MBIA Inc., the bond insurer locked in a three-year legal battle with Bank of America Corp., is paying executives $11.4 million in cash bonuses to stay with the company for at least three more years.
The board of the Armonk, N.Y.-based firm approved compensation for Chief Financial Officer Chuck Chaplin, Chief Operating Officer William Fallon, Chief Legal Officer Ram Wertheim and Chief Portfolio Officer Anthony McKiernan that include the cash retention awards and 2 million shares of stock.
Chaplin and Fallon will receive $3.5 million each, Wertheim $2.4 million and McKiernan $2 million for staying on through December 2015, according to a regulatory filing today. If an executive leaves before then without the board’s consent, he must repay a portion of the bonus and forfeit additional stock awards.
MBIA said in March that its four top executives, Chaplin, Fallon, Wertheim and Chief Executive Officer Jay Brown, wouldn’t receive a cash bonus or long-term incentive pay for 2011 after talks with the New York State Department of Financial Services.
The insurer is battling Bank of America over faulty loans included in toxic mortgage-backed securities that it insured, while the bank is suing MBIA over a corporate restructuring.