EMPLOYMENT AGREEMENT

AGREEMENT made as of the 23rd day of December 2004, between People?s Choice Financial Corporation, a Maryland corporation (the ?Company?), and Brad Plantiko (the ?Executive?).

The Executive is presently employed as an Executive Vice President of the Company. The Company recognizes that the Executive?s contribution to the growth and success of the Company has been substantial. The Company desires to provide for the continued employment of the Executive and to make certain changes in the Executive?s employment arrangements with the Company which the Company has determined will reinforce and encourage the continued attention and dedication to the Company of the Executive as a member of the Company?s management, in the best interest of the Company and its shareholders. The Executive is willing to commit himself to continue to serve the Company, on the terms and conditions herein provided. The Executive?s continued employment with the Company is contingent on his execution of this Employment Agreement. Any and all employment contracts, bonus plans and agreements, and all amendments to such employment contracts, bonus plans and agreements between Executive and People?s Choice Home Loan, Inc., a Wyoming corporation, shall be superseded in their entirety and rendered null and void upon the commencement date of this Agreement as provided in Section 2 below.

In order to effect the foregoing, the Company and the Executive wish to enter into an employment agreement on the terms and conditions set forth below (the ?Agreement?). Accordingly, in consideration of the premises and the respective covenants and agreements of the parties herein contained, and intending to be legally bound hereby, the parties hereto agree as follows:

1. Employment. The Company hereby agrees to continue to employ the Executive, and the Executive hereby agrees to continue to serve the Company, on the terms and conditions set forth herein.

2. Term. The employment of the Executive by the Company as provided in Section 1 will commence on the date of the completion of the Company?s private placement of shares of its common stock pursuant to Rule 144A of the Securities and Exchange Commission and end on December 31, 2007, unless further extended or sooner terminated as hereinafter provided. Commencing on January 1, 2006, and on each January 1 thereafter (each, an ?Anniversary Date?), the term of the Executive?s employment shall automatically be extended for one (1) additional year, unless the Company or the Executive provides 90 days? written notice to the other prior to any such Anniversary Date that it or he does not wish the Term of this Agreement to continue to be automatically extended as described above. In the event either party gives such notice, no additional automatic extensions shall take effect. For purposes of this Agreement, ?Term? shall mean the actual duration of Executive?s employment hereunder, taking into account any extensions or notices not to extend pursuant to this Section 2 or termination of employment pursuant to Section 7.

3. Position and Duties. The Executive shall serve as an Executive Vice President and Chief Financial Officer and shall have such responsibilities, duties and authority as he may have as of the date hereof and as may from time to time be assigned to the Executive by the Chief Executive Officer (?CEO?), to whom the Executive shall report directly, that are consistent with such responsibilities, duties and authority. The Executive shall devote substantially all his working time and efforts to the business and affairs of the Company; provided, that nothing in this Agreement shall preclude Executive from serving as a director or trustee in any other firm or from pursuing personal real estate investments and other personal investments, as long as such activities do not interfere with Executive?s performance of his duties hereunder or violate Section 9 or 10 of this Agreement.

4. Service on Committees. During the Term, the Executive agrees to continue to serve on committees specified by the CEO.

5. Place of Performance. In connection with the Executive?s employment by the Company, the Executive shall be based at the principal executive offices of the Company in Irvine, California, except for required travel on the Company?s business to an extent substantially consistent with present business travel obligations.

6. Compensation and Related Matters.

(a) Base Salary. The Company shall pay the Executive a base salary annually (the ?Base Salary?), which shall be payable in periodic installments according to the Company?s normal payroll practices. The initial Base Salary shall be $300,000. During the Term, the Company?s board of directors (the ?Board?) or the Compensation Committee of the Board (the ?Compensation Committee?) shall review the Base Salary at least once a year to determine whether the Base Salary should be increased effective the following January 1; provided, however, that on January 1, 2006 and on each January 1 thereafter, the Base Salary shall be increased by at least 10 percent. The Base Salary, including any increases, shall not be decreased during the Term. For purposes of this Agreement, the term ?Base Salary? shall mean the amount established and adjusted from time to time pursuant to this Section 6(a).

(b) Annual Cash Incentive Awards. The Executive shall be eligible to participate in the Company?s annual cash incentive bonus plan adopted by the Compensation Committee for each fiscal year during the Term of this Agreement (?Bonus Plan?), subject to the terms and conditions of the Bonus Plan. If the Executive or the Company, as the case may be, satisfies the performance criteria contained in such Bonus Plan for a fiscal year, he shall receive an annual cash incentive bonus (the ?Incentive Bonus?) in an amount determined by the Compensation Committee, subject to a maximum Incentive Bonus of two hundred percent (200%) of Executive?s Base Salary for such fiscal year and subject to ratification by the Board, if required. If the Executive or the Company, as the case may be, fails to satisfy the performance criteria contained in such Bonus Plan for a fiscal year, the Compensation Committee may determine whether any Incentive Bonus shall be payable to Executive for that year, subject to ratification by the Board, if required. Beginning January 1, 2005, the Bonus Plan shall contain both individual and group goals established by the Compensation Committee. The annual Incentive Bonus shall be paid to the Executive no later than thirty (30) days after the date the Compensation Committee

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determines whether the criteria in the Bonus Plan for such fiscal year were satisfied, but in no event later than April 15 of the following fiscal year. For purposes of this Agreement, the term ?Incentive Bonus? shall mean the amount established pursuant to this Section 6(b).

(c) Stock Based Awards. The Company has established the 2004 Equity Incentive Plan (?Equity Incentive Plan?). Subject to the terms and conditions of the Equity Incentive Plan, the Executive shall be eligible to participate in the Equity Incentive Plan, and shall be eligible to receive annual stock option and/or restricted stock awards under the Equity Incentive Plan. The Compensation Committee shall make and approve any such awards to the Executive pursuant to the Equity Incentive Plan.

(i) 2004 Equity Incentive Plan Option Grants. Option awards under the Equity Incentive Plan will have an exercise price per share equal to the closing price of the Company?s common stock on the trading day immediately preceding the date of grant, will have a term of ten (10) years and will vest and become exercisable with respect to 1/3 of the underlying shares of Company common stock on the first, second and third anniversaries, respectively, of the date of grant; provided, however, that the Executive will be 100% vested in all outstanding option awards, including the unvested portion of such awards, upon (i) a Change in Control (as defined herein), (ii) a termination by the Company without Cause (as defined herein), or (iii) a termination by the Executive for Good Reason (as defined herein), and that the Executive will forfeit all unvested options if he is terminated for Cause, Disability (as defined below) or death, or if he terminates his employment hereunder for other than Good Reason.

(ii) 2004 Equity Incentive Plan Restricted Stock Awards. The Equity Incentive Plan provides for the issuance of shares of Company common stock as restricted common stock (?Restricted Stock Grants?) to the extent that such shares of common stock are available thereunder. Restricted Stock Grants awarded to the Executive shall be subject to forfeiture restrictions that will terminate with respect to 1/3 of the awarded shares on the first, second and third anniversaries of the date of the issuance; provided, further, that the Executive will be 100% vested and all restrictions on each outstanding Restricted Stock Grant will lapse upon (i) a Change in Control (as defined herein), (ii) a termination by the Company without Cause (as defined herein), or (iii) a termination by the Executive for Good Reason (as defined herein), and that the Executive will forfeit all shares with respect to which the forfeiture restrictions have not terminated if he is terminated for Cause, Disability (as defined below) or death, or if he terminates his employment hereunder for other than Good Reason. The common stock issued as Restricted Stock Grants will have voting and dividend rights.

For purposes of this Agreement:

?Acquiring Person? means that a Person, considered alone or as part of a ?group? within the meaning of Section 13(d)(3) of the Securities Exchange Act of 1934, as amended, is or becomes directly or indirectly the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of securities representing more than thirty-three and one-third percent (33 1/3%) of the Company?s then outstanding securities entitled to vote generally in the election of the Board.

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?Continuing Director? means any member of the Board, while a member of the Board and (i) who was a member of the Board on the closing date of the Company?s initial public offering of the Common Stock or (ii) whose nomination for or election to the Board was recommended or approved by a majority of the Continuing Directors.

?Control Change Date? means the date on which a Change in Control occurs. If a Change in Control occurs on account of a series of transactions, the ?Control Change Date? is the date of the last of such transactions.

?Change in Control? means (i) a Person is or becomes an Acquiring Person; (ii) holders of the securities of the Company entitled to vote thereon approve any agreement with a Person (or, if such approval is not required by applicable law and is not solicited by the Company, the closing of such an agreement) that involves the transfer of all or substantially all of the Company?s total assets on a consolidated basis, as reported in the Company?s consolidated financial statements filed with the Securities and Exchange Commission; (iii) holders of the securities of the Company entitled to vote thereon approve a transaction (or, if such approval is not required by applicable law and is not solicited by the Company, the closing of such a transaction) pursuant to which the Company will undergo a merger, consolidation, or statutory share exchange with a Person, regardless of whether the Company is intended to be the surviving or resulting entity after the merger, consolidation, or statutory share exchange, other than a transaction that results in the voting securities of the Company carrying the right to vote in elections of persons to the Board outstanding immediately prior to the closing of the transaction continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) at least 50% (fifty percent) of the Company?s voting securities carrying the right to vote in elections of persons to the Company?s Board, or such securities of such surviving entity, outstanding immediately after the closing of such transaction; (iv) the Continuing Directors cease for any reason to constitute a majority of the Board; (v) holders of the securities of the Company entitled to vote thereon approve a plan of complete liquidation of the Company or an agreement for the sale or liquidation by the Company of all or substantially all of the Company?s assets (or, if such approval is not required by applicable law and is not solicited by the Company, the commencement of actions constituting such a plan or the closing of such an agreement); or (vi) the Board adopts a resolution to the effect that, in its judgment, as a consequence of any one or more transactions or events or series of transactions or events, a Change in Control of the Company has effectively occurred. The Board shall be entitled to exercise its sole and absolute discretion in exercising its judgment and in the adoption of such resolution, whether or not any such transaction(s) or event(s) might be deemed, individually or collectively, to satisfy any of the criteria set forth in subparagraphs (i) through (v) above.

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