| Item 5.02. |
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers |
On December 15, 2022, Radian Group Inc. (the “Company”) reported that J. Franklin Hall was no longer serving as the Company’s Chief Financial Officer (principal financial officer), effective December 14, 2022. As previously reported, Mr. Hall’s involuntary termination of employment with the Company is not the result of any issues or disagreements with the Company relating to the Company’s financial disclosures, accounting matters, operations, polices or practices, and Mr. Hall is expected to remain with the Company through February 28, 2023 (the “Termination Date”), to support the Company’s transition to a new Chief Financial Officer.
On January 13, 2023, the Company and Mr. Hall entered into a Transition, Separation and Release Agreement (the “Separation Agreement”). Subject to the terms and conditions of the Separation Agreement, Mr. Hall will be entitled to severance payments and other benefits that are consistent with the compensation and other benefits applicable to a “qualifying termination” under his previously disclosed Executive Severance Agreement and as described in the Company’s Proxy Statement filed with the Securities and Exchange Commission on April 7, 2022, with the modifications described below.
Under the Separation Agreement, Mr. Hall’s short-term incentive (STI) award for 2022 performance will be paid at his target STI amount multiplied by the corporate funding percentage awarded by the Compensation and Human Capital Management Committee of the Board of Directors of the Company (“Committee”) based on the Company’s 2022 financial and strategic performance. In addition, in exchange for Mr. Hall’s agreement to remain available should he be needed for transition assistance through December 31, 2023, the Separation Agreement provides that, upon his Termination Date, Mr. Hall will receive vesting service credit for his outstanding performance-based and time-based restricted stock unit (“RSU”) awards, as if he had remained employed with the Company through December 31, 2023. Other than this additional vesting service credit, the outstanding RSU awards will continue to be administered in accordance with their terms, including in the case of performance-based RSU awards, with future vesting subject to achievement of applicable performance-based criteria previously established by the Committee and included in the terms of the original grants.
Mr. Hall executed a release of claims against the Company in connection with entering into the Separation Agreement, and to receive the severance payments and other benefits under the Separation Agreement, Mr. Hall must execute and not revoke a second release of claims against the Company upon termination of his employment. Under the Separation Agreement, Mr. Hall has agreed not to compete with the Company and not to solicit the Company’s employees or customers for twelve months following the Termination Date.
The foregoing summary of the Separation Agreement is not a complete description of all of the terms and conditions, and is qualified in its entirety by reference to the full text of the agreement which is filed as an exhibit to this Form 8-K/A.