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Exhibit
10.1
TRANSITION
AGREEMENT
AND GENERAL
RELEASE
THIS AGREEMENT, made and
entered into as of this 11th day of December, 2007, by and between
Radian Group Inc. a Delaware corporation (hereinafter
“Radian” or the “Company”), and Mark Casale
(“Executive”), reads as follows:
I.
BACKGROUND
A. The Company currently
employs Executive. The Company and Executive have mutually agreed
to terminate Executive’s employment with the Company
effective December 31, 2007 (the “Termination
Date”). The Company and Executive agree that between
November 1, 2007 and the Termination Date, Executive shall
continue as an employee of the Company as set forth
below.
B. In appreciation for
Executive’s service to the Company and in exchange for all of
Executive’s undertakings in this Agreement, the Company and
Executive wish to enter into an agreement to (i) provide
releases by Executive and the Company as to claims that might be
asserted by the Executive or the Company, as further described
herein, and (ii) assuming that Executive complies with,
executes, and does not revoke this Agreement and the Second
Release, as defined below, provide Executive with the benefits and
entitlements as provided herein.
II. SUBSTANTIVE
PROVISIONS
In consideration of the
mutual promises contained in this Agreement, the Company and
Executive, intending to be legally bound, agree as
follows:
1. Executive’s employment with the
Company shall terminate on the Termination Date. Executive shall
continue as an employee of the Company until the Termination Date
and shall perform such services as the Company may reasonably
request to provide an orderly transition until the Termination
Date. On November 1, 2007, Executive shall relinquish the
title of President, Radian Guaranty, and shall cease to serve as an
executive officer of the Company or an officer or director of any
subsidiaries. Executive shall not be required to be at work in his
office after November 1, 2007. Executive shall perform his
duties from another location and shall be reasonably available by
telephone and email.
(a) Through the Termination
Date, Executive shall continue to receive his current base salary,
at the monthly rate (prior to any deductions) in effect for
Executive on the date of this Agreement, in regular payroll
installments.
(b) Through the Termination
Date, Executive shall continue to be subject to, and eligible for,
all of the Company’s regular benefits and perquisites,
policies and programs for executives generally; provided that,
except as provided in subsection (f) below, Executive shall
not be entitled to receive any bonus compensation or other
incentive compensation with respect to his employment with the
Company before or after the date of this Agreement.
(c) Through the Termination
Date, Executive shall continue to vest in all equity grants made to
him prior to the date of this Agreement but shall not be eligible
for any additional grants after the date of this
Agreement.
(d) As soon as practicable
after the Termination Date, Executive shall receive conversion
rights under those welfare benefit plans of the Company in which he
participated and which provide for such rights, and Executive shall
be entitled to COBRA health care continuation coverage under
section 4980B of the Internal Revenue Code of 1986, as amended (the
“Code”). All other employee and executive benefits not
so converted shall cease on the Termination Date.
(e) As soon as practicable
after the Termination Date, Executive shall be paid for all unused
personal and vacation time.
(f) If Executive complies
with all the terms of this Agreement (including without limitation
continuing in employment through the Termination Date and complying
with Sections 4, 5, 6, 7 and 8 below) and Executive executes and
does not revoke the Second Release, as described in Section 7
below, Executive shall receive the following after the Termination
Date:
(i) Executive shall receive a
lump sum 2007 bonus payment of $100,000 within 30 days following
the Termination Date.
(ii) During the period
beginning on the first business day following the Termination Date
and ending on October 31, 2009 (the “Severance
Period”), Executive shall receive monthly severance payments
of $31,250 per month, which shall commence within 30 days following
the Termination Date and shall be paid in regular payroll
installments.
(iii) During the Severance
Period, until Executive is eligible for health insurance coverage
from a subsequent employer (including through self-employment), if
Executive elects COBRA health care continuation coverage under the
Company’s health plan, Executive shall receive monthly
reimbursement of his COBRA health care continuation coverage
monthly premium paid under the Company’s health plan; the
reimbursement shall commence within 30 days following the
Termination Date and shall be paid on the first payroll date of
each month.
(iv) The 18,000 shares of
restricted stock that Executive currently holds shall become fully
vested on the date on which this Agreement is executed; provided,
however, that the shares (net of tax withholding, as described
below) shall be held by the Company, and may not be transferred by
Executive, until October 31, 2009. Executive understands that
the shares will be taxable on the date on which this Agreement is
executed, and the Company has agreed that shares will be withheld
to satisfy the minimum tax withholding requirements. If Executive
complies with all the terms of this Agreement, the Company shall
deliver the shares (net of the tax withholding) to Executive within
10 days after October 31, 2009. If Executive breaches any
provision of this Agreement, the shares will be immediately
forfeited and will not be delivered to Executive on
October 31, 2009.
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(v) Executive is eligible for
executive outplacement services, for up to 12 months after the
Termination Date, and not to exceed a maximum of $25,000 in cost.
These services will be paid for by the Company.
Except to the extent provided in
Section 7(a) below, all payments and benefits due in
accordance with the terms of this Section 1 shall be made to
Executive (or his estate) regardless of whether he dies or becomes
disabled following the date of this Agreement and prior to payment
being made. In addition to the foregoing, and not conditioned on
the execution of this Agreement, Executive shall receive all
benefits due under any employee benefit plans or programs under
which Executive participated and under which Executive has accrued
and become or may become entitled to benefits (other than under any
Company separation or severance plan or programs), in accordance
with the terms of the applicable plan or program and applicable
law. All payments under this Agreement are subject to applicable
tax withholding. Executive is solely responsible for all taxes
arising in connection with this Agreement.
2. Executive and the Company
agree that the change in control agreement between Executive and
the Company dated November 9, 2004 (the “CIC
Agreement”) will terminate and be of no further force or
effect as of November 1, 2007.
3. Executive agrees and
acknowledges that the Company, on a timely basis, has paid, or
agreed to pay, to Executive all other amounts due and owing based
on his prior services and that the Company has no obligation,
contractual or otherwise to Executive, except as provided herein,
nor does it have any obligation to hire, rehire or re-employ
Executive after the Termination Date. Executive acknowledges that
the Company is not required to enter into this Agreement and that
the provisions of this Agreement will provide Executive with
payments and benefits that are in excess of that to which Executive
otherwise would have been entitled.
4. (a) Until the Termination
Date, Executive shall have no other employment or consulting
relationships. Executive hereby agrees that through the Termination
Date and during the six-month period following the Termination
Date, (i) he will not, without the Company’s express
written consent, be employed by, associated with or otherwise
engaged (directly or indirectly) with any of the following
companies (all of whose primary business involves providing
mortgage insurance or financial guaranty to financial
institutions): Genworth Financial, PMI or MGIC (or their respective
successors), and (ii) he will not, either directly or through
others, solicit, divert or appropriate, or attempt to solicit,
divert or appropriate any customer or actively sought prospective
customer of the Company for the purpose of providing such customer
or actively sought prospective customer with services or products
competitive with those offered by the Company on the Termination
Date. Executive agrees that his covenants set forth in this
Section 4 extend throughout the United States.
(b) For purposes of this
Section 4, Section 5, Section 6, Section 7 and
Section 8, the term “Company” shall be deemed to
include Radian and the subsidiaries and affiliates of
Radian.
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5. (a) For purposes of this
Agreement, Executive acknowledges and agrees that the terms
“Confidential Information” and “Trade
Secrets” shall mean information that the Company owns or
possesses, that it uses or is potentially useful in its business,
that it treats as proprietary, private or confidential, and that is
not generally known to the public, including confidential
information as described in the Company’s Code of Conduct in
effect on the Termination Date; provided, however, that the terms
“Confidential Information” and “Trade
Secrets” shall not include information which: (i) was
known to Executive prior to his initial employment with the
Company; or (ii) is or becomes a part of the public domain
through no wrongful act of Executive; or (iii) is rightfully
obtained by Executive from a third party and is not governed by a
confidentiality agreement or similar restrictions; or (iv) is
required to be disclosed pursuant to an order of a court or
government agency or authority (provided that in the event any such
order is received by Executive, Executive notifies the Company in
writing within two business days of Executive’s receipt of
such order). Executive further acknowledges that Executive’s
relationship with the Company is one of confidence and trust such
that Executive has in the past been, and may in the future be,
privy to Confidential Information and Trade Secrets of the
Company.
(b) Executive covenants and
agrees that during Executive’s employment by the Company and
at all times thereafter, Executive shall keep all Confidential
Information and Trade Secrets strictly confidential, and Executive
shall safeguard the Confidential Information and Trade Secrets from
exposure to, or appropriation by, unauthorized persons, and
Executive shall not, without the prior written consent of the
Company, divulge, reveal, report, publish, transfer or use, for any
purpose whatsoever, such Confidential Information and Trade
Secrets, except as may be required by law or in any judicial or
administrative proceeding. Executive also covenants and agrees that
he will comply with the applicable requirements of the
Company’s Code of Conduct.
(c) Executive covenants and
agrees that during Executive’s employment by the Company and
for a period of six months following the Termination Date,
Executive shall not, directly or indirectly, for the benefit of any
person, solicit, aid in solicitation of, induce, encourage or in
any way cause any employee of the Company to leave the employ of
the Company.
(d) Executive covenants and
agrees that during Executive’s employment by the Company and
at all times thereafter, Executive will not in any way disparage
the Company, its principals, shareholders, officers, directors,
employees, agents and related entities in any way, including, but
not limited to, its name, business reputation or business
practices. The Company agrees that it will not disparage Executive
in any way.
(e) Executive covenants and
agrees that during Executive’s employment by the Company and
for a period of six months following the Termination Date, without
the prior written consent of the Board of Directors of the Company,
Executive shall not (directly or indirectly, through one or more
intermediaries or in any other consulting capacity)
(i) purchase, offer or agree to purchase, or announce an
intention to purchase, directly or indirectly, any voting
securities or assets of the Company in excess of 5% of the
outstanding common stock of the Company; (ii) make, or in any
way participate, directly or indirectly, in any
“solicitation” of “proxies” to vote or
“consents” (as such terms are used in the rules and
regulations of the
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Securities and Exchange Commission) or
seek to advise or influence any person with respect to the voting
of any voting securities of the Company or any subsidiary thereof;
(iii) initiate or support, directly or indirectly, any
stockholder proposal with respect to the Company;
(iv) directly or indirectly make any public announcement with
respect to, or submit a proposal for, or offer of (with or without
conditions) any extraordinary transaction involving the Company or
its securities or assets or any subsidiary thereof, or of any
successor to or person in control of the Company or any of its
businesses, or any assets of the Company or any subsidiary or
division thereof or of any such successor or controlling person;
(v) seek or propose to influence or control the
Company’s man
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