effective date of such termination. During any period of severance pay hereunder, Executive shall not be entitled to receive any bonus, health insurance, life insurance or other benefit of employment, except as required under COBRA and similar applicable law. In the event that Executive is covered by any change in control severance policy of the Company as in effect from time to time (or any similar plan, program, or policy of the Company) (a “CIC Severance Policy”) and it is determined that Executive is entitled to severance benefits under such CIC Severance Policy, then, notwithstanding anything else contained in such CIC Severance Policy to the contrary: (1) in no event shall Executive’s severance benefits under such CIC Severance Policy that are payable in cash exceed the amount of the cash severance benefit that Executive would be entitled to under this Agreement if her employment was terminated by the Company without Cause, and (2) in no event shall Executive be entitled to benefits under both this Agreement and the CIC Severance Policy (if Executive is otherwise entitled to benefits under both, she may promptly following the termination of her employment specify to the Company which benefit she elects to receive, with, for purposes of clarity, the CIC Severance Policy benefit modified as provided in the preceding clause (1)).

(c)  Termination Because of Employee Disability. Should Executive become Disabled (as defined above), Executive acknowledges that Executive’s employment may be terminated any time thereafter if such Disability continues; provided that, during the period of the Disability prior to such termination of employment, Executive shall continue to receive all compensation and benefits as if Executive were actively employed less any sums received directly by the Executive, if any, under any policy or policies of disability income insurance purchased by the Company. In the event of such termination, Executive’s rights to receive any salary or payments under this Agreement shall terminate but Executive shall have the right to continue to receive any and all employee benefits, if any, as to which Executive may be entitled under the employee benefit plans and insurance provided by the Company. Executive’s rights under any Company Benefit Plans shall be those rights accorded to any terminated employee under the plan provisions and applicable law.

(d)  Termination by Executive . Executive may terminate Executive’s employment hereunder at any time, upon written notice to the Chief Executive Officer of the Company. In such event, Executive shall be entitled to the Base Salary, vacation and other benefits that have accrued prior to the effective date of termination. Executive shall not (except as expressly provided in clause (e) below) be entitled to any other form of severance payment or other compensation, including, without limitation, any bonus compensation under Paragraph 2.2 hereof.

(e)  Change in Control . If a Change in Control occurs and Executive’s employment is terminated either by the Company without Cause or by Executive for Good Reason upon or within eighteen months following such Change in Control event, the Company shall (in lieu of, not in addition to, any obligations of the Company to Executive pursuant to the preceding provisions of this Section 4.3) pay to Executive the benefits set forth in the Company’s then in effect Change in Control Severance Policy.

4.5 Notwithstanding anything in Section 4.3 to the contrary, in the event the Company otherwise has any obligation pursuant to Section 4.3 to make severance paym