SCHEDULE 14A
(RULE 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. )
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
RADIAN GROUP INC.
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(Name of Registrant as Specified in Its Charter)
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(Name of Person(s) Filing Proxy Statement if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the form or schedule and the date of its filing.
(1) Amount previously paid:
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(2) Form, schedule or registration statement no.:
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(3) Filing party:
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(4) Date filed:
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[RADIAN LETTERHEAD WITH LOGO]
April 5, 2002
Dear Stockholder:
You are cordially invited to attend the 2002 Annual Meeting of Stockholders
of Radian Group Inc., which will be held at the offices of the Company at 1601
Market Street, 11th Floor, Philadelphia, Pennsylvania 19103, at 9:00 a.m., local
time, on Tuesday, May 7, 2002. The accompanying Notice of Annual Meeting of
Stockholders and Proxy Statement describe the items to be considered and acted
upon by the stockholders at the meeting.
Whether or not you plan to attend the upcoming meeting, please sign, date
and return the enclosed proxy card as soon as possible so that your shares can
be voted in accordance with your instructions. If you attend the meeting, you
may revoke your proxy, if you wish, and vote personally. Since the
representation of stockholders at the meeting is very important, we thank you in
advance for your participation.
Sincerely,
/s/ Howard S. Yaruss
HOWARD S. YARUSS
Secretary
RADIAN GROUP INC.
1601 Market Street
Philadelphia, PA 19103
------------------------
NOTICE OF 2002 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON
MAY 7, 2002
------------------------
TO THE STOCKHOLDERS OF
RADIAN GROUP INC.:
Notice is hereby given that the Annual Meeting of the Stockholders of
RADIAN GROUP INC., a Delaware corporation (the "Company"), will be held at the
offices of the Company, 1601 Market Street, 11th Floor, Philadelphia,
Pennsylvania, on Tuesday, May 7, 2002 at 9:00 a.m., local time, for the
following purposes:
1. To elect four directors for terms of three years each, to serve until
their successors shall be elected and qualified;
2. To approve the appointment of Deloitte & Touche LLP as the Company's
independent auditors for the year ending December 31, 2002; and
3. To transact such other business as may properly come before the
meeting or any adjournments thereof.
Only stockholders of record as of the close of business on March 22, 2002
will be entitled to notice of the annual meeting and to vote at the annual
meeting and any adjournments thereof. A list of stockholders entitled to vote at
the meeting will be available for inspection during normal business hours from
April 27, 2002 through May 7, 2002 at the offices of the Company at 1601 Market
Street, 11th Floor, Philadelphia, PA 19103.
By Order of the Board of Directors,
HOWARD S. YARUSS
Secretary
Philadelphia, PA
April 5, 2002
EACH STOCKHOLDER IS URGED TO COMPLETE, SIGN AND RETURN THE ENCLOSED PROXY CARD
IN THE ENVELOPE PROVIDED, WHICH REQUIRES NO POSTAGE IF MAILED IN THE UNITED
STATES. THE GIVING OF SUCH PROXY DOES NOT AFFECT YOUR RIGHT TO VOTE IN PERSON IN
THE EVENT YOU ATTEND THE MEETING. YOU MAY REVOKE YOUR PROXY AT ANY TIME BEFORE
IT IS VOTED.
RADIAN GROUP INC.
1601 Market Street
Philadelphia, PA 19103
------------------------
PROXY STATEMENT
FOR
2002 ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON
MAY 7, 2002
------------------------
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of RADIAN GROUP INC. (the "Company"), for use
at the 2002 annual meeting of stockholders to be held at the offices of the
Company, 1601 Market Street, 11th Floor, Philadelphia, PA, on Tuesday, May 7,
2002 at 9:00 a.m., local time, and at any adjournments thereof. A copy of the
notice of meeting accompanies this Proxy Statement. This Proxy Statement and the
accompanying Proxy Card are expected to be distributed to stockholders on or
about April 5, 2002.
The cost of solicitation of proxies will be borne by the Company. In
addition to the use of the mails, Georgeson Shareholder Communications Inc. has
been engaged to solicit proxies by mail, telephone or personal solicitation. It
is anticipated that the fees to be paid to Georgeson Shareholder Communications
Inc. by the Company will not exceed $10,000. Proxies may also be solicited by
officers and directors and a small number of employees of the Company who will
not be specially compensated for such services. The Company will also request
banks, brokers and other custodians, nominees and fiduciaries to forward copies
of the proxy material to their principals and to request authority for the
execution of proxies. The Company will, upon request, reimburse such persons for
reasonable expenses incurred in that regard.
PURPOSE OF THE MEETING
At the annual meeting, the stockholders will be asked to (i) elect four
directors to hold office as provided by law and the By-laws of the Company, (ii)
approve the appointment of Deloitte & Touche LLP as the Company's independent
auditors for the fiscal year ending December 31, 2002, and (iii) transact such
other business as may properly come before the meeting.
VOTING AT THE MEETING
Holders of record of the shares of common stock of the Company at the close
of business on March 22, 2002 are entitled to notice of and to vote at the
meeting. As of that date, 94,578,761 shares of common stock were issued and
outstanding. Each stockholder entitled to vote shall have the right to one vote
for each share outstanding held of record by such stockholder.
The Company presently has no other class of stock outstanding that is
entitled to vote at the meeting. A quorum is necessary to conduct the business
of the meeting. The holders of a majority of the shares entitled to vote,
present in person or represented by proxy, constitutes a quorum. The affirmative
vote of a plurality of the shares present in person or represented by proxy at
the meeting and entitled to vote is required for the election of directors. The
affirmative vote of a majority of the shares present in person or represented by
proxy at the meeting and entitled to vote is required to take action with
respect to any other matter as may be properly brought before the meeting.
With regard to election of directors, votes may be cast in favor or
withheld; votes that are withheld will be considered present for purposes of
determining whether a quorum exists, but will be excluded entirely from the vote
and will have no effect.
1
Abstentions may be specified on the proposal to approve the Company's
auditors. Abstentions may not be specified for the election of directors.
Abstentions will be considered present for purposes of determining whether a
quorum exists, will not be counted as votes cast in the affirmative, and will
therefore have the same effect as a negative vote.
Brokers that are member firms of the New York Stock Exchange and that hold
shares in street name for customers have the authority to vote those shares with
respect to the election of directors and the approval of the appointment of
Deloitte & Touche LLP if they have not received instructions on how to vote on
either or both of these matters from the customers.
Shares cannot be voted at the meeting unless the holder of record is
present in person or is represented by proxy. The enclosed Proxy Card is a means
by which a stockholder may authorize the voting of his or her shares at the
meeting. The shares of common stock represented by each properly executed Proxy
Card will be voted at the meeting in accordance with each stockholder's
directions. Stockholders are urged to specify their choices by marking the
appropriate boxes on the enclosed Proxy Card; if no choice has been specified,
the shares will be voted as recommended by the Board of Directors. If any other
matters are properly presented to the meeting for action, the proxy holders will
vote the proxies (which confer discretionary authority to vote on such matters)
in accordance with their best judgment.
Execution of the accompanying Proxy Card will not affect a stockholder's
right to revoke it by giving written notice of revocation to the Secretary of
the Company before the proxy is voted, by voting in person at the meeting, or by
executing a later-dated proxy that is received by the Company before the
meeting.
YOUR PROXY VOTE IS IMPORTANT TO THE COMPANY. ACCORDINGLY, YOU ARE ASKED TO
COMPLETE, SIGN AND RETURN THE ACCOMPANYING PROXY CARD WHETHER OR NOT YOU PLAN TO
ATTEND THE MEETING. IF YOU PLAN TO ATTEND THE MEETING TO VOTE IN PERSON AND YOUR
SHARES ARE REGISTERED WITH THE COMPANY'S TRANSFER AGENT (THE BANK OF NEW YORK)
IN THE NAME OF A BROKER, BANK OR OTHER CUSTODIAN, NOMINEE OR FIDUCIARY, YOU MUST
SECURE A PROXY FROM SUCH PERSON ASSIGNING YOU THE RIGHT TO VOTE YOUR SHARES.
I. ELECTION OF DIRECTORS
The Company's Amended and Restated Certificate of Incorporation provides
that the Board of Directors of the Company is classified into three classes of
directors having staggered terms. Each class is to be as equal in size as
possible. Each class holds office for a term of three years and until the
election and qualification of their respective successors or until their earlier
removal or resignation.
Four directors are to be elected at the 2002 annual meeting. The terms of
five current directors, David C. Carney, Howard B. Culang, Claire M. Fagin,
Rosemarie Greco and Ronald W. Moore, will expire at the 2002 annual meeting. One
of the current directors, Claire M. Fagin, will retire from the Board of
Directors of the Company effective at the 2002 annual meeting. The Board of
Directors has nominated Mr. Carney, Mr. Culang, Ms. Greco and Mr. Moore for
reelection as directors for terms of office that would expire in 2005. The
remaining seven directors will continue to serve in accordance with their prior
election or appointment.
The nominees have consented to be named and to serve if elected or
confirmed. Unless otherwise instructed by the stockholders, the persons named in
the proxies will vote the shares represented thereby FOR the election of such
nominees and the proposals of the Board. The Board of Directors believes all
nominees will be able to serve as directors; however, if this should not be the
case, the proxies may be voted for any substitute nominee to be designated by
the Board of Directors.
The directors are to be elected by a plurality of the shares present in
person or represented by proxy at the meeting and entitled to vote. The Board of
Directors unanimously recommends a vote FOR the election of Mr. Carney, Mr.
Culang, Ms. Greco and Mr. Moore as directors for terms of office expiring in
2005.
REQUIREMENTS FOR PROPOSAL OF NOMINEES
The Company's Amended and Restated Certificate of Incorporation prohibits a
nominee from being elected a director unless the name of the nominee, together
with such consents and information concerning
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present and prior occupations, transactions with the Company or its
subsidiaries, and other matters as may be required pursuant to the By-laws, is
filed with the Secretary of the Company no later than the time fixed pursuant to
the By-laws.
The Company's By-laws permit any stockholder entitled to vote for the
election of directors at a meeting to nominate a director for election by giving
written notice thereof to the Secretary of the Company received not less than 60
days before the meeting (as further described in this Proxy Statement in the
section entitled "STOCKHOLDER PROPOSALS FOR THE 2003 ANNUAL MEETING" on page
24.) This notice must contain or be accompanied by the following information:
(a) the name and residence of the stockholder who intends to make the
nomination;
(b) a representation that the stockholder is a holder of record of the
Company's voting stock and intends to appear in person or by proxy at the
meeting to nominate the person or persons specified in the notice;
(c) such information regarding each nominee as would be required in a
proxy statement filed pursuant to the rules of the Securities and Exchange
Commission had proxies been solicited with respect to the nominee by the
management or Board of Directors of the Company;
(d) a description of all arrangements or understandings among the
stockholder and each nominee and any other person or persons (naming such
person or persons) pursuant to which the nomination or nominations are to
be made by the stockholder; and
(e) the consent of each nominee to serve as a director of the Company.
INFORMATION REGARDING NOMINEES FOR ELECTION AS DIRECTORS AND REGARDING
CONTINUING DIRECTORS
The information provided below as to personal background has been provided
by each director and nominee as of March 15, 2002. References in this section to
"Radian Guaranty" are to Radian Guaranty Inc., an operating subsidiary of the
Company.
NOMINEES FOR ELECTION AT THE
2002 ANNUAL MEETING FOR
TERMS EXPIRING IN 2005
DAVID C. CARNEY............ Mr. Carney has been Chairman of the Board of
Directors of ImageMax, Inc. since 1999 and has been
a director of ImageMax, Inc. since 1997. He served
as Executive Vice President of Jefferson Health
Systems from October 1996 until May 1999. From
April 1995 until October 1996 he was Chief
Executive Officer of D.C. Carney Consulting
Service. He served as Chief Financial Officer of
CoreStates Financial Corp, a banking and financial
services holding company, from April 1991 until
April 1995. Mr. Carney is a Certified Public
Accountant and served as Philadelphia Area Managing
Partner for Ernst & Young LLP from 1980 through
1991. He has served as a director of AAA
Mid-Atlantic and Keystone Insurance Companies since
1996. He has been a director of the Company since
November 1992. Age: 64.
HOWARD B. CULANG........... Mr. Culang has been President of Laurel
Corporation, a financial services firm, since
January 1996. He has been Managing Member of JH
Capital Management, a management company for a
private equity fund, since July 1998. He has been
the Managing Member of Cognitive Capital
Management, a management company for a private fund
of funds, since January 2001. From January 1994 to
December 1995, he was Vice Chairman of Residential
Services Corporation of America, the holding
company for Prudential Home Mortgage, Lender's
Service, Inc.
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and Prudential Real Estate Affiliates. He served as
a director of Smart Storage Inc. between 1997 and
2001. He has been a director of the Company since
June 1999. Age: 55.
ROSEMARIE GRECO............ Ms. Greco is a Principal of GRECOventures, a
business consulting and investment partnership. She
served as President of CoreStates Financial Corp.,
the parent company of Corestates Bank, from May
1996 until August 1997 and President and Chief
Executive Officer of CoreStates Bank, a financial
institution, from August 1994 to August 1997. She
also served as Chief Banking Officer of CoreStates
Financial Corp. from August 1994 to May 1996, and
as Chief Retail Services Officer from October 1993
to August 1994. She was a bank director from April
1992 to August 1997. Ms. Greco is also a director
of Sunoco, Inc. and Exelon, Inc. She is a trustee
of Pennsylvania Real Estate Investment Trust and
SEI I Funds of SEI Investment Management. She has
been a director of the Company since June 1999.
Age: 55.
RONALD W. MOORE............ Mr. Moore has been an Adjunct Professor of Business
Administration, Graduate School of Business
Administration, Harvard University since 1990. Mr.
Moore has been a director of the Company since
November 1992. Age: 56.
DIRECTORS CONTINUING IN OFFICE
WITH TERMS EXPIRING IN 2003
FRANK P. FILIPPS........... Mr. Filipps is the Chief Executive Officer of the
Company and has been the Chairman of its Board of
Directors since June 1999. He joined the Company
and Radian Guaranty, as Senior Vice President and
Chief Financial Officer in November 1992, and
became Executive Vice President and Chief Operating
Officer of the Company and Radian Guaranty in 1994.
In January 1995 he became President of the Company
and Chairman of the Board, President and Chief
Executive Officer of Radian Guaranty. In January
1996 Mr. Filipps was named Chief Executive Officer
of the Company. From 1975 until October 1992 he was
an executive with American International Group,
Inc., an insurance holding company, serving as Vice
President and Treasurer from 1989 to 1992. He has
been a director of Impac Mortgage Holdings since
November 1995. He has been a director of the
Company since May 1995. Age: 54.
STEPHEN T. HOPKINS......... Mr. Hopkins is President of Hopkins and Company
LLC, a management consulting business he formed in
February 1999. From January 1976 to January 1999,
he held a number of managerial positions with
Federal Home Loan Mortgage Corporation ("Freddie
Mac"), serving as Senior Vice President and
National Sales Director from April 1994 through
August 1998. He has been a director of the Company
since June 1999. Age: 51.
ROBERT W. RICHARDS......... Mr. Richards was Chairman of the Board of Directors
of Source One Mortgage Services Corporation, a
mortgage banking company, from 1989 until his
retirement in 1996. He held a number of managerial
positions with Source One from 1971 through 1996,
serving as President from 1987 to 1989. He has been
a director of the Company since November 1992. Age:
59.
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ANTHONY W. SCHWEIGER....... Mr. Schweiger is the President of The Tomorrow
Group, LLC, which provides specialized financial
and management services for complex and
strategic/turnaround business issues. He is also
Managing Principal of e-brilliance, LLC, a
specialized Information Technology consulting and
education firm. He has been a director of Paragon
Technologies, Inc. since May 2001 and currently
serves as Chairman of Paragon Technologies, Inc. In
his capacity as a consultant, Mr. Schweiger served
as the senior acting manager in a variety of
businesses including Acting COO for WineAccess, a
development stage infomediary from May 1998 to
March 1999 and Acting Chief Executive Officer for
Care Systems in 1995. He was Managing Director of
the Stafford Companies, an investment banking firm
from November 1994 until April 1995. From November
1993 through August 1994, he served as the
Executive Vice President of First Advantage
Mortgage Corporation, a mortgage banking company.
Prior to that, he served as the President and Chief
Executive Officer of Meridian Mortgage Corporation
from 1987 until 1993 and the Executive Vice
President/Chief Operating Officer for that company
from 1983 to 1987. He has been a director of the
Company since November 1992. Age: 60
DIRECTORS CONTINUING IN OFFICE
WITH TERMS EXPIRING IN 2004
JAMES W. JENNINGS.......... Mr. Jennings has been a partner in the Philadelphia
office of the law firm of Morgan, Lewis & Bockius
LLP since 1970. He has been a director of the
Company since January 1993. Age: 65.
ROY J. KASMAR.............. Mr. Kasmar has been President and Chief Operating
Officer of the Company and Radian Guaranty since
June 1999. He joined Amerin Guaranty Corporation,
an Illinois domiciled insurer and wholly owned
subsidiary of the Company ("Amerin"), as Executive
Vice President and Chief Operating Officer in May
1996 and became President and Chief Operating
Officer of Amerin in November 1997. He has been a
director of Amerin since December 1996, and he was
a director of Amerin Corporation from September
1998 until it merged with and into the Company in
June 1999, at which time he became a director of
the Company. From 1988 to 1996 he was a member of
the Operating Committee and managing director of
the Capital Markets group with Prudential Home
Mortgage. He served as Chief Operating Officer and
Vice President in charge of secondary marketing of
First Boston Capital Group from 1984 to 1988. Prior
to that he served as Vice President in charge of
secondary marketing of Chase Home Mortgage from
1981 to 1984. Age: 46.
HERBERT WENDER............. Mr. Wender has been Lead Director and Chairman of
the Executive Committee of the Company since June
1999. He served as Chairman of the Board of
Directors of the Company from August 1992 to June
1999. He was Chairman of the Board and Chief
Executive Officer of Radian Guaranty from June 1983
until July 1992. Mr. Wender was a director of
LandAmerica Financial Group, Inc. from February
1998 to February 2001 and served as its Vice
Chairman from February 1998 through May 1999. He
was Chairman of the Board and Chief Executive
Officer of Commonwealth Land Title Insurance
Company, a title insurance
5
company, from June 1983 until February 1998. He has
been a director of the Company since July 1992.
Age: 64.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
The Company believes that during the year ended December 31, 2001, its
directors and executive officers complied with all applicable filing
requirements of Section 16(a) of the Securities Exchange Act of 1934, as
amended, except as noted herein. During the year ended December 31, 2001, each
of Mr. Frank Filipps, Chairman of the Company, and Mr. Anthony W. Schweiger, a
director of the Company, inadvertently failed to file a Form 4, disclosing one
transaction each, on a timely basis. A Form 4 was subsequently filed by each. In
addition, Mr. Martin Kamarck, an officer of the Company, and Mr. Herbert Wender,
a director of the Company, each inadvertently failed to file an annual Form 5,
disclosing one transaction each, on a timely basis. A Form 5 was subsequently
filed by each. The foregoing statements are based solely upon a review of copies
of reports furnished to the Company and written representations of its directors
and officers that no other reports were required.
SECURITY OWNERSHIP OF MANAGEMENT
AND CERTAIN BENEFICIAL OWNERS
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The following table indicates, as of December 31, 2001, information
relating to each person known to the Company to be the beneficial owner within
the meaning of Section 13(d) of the Securities Exchange Act of 1934, as amended,
of more than five percent (5%) of the Company's common stock.
SHARES VOTING POWER INVESTMENT POWER
BENEFICIALLY PERCENT --------------------- ---------------------
NAME AND BUSINESS ADDRESS OWNED(1) OF CLASS(2) SOLE SHARED SOLE SHARED
------------------------- ------------ ----------- ---- ------ ---- ------
INVESCO Institutional (NA),
Inc.(3)...................... 7,256,291 7.74% -0- 7,256,291 -0- 7,256,291
1315 Peachtree Street NE
Atlanta, GA 30309
T. Rowe Price Associates(4).... 4,840,040 5.1% 674,788 -0- 4,840,040 -0-
100 E. Pratt Street
Baltimore, MD 21202
---------------
(1) The information herein is presented in reliance on information disclosed by
the named beneficial owners on Schedules 13D or 13G, as filed with the
Securities and Exchange Commission with respect to shares of the Company
which are owned by the beneficial owners.
(2) The percentage has been determined based upon the number of shares
outstanding as of the close of business on December 31, 2001.
(3) On January 29, 2002 INVESCO Institutional (NA), Inc. ("INVESCO") filed a
Schedule 13G stating its ownership of common stock as set forth in the table
above at December 31, 2001. INVESCO did not specify therein with whom voting
and investment power is shared.
(4) On February 22, 2002, T. Rowe Price Associates, Inc. ("Price Associates")
filed an amendment to its Schedule 13G stating its ownership of common stock
as set forth in the table above at December 31, 2001. According to such
Schedule 13G, only its client or its client's custodian or trustee bank has
the right to receive dividends paid with respect to, and proceeds from the
sale of, such securities and that the ultimate power to direct the receipt
of dividends paid with respect to, and the proceeds from the sale of, such
securities, is vested in the individual and institutional clients for which
Price Associates serves as an investment adviser, and any and all
discretionary authority delegated to Price Associates may be revoked in
whole or in part at any time. According to such Schedule 13G, no individual
accounts hold an interest of 5% or more in the securities of the Company.
6
SECURITY OWNERSHIP OF DIRECTORS AND OFFICERS
The following table sets forth, as of March 15, 2002, all shares of common
stock of the Company which are deemed to be beneficially owned by each director
of the Company, each executive officer of the Company named in the Summary
Compensation Table on page 11 of this Proxy Statement, and the directors and all
current executive officers of the Company as a group.
NUMBER OF
SHARES
BENEFICIALLY PERCENTAGE
NAME OWNED(1)(2) OF CLASS
---- ------------ ----------
Frank P. Filipps............................................ 579,537 *
Herbert Wender.............................................. 275,500 *
C. Robert Quint............................................. 224,711 *
Roy J. Kasmar............................................... 129,806 *
Martin Kamarck.............................................. 65,390 *
David C. Carney............................................. 51,600 *
James W. Jennings........................................... 49,600 *
Howard S. Yaruss............................................ 44,195 *
Ronald W. Moore............................................. 32,400 *
Robert W. Richards.......................................... 31,300 *
Anthony W. Schweiger........................................ 29,400 *
Claire M. Fagin............................................. 23,300 *
Howard B. Culang............................................ 7,200 *
Rosemarie B. Greco.......................................... 7,200 *
Stephen T. Hopkins.......................................... 7,200 *
All directors and current executive officers as a group (18
persons).................................................. 1,584,179 1.69%
---------------
* Less than one percent of class
(1) Shares are "beneficially owned" by a person if such person, directly or
indirectly, has or shares (i) the voting power thereof, including the power
to vote or direct the voting of such shares, or (ii) the power to dispose or
direct the disposition of such shares. In addition, a person is deemed to
beneficially own any shares which such person has the right to acquire
beneficial ownership of within 60 days. Each named person in this table has
sole voting and investment powers over the shares shown unless otherwise
indicated.
(2) Includes: (1) shares allocable to employee contributions under the Company's
Savings Incentive Plan as of January 31, 2001, as to which the employee has
dispositive power; (2) shares that may be acquired within 60 days after
March 15, 2002, upon exercise of employee and director stock options, as
follows: Mr. Filipps -- 329,422 shares; Mr. Wender -- 271,500 shares; Mr.
Quint -- 201,750 shares; Mr. Kasmar -- 122,098 shares; Mr. Kamarck -- 61,596
shares; Mr. Carney -- 43,200 shares; Mr. Jennings -- 41,200 shares; Mr.
Yaruss -- 36,375 shares; Mr. Moore -- 27,200 shares; Mr. Richards -- 25,200
shares; Mr. Schweiger -- 7,200 shares; Dr. Fagin -- 20,100 shares; Mr.
Culang -- 4,800 shares; Ms. Greco -- 4,800 shares; Mr. Hopkins -- 4,800
shares; and all executive officers not named in the aggregate -- 21,850
shares; and (3) phantom stock units as to which vesting will occur under
certain circumstances as follows: Mr. Filipps -- 27,569 shares; Mr.
Quint -- 7,324 shares; Mr. Kasmar -- 7,708 shares; Mr. Kamarck -- 3,794
shares; Mr. Carney -- 3,200 shares; Mr. Jennings -- 3,200 shares; Mr.
Yaruss -- 4,303 shares; Mr. Moore -- 3,200 shares; Mr. Richards -- 3,200
shares; Mr. Schweiger -- 3,200 shares; Dr. Fagin -- 3,200 shares; Mr.
Culang -- 2,400 shares; Ms. Greco -- 2,400 shares; Mr. Hopkins -- 2,400
shares; and all executive officers not named in the aggregate -- 3,990
shares.
7
MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES
The Board of Directors of the Company holds regular quarterly meetings and
special meetings as and when necessary. During the period January 1, 2001
through December 31, 2001, the Board of Directors of the Company met on four
occasions. The By-laws of the Company provide that the Board of Directors, by a
resolution adopted by a majority of the entire Board, may designate an Executive
Committee or other committees, each of which shall consist of one or more
directors. In addition to the Executive Committee, the Board of Directors has
the following standing committees: Stock Option and Compensation Committee,
Audit Committee, Nominating Committee and Investment Committee. Each director
participated in at least 75% of the meetings of the Board of Directors and the
committees thereof, on which he or she served, held during 2001.
EXECUTIVE COMMITTEE. As of December 31, 2001, the Executive Committee was
composed of Messrs. Wender (Chairman), Carney, Filipps, Kasmar and Schweiger.
The Executive Committee met three times during the period from January 1, 2001
through December 31, 2001.
STOCK OPTION AND COMPENSATION COMMITTEE. As of December 31, 2001, the
Stock Option and Compensation Committee was composed of four non-employee
directors, Mr. Richards (Chairman), Dr. Claire M. Fagin (who is not seeking
re-election to the Board of Directors and will retire as of the 2002 annual
meeting), Ms. Greco and Mr. Moore. This Committee is responsible for
administering the Company's 1992 Stock Option Plan, 1995 Equity Compensation
Plan, 1992 Amerin Corporation Long-Term Incentive Plan and the Enhance Financial
Services Group Inc. Long Term Incentive Plans and for setting compensation for
the Company's senior managers. The Stock Option and Compensation Committee met
five times during the period January 1, 2001 through December 31, 2001. The
Stock Option and Compensation Committee's report for fiscal year 2001 appears on
page 17.
AUDIT COMMITTEE. As of December 31, 2001, the Audit Committee was composed
of four non-employee directors, Messrs. Carney (Chairman), Hopkins, Jennings,
and Schweiger. This Committee is responsible for recommending to the Board of
Directors the independent auditors to be retained by the Company; reviewing and
approving the financial results of the Company; reviewing with the Company's
independent auditors the scope and results of their audits; reviewing with the
independent auditors and management the Company's accounting and reporting
principles, practices and policies and the adequacy of the Company's accounting,
operating and financial controls. The Audit Committee met five times during the
period between January 1, 2001 and December 31, 2001. The Report of the Audit
Committee for fiscal year 2001 appears on page 22.
NOMINATING COMMITTEE. As of December 31, 2001, the Nominating Committee
was composed of four non-employee directors, Messrs. Schweiger (Chairman),
Carney, Hopkins and Jennings. This Committee is responsible for identifying and
recommending to the Company's stockholders nominees to the Company's Board of
Directors. The Nominating Committee considers nominees who are recommended by
stockholders as additional members of the board or to fill vacancies on the
board. Stockholders desiring to submit the names of, and any pertinent data with
respect to, such nominees should send this information, in writing, to the
Chairman of the Nominating Committee, Mr. Anthony W. Schweiger, in care of the
Company. The Nominating Committee met two times during the period between
January 1, 2001 and December 31, 2001. The procedures for stockholders to follow
in nominating candidates to the Board of Directors is described in this Proxy
Statement in the section entitled "ELECTION OF DIRECTORS -- Requirements for
Proposal of Nominees" on page 2.
INVESTMENT COMMITTEE. As of December 31, 2001, the Investment Committee
was composed of Mr. Moore (Chairman), Mr. Culang, Dr. Fagin, and Mr. Richards.
The Investment Committee met four times during the period January 1, 2001
through December 31, 2001.
8
EXECUTIVE OFFICERS OF THE COMPANY
Set forth below is certain information regarding each of the current
executive officers of the Company as of March 15, 2002. The executive officers
of the Company are elected by the Board of Directors to serve in their
respective capacities until their successors are duly elected and qualified or
until their earlier resignation or removal. References in this section to
"Radian Guaranty" are to Radian Guaranty Inc., an operating subsidiary of the
Company.
Mark Casale................ Mr. Casale joined the Company as Senior Vice
President, Strategic Investments in May 2001. From
August 2000 until April 2001, he served as Vice
President of Society Hill Capital Management. From
February 1992 until May 2000, he served in various
senior management positions with Advanta
Corporation, a financial services company. Age: 37.
Frank P. Filipps........... Information about Mr. Filipps is set forth on page
4 of this Proxy Statement.
Martin Kamarck............. Mr. Kamarck joined the Company in February 2001, as
a result of the Company's acquisition of Enhance
Financial Services Group Inc. ("Enhance"). He
joined Enhance in April 1999 as
President -- Insurance Businesses, in which
capacity he also served as President of Enhance's
wholly owned subsidiaries, Asset Guaranty Insurance
Company (now named Radian Asset Assurance Inc.) and
Enhance Reinsurance Company (now named Radian
Reinsurance Inc.). He continues to serve as
President of Radian Asset Assurance Inc. and Radian
Reinsurance Inc. with offices in New York City and
London. From April 1997 through 1999, Mr. Kamarck
was President and Chief Operating Officer of AEW
Capital Management L.P., a leading real estate
investment management firm now owned by CDC Ixis.
Mr. Kamarck was in public service from November
1993 through March 1997 with the Export-Import Bank
of the United States, initially as First Vice
President and Vice Chairman of the Board and then
as President and Chairman. From 1987 until March
1993, Mr. Kamarck was an executive with Financial
Guaranty Insurance Company, serving as General
Counsel, Director of Real Estate Finance, Co-Head
of Structured Finance and as member of the board of
directors. He started his career as an attorney
with the firm of Morrison & Foerster in San
Francisco and subsequently as a partner from 1981-
1986 in Washington, D.C. He has been a member of
the board of directors of the Association of
Financial Guaranty Insurers since 1999 and was Vice
Chairman in 2000-2001. Age: 52.
Roy J. Kasmar.............. Information about Mr. Kasmar is set forth on page 5
of this Proxy Statement.
C. Robert Quint............ Mr. Quint was named Executive Vice President, Chief
Financial Officer of the Company in April 1999. He
was named Senior Vice President, Chief Financial
Officer of the Company and Radian Guaranty in
January 1996. He joined Radian Guaranty as Vice
President, Administration and Controller in August
1990. In July 1992 he became Vice President,
Administration and Controller of the Company. In
January 1995, he was named Vice President, Finance
and Controller of the Company and Radian Guaranty.
From June 1987 until August 1990 he served as an
Assistant Controller for Reliance Development
Group, a commercial real estate developer. Age: 42.
9
Elizabeth Shuttleworth..... Ms. Shuttleworth joined Radian Guaranty in May 2001
as Executive Vice President of Information Systems.
She was appointed Senior Vice President of the
Company in October 2001. From 1998 to May 2001 Ms.
Shuttleworth was Vice President of Information
Technology and Chief Information Officer of Vlasic
Foods International Inc. Throughout her career, Ms.
Shuttleworth has held various positions with global
corporations as a Director of Business Services as
well as several strategic and business consulting
positions. Age: 50
Scott Stevens.............. Mr. Stevens was named Senior Vice President, Human
Resources and Administration of the Company in
February 2001. He was named Senior Vice President,
Human Resources and Administration of Radian
Guaranty in July 1998. He joined Radian Guaranty as
Vice President, Human Resources and Administration
in June 1995. He was a private human resources
consultant to several firms from 1993 to 1995
before joining Radian Guaranty. He was previously
associated with Meridian Mortgage Corporation as
Senior Vice President, Corporate Services, from
1987 to 1993, BancTEXAS Dallas, N.A. as a Vice
President, Corporate Services and Human Resources,
from 1983 to 1987 and Provident Bancorp, Inc. as an
Assistant Vice President, Human Resources, from
1978 to 1983. Age: 46
Howard S. Yaruss........... Mr. Yaruss was named Executive Vice President of
the Company in February 2002. He joined the Company
and Radian Guaranty in July 1997 as Senior Vice
President, Secretary and General Counsel. From July
1991 until July 1997 he served as Vice President,
Assistant General Counsel and Assistant Secretary
of Capital Reinsurance Company, a reinsurance
company. Age: 43.
COMPENSATION OF DIRECTORS AND EXECUTIVE OFFICERS
DIRECTOR COMPENSATION
Mr. Wender receives as compensation for his services as Lead Director of
the Company $100,000 per year plus stock options with a present value on the
date of grant of approximately $100,000 per year. All other directors of the
Company who do not serve as officers of the Company receive an annual fee for
their services of $20,000, a $2,000 annual fee for serving as the chairman of a
committee, a $1,500 fee for each Board of Directors meeting attended, a $1,500
fee for each committee meeting attended not in conjunction with a Board of
Directors meeting and a $500 fee for each committee meeting attended in
conjunction with a Board of Directors meeting attended. In addition,
non-employee directors are reimbursed for their out-of-pocket expenses incurred
in connection with a Board of Directors or committee meeting. Directors who are
employees do not receive additional compensation for their service as a
director. Each non-employee director automatically receives an annual grant of
800 units of phantom stock at full value exercisable upon his or her departure
from the Board of Directors of the Company. Each non-employee director also
receives an annual grant of 2,400 non-qualified stock options, under the
Company's stock option plan, at the fair market value of the Company's Common
Stock on the date of the grant. These options become vested and fully
exercisable on the first anniversary of the date of the grant, provided that the
optionee is a director of the Company on such anniversary date. Options are
exercisable for ten years after the date of the grant, provided that the
optionee remains a director of the Company.
10
EXECUTIVE COMPENSATION
The following table sets forth certain information for the years ended
December 31, 2001, 2000 and 1999 as to the compensation of (i) the Chief
Executive Officer of the Company and (ii) the four most highly compensated
executive officers of the Company other than the Chief Executive Officer.
SUMMARY COMPENSATION TABLE
LONG TERM
COMPENSATION
-----------------
AWARDS
-----------------
SECURITIES
UNDERLYING
ANNUAL COMPENSATION OPTIONS/ SARS AND ALL OTHER
----------------------------- PHANTOM STOCK COMPEN-
NAME AND PRINCIPAL POSITION YEAR SALARY($)(1) BONUS($)(2)(3) UNITS(#)(4) SATION($)(5)
--------------------------- ---- ------------ -------------- ----------------- ------------
Frank P. Filipps.............. 2001 $675,000 $900,450 285,955(6)(7) $ 8,716
Chairman of the Board and 2000 $530,000 $737,000 248,764(8)(9) $ 47,634
Chief Executive Officer 1999 $500,000 $750,000 135,000(9) $ 21,979
Roy J. Kasmar................. 2001 $425,000 $425,212 59,683(6) $ 8,639
President and Chief 2000 $397,500 $399,487 87,237(9) $ 75,870
Operating Officer 1999 $336,828 $475,000 60,000 $137,836
Martin Kamarck................ 2001 $343,918 $272,136 33,794(6) $ 11,242
President of Enhance Financial
Services Group Inc.(10)
C. Robert Quint............... 2001 $300,000 $250,125 37,294(6) $ 8,591
Executive V.P., Chief 2000 $237,500 $198,906 43,604(9) $ 18,361
Financial Officer 1999 $225,000 $247,500 37,000(9) $ 15,862
Howard S. Yaruss.............. 2001 $250,000 $220,000 26,303(6) $ 8,519
Sr. V.P., Secretary & 2000 $183,750 $137,812 26,688(9) $ 17,446
General Counsel 1999 $175,000 $131,250 19,500(9) $ 18,400
---------------
(1) Includes employee contributions to the Company's Savings Incentive Plan.
(2) Bonus stated herein has been reduced by the phantom stock unit grants
included in the Long Term Compensation Awards column of this table and the
Long Term Incentive Plan Table on page 14.
(3) All or a portion of the bonus may have been deferred pursuant to the terms
of the Deferred Compensation Plan.
(4) Previous grants have been adjusted for the 2 for 1 stock split that
occurred on June 21, 2001.
(5) For 2001, represents matching contributions by the Company under the
Company's Savings Incentive Plan in the amount of $8,500 to each of the
named executive offices in the table and the premiums paid by the Company
for term life insurance. Commencing with fiscal 2001, the Company is not
including in the Summary Compensation Table any amounts of perquisites and
other personal benefits not required to be reported by the rules and
regulations of the Securities and Exchange Commission.
(6) Includes phantom stock units granted in lieu of a portion of the bonus
stated herein.
(7) Includes Mr. Filipps' reload grants totaling 150,386 options as a result of
a stock swap and reload transaction which occurred in 2001.
(8) Includes Mr. Filipps' reload grants totaling 37,706 options as a result of
two stock swap and reload transactions which occurred in 2000.
(9) Includes phantom stock units granted during prior compensation period.
(10) Employment with the Company commenced upon the acquisition of Enhance
Financial Services Group on February 28, 2001. The table reflects only
amounts earned following such acquisition.
11
The following table sets forth certain information concerning grants of
stock options made during the year ended December 31, 2001 to the executive
officers of the Company named in the Summary Compensation Table.
OPTION/SAR GRANTS IN LAST FISCAL YEAR
INDIVIDUAL GRANTS
-----------------------------------------------------
NUMBER OF % OF TOTAL POTENTIAL REALIZABLE VALUE
SECURITIES OPTIONS/SARS AT ASSUMED ANNUAL RATES OF
UNDERLYING GRANTED TO EXERCISE STOCK PRICE APPRECIATION FOR
OPTIONS/ EMPLOYEES OR BASE OPTION TERM (10 YEARS)($)(1)
SARS IN FISCAL PRICE EXPIRATION ----------------------------
NAME GRANTED(5) YEAR ($/SHARE) DATE 5% 10%
---- ---------- ------------ --------- ---------- ------------ ------------
Frank P. Filipps..... 160,000(2) 8.5% $27.1875 01/22/11 $2,735,691 $6,932,779
108,000(3) 5.74% $ 35.81 11/06/11 $2,432,237 $6,163,767
14,228(4) .76% $ 38.00 01/21/07 $ 340,020 $ 861,679
40,301(4) 2.14% $ 38.00 01/20/04 $ 963,113 $2,440,717
41,578(4) 2.21% $ 38.00 12/22/05 $ 993,630 $2,518,055
54,279(4) 2.88% $ 38.00 12/16/04 $1,297,159 $3,287,256
Roy J. Kasmar........ 80,000(2) 4.25% $27.1875 01/22/11 $1,367,845 $3,466,389
51,975(3) 2.76% $ 35.81 11/06/11 $1,170,514 $2,966,312
Martin Kamarck....... 30,000(3) 1.59% $ 35.81 11/06/11 $ 675,621 $1,712,157
C. Robert Quint...... 40,000(2) 2.12% $27.1875 01/22/11 $ 683,922 $1,733,194
29,970(3) 1.59% $ 35.81 11/06/11 $ 674,945 $1,710,445
Howard S. Yaruss..... 25,000(2) 1.33% $27.1875 01/22/11 $ 427,451 $1,083,246
22,000(3) 1.17% $ 35.81 11/06/11 $ 495,455 $1,255,582
---------------
(1) The dollar amounts under these columns are the result of calculations at the
5% and 10% appreciation rates set by the Securities and Exchange Commission
by rule and therefore are not intended to and do not forecast possible
future appreciation in the value of the common stock of the Company. The
applicable rules of the Securities and Exchange Commission permit the
Company to use an alternative formula for a grant date valuation, an
approach which would state gains at present, and therefore lower, value.
However, the Company did not use such alternative formula because it does
not believe that any alternative formula would determine with reasonable
accuracy a present value based on future unknown or volatile factors.
(2) These options vest in four equal installments on each anniversary of January
22 in 2003, 2004, 2005 and 2006. The options have a reload feature whereby
options exercised may be paid for with previously owned mature shares of
common stock and a regrant of the number of options equal to those shares
exchanged will occur at the then current fair market value for the remaining
term of the original option grant.
(3) These options vest in four equal installments on each anniversary of
November 6 in 2002, 2003, 2004 and 2005. The options have a reload feature
as described in Note (2) above.
(4) These stock options were granted as reloads as a result of the exercise of
options by Mr. Filipps using previously owned shares of the Company's common
stock. The potential realizable value columns reflect appreciation only
through the remainder of the original option terms.
(5) Grants prior to June 21, 2001 have been adjusted to reflect the 2 for 1
stock split that occurred on that date.
12
The following table sets forth certain information concerning exercises of
stock options during the year ended December 31, 2001 and the value of
unexercised stock options at December 31, 2001 for the executive officers of the
Company named in the Summary Compensation Table.
AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND
FISCAL YEAR-END OPTION/SAR VALUES(1)
NUMBER OF SECURITIES
UNDERLYING UNEXERCISED VALUE OF UNEXERCISED
OPTIONS/ SARS AT IN-THE-MONEY OPTIONS/ SARS
SHARES DECEMBER 31, 2001(2)(4) AT DECEMBER 31, 2001($)
ACQUIRED ON VALUE --------------------------- ---------------------------
NAME EXERCISE(#)(4) REALIZED($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
---- -------------- ----------- ----------- ------------- ----------- -------------
Frank P. Filipps..... 280,526 $7,299,345(3) 265,672 476,750 $1,896,898 $7,906,276
Roy J. Kasmar........ 60,000 $1,070,378 107,098 191,075 $2,069,994 $2,947,226
Martin Kamarck....... -- -- 61,596 30,000 $ 343,297 $ 214,200
C. Robert Quint...... -- -- 187,750 141,220 $6,014,147 $2,428,040
Howard S. Yaruss..... -- -- 28,000 84,500 $ 513,873 $1,347,478
---------------
(1) At December 31, 2001, the closing price of a share of the Company's common
stock on the New York Stock Exchange was $42.95.
(2) There is a reload feature attached to outstanding option grants whereby
options exercised may be paid for with previously owned shares of common
stock and a regrant of the number of options equal to those shares exchanged
will occur at the then current fair market value for the remaining term of
the original option grant.
(3) Shares were exercised pursuant to a stock swap and subsequent reload.
(4) Grants prior to June 21, 2001 have been adjusted to reflect the 2 for 1
stock split that occurred on that date.
13
The following table sets forth certain information concerning grants made
with respect to the year ended December 31, 2001 of phantom stock units under
the Company's Equity Compensation Plan to the executive officers of the Company
named in the Summary Compensation Table.
LONG-TERM INCENTIVE PLANS --
PHANTOM STOCK AWARDS IN LAST FISCAL YEAR
NUMBER OF SHARES, PERFORMANCE OR OTHER PERIOD
NAME UNITS OR OTHER RIGHTS UNTIL MATURATION OR PAYOUT(5)
---- --------------------- -----------------------------
Frank P. Filipps.................................. 15,000(1) January 2, 2002
13,352(2) February 7, 2002
12,000(4) March 16, 2003
15,569(3) January 16, 2003
Roy J. Kasmar..................................... 7,237(2) February 7, 2002
7,708(3) January 16, 2003
Martin Kamarck.................................... 3,794(3) January 16, 2003
C. Robert Quint................................... 3,000(1) January 2, 2002
3,603(2) February 7, 2002
3,000(4) March 16, 2003
4,324(3) January 16, 2003
Howard S. Yaruss.................................. 2,000(1) January 2, 2002
1,689(2) February 7, 2002
2,000(4) March 16, 2003
2,303(3) January 16, 2003
---------------
(1) Represents the grant of phantom stock units to select key employees and
executive officers based on the fair market value of the common stock on
December 17, 1999 ($45.25 per share).
(2) Represents the grant of phantom stock units as part of the executive
officers' 2000 annual bonus, based on the fair market value of the common
stock on January 22, 2001 ($27.1875 per share).
(3) Represents the grant of phantom stock units as part of the executive
officers' 2001 annual bonus, based on the fair market value of the common
stock on November 6, 2001 ($35.81 per share), the date as of which bonus
amounts were calculated.
(4) Represents the grant of phantom stock units to select key employees and
executive officers based on the fair market value of the common stock on
February 28, 2001 ($30.925 per share).
(5) The phantom stock units granted in lieu of cash bonus vest one year from the
date granted and must be exercised within 15 days of the date the phantom
stock units vest. The units are payable in Company common stock. Other
phantom stock unit awards generally vest two years from date of grant and
must be exercised within 15 days of the date they vest.
14
CHANGE IN CONTROL AGREEMENTS
See the section entitled "CERTAIN TRANSACTIONS" on page 20 of this Proxy
Statement for a description of change in control agreements between the Company
and its executive officers.
DEFERRED COMPENSATION PLAN
In October 1999, the Board of Directors of the Company approved a Deferred
Compensation Plan for certain key officers. The Deferred Compensation Plan
affords the key officers the opportunity to elect to defer receipt of their
annual bonus monies. This program provides a way for key officers to defer
income and tax liability while earning a rate of return equal to either (i) 200
basis points above the U.S. 30-year Treasury rate or (ii) the Company's return
on equity.
COMPANY PENSION PLAN AND SUPPLEMENTAL EXECUTIVE RETIREMENT PLAN
The Board of Directors of the Company established the Company's Pension
Plan (the "Pension Plan") in 1992. The Pension Plan is intended to be
tax-qualified under Section 401(a) of the Internal Revenue Code. All salaried
and hourly employees of the Company are eligible to participate in the Pension
Plan upon the attainment of 20 1/2 years of age and one year of eligible
service. A participant is generally fully vested after five years of service
subsequent to age 18.
The amount of the annual normal retirement benefit of a participant is the
sum of (i) 1.1% of his average base salary (up to a statutory maximum equal to
$170,000 in 2001) for the five consecutive calendar years for which such average
is highest ("Average Annual Salary") multiplied by his number of years of
credited service not in excess of 35 years, plus (ii) 0.5% of the participant's
Average Annual Salary in excess of the average of the annual Social Security
taxable wage bases in effect for each of the 35 calendar years ending with the
calendar year in which he attains Social Security retirement age multiplied by
his number of years of credited service not in excess of 35 years, plus (iii)
0.5% of the participant's Average Annual Salary multiplied by his number of
years of credited service in excess of 35 years.
In January 1997, the Board of Directors of the Company established a
nonqualified Supplemental Executive Retirement Plan ("SERP") for selected senior
officers of the Company. This plan is intended to provide certain officers with
a supplemental retirement program to the Pension Plan. The difference between
the SERP and the Pension Plan is that the SERP is not subject to the statutory
cap on compensation that may be taken into account for the calculation of
benefits ($170,000 in 2001) and the statutory cap on actual benefits ($135,000
in 2001). The benefit under the SERP is determined using the same formula as
that under the Pension Plan but is based on total compensation (inclusive of
salary and bonus) up to 150% of average base pay for the three consecutive
calendar years for which such base pay is the highest.
The following table sets forth the approximate annual retirement benefits
that a full-time employee, including an officer, may receive under the Company's
Pension Plan, assuming selection of a single life annuity and retirement at age
65, based on the indicated assumptions as to Average Annual Salary and years of
credited service. The following table assumes that the Company was in existence
for the entire year of 1992. Benefits shown in the following table in excess of
$135,000 are payable by the Company only to persons designated by the Board of
Directors as eligible to participate in the SERP.
15
RADIAN GROUP INC.
PENSION PLAN TABLE
YEARS OF CREDITED SERVICE
AVERAGE -------------------------------------------------------------------------
ANNUAL SALARY 5 10 15 20 25 30 35
------------- ------- -------- -------- -------- -------- -------- --------
$ 100,000 $ 7,100 $ 14,200 $ 21,300 $ 28,400 $ 35,500 $ 42,600 $ 49,700
$ 150,000 11,100 22,200 33,300 44,400 55,500 66,600 77,700
$ 170,000 12,700 25,400 38,100 50,800 63,500 76,200 88,900
$ 200,000 15,100 30,200 45,300 60,400 75,500 90,600 105,700
$ 250,000 19,100 38,200 57,300 76,400 95,500 114,600 133,700
$ 300,000 23,100 46,200 69,300 92,400 115,500 138,600 161,700
$ 500,000 39,100 78,200 117,300 156,400 195,500 234,600 273,700
$ 750,000 59,100 118,200 177,300 236,400 295,500 354,600 413,700
$1,000,000 79,100 158,200 237,300 316,400 395,500 474,600 553,700
For the year ended December 31, 2001, the base salary covered by the
Pension Plan for the officers named in the Summary Compensation Table in this
Proxy Statement is set forth in the "salary" column of the Summary Compensation
Table. The credited years of service as of December 31, 2001 for each such
officer is as follows: Mr. Filipps -- 9 years; Mr. Kasmar -- 6 years; Mr.
Yaruss -- 5 years and Mr. Quint -- 18 years. Mr. Kamarck continues to
participate in the Enhance Reinsurance Pension Plan detailed in this section.
ENHANCE REINSURANCE PENSION PLAN
The Company continues to maintain the defined benefit pension plan of
Enhance Financial Services Group Inc. ("Enhance"), which the Company acquired in
2001, named the Enhance Reinsurance Pension Plan ("Enhance Pension Plan"), for
employees of Enhance and its direct wholly-owned subsidiaries. The Enhance
Pension Plan is intended to be tax-qualified under Section 401(a) of the
Internal Revenue Code. Employees of Enhance and its direct wholly-owned
subsidiaries who have attained age 21 and who have completed at least one year
of service are eligible to participate in the Enhance Pension Plan. The Enhance
Pension Plan provides a normal retirement benefit at normal retirement (the
earlier of the date on which a participant (a) has attained age 65 and completed
five years of participation or (b) has attained age 62 and completed 10 years of
participation) equal to 2.25% of the participant's compensation (up to the
statutory maximum of $170,000) multiplied by his or her years of service up to
his or her first 15 years, plus 1.75% of the participant's compensation (up to
the statutory maximum) multiplied by his or her years of service for his or her
next 10 years, plus 1% of the participant's compensation multiplied by his or
her years of service for his or her next five years. Compensation, under the
Enhance Pension Plan, is defined as the average of the participant's three
highest consecutive years of earnings.
In addition, in 1999 Enhance adopted, a non-qualified supplemental pension
plan (the "Enhance SPP"). All employees of the Enhance who are eligible to
participate in the Enhance Pension Plan and who receive total annual
compensation in excess of the Code Maximum are eligible to participate in the
Enhance SPP. The Enhance SPP provides a retirement benefit supplemental to
benefits provided by the Enhance Pension Plan equal to 1.75% of the
participant's compensation above the Code Maximum multiplied by his or her years
of service up to his or her first 25 years, plus 1.0% of the participant's
compensation above the Code Maximum multiplied by his or her years of service
for his or her next five years. Compensation is defined as the average of the
participant's three highest consecutive years of earnings. The vested percentage
of a participant will be the lower of (a) 20% per year of service beginning
after two years of service such that his or her vested percentage is 100% after
six years, and (b) such other rate per year as will cause a given participant to
be fully vested at age 60. For purposes of determining a participant's
retirement benefit and vested percentage, "years of service" and "years of
participation," while not synonymous, include service with the Company and
certain service with predecessor employers. Also, for purposes of the Enhance
SPP, in addition to each such executive officer's actual years of service, upon
becoming fully vested under the terms of the Enhance Pension Plan, each
participant in the Enhance SPP who is or subsequently becomes an executive
officer of Enhance at the level of Executive Vice President and above will be
credited with additional years of
16
employment services under the EPP equal to the excess of five over the actual
years of employment service credited to that officer under the EPP prior to its
effective date.
The following table sets forth the approximate annual retirement benefits
payable under the Enhance Pension Plan assuming retirement at normal retirement
age at various levels of compensation and years of service. Such benefits are
based on a straight life annuity and are not subject to any deduction for Social
Security or other offset amounts.
ENHANCE REINSURANCE
PENSION PLAN TABLE
HIGHEST YEARS OF CREDITED SERVICE
AVERAGE --------------------------------------------------------------------------
COMPENSATION 5 10 15 20 25 30 35(1)
------------ -------- -------- -------- -------- -------- -------- --------
$ 100,000 $ 11,250 $ 22,500 $ 33,750 $ 42,500 $ 51,250 $ 56,250 $ 56,250
$ 150,000 16,875 33,750 50,625 63,750 76,875 84,375 84,375
$ 170,000 19,125 38,250 57,375 72,250 87,125 95,625 95,625
$ 200,000 22,500 45,000 67,500 85,000 102,500 112,500 112,500
$ 250,000 28,125 56,250 84,375 106,250 128,125 140,625 140,625
$ 300,000 33,750 67,500 101,250 127,500 153,750 168,750 168,750
$ 500,000 56,250 112,500 168,750 212,500 256,250 281,250 281,250
$ 750,000 84,375 168,750 253,125 318,750 384,375 421,875 421,875
$1,000,000 112,500 225,000 337,500 425,000 512,500 562,500 562,500
---------------
(1) The Enhance Pension Plan limits service to 30 years for benefit purposes.
As of the year ended December 31, 2001, Mr. Martin Kamarck, the officer
named the in the Summary Compensation Table who participates in the Enhance
Pension Plan, had 3 years of credited service and participation under the
Enhance Pension Plan.
STOCK OPTION AND COMPENSATION COMMITTEE REPORT ON COMPENSATION OF EXECUTIVE
OFFICERS OF THE COMPANY
The Stock Option and Compensation Committee (the "Committee") of the
Company's Board of Directors has provided the following report on executive
compensation for the year ended December 31, 2001:
COMPENSATION PHILOSOPHY
The Committee believes that the Company's executive compensation program
should be closely related to the services that the executives deliver to the
Company and the value such services bring to the stockholders of the Company.
Therefore, in practice, it believes an executive's compensation should be based,
in part, on the achievement by the Company of certain specified financial
objectives and, in part, on the achievement by the executive of specific,
individual objectives. The Company's financial objectives are recommended by
management and are approved by the Committee and further ratified by the full
Board of Directors. Achievement of both corporate and individual objectives
should lead to improved performance and greater value to the stockholders. The
Committee has worked with an outside consultant which has reviewed the Company's
compensation programs compared to those provided by similar organizations.
TYPES OF COMPENSATION
The Company's executive compensation program has three components: annual
base salary, annual bonus, and stock options. The variable portions of the
executive compensation program (annual bonus and stock options) are directly
tied to the results of the Company's operations. The annual bonus has been
designed to recognize shorter-term results while awards of stock options have
been implemented to recognize sustained corporate growth and profitability.
17
ANNUAL BASE SALARY
The annual base salary levels for the Company's executive officers are
intended to be competitive with salaries for executive officers in comparable
industries with similar levels of responsibility. The Company believes the
salaries are competitive. Salaries paid to executive officers are fixed by the
Committee. The Committee grants periodic salary increases, if warranted, after a
review of individual performance and an assessment of the competitiveness of the
executive's current salary.
ANNUAL BONUS
The annual bonus plan is designed to reflect the achievement of specific
individual and corporate goals and objectives. The award of an annual bonus
recognizes the individual contributions of an executive officer to the Company's
operations. Each executive officer's contributions are measured against specific
goals and objectives established by each executive officer and the Committee at
the beginning of the year for the executive officer and the Company. Among the
factors considered in establishing corporate objectives are the Company's return
on equity, net income, combined ratio, growth in earnings and revenue, reduction
in expenses, and increases in productivity. Individual objectives are based on
the executive's position with the Company or an affiliate. Each year, the
Chairman of the Company reviews the performance of all executive officers and
makes specific recommendations to the Committee regarding the amount of annual
bonus, if any, to be awarded. The amount of the annual bonus is dependent upon
achieving specific goals and objectives. The amount of the annual bonus actually
awarded to an executive officer is dependent on meeting or exceeding specific
annual targets. Failure to reach the targeted goals results in lower annual
bonus awards and may, in the appropriate circumstances, result in no award.
Starting with annual bonuses earned in 2000 by executive officers and other key
officers designated by Mr. Filipps, a portion will be paid in phantom stock
units of the Company. Because the attainment of the goals and objectives of the
Company should lead to increased stockholder returns, the Committee believes the
annual bonus plan creates a direct relationship between executive compensation
and the creation of additional value for the stockholders.
LONG-TERM EQUITY INCENTIVE
The Company's 1992 Stock Option Plan and 1995 Equity Compensation Plan
provide the Company the opportunity to reward the contributions of key
employees -- executive officers and others. Based upon a review of practices by
corporations of similar size and/or business and management's recommendations,
the Committee has approved guidelines that provide for stock option grants to
executive officers (and key employees) upon the occurrence of one or more of the
following events: (i) initial employment; (ii) promotion to a new, more senior
position with increased responsibility and accountability; and (iii) the
attainment of specific goals and objectives by an executive officer or key
employee and the Company.
The Committee reviews the individual performance of Messrs. Filipps and
Kasmar. The performance of the other executive officers of the Company is
reviewed by Mr. Filipps, who makes specific recommendations to the Committee
regarding the eligibility of, and the number of stock options to be granted to,
those executive officers of the Company who have made significant contributions
to the Company's results of operations.
To make its determinations, the Committee evaluates the performance of the
Company during a calendar year by examining a number of factors including the
Company's competitive position, growth in earnings, return on equity and other
specific corporate goals and objectives, and, in the case of executive officers
other than the Chief Executive Officer, examines the recommendations of the
Chief Executive Officer. The Committee grants, subject to approval and
ratification by the Board of Directors, stock options to the Chief Executive
Officer and other executive officers and key employees.
On January 22, 2001 and November 6, 2001, the executive officers of the
Company named in the "Summary Compensation Table" were granted options to
purchase shares of common stock as set forth in the "Option/SAR Grants in Last
Fiscal Year" table on page 12 of this Proxy Statement. During 2001, the
executive officers of the Company as a group were granted options to purchase
584,195 shares (not including: (i) phantom stock units set forth in the "Long
Term Incentive Plans" table on page 14 of this Proxy Statement; or (ii) Mr.
Filipps' options that were reloaded in 2001).
18
COMPENSATION OF THE CHIEF EXECUTIVE OFFICER
Mr. Filipps' annual compensation is fixed by the Committee. The Committee
may grant periodic salary increases, if warranted, after a review of Mr.
Filipps' performance and an assessment of the competitiveness of Mr. Filipps'
current base salary. The award of an annual bonus recognizes Mr. Filipps'
contributions to the Company's overall results. Contributions are measured
against specific goals and objectives which are established by the Committee at
the beginning of each year. In setting Mr. Filipps' salary for fiscal year 2001,
the Committee considered the Company's return on equity, combined ratio, growth
in earnings and revenue, reduction in expenses, increases in profitability,
changes in the Company's risk profile, and implementation of the Company's
strategic plans (including the plan to diversify the Company's revenues) as well
as other key measures of the Company's performance.
COMPLIANCE WITH INTERNAL REVENUE CODE SECTION 162(m)
Section 162(m) of the Internal Revenue Code, enacted in 1993, generally
disallows a tax deduction to public companies for compensation over $1 million
paid to a corporation's Chief Executive Officer and the four next most highly
compensated executive officers, except to the extent that any amount in excess
of such limit is paid pursuant to a plan containing a performance standard or a
stock option plan that meets certain requirements. The amendments to the
Company's 1992 Stock Option Plan approved at its 1995 Annual Meeting were
designed to bring the 1992 Stock Option Plan into compliance with Section
162(m). The Company's 1995 Equity Compensation Plan was also drafted to comply
with Section 162(m). To the extent readily determinable and as one of the
factors in its consideration of compensation matters, the Committee considers
the anticipated tax treatment to the Company and to the executive officers of
various payments and benefits. The Committee intends to retain the deductibility
of compensation pursuant to Section 162(m), but reserves the right to provide
non-deductible compensation if it determines that such action is in the best
interests of the Company and its stockholders.
MEMBERS OF THE STOCK OPTION AND COMPENSATION COMMITTEE
Robert W. Richards (Chairman)
Claire M. Fagin
Rosemarie Greco
Ronald W. Moore
The preceding report, and the stockholder return graph below, do not constitute
soliciting material and should not be considered filed or incorporated by
reference into any other Company filing with the Securities and Exchange
Commission.
TOTAL STOCKHOLDER RETURN GRAPH
Set forth below is a line graph comparing the cumulative total return to
stockholders of a $100 investment in (i) the Company's common stock, (ii) the
Standard and Poor's 500 index, and (iii) a peer group constructed by the Company
for the period December 31, 1996 through December 31, 2001. In view of the
changes in the company's business, most notably the diversification into
financial guaranty insurance, the Company has changed its peer group. The new
group of peer companies, consisting of MGIC Investment Corporation, PMI Group,
ACE Ltd., XL Capital Ltd., MBIA, Inc. and AMBAC Financial Group Inc., was
selected based on its closer resemblance to the Company as a result of its
business mix and market capitalization. The five companies in the old peer group
were MGIC Investment Corporation, PMI Group, Triad Guaranty Inc., Fannie Mae and
Freddie Mac. The graph reflects figures for both the old peer group and the new
one.
Total stockholder return is determined by dividing (i) the sum of the
cumulative amount of dividends for a given period (assuming dividend
reinvestment) and the difference between the share price at the end and the
beginning of the period, by (ii) the share price at the beginning of the period.
19
[PERFORMANCE GRAPH]
INDEXED RETURNS
YEARS ENDING
----------------------------------------------------------------------------------------------------------------
Base
Period
Company Name/ Index Dec 96 Dec 97 Dec 98 Dec 99 Dec 00 Dec 01
----------------------------------------------------------------------------------------------------------------
RADIAN GROUP INC 100 164.75 125.65 130.94 206.30 236.55
S&P 500 INDEX 100 133.36 171.48 207.56 188.66 166.24
NEW PEER GROUP 100 153.38 143.00 136.68 200.33 202.38
OLD PEER GROUP 100 155.22 203.65 172.38 244.53 230.22
General comments regarding the Total Stockholder Return Graph:
(1) The graph assumes reinvestment of dividends.
(2) Past total stockholder returns may not be indicative of returns to be
achieved in the future or for periods of time longer than the periods shown
in the above graph.
CERTAIN TRANSACTIONS
Prior to the Company's initial public offering in October 1992, the Company
and Radian Guaranty, were indirect subsidiaries of Reliance Group Holdings, Inc.
("Reliance"). Mr. Wender, Lead Director of the Company, was Chairman of the
Board and Chief Executive Officer of Commonwealth Land Title Insurance Company
("Commonwealth"), an indirect subsidiary of Reliance at that time. Concurrently
with the initial public offering, Commonwealth purchased 800,000 shares of the
Company's $4.125 preferred stock for an aggregate purchase price of $40.0
million. On February 27, 1998, Commonwealth was acquired by LandAmerica
Financial Group, Inc. who, as successor to Commonwealth, now owns the preferred
stock. Dividends on the preferred stock are payable quarterly and for the year
ended December 31, 2001 totaled $3.3 million. The preferred stock is redeemable,
in whole or from time to time in part, at the option of the Company, at $54.125
per share beginning on August 15, 2002 and declining to $50.00 per share on
August 15,
20
2005. On August 15 of each year beginning in 2002, the Company is obligated, to
the extent it has funds legally available therefor, to redeem 72,000 shares of
preferred stock (80,000 shares in 2012) at a redemption price of $50.00 per
share. In the event that dividends on the preferred stock are in arrears and
unpaid in an amount equal to six quarterly dividends, the size of the Company's
Board of Directors will be increased by two to permit the holders of the
preferred stock, voting separately as a class, to elect two directors. The
Company may not consummate any Fundamental Transaction (defined as a merger,
consolidation, sale of assets or similar transaction on which the holders of the
common stock are entitled to vote) unless such transaction is approved by
two-thirds of the outstanding shares of the preferred stock. In connection with
the sale of preferred stock, the Company granted to Commonwealth certain rights
to register the preferred stock under the Securities Act of 1933, as amended.
The Company has entered into change in control agreements with each of
Messrs. Frank P. Filipps, Roy J. Kasmar, C. Robert Quint, Scott C. Stevens, and
Howard S. Yaruss. The change in control agreements have initial terms of three
years and upon expiration of such period will be automatically extended for
successive one-year terms, unless terminated by either party. The change in
control agreements provide that in the event that, within two years after a
"change in control" of the Company or Radian Guaranty, the executive's
employment is terminated (i) by the Company for any reason other than (1) the
executive's continued illness, injury or incapacity for a period of twelve
consecutive months or (2) 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 (ii) by the executive in the event of relocation or certain
specified adverse changes in employment status and compensation, the executive
would be entitled to a lump-sum cash payment equal to two times (1) the
executive's then current annual base compensation plus (2) the target bonus for
the year in which a termination occurs. Additionally, upon a change in control
(as defined in the agreements), all options and phantom stock units not then
vested would fully vest, and any restricted stock previously granted to the
executive which has not yet vested or become freely transferable would become
fully vested and freely transferable.
Enhance Financial Services Group Inc., a wholly-owned subsidiary of the
Company ("Enhance"), has entered into a Second Amended and Restated
Change-In-Control Protection Agreement with Martin Kamarck. Under that
agreement, if Mr. Kamarck's employment is terminated by Enhance and its
subsidiaries without cause or if he departs with good reason within 24 months
after a change of control. Mr. Kamarck is entitled to cash severance in a lump
sum equal to three times his then annual compensation (including a bonus
component represented by the prior year's bonus). He is also entitled to receive
a bonus for the year of termination pro rata through the date of termination and
become immediately and fully vested in Enhance's non-qualified Supplemental
Pension Plan. In addition, he is entitled to receive outplacement assistance,
will remain covered under Enhance's and its subsidiaries' welfare benefit and
perquisite programs offered and will be entitled to continue to participate in
the Company's Stock Incentive Plan (including the receipt of Company matching
contributions) for a period of time following termination. Furthermore, all of
his options and other long-term incentives become immediately vested upon a
change in control.
Anthony W. Schweiger, a member of the Board of Directors, is a Managing
Principal of e-brilliance, LLC, a specialized Information Technology consulting
and education firm. Mr. Schweiger maintains a 27% ownership interest in
e-brilliance. Radian Guaranty entered into a contract with e-brilliance and paid
it $177,250 for services rendered in 2001. Mr. Schweiger's association with
e-brilliance has been reviewed by the disinterested members of the Board of
Directors of the Company (pursuant to the New York Stock Exchange rules). It was
determined that Mr. Schweiger's relationship with e-brilliance does not
interfere with his exercise of independent judgment as it relates to his
participation on the Audit Committee. The Board of Directors of the Company
concluded that Mr. Schweiger does not have a controlling interest in the overall
business arrangements between Radian Guaranty and e-brilliance.
21
II. STOCKHOLDER APPROVAL OF INDEPENDENT AUDITORS
The Board of Directors of the Company recommends that the stockholders
approve the firm of Deloitte & Touche LLP as the independent auditors to audit
the books, records and accounts of the Company for the current fiscal year.
Deloitte & Touche LLP also served as the Company's independent auditors for the
fiscal year ended December 31, 2001.
Adoption of this proposal requires the affirmative vote of a majority of
the shares present in person or represented by proxy at the meeting and entitled
to vote. The Board of Directors unanimously recommends a vote FOR this proposal.
If the stockholders fail to approve the appointment of Deloitte & Touche LLP,
the Board of Directors of the Company will reconsider whether or not to retain
the firm. It is understood that even if the selection of Deloitte & Touche LLP
is approved, the Board, at its discretion, may direct the appointment of a new
independent auditing firm at any time during the year if the Board determines
that such a change would be in the best interests of the Company and its
stockholders.
A representative of Deloitte & Touche LLP is expected to attend the 2002
annual meeting of stockholders. Such representative will have an opportunity to
make a statement, if he or she desires, and will be available to respond to
appropriate stockholder' questions.
AUDIT COMMITTEE REPORT
The members of the Audit Committee of the Company's Board of Directors have
submitted the following report for the year ended December 31, 2001:
The functions of the Audit Committee are: To recommend to the Board of
Directors the independent auditors to be nominated and retained by the Company
(subject to Board approval), to review the independence of such auditors and
monitor the professional services provided, to review and approve the financial
results of the Company, to review and approve the scope of the annual audit
activities of the independent auditors, to review audit results with the
independent auditors, to review with the independent auditors and management the
Company's accounting and reporting principles, practices and policies and the
adequacy of the Company's accounting, operating and financial controls, and to
assist the Board of Directors in fulfilling its fiduciary responsibilities as to
the system of internal controls, accounting policies and reporting practices of
the Company and the sufficiency of auditing relative thereto. The committee held
five meetings during 2001.
The Audit Committee has reviewed and discussed the Consolidated Financial
Statements of Radian Group Inc. and Subsidiaries for the years ended December
31, 2001, 2000 and 1999 (the "Audited Financial Statements") with management of
the Company, and has discussed with Deloitte & Touche LLP, the Company's
independent auditors for the fiscal year 2001, the matters required to be
discussed by SAS 61, "Codification of Statements on Auditing Standards, AU sec.
380", as may be modified or supplemented. The Audit Committee has received the
written disclosures and the letter from the independent accountants required by
Independence Standards Board Standard No. 1, "Independence Discussions with
Audit Committees", and has discussed with Deloitte & Touche LLP the independence
of Deloitte & Touche LLP.
Management is responsible for the Company's financial reporting process
including its system of internal controls, and for the preparation of
consolidated financial statements in accordance with accounting principles
generally accepted in the United States. The Company's independent auditors are
responsible for auditing those financial statements. The Audit Committee's
responsibility is to oversee these processes. It is neither the duty nor the
responsibility of the Audit Committee to conduct auditing or accounting reviews
or procedures. Therefore, the Audit Committee has relied, without independent
verification, on management's representation that the financial statements have
been prepared with integrity and objectivity and in conformity with accounting
principles generally accepted in the United States and on the representations of
the independent auditors included in their report on the Company's financial
statements. Furthermore, the Audit Committee's considerations and discussions
with management and the independent auditors do not assure that the Company's
financial statements are presented in accordance with accounting principles
generally accepted in the United States, that the audit of the Company's
financial statements has been carried out in accordance
22
with generally accepted auditing standards or that the Company's independent
accountants are in fact "independent."
Based on the foregoing review and discussions, the Audit Committee has
recommended to the Board of Directors that the Audited Financial Statements of
the Company be included in the Company's Annual Report on Form 10-K for the year
ended December 31, 2001 for filing with the U.S. Securities and Exchange
Commission.
AUDIT FEES
During fiscal year 2001, Deloitte & Touche LLP provided various audit,
audit related and non-audit services to the Company as follows:
a) AUDIT FEES: The aggregate fees billed by Deloitte & Touche LLP for
professional services rendered for the audit of the Company's annual
financial statements for the fiscal year ended December 31, 2001 and the
reviews of the financial statements included in the Company's Quarterly
Reports on Form 10-Q for that fiscal year were $495,000;
b) FINANCIAL INFORMATION SYSTEMS DESIGN AND IMPLEMENTATION FEES: The
aggregate fees billed by Deloitte & Touche LLP for professional services
relating to financial information systems design and implementation
rendered during the fiscal year ended December 31, 2001 were $356,153; and
c) ALL OTHER FEES: The aggregate fees billed by Deloitte & Touche LLP
for professional services related to all other services provided during the
fiscal year ended December 31, 2001 were $873,987, including audit related
services of approximately $415,000 and non-audit services of $459,000.
Audit related services generally include fees for consents and comfort
letters and for the audits of the company's employee benefit plans.
MEMBERS OF THE AUDIT COMMITTEE
David C. Carney (Chairman)
Stephen T. Hopkins
James W. Jennings
Anthony W. Schweiger
The preceding report does not constitute soliciting material and should not be
considered filed or incorporated by reference into any other Company filing with
the Securities and Exchange Commission.
In reviewing the independence of Deloitte & Touche LLP, the Audit Committee
considered whether the provision of the services described above under the
captions "Financial Information Systems Design and Implementation Fees" and "All
Other Fees" is compatible with maintaining the independence of Deloitte & Touche
LLP.
The Audit Committee, at its October 2000 meeting, approved and adopted the
Charter of the Audit Committee of the Board of Directors, a copy of which was
attached to the 2001 proxy statement.
III. OTHER MATTERS
The Board of Directors is not aware of any matters not set forth herein
that may come before the meeting. If, however, further business properly comes
before the meeting, the persons named in the proxies will vote the shares
represented thereby in accordance with their best judgment.
23
STOCKHOLDER PROPOSALS FOR THE
2003 ANNUAL MEETING
Stockholders must submit proposals on matters appropriate for stockholder
action at annual meetings, including director nominations, in accordance with
regulations adopted by the Securities and Exchange Commission. To be considered
for inclusion in the Proxy Statement and Proxy Card relating to the 2003 annual
meeting, such proposals must be received by the Company no later than December
6, 2002 and must otherwise meet the requirements of the rules of the Securities
and Exchange Commission. Proposals should be directed to the attention of the
Secretary of the Company.
Where a stockholder submits a proposal for consideration at the 2003 annual
meeting outside of the process described in Rule 14a-8 promulgated under the
Securities Exchange Act of 1934 rather than for inclusion in the Proxy Statement
and Proxy Card relating to the 2003 annual meeting, the stockholder must comply
with the procedure set forth in the Company's By-laws. This means that the
proposal must be received by the Secretary of the Company at least 60 days
before the 2003 annual meeting (except that if the Company gives less than 75
days' notice of the 2003 annual meeting, then the proposal must be received by
the Secretary of the Company no later than the close of business on the 15th day
after the day on which the Company mails the notice of the 2003 annual meeting).
ANNUAL REPORT ON FORM 10-K
The Company will furnish, without charge, to each person whose proxy is
being solicited, upon the written request of such person, a copy of the
Company's annual report on Form 10-K for the year ended December 31, 2001,
including financial statements and schedules thereto, but excluding exhibits.
Requests for copies of such report should be directed to C. Robert Quint,
Executive Vice President, Chief Financial Officer, Radian Group Inc., 1601
Market Street, Philadelphia, PA 19103.
By Order of the Board of Directors,
HOWARD S. YARUSS
Secretary
April 5, 2002
24
--------------------------------------------------------------------------------
RADIAN GROUP INC.
PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 7, 2002
SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS
The undersigned hereby authorizes Frank P. Filipps, Howard S. Yaruss, and
C. Robert Quint, and each of them, individually, with power of substitution, to
vote and otherwise represent all of the shares of Common Stock of Radian Group
Inc., (the "Company"), held of record by the undersigned, at the Annual Meeting
of Stockholders of the Company to be held at the Company's offices, 1601 Market
St., 11th floor, Philadelphia, PA, on Tuesday, May 7, 2002 at 9:00 a.m. local
time, and any adjournment(s) thereof, as indicated on the reverse side hereof.
The undersigned acknowledges receipt of the Notice of Annual Meeting of
Stockholders and Proxy Statement dated in each case April 5, 2002. All other
proxies heretofore given by the undersigned to vote shares of the Company's
Common Stock are expressly revoked.
THE SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS DESCRIBED ON THE
REVERSE HEREOF BY THE STOCKHOLDER. IF NOT OTHERWISE DIRECTED, THIS PROXY WILL BE
VOTED FOR THE PROPOSAL REFERRED TO IN ITEM 1 AND 2.
RADIAN GROUP, INC.
P.O. BOX 11024
NEW YORK, N.Y. 10203-0024
To change your address, please mark this box. / /
DETACH PROXY CARD HERE
______________________________________________________________________________
Sign, Date and Return the [ X ]
[ ] Proxy Card Promptly Using Votes must be indicated
the Enclosed Envelope. (x) in Black or Blue ink.
1. To elect directors, for terms as described herein, each to serve until FOR [ ] WITHHOLD [ ] EXCEPTIONS [ ]
their successors shall be elected and qualified; ALL FOR ALL
Nominees: David C. Carney, Howard B. Culang, Rosemarie Greco and Ronald W.
Moore.
(INSTRUCTIONS: TO WITHHOLD AUTHORITY TO VOTE FOR ANY INDIVIDUAL
NOMINEE, MARK THE "EXCEPTIONS" BOX AND WRITE THAT NOMINEE'S NAME IN THE SPACE
PROVIDED BELOW.)
*Exceptions _________________________________________________________________
FOR AGAINST ABSTAIN
2. To ratify the appointment of Deloitte & Touche LLP as [ ] [ ] [ ]
the Company's Independent auditors for the year ending
December 31, 2002; and
3. To transact such other business as may properly come
before the meeting or any adjournment thereof.
_________
|
|
|
|
| | Please sign exactly as name or names appear
| | on this proxy. If stock is held jointly, each
| | holder should sign. If signing as attorney,
| trustee, executor, administrator, custodian,
| guardian, or authorized officer, please give
| full title.
________|
Date | Share Owner sign here | Co-Owner
| | sign here
| |
| |
| |
_____|__________________________|_____________
_______________________________________________________________________________
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