Exhibit 10.60

 

NEW CENTURY FINANCIAL CORPORATION

 

DIRECTORS DEFERRED COMPENSATION PLAN

 

--------------------------------------------------------------------------------

TABLE OF CONTENTS

 

1.    DEFINITIONS    1 2.    PARTICIPATION    3 3.    DEFERRAL ELECTIONS    3  
   3.1   

General Rule

   3      3.2   

Timing of Deferral Election

   3      3.3   

Duration of Deferral Election

   3 4.    STOCK UNIT ACCOUNTS    3      4.1   

Crediting of Deferrals

   3      4.2   

Dividend Equivalents

   4      4.3   

No Stockholder Rights

   4 5.    VESTING    4 6.    ADJUSTMENTS    4 7.    DISTRIBUTIONS; SHARE LIMIT
   4 8.    ADMINISTRATION    5      8.1   

Committee Action

   5      8.2   

Powers and Duties of the Committee

   5      8.3   

Construction and Interpretation

   6      8.4   

Compensation, Expenses and Indemnity

   6      8.5   

Statements

   6 9.    MISCELLANEOUS    6      9.1   

Unsecured General Creditor

   6      9.2   

Trust Arrangement

   6      9.3   

Tax Withholding

   7      9.4   

Restriction Against Assignment

   7      9.5   

Amendment, Modification, Suspension or Termination

   7      9.6   

Governing Law; Severability

   7      9.7   

Payments on Behalf of Persons Under Incapacity

   7      9.8   

No Service Commitment

   8      9.9   

Compliance with Laws

   8      9.10   

Plan Construction

   8      9.11   

Headings

   8      9.12   

Claims Procedure

   8

 

--------------------------------------------------------------------------------

1. DEFINITIONS

 

Whenever the following words and phrases are used in this Plan, with the first
letter capitalized, they shall have the meanings specified below.

 

“Annual Retainer” shall mean the cash annual retainer (but not meeting fees)
that the Participant is entitled to for services rendered as a member of the
Board of Directors (before reduction on account of deferrals under this Plan)
for a particular Plan Year.

 

“Beneficiary” or “Beneficiaries” shall mean the person or persons, including a
trustee, personal representative or other fiduciary, last designated in writing
by a Participant in accordance with procedures established by the Committee to
receive the benefits specified hereunder in the event of the Participant’s
death. No beneficiary designation shall become effective until it is filed with
the Committee, and no beneficiary designation of someone other than the
Participant’s spouse shall be effective unless such designation is consented to
by the Participant’s spouse on a form provided by and in accordance with the
procedures established by the Committee. If there is no Beneficiary designation
in effect, or if there is no surviving designated Beneficiary, then the
Participant’s surviving spouse shall be the Beneficiary. If there is no
surviving spouse to receive any benefits payable in accordance with the
preceding sentence, the duly appointed and currently acting personal
representative of the participant’s estate (which shall include either the
Participant’s probate estate or living trust) shall be the Beneficiary. In any
case where there is no such personal representative of the Participant’s estate
duly appointed and acting in that capacity within 90 days after the
Participant’s death (or such extended period as the Committee determines is
reasonably necessary to allow such personal representative to be appointed, but
not to exceed 180 days after the Participant’s death), then Beneficiary shall
mean the person or persons who can verify by affidavit or court order to the
satisfaction of the Committee that they are legally entitled to receive the
benefits specified hereunder. In the event any amount is payable under the Plan
to a minor, payment shall not be made to the minor, but instead be paid (a) to
that person’s living parent(s) to act as custodian, (b) if that person’s parents
are then divorced, and one parent is the sole custodial parent, to such
custodial parent, or (c) if no parent of that person is then living, to a
custodian selected by the Committee to hold the funds for the minor under the
Uniform Transfers or Gifts to Minors Act in effect in the jurisdiction in which
the minor resides. If no parent is living and the Committee decides not to
select another custodian to hold the funds for the minor, then payment shall be
made to the duly appointed and currently acting guardian of the estate for the
minor or, if no guardian of the estate for the minor is duly appointed and
currently acting within 60 days after the date the amount becomes payable,
payment shall be deposited with the court having jurisdiction over the estate of
the minor.

 

“Board of Directors” or “Board” shall mean the Board of Directors of the
Company.

 

“Committee” shall mean the Compensation Committee of the Board, which shall
administer the Plan in accordance with Section 8 of the Plan.

 

“Common Stock” shall mean the common stock of the Company, subject to adjustment
pursuant to Section 6 of the Plan.

 

“Company” shall mean New Century Financial Corporation, a Delaware corporation,
and any successor corporation.

 

1

--------------------------------------------------------------------------------

“Director” shall mean any individual who is serving as a member of the Board and
who is not an employee of the Company or one of its subsidiaries.

 

“Dividend Equivalent” shall mean the amount of cash dividends or other cash
distributions paid by the Company on that number of shares of Common Stock equal
to the number of Stock Units credited to a Participant’s Stock Unit Account as
of the applicable record date for the dividend or other distribution, which
amount shall be credited in the form of additional Stock Units to the
Participant’s Stock Unit Account, as provided in Section 4.2.

 

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended from
time to time.

 

“Fair Market Value” on any date means:

 

(a) if the stock is listed or admitted to trade on a national securities
exchange, the closing price of the stock on the Composite Tape on the relevant
date (or, if there is no trading of the stock on such date, then the closing
price of the stock as quoted on such Composite Tape on the next preceding date
on which there was trading in such shares) on the principal national securities
exchange on which the stock is so listed or admitted to trade, as published in
The Wall Street Journal;

 

(b) if the stock is not listed or admitted to trade on a national securities
exchange, the last price for the stock on such date (or, if there is no trading
of the stock on such date, then the last price for the stock on the next
preceding date on which there was trading in such shares), as furnished by the
National Association of Securities Dealers, Inc. (“NASD”) through the NASDAQ
National Market Reporting System or a similar organization if the NASD is no
longer reporting such information;

 

(c) if the stock is not listed or admitted to trade on a national securities
exchange and is not reported on the National Market Reporting System, the mean
between the bid and asked price for the stock on such date (or as of the most
recent business day that such information is available if the relevant date is
not a business day), as furnished by the NASD or a similar organization; or

 

(d) if the stock is not listed or admitted to trade on a national securities
exchange, is not reported on the National Market Reporting System and if bid and
asked prices for the stock are not furnished by the NASD or a similar
organization, the value as established by the Committee at such time for
purposes of this Plan.

 

“Participant” shall mean any Director who elects to defer his or her Annual
Retainer in accordance with Section 3.1.

 

“Plan” shall mean the New Century Financial Corporation Directors Deferred
Compensation Plan as set forth herein and as it may be amended from time to
time.

 

“Plan Year” shall mean the period of approximately one year commencing with an
annual meeting of the Company’s stockholders and ending with the next succeeding
annual meeting of the Company’s stockholders.

 

2

--------------------------------------------------------------------------------

“Stock Unit” shall mean a non-voting unit of measurement, which is deemed solely
for bookkeeping purposes under this Plan to be equivalent to one outstanding
share of Common Stock (subject to adjustment pursuant to Section 6).

 

“Stock Unit Account” shall mean the bookkeeping account maintained by the
Committee for each Participant that is credited with any Stock Units and
Dividend Equivalents with respect to such Stock Units.

 

“Termination Date” shall mean the date that the Participant’s services as a
member of the Board of Directors terminates for any reason.

 

2. PARTICIPATION

 

Directors will be eligible to defer all or a portion of their Annual Retainer in
accordance with Section 3. Notwithstanding anything else contained in this Plan
to the contrary, the Committee may, at any time and in its sole discretion,
terminate the ability of a Director to defer additional amounts under Section 3.

 

3. DEFERRAL ELECTIONS

 

3.1 General Rule. For any Plan Year commencing after January 1, 2004, a Director
may elect, on a form and in a manner prescribed by the Committee, to defer under
this Plan any of the following amounts:

 

(1) 50% of the Director’s Annual Retainer for that Plan Year,

 

(2) 75% of the Director’s Annual Retainer for that Plan Year, or

 

(3) 100% of the Director’s Annual Retainer for that Plan Year.

 

3.2 Timing of Deferral Election. An election to defer all or a portion of a
Participant’s Annual Retainer for a particular Plan Year must be filed on or
before the December 31 immediately preceding that Plan Year (or such earlier
deadline as the Committee may adopt with respect to that Plan Year).

 

3.3 Duration of Deferral Election. Any deferral election made by a Participant
pursuant to this Section 3 shall be irrevocable by the Participant and shall be
effective only with respect to the Annual Retainer for that particular Plan
Year. A Participant must file a new deferral election, on a form and in a manner
prescribed by the Committee, to defer his or her Annual Retainer for any
subsequent Plan Year.

 

4. STOCK UNIT ACCOUNTS

 

4.1 Crediting of Deferrals. The Committee shall establish and maintain a Stock
Unit Account for each Participant under this Plan. With respect to each
Participant who elects a deferral of all or a portion of his or her Annual
Retainer for a particular Plan Year, the Committee shall, as of the date(s) on
which the deferred portion of the Participant’s Annual Retainer would have
otherwise been paid to the Participant but for the Participant’s deferral
election under this Plan (each, a “Deferral Date”), credit the Participant’s
Stock Unit Account with a number of

 

3

--------------------------------------------------------------------------------

Stock Units equal to: (a) the amount of the Annual Retainer that the Participant
elected to defer under this Plan and that would have otherwise been paid to the
Participant on that Deferral Date but for the Participant’s deferral election
under this Plan, divided by (b) the Fair Market Value of a share of Common Stock
as of that Deferral Date.

 

4.2 Dividend Equivalents. As of the date on which the Company pays a dividend on
its Common Stock (each, a “Crediting Date”), the Participant’s Stock Unit
Account shall be credited with additional Stock Units equal in number to (a) the
amount of the Dividend Equivalents representing cash dividends paid on that
number of shares equal to the aggregate number of Stock Units in the
Participant’s Stock Unit Account at the start of business as of the relevant
dividend record date, divided by (b) the Fair Market Value of a share of Common
Stock as of that Crediting Date.

 

4.3 No Stockholder Rights. A Participant’s Stock Unit Account shall be a
memorandum account on the books of the Company. The Stock Units credited to a
Participant’s Stock Unit Account shall be used solely as a device for the
determination of the number of shares of Common Stock (or cash pursuant to
Section 7) to be eventually distributed to such Participant in accordance with
this Plan. The Stock Units shall not be treated as property or as a trust fund
of any kind. No Participant shall be entitled to any voting or other stockholder
rights with respect to Stock Units granted or credited under this Plan. The
number of Stock Units credited (and the Common Stock to which the Participant is
entitled under this Plan) shall be subject to adjustment in accordance with
Section 6 of this Plan. A Participant’s Stock Unit Account shall be reduced by
the number of Stock Units with respect to which payment or distribution is made
the terms of this Plan. The Participant shall have no further rights with
respect to any such Stock Unit which has been so settled in accordance with this
Plan.

 

5. VESTING

 

A Participant’s Stock Unit Account shall be 100% vested at all times.

 

6. ADJUSTMENTS

 

If any stock dividend, stock split, recapitalization, merger, consolidation,
combination or other reorganization, exchange of shares, sale of all or
substantially all of the assets of the Company, split-up, split-off,
extraordinary redemption, liquidation or similar change in capitalization or any
distribution to holders of the Company’s Common Stock shall occur, proportionate
and equitable adjustments consistent with the effect of such event on
stockholders generally (but without duplication of benefits if Dividend
Equivalents are credited) shall be made in the number and type of shares of
Common Stock or other securities, property and/or rights contemplated hereunder
and of rights in respect of Stock Units and Stock Unit Accounts credited under
this Plan so as to preserve the benefits intended.

 

7. DISTRIBUTIONS; SHARE LIMIT

 

Upon the termination of a Participant’s services as a member of the Board of
Directors for any reason, the Stock Units credited to his or her Stock Unit
Account shall be distributed upon or promptly after that date in the form of an
equivalent number of whole shares of Common Stock. The maximum of number of
shares of Common Stock that may be delivered with respect to benefits under this
Plan is 50,000 shares. Such limit is subject to adjustment pursuant to Section

 

4

--------------------------------------------------------------------------------

6. The shares delivered with respect to benefits under this Plan may be shares
of the Company’s authorized but unissued Common Stock and any of the Company’s
Common Stock held as treasury shares. Notwithstanding any other provision of
this Plan, the Committee may, in its sole discretion, settle any Stock Units
otherwise payable in accordance with this Plan by a cash payment in lieu of
Common Stock. Without limiting the Company’s authority to settle any Stock Unit
in cash pursuant to the preceding sentence, any Stock Unit shall be settled by a
cash payment in lieu of Common Stock to the extent that the share limit of this
Section 7 would be exceeded by a payment in Common Stock. The amount of any cash
payment in settlement of a Stock Unit (or Stock Units) shall equal the Fair
Market Value of a share of Common Stock as of the last day that the Participant
was a member of the Board, multiplied by the number of Stock Units to be settled
in cash.

 

8. ADMINISTRATION

 

8.1 Committee Action. The Committee shall act at meetings by affirmative vote of
a majority of the members of the Committee. Any action permitted to be taken at
a meeting may be taken without a meeting if, prior to such action, a written
consent to the action is signed by all members of the Committee and such written
consent is filed with the minutes of the proceedings of the Committee. A member
of the Committee shall not vote or act upon any matter which relates solely to
himself or herself as a Participant. The Chairman or any other member or members
of the Committee designated by the Chairman may execute any certificate or other
written direction on behalf of the Committee.

 

8.2 Powers and Duties of the Committee. The Committee shall enforce the Plan in
accordance with its terms, shall be charged with the general administration of
the Plan, and shall have all powers necessary to accomplish its purposes,
including, but not by way of limitation, the following:

 

(a) To construe and interpret the terms and provisions of this Plan;

 

(b) To compute and certify the amount and kind of benefits payable to
Participants and their Beneficiaries, and to determine the time and manner in
which such benefits are paid;

 

(c) To maintain all records that may be necessary for the administration of the
Plan;

 

(d) To provide for the disclosure of all information and the filing or provision
of all reports and statements to Participants, Beneficiaries or governmental
agencies as shall be required by law;

 

(e) To make and publish such rules for the regulation of the Plan and procedures
for the administration of the Plan as are not inconsistent with the terms
hereof;

 

(f) To appoint a plan administrator or any other agent, and to delegate to them
such powers and duties in connection with the administration of the Plan as the
Committee may from time to time prescribe; and

 

(g) To authorize all disbursements pursuant to this Plan.

 

5

--------------------------------------------------------------------------------

8.3 Construction and Interpretation. The Committee shall have full discretion to
construe and interpret the terms and provisions of this Plan, which
interpretation or construction shall be final and binding on all parties,
including but not limited to any Participant or Beneficiary.

 

8.4 Compensation, Expenses and Indemnity.

 

(a) The members of the Committee shall serve without compensation for their
services hereunder.

 

(b) The Committee is authorized at the expense of the Company to employ such
legal counsel as it may deem advisable to assist in the performance of its
duties hereunder. Expenses and fees in connection with the administration of the
Plan shall be paid by the Company.

 

(c) To the extent permitted by applicable state law, the Company shall indemnify
and save harmless the Committee and each member thereof, the Board of Directors
and any delegate of the Committee who is an employee of the Company against any
and all expenses, liabilities and claims, including legal fees to defend against
such liabilities and claims arising out of their discharge in good faith of
responsibilities under or incident to the Plan, other than expenses and
liabilities arising out of willful misconduct. This indemnity shall not preclude
such further indemnities as may be available under insurance purchased by the
Company or provided by the Company under any bylaw, agreement or otherwise, as
such indemnities are permitted under state law.

 

8.5 Statements. Under procedures established by the Committee, a Participant
shall receive a statement with respect to such Participant’s Stock Unit Account
on a basis no less frequently than annually through the final statement which
reflects that all Plan benefits have been paid to the Participant.

 

9. MISCELLANEOUS

 

9.1 Unsecured General Creditor. Participants and their Beneficiaries, heirs,
successors, and assigns shall have no legal or equitable rights, claims, or
interest in any specific property or assets of the Company or any of its
subsidiaries. No assets of the Company or any of its subsidiaries shall be held
under any trust, or held in any way as collateral security for the fulfilling of
the obligations of the Company under this Plan. Any and all of each the
Company’s assets shall be, and remain, the general unpledged, unrestricted
assets of the Company. The Company’s obligations under the Plan shall be merely
that of an unfunded and unsecured promise of the Company to pay money in the
future to those persons to whom the Company has a benefit obligation under this
Plan (as determined in accordance with the terms hereof), and the respective
rights of the Participants and Beneficiaries shall be no greater than those of
unsecured general creditors.

 

9.2 Trust Arrangement. Notwithstanding Section 9.1, in order to provide assets
from which to fulfill the obligations of the Participants and their
beneficiaries under this Plan, the Company may establish a trust by a trust
agreement with a third party, the trustee, to which the Company may, in its
discretion, contribute cash or other property, including securities issued by
the Company, to provide for the benefit payments under this Plan. The provisions
of this Plan shall govern the rights of a Participant to receive distributions
pursuant to this Plan. The

 

6

--------------------------------------------------------------------------------

provisions of the trust shall govern the rights of the Company, Participants and
the creditors of the Company to any assets transferred to the trust. The Company
shall at all times remain liable to carry out its obligations under this Plan.
The Company’s obligations under this Plan may be satisfied with trust assets
distributed pursuant to the terms of the trust, and any such distribution shall
reduce the Company’s obligations under this Plan.

 

9.3 Tax Withholding. In the event that tax is required to be withheld in
connection with any deferral, payment of benefits, or delivery of shares of
Common Stock under this Plan, the Company 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 Company may be required to withhold with
respect to such event, 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 Company may be
required to withhold with respect to such event.

 

9.4 Restriction Against Assignment. The Company shall pay all amounts payable
hereunder only to the person or persons designated by the Plan and not to any
other person or corporation. No part of a Participant’s Stock Unit Account shall
be liable for the debts, contracts, or engagements of any Participant, his or
her Beneficiary, or successors in interest, nor shall a Participant’s Stock Unit
Account be subject to execution by levy, attachment, or garnishment or by any
other legal or equitable proceeding, nor shall any such person have any right to
alienate, anticipate, commute, pledge, encumber, or assign any benefits or
payments hereunder in any manner whatsoever. If any Participant, Beneficiary or
successor in interest is adjudicated bankrupt or purports to anticipate,
alienate, sell, transfer, assign, pledge, encumber or charge any distribution or
payment from the Plan, voluntarily or involuntarily, the Committee, in its
discretion, may cancel such distribution or payment (or any part thereof) to or
for the benefit of such Participant, Beneficiary or successor in interest in
such manner as the Committee shall direct.

 

9.5 Amendment, Modification, Suspension or Termination. The Board or the
Committee may amend, modify, suspend or terminate the Plan in whole or in part,
except that no amendment, modification, or suspension shall, without the
Participant’s written consent, have any retroactive effect to reduce the Stock
Units allocated to a Participant’s Stock Unit Account or otherwise materially
and adversely affect the Participant’s rights with respect to his or her Stock
Units then credited to his or her Stock Unit Account or to be credited with
respect to a deferral election previously made by the Participant. The Board may
however, at any time, terminate this Plan; provided that in the event this Plan
is terminated, the Stock Units credited to a Participant’s Stock Unit Account
shall be distributed (or paid in cash equivalent in accordance with this Plan)
to the Participant (or, in the event of his or her death, his or her
Beneficiary) in a lump sum within thirty (30) days following the date of
termination.

 

9.6 Governing Law; Severability. This Plan shall be construed, governed and
administered in accordance with the laws of the State of Delaware. If any
provisions of this instrument shall be held by a court of competent jurisdiction
to be invalid or unenforceable, the remaining provisions hereof shall continue
to be fully effective.

 

9.7 Payments on Behalf of Persons Under Incapacity. In the event that any amount
becomes payable under the Plan to a person who, in the sole judgment of the
Committee, is

 

7

--------------------------------------------------------------------------------

considered by reason of physical or mental condition to be unable to give a
valid receipt therefore, the Committee may direct that such payment be made to
any person found by the Committee, in its sole judgment, to have assumed the
care of such person. Any payment made pursuant to such determination shall
constitute a full release and discharge of the Committee, the Company and its
affiliates of their respective obligations to the Participant with respect to
this Plan.

 

9.8 No Service Commitment. Participation in this Plan shall not give any person
the right to continued service to the Company or any rights or interests other
than as herein provided. No Participant shall have any right to any payment or
benefit hereunder except to the extent provided in this Plan.

 

9.9 Compliance with Laws. This Plan and the offer, issuance and delivery of
shares of Common Stock and/or the payment of money through the deferral of
compensation under this Plan are subject to compliance with all applicable
federal and state laws, rules and regulations (including but not limited to
state and federal securities law) and to such approvals by any listing, agency
or any regulatory or governmental authority as may, in the opinion of counsel
for the Company, be necessary or advisable in connection therewith. Any
securities delivered under this Plan shall be subject to such restrictions, and
the person acquiring such securities shall, if requested by the Company, provide
such assurances and representations to the Company as the Company may deem
necessary or desirable to assure compliance with all applicable legal
requirements.

 

9.10 Plan Construction. It is the intent of the Company that transactions
pursuant to this Plan satisfy and be interpreted in a manner that satisfies the
applicable requirements of Rule 16b-3 promulgated under the Exchange Act (“Rule
16b-3”) so that, to the extent elections are timely made, the crediting of Stock
Units, the distribution of shares of Common Stock and any other event with
respect to Stock Units under the Plan will be entitled to the benefits of Rule
16b-3 or other exemptive rules under Section 16 of the Exchange Act and will not
be subjected to avoidable liability thereunder. Neither the Company nor the
Committee shall, however, be liable to any Participant for any liability that
the Participant may have under Section 16 of the Exchange Act with respect to
any transaction or other event under or with respect to this Plan.

 

9.11 Headings. Headings and subheadings in this Plan are inserted for
convenience of reference only and are not to be considered in the construction
of the provisions hereof.

 

9.12 Claims Procedure.

 

A person who believes that he or she is being denied a benefit to which he or
she is entitled under the Plan (hereinafter referred to as “Claimant”) may file
a written request for such benefit with the Committee, setting forth his or her
claim. The request must be addressed to the Committee at the Company’s then
principal executive offices.

 

Upon receipt of a claim, the Committee shall advise the Claimant that a reply
will be forthcoming within ninety (90) days and shall, in fact, deliver such
reply within such period. The Committee may, however, extend the reply period
for an additional ninety (90) days for special circumstances. If the claim is
denied in whole or in part, the Committee shall inform the Claimant in writing,
using language calculated to be understood by the Claimant, setting forth: (i)
the specified reason or reasons for such denial, (ii) the specific reference to
pertinent provisions of the Plan on which such denial is based, (iii) a
description of any additional material or

 

8

--------------------------------------------------------------------------------

information necessary for the Claimant to perfect his or her claim and an
explanation why such material or such information is necessary, (iv) appropriate
information as to the steps to be taken if the Claimant wishes to submit the
claim for review, and (v) the time limits for requesting a review set forth
below.

 

Within sixty (60) days after the receipt by the Claimant of the written reply
described above, the Claimant may request in writing that the Committee review
its determination. Such request must be addressed to the Committee at the
Company’s then principal executive offices. The Claimant or his or her duly
authorized representative may, but need not, review the pertinent documents and
submit issues and comments in writing for consideration by the Committee. If the
Claimant does not request a review within such sixty (60) day period, he or she
shall be barred and estopped from challenging the Committee’s determination.

 

Within sixty (60) days after the Committee’s receipt of a request for review,
after considering all materials presented by the Claimant, the Committee will
inform the Claimant in writing, in manner calculated to be understood by the
Claimant, of its decision setting forth the specific reasons for the decision
and containing specific references to the pertinent provisions of the Plan on
which the decision is based. If special circumstances require that the sixty
(60) day time period be extended, the Committee will so notify the Claimant and
will render the decision as soon as possible, but no later than one hundred
twenty (120) days after receipt of the request for review.

 

IN WITNESS WHEREOF, the Company has caused this document to be executed by its
duly authorized officer effective as of December 11, 2003.

 

NEW CENTURY FINANCIAL CORPORATION By:  

/s/ STERGIOS THEOLOGIDES

   

--------------------------------------------------------------------------------

Print Name: Stergios Theologides

Its:

 

Executive Vice President

 

9