Exhibit
10.1
AGREEMENT
THIS AGREEMENT made and entered into this 12th day of December,
2005 by and between Radian Group Inc. , a corporation
organized and existing under the laws of the state of Delaware
(hereinafter referred to as the “Company”) and
(hereinafter referred to as the
“Executive”).
WHEREAS , the Executive is presently employed as its
; and
WHEREAS , the board of directors of the Company (the
“Board”) recognizes that, as is the case with many
publicly-held corporations, the possibility of a Change of Control
(as that term is defined in Section 1 hereof) of the Company
exists and that such possibility, and the uncertainty and questions
it may raise among management, may result in the departure or
distraction of key management personnel to the detriment of the
Company; and
WHEREAS , the Board has determined that appropriate
steps should be taken to reinforce and encourage the continued
attention and dedication of key members of the Company’s
management to their assigned duties without distraction in the face
of potentially disturbing circumstances arising from the
possibility of a change in control of the Company.
NOW, THEREFORE , in consideration of the foregoing and the
mutual covenants and agreements hereinafter set forth and intending
to be legally bound hereby, the parties hereto agree as
follows:
1. Definitions . When used in this Agreement, the following
terms shall have the specific meanings shown in this Section unless
the context of any provision of this Agreement clearly requires
otherwise:
(a) “Affiliate” and
“Associate” shall have the respective meanings ascribed
to such terms in Rule 12b-2 of the General Rules and Regulations
under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”).
(b) “Beneficial Owner”
of any securities shall mean:
(i) a Person or any of such
Person’s Affiliates or Associates that, directly or
indirectly, has the right to acquire such securities (whether such
right is exercisable immediately or only after the passage of time)
pursuant to any agreement, arrangement or understanding (whether or
not in writing) or upon the exercise of conversion rights, exchange
rights, warrants or options, or otherwise; provided ,
however , that a Person shall not be deemed the
“Beneficial Owner” of securities tendered pursuant to a
tender or exchange offer made by such Person or any of such
Person’s Affiliates or Associates until such tendered
securities are accepted for payment, purchase or exchange;
or
(ii) a Person or any of such
Person’s Affiliates or Associates that, directly or
indirectly, has the right to vote or dispose of or has
“beneficial ownership” of such securities (as
determined pursuant to Rule 13d-3 of the General Rules and
Regulations under the Exchange Act), including, without limitation,
pursuant to any agreement, arrangement or understanding (whether or
not in writing); provided , however , that a Person
shall not be deemed the “Beneficial Owner” of any
security under this subsection (ii) as a result of an oral or
written agreement, arrangement or understanding to vote such
security if such agreement, arrangement or understanding
(A) arises solely from a revocable proxy given in response to
a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable provisions of the General Rules and
Regulations under the Exchange Act, and (B) is not then
reportable by such Person on Schedule 13D or 13G under the Exchange
Act (or any comparable successor report).
(iii) where voting securities are
beneficially owned, directly or indirectly, by any other Person (or
any Affiliate or Associate thereof) with which such Person (or any
of such Person’s Affiliates or Associates) has any agreement,
arrangement or understanding (whether or not in writing) for the
purpose of acquiring, holding, voting (except pursuant to a
revocable proxy described in the proviso to subsection
(ii) above) or disposing of any voting securities of the
Company;
provided , however , that nothing in this
subsection (b) shall cause a Person engaged in business as an
underwriter of securities to be the “Beneficial Owner”
of any securities acquired through such Person’s
participation in good faith in a firm commitment underwriting until
expiration of forty (40) days after the date of such
acquisition.
(c) “Change of Control”
shall be deemed to have taken place if (i) any Person (except
for the Executive or the Executive’s family, the Company, any
employee benefit plan of the Company or of any Affiliate, or any
Person or entity organized, appointed or established by the Company
for or pursuant to the terms of any such employee benefit plan),
together with all Affiliates and Associates of such Person, shall
become the Beneficial Owner in the aggregate of twenty percent
(20%) or more of the shares of the Company then outstanding
and entitled to vote generally in the election of directors,
(ii) any Person (except for the Executive or the
Executive’s family), together with all Affiliates and
Associates of such Person, purchases all or substantially all of
the assets of the Company, (iii) during any twenty-four
(24) month period, individuals who at the beginning of such
period constituted the Board cease for any reason to constitute a
majority thereof, unless the election, or the nomination for
election by the Company’s stockholders, of at least
seventy-five percent (75%) of the directors who were not
directors at the beginning of such period was approved by a vote of
at least seventy-five percent (75%) of the directors in office
at the time of such election or nomination who were directors at
the beginning of such period, or (iv) the Company consummates
a merger, consolidation or share exchange (the “Corporate
Event”), as a result of which the
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stockholders of the Company immediately prior to
such Corporate Event shall not hold, directly or indirectly,
immediately following such Corporate Event a majority of the
combined voting power of the voting securities entitled to vote
generally in the election of directors of the surviving or
resulting corporation, in case of a merger or consolidation, or of
the acquiring corporation, in case of the share
exchange.
(d) “Person” shall mean
any individual, firm, corporation, partnership or other
entity.
(e) “Subsidiary” shall
have the meaning ascribed to such term in Rule 12b-2 of the General
Rules and Regulations under the Exchange Act.
(f) “Termination Date”
shall mean the date of receipt of the Notice of Termination
described in Section 2 hereof or any later date specified
therein, as the case may be.
(g) “Termination of
Employment” shall mean the termination of the
Executive’s actual employment relationship with the
Company.
(h) “Qualifying
Termination” shall mean the Termination of Employment within
six (6) months prior to or within three (3) years after a
Change of Control either:
(i) initiated by the Company for any
reason other than (A) the Executive’s continuous
illness, injury or incapacity for a period of twelve
(12) consecutive months or (B) for “cause”,
which shall mean misappropriation of funds, habitual insobriety,
substance abuse, conviction of a crime involving moral turpitude,
or gross negligence in the performance of duties, which gross
negligence has had a material adverse effect on the business,
operations, assets, properties or financial condition of the
Company and its Subsidiaries taken as a whole or, where the
Executive’s professional efforts are principally on behalf of
a single Subsidiary of the Company, a material adverse effect on
the business, operations, assets, properties or financial condition
of such Subsidiary; or
(ii) initiated by the Executive upon
or within six (6) months of one or more of the
following:
(A) any failure of the Company to
comply with and satisfy any of the conditions of this
Agreement;
(B) any change resulting in a
significant reduction by the Company of the authority, duties or
responsibilities of the Executive;
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(C) any removal by the Company of
the Executive from the employment grade, compensation level or
officer positions which the Executive holds as of the effective
date hereof, except in connection with promotions to a higher
office;
(D) the requirement that the
Executive undertake business travel (or commuting in excess of
fifty (50) miles each way) to an extent substantially greater
than is reasonable and customary for the position the Executive
holds; or
(E) any failure of the Company to
obtain an agreement from any successor of the Company to perform
this Agreement in accordance with Section 15
hereof.
2. Notice of Termination
. Any Qualifying Termination shall
be communicated by the Notice of Termination to the other party
hereto given in accordance with Section 16 hereof. For
purposes of this Agreement, a “Notice of Termination”
means a written notice which (a) indicates the specific
termination provision in this Agreement relied upon,
(b) briefly summarizes the facts and circumstances deemed to
provide a basis for termination of the Executive’s employment
under the provision so indicated, and (c) if the Termination
Date is other than the date of receipt of such notice, specifies
the Termination Date (which date shall not be more than fifteen
days after the giving of such notice).
3. Benefits Upon Change of Control and
Qualifying Termination .
(a) In the event of a Change of
Control, (i) all stock options (“Options”)
previously granted to the Executive, including, without limitation,
under any Company stock option or equity compensation plan, which
have not yet fully vested shall become fully vested, and
(ii) all phantom equity rights and restricted stock
(“Grants”) previously granted to the Executive,
including, without limitation, under any Company equity
compensation plan, which have not yet fully vested or become freely
transferable shall become fully vested and freely
transferable.
(b) In the event of a Qualifying
Termination, the Company shall pay to the Executive, within fifteen
days following the Termination Date, an amount in cash equal to two
(2) times (i) the Executive’s then current annual
base compensation plus (ii) the bonus received by the
Executive for the most recently ended fiscal year (annualized where
applicable).
(c) In the event of a Qualifying
Termination, in the Company’s sole discretion, the Company
shall (i) permit the Executive to participate in the
Company’s life, disability, accident and health insurance
plans (or substantially similar plans) for a period not to exceed
thirty-six (36) months following the Termination Date,
provided that the Executive shall be responsible for the payment of
any premium or other amount, including deductibles, payable
generally by plan participants (the “Participants’
Portion”)
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or (ii) make an additional cash payment to
the Executive equal to the amount by which the then current
aggregate cost to the Company of providing such benefits for such
period of time exceeds the then current aggregate
Participants’ Portion for such period of time.
4. Other Payments . The payments due under Section 3 hereof
shall be in addition to and not in lieu of any payments or benefits
due to the Executive under any other plan, policy or program of the
Company except that no payments shall be due to the Executive under
the Company’s then current severance pay plan for employees,
if any.
5. Establishment of Trust
. The Company has or will establish
an irrevocable trust fund (hereinafter referred to as the
“Trust Fund”) pursuant to a trust agreement to hold
assets
