Exhibit 10.2

RADIAN GROUP INC.

AMENDED AND RESTATED

2008 EQUITY COMPENSATION PLAN

STOCK OPTION AGREEMENT

This STOCK OPTION AGREEMENT, dated as of May 12, 2010 (the “Date of Grant”), is
delivered by Radian Group Inc., a Delaware corporation (the “Company”), to S. A.
Ibrahim an employee of the Company or one of its Subsidiaries (the “Grantee”).

RECITALS

WHEREAS, the Radian Group Inc. 2008 Equity Compensation Plan, as amended (the
“Plan”) permits the grant of stock options to employees, officers, directors,
consultants and advisors of the Company to purchase shares of Common Stock, in
accordance with the terms and provisions of the Plan.

WHEREAS, the Committee, appointed by the Board of Directors of the Company to
administer the Plan, has determined that it would be to the advantage and in the
best interest of the Company to make the grant provided for herein as an
inducement for the Grantee to continue as an employee of the Company and to
promote the best interests of the Company and its stockholders.

WHEREAS, the applicable provisions of the Plan are incorporated in this Stock
Option Agreement by reference, including the definitions of terms contained in
the Plan (unless such terms are otherwise defined herein).

WHEREAS, the Company and the Grantee are parties to an Employment Agreement
dated May 5, 2008 (the “Employment Agreement”).

NOW, THEREFORE, the parties hereto, intending to be legally bound hereby, agree
as follows:

1. Grant of Option. Subject to the terms and conditions set forth in this Stock
Option Agreement, the Company, with the approval and at the direction of the
Committee, hereby grants to the Grantee a Nonqualified Stock Option to purchase
87,900 shares of Common Stock at an exercise price of $10.42 per share (the
“Option”) under the Plan. The Grantee hereby accepts the Option and agrees to be
bound by the terms and conditions of this Stock Option Agreement and the Plan
with respect to the award. By accepting this Option, the Grantee understands and
agrees that the terms of this Stock Option Agreement supersede and replace the
terms of the Employment Agreement with respect to the subject matter hereof.

2. Vesting and Exercisability. Provided the Grantee meets the requirements set
forth in this Stock Option Agreement, except as set forth in Sections 3 and 4
below, the Option awarded under this Stock Option Agreement shall vest and
become exercisable as follows:

 

Vesting Date

  

Vested Shares subject to the Option

May 12, 2013    50% of the shares May 12, 2014    Remaining 50% of the shares

 

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Notwithstanding the foregoing, in the event of a termination of the Grantee’s
employment for Cause (as defined in the Employment Agreement), the Option shall
be forfeited. If the vesting schedule above would produce a fractional share,
the portion of the Option that is exercisable shall be rounded down to the
nearest whole share.

3. Retirement, Disability and Death.

(a) Retirement. If the Grantee’s employment terminates on account of the
Grantee’s Retirement prior to May 12, 2014, the Option shall become fully vested
as of the date of the Grantee’s termination of employment, but shall become
exercisable only on the dates set forth above in Section 2, except as described
in Sections 3(b) and 4 below. For purposes of this Stock Option Agreement, the
term “Retirement” shall mean the Grantee’s separation from service without
Cause, other than on account of Disability or death, following the Grantee’s
attainment of age 55 and completion of five years of service with the Company.

(b) Disability and Death. If the Grantee’s employment terminates on account
of the Grantee’s death or Disability, the Option will automatically vest in full
and become fully exercisable on the date of the Grantee’s termination of
employment.

4. Change of Control.

(a) If a Change of Control occurs and the Grantee’s employment with the Company
or a Subsidiary is terminated by the Company or a Subsidiary without Cause or
the Grantee terminates employment for Good Reason (as defined in the Employment
Agreement), and the Grantee’s date of termination occurs (or in the event of the
Grantee’s termination for Good Reason, the event giving rise to Good Reason
occurs), in each case, during the period beginning on the date that is 90 days
before the Change of Control and ending on the date that is one year following
the Change of Control, the Option will be vested and exercisable in full on the
Grantee’s date of termination (or, if later, on the date of the Change of
Control). However, in no event may the Option be exercised after seven years
from the Date of Grant.

(b) For the avoidance of doubt, in no event shall a Change of Control occur as a
result of the Company’s participation in the Troubled Asset Relief Program under
the Emergency Economic Stabilization Act of 2008 and the American Recovery and
Reinvestment Act of 2009, or any similar program of the United States, any of
its states, or any of their respective political subdivisions, departments,
agencies or instrumentalities (collectively, “TARP”).

5. Exercise of the Option.

(a) When the Option becomes vested and exercisable in accordance with Sections
2, 3 or 4 above, the Grantee may exercise part or all of the exercisable Option
by delivering a duly completed notice of intent to exercise to the Company,
specifying the number of shares as to which the Option is to be exercised and
the method of payment. Payment of the exercise price shall be made in accordance
with procedures in effect from time to time based on the type of payment being
made but, in any event, prior to issuance of the shares of Common Stock. The
Grantee shall pay the exercise price (i) in cash, (ii) with the approval of the
Committee, by delivering shares of Common Stock, which shall be valued at their
fair market value on the date of exercise, or by attestation (on a form
prescribed by the Committee) to ownership of shares Common Stock having a fair
market value on the date of exercise equal to the exercise price, (iii) by
payment through a broker in accordance with procedures permitted by Regulation T
of the Federal Reserve Board or (iv) by any combination of the foregoing. The
Company’s obligation to deliver shares of Common Stock upon exercise of the
Option shall be subject to all applicable laws, rules and regulations and also
to such approvals by governmental agencies as may be deemed appropriate by the
Committee. Upon exercise of the Option (or portion thereof), the Option (or
portion thereof) will terminate and cease to be outstanding.

 

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(b) During the Grantee’s lifetime, except as set forth in Section 6 below,
exercise of the Option shall be solely by the Grantee (or his or her legal
guardian or legal representative) and, after the Grantee’s death, the Option
shall be exercisable (subject to the limitations specified in the Plan) solely
by the legal representatives of the Grantee, or by the person or persons who
acquire the right to exercise such Option by will or by the laws of descent and
distribution, to the extent that the Option was outstanding as of the date of
the Grantee’s death.

6. Transferability.

(a) During the Grantee’s lifetime, the Option shall be exercisable only by the
Grantee (or his or her guardian or legal representative), and neither any Option
nor any right hereunder shall be assignable or otherwise transferable except by
will or by the laws of descent and distribution or except as otherwise permitted
by the Plan, nor shall any Option be subject to attachment, execution or other
similar process. In the event of any attempt by the Grantee to alienate, assign,
pledge, hypothecate or otherwise dispose of any Option or any right hereunder,
except as provided for herein, or in the event of the levy of any attachment,
execution or similar process upon the rights or interest hereby conferred, the
Company may terminate any Option by notice to the Grantee and the Option and all
rights hereunder shall thereupon become null and void.

(b) Notwithstanding the foregoing, the Committee may provide that a Grantee may
transfer this Option to family members, one or more trusts for the benefit of
family members, or one or more partnerships of which family members are the only
partners, according to such terms as the Committee may determine; provided that
the Grantee receives no consideration for the transfer of an Option and the
transferred Option shall continue to be subject to the same terms and conditions
as were applicable to the Option immediately before the transfer.

7. Termination of the Option.

(a) The Option shall have a term of seven years from the Date of Grant and shall
terminate at the expiration of that period (on May 12, 2017), unless the Option
is terminated at an earlier date pursuant to the provisions of this Stock Option
Agreement or the Plan.

(b) In the event of the termination of the Grantee’s employment on account of
Retirement, Disability or death of the Grantee, or pursuant to Section 4 above,
the Option held by the Grantee may be exercised (pursuant to the terms of the
Plan and subject to the restrictions on exercisability in Section 3(a) above, if
applicable) by the Grantee (or the Grantee’s personal representative) at any
time prior to the expiration of the seven-year term of the Option.

(c) Notwithstanding the foregoing, in no event may the Option be exercised after
the date that is the seventh anniversary of the Date of Grant (May 12, 2017). In
the event a Grantee’s employment is terminated by the Company or a Subsidiary
for Cause, the Option (including the vested portion, if any) held by such
Grantee shall immediately terminate and be of no further force or effect.

 

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8. Certain Corporate Changes. If any change is made to the Common Stock (whether
by reason of merger, consolidation, reorganization, recapitalization, stock
dividend, stock split, combination of shares, or exchange of shares or any other
change in capital structure made without receipt of consideration), then unless
such event or change results in the termination of the Option, the Committee
shall adjust, in an equitable manner and as provided in the Plan, the number and
class of shares subject to the Option held by the Grantee and/or the exercise
price of such Option to reflect the effect of such event or change in the
Company’s capital structure in such a way as to preserve the value of the
Option. Any adjustment that occurs under the terms of this Section 8 or the Plan
will not change the timing or form of payment with respect to any exercised
Option or portion thereof.

9. Grant Subject to Plan Provisions. This Stock Option Agreement is made
pursuant to the terms of the Plan, the terms of which are incorporated herein by
reference, and shall in all respects be interpreted in accordance therewith. The
decisions of the Committee shall be conclusive upon any question arising
hereunder. The Grantee’s receipt of the Option awarded under this Stock Option
Agreement constitutes such Grantee’s acknowledgment that all decisions and
determinations of the Committee with respect to the Plan, this Stock Option
Agreement, and/or the Option shall be final and binding on the Grantee, his or
her beneficiaries and any other person having or claiming an interest in such
Option. The settlement of any award with respect to Option is subject to the
provisions of the Plan and to interpretations, regulations and determinations
concerning the Plan as established from time to time by the Committee in
accordance with the provisions of the Plan. A copy of the Plan will be furnished
to each Grantee upon request. Additional copies may be obtained from the
Corporate Secretary of the Company, 1601 Market Street, Philadelphia,
Pennsylvania 19103-2197.

10. No Employment or Other Rights. Neither the granting of the Option, nor any
other action taken with respect to such Option, shall confer upon the Grantee
any right to continue in the employ of the Company or a Subsidiary or shall
interfere in any way with the right of the Company or a Subsidiary to terminate
Grantee’s employment at any time. The right of the Company or a Subsidiary to
terminate at will the Grantee’s employment or service at any time for any reason
is specifically reserved.

11. No Stockholder Rights. Neither the Grantee, nor any person entitled to
exercise the Grantee’s rights in the event of the Grantee’s death or in
accordance with the terms of this Stock Option Agreement, shall have any of the
rights and privileges of a stockholder with respect to the shares subject to the
Option, except to the extent that certificates for such shares shall have been
issued upon the exercise of the Option as provided for herein (or an appropriate
book entry has been made). Except as described in the Plan or in this Stock
Option Agreement, no adjustments are made for dividends or other right if the
applicable record date occurs before Grantee’s shares are issued (or an
appropriate book entry has been made).

12. Assignment and Transfers. The rights and interests of the Grantee under this
Stock Option Agreement may not be sold, assigned, encumbered or otherwise
transferred except, in the event of the death of the Grantee, by will or by the
laws of descent and distribution. The rights and protections of the Company
hereunder shall extend to any successors or assigns of the Company and to the
Company’s parents, subsidiaries, and affiliates. This Stock Option Agreement may
be assigned by the Company without the Grantee’s consent.

13. Income Taxes; Withholding Taxes. All obligations of the Company under this
Stock Option Agreement shall be subject to the rights of the Company as set
forth in the Plan to withhold amounts required to be withheld for any taxes, if
applicable. At the time of exercise, the Company shall have the right to deduct
from other compensation, or to withhold shares of Common Stock, in an amount
equal to the federal (including FICA), state, local and foreign income taxes and
other amounts as may be required by law to be withheld with respect to the
exercise of the Option, provided that any share withholding shall not exceed the
Grantee’s minimum applicable withholding tax rate for federal (including FICA),
state, local and foreign tax liabilities.

 

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14. Applicable Law. The validity, construction, interpretation and effect of
this instrument shall exclusively be governed by, and determined in accordance
with, the applicable laws of the State of Delaware, excluding any conflicts or
choice of law rule or principle. In addition, this Stock Option Agreement shall
be subject to any required approvals by any governmental or regulatory agencies.
Notwithstanding anything in this Stock Option Agreement to the contrary, the
Plan, this Stock Option Agreement, and the Option awarded hereunder shall be
subject to all applicable laws, including any laws, regulations, restrictions or
governmental guidance that becomes applicable in the event of the Company’s
participation in TARP, and the Committee reserves the right to modify this Stock
Option Agreement and the Option as necessary to conform to any restrictions
imposed under TARP. As a condition of participating in the Plan, and by the
Grantee’s acceptance of the Option, the Grantee is deemed to have agreed to any
such modifications that may be imposed by the Committee, and agrees to sign such
waivers or acknowledgments as the Committee may deem necessary or appropriate
with respect to TARP restrictions applicable to the Option granted to the
Grantee under this Stock Option Agreement.

15. Notice. Any notice to the Company provided for in this Stock Option
Agreement shall be addressed to it in care of the Corporate Secretary of the
Company, 1601 Market Street, Philadelphia, Pennsylvania 19103-2197, and any
notice to the Grantee shall be addressed to such Grantee at the current address
shown on the payroll of the Company, or to such other address as the Grantee may
designate to the Company in writing in accordance with this Section. Except as
otherwise provided by this Section, any notice provided for hereunder shall be
delivered by hand, sent by telecopy or electronic mail or enclosed in a properly
sealed envelope addressed as stated above, registered and deposited, postage and
registry fee prepaid in the United States mail or other mail delivery service.
Notice to the Company shall be deemed effective upon receipt. By receipt of the
Option granted hereunder, Grantee hereby consents to the delivery of information
(including without limitation, information required to be delivered to the
Grantee pursuant to the applicable securities laws) regarding the Company, the
Plan, the Option via the Company’s electronic mail system or other electronic
delivery system.

IN WITNESS WHEREOF, the parties have executed this Stock Option Agreement as of
the Date of Grant.

 

Radian Group Inc.

/s/ Suzann C. Boylan

Suzann C. Boylan

Chief Human Resources Officer

I hereby accept the award of the Option described in this Stock Option
Agreement, and I agree to be bound by the terms of the Plan and this Stock
Option Agreement. I hereby agree that all decisions and determinations of the
Committee with respect to the Option shall be final and binding.

Acknowledged and Agreed by Award Recipient:

 

Signature:  

/s/ S.A. Ibrahim

Print Name:  

S.A. Ibrahim

Date:  

7/12/10

 

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