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EXHIBIT 10.21

CCC INFORMATION SERVICES GROUP INC.
EXECUTIVE SEVERANCE POLICY

 

Human Resources Policy:
Severance - EMG
   
Section:
Benefits
   
Effective Date:
March 1, 2004
   
Supercedes:
Severance - US Based Employees
     
Effective Date: February 1, 2001
     
Salary Grades O, P, X

 
Policy
 
In the event an Eligible Executive is terminated “Without Cause” or an Eligible
Executive resigns for “Good Reason,” the Executive shall be entitled to
severance benefits as detailed in this policy.
 
Definitions
 
Change in Control - Any of the following: (i) the merger, consolidation, or
reorganization of the Company with any other corporation after which the holders
of Common Stock immediately prior to the effective date thereof hold less than
51% of the outstanding common stock of the surviving or resulting entity;
provided, however, that no change-in-control will occur if after the merger,
consolidation or reorganization, a holder of Common Stock immediately prior to
the effective date thereof is the largest stockholder of the surviving or
resulting entity and owns at least 25% of the outstanding ownership interest in
the surviving or resulting entity; (ii) the sale of all or substantially all of
the assets of the Company to any person or entity other than a wholly owned
subsidiary; (iii) any person or group of persons acting in concert, other than
individuals who are stockholders, directors or officers of the Company on June
28, 2000, or entity becomes the beneficial owner, directly or indirectly, of
more than 50% of the outstanding Common Stock; or (iv) the individuals who, as
of the close of the most recent annual meeting of the Company's stockholders,
are members of the Board of Directors (the "Existing Directors") cease for any
reason to constitute more than 50% of the Board; provided, however, that if the
election, or nomination for election, by the Company's stockholders of any new
director was approved by a vote of at least 50% of the Existing Directors, such
new director shall be considered an Existing Director; provided further,
however, that no individual shall be considered an Existing Director if such
individual initially assumed office as a result of either an actual or
threatened "Election Contest" (as described in Rule 14a-11 under the Securities
Exchange Act of 1934) or other actual or threatened solicitation of proxies by
or on behalf of anyone other than the Board (a "Proxy Contest"), including by
reason of any agreement intended to avoid or settle any Election Contest or
Proxy Contest.
 
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Company - CCC Information Services Inc. and any successor thereto.
 
Company Funded Rate - The rate at which the company funds its annual bonus plan.
The Company funded rate is expressed as a percentage of the total bonus pool
available for distribution based on achievement versus the Company's financial
targets and strategic objectives. It is calculated by applying formulae and
other guidelines that are approved by the Compensation and Nominating Committee
to the Company's audited financial results and operating results following the
end of the fiscal year.
 
Compensation and Nominating Committee - The Compensation and Nominating
Committee of the Board of Directors of the Company.
 
EMG - The Company’s Executive Management Group as designated by the Chief
Executive Officer of the Company. 
 
Eligible Executive - Each member of the EMG who (1) has been notified in writing
by the Chief Executive Officer or Senior Human Resources Officer that he or she
is covered by this policy and (2) is not party to a formal employment agreement
with the Company.
 
Termination “For Cause” - The Eligible Executive’s involuntary termination for
(i) willful failure to perform his or her duties, (ii) willful misconduct which
is demonstrably and materially injurious to the Company, monetarily or
otherwise, (iii) egregious misconduct involving serious moral turpitude to the
extent that his or her creditability and reputation no longer conforms to the
standard of senior executives of the Company (iv) dishonesty, unethical
behavior, breach of fiduciary responsibilities, or material violation of Company
policy shall constitute termination “For Cause.”
 
Termination “For Good Reason” -The voluntary resignation of employment by an
Eligible Executive following: (i) a material reduction in the nature or status
of the Eligible Executive’s authorities, duties or responsibilities from those
in effect at the time he or she first qualified to receive benefits under this
policy, but excluding transfers to equivalent positions and reductions in duties
or responsibilities due to documented poor performance; (ii) within twenty-four
months following the consummation of the event constituting a Change in Control
a material reduction in the nature or status of the Eligible Executive’s
authorities, duties or responsibilities from those in effect immediately prior
to the Change in Control; or (iii) any failure by the Company to fulfill it’s
employment obligations other than an isolated, insubstantial, or inadvertent
failure not occurring in bad faith shall constitute termination for “Good
Reason.”
 
An Eligible Executive must declare his or her intention to terminate employment
for “Good Reason” by providing written notice to the company’s Chief Executive
Officer and Senior Human Resources Officer detailing the circumstances that,
under this definition, constitute a termination for Good Reason. A termination
for “Good Reason” shall not occur under clause (iii) above until thirty (30)
days have elapsed from the date that such notice is received and, during those
thirty (30) days, the Company fails to cure or initiate material action to cure
the circumstances for which the notice of termination for Good Reason has been
given.
 
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Termination “Without Cause” - Involuntary termination of an Eligible Executive’s
employment for reasons not related to termination “For Cause.” Termination
“Without Cause” includes but is not limited to involuntary terminations due to
job elimination, reduction in force, or transfer of principal place of business
to a location which is more than fifty (50) miles from the Company’s principal
place of business on the date this policy is effective.
 
Eligibility for Severance Benefits
 
Only Eligible Executives who execute both (i) a general release of all claims
and covenant not to sue the Company and (ii) either a non-compete agreement if
the Eligible Executive has not already executed a non-compete, or if the
Executive has a non-compete agreement, a reaffirmation of the covenants
contained in such agreement, may receive severance benefits under this policy.
In the event an Eligible Executive violates the non-compete during a period in
which severance benefits are payable under this policy, then such Eligible
Executive shall forfeit all remaining severance benefits, including any unpaid
bonus, rights to subsidized COBRA or continued outplacement services, and the
Eligible Executive shall have no further rights under this policy.
 
Administration
 
The policy shall be administered by the Company’s Senior Human Resources
Officer. The policy may not be altered or changed in any way without the
approval of the Compensation and Nominating Committee of the Board of Directors.
Any exceptions to the policy must be approved by the Compensation and Nominating
Committee of the Board of Directors. This policy may be amended at any time with
the approval of the Compensation and Nominating Committee of the Board of
Directors. Notwithstanding the foregoing, this policy may not be amended or
terminated to decrease the level of severance payable, or to eliminate any
Eligible Executive's eligibility for participation under such policy during the
period immediately following the consummation of the event constituting a Change
in Control and ending twenty-five (25) months following a Change in Control.
 
Terminations that Qualify for Severance Benefits
 
An Eligible Executive shall receive severance benefits in the event he or she:
 
·
Is terminated by the Company “Without Cause;” or

·
Terminates for “Good Reason.”

 
Severance Benefits
 
·
If such termination occurs before the first anniversary of the Eligible
Executive’s designation as an EMG member, (a) six month’s salary, payable in
installments according to the Company’s regular payroll practices, plus (b)
prorated target bonus multiplied by the Company Funded Rate up to a maximum of
50% of full target bonus for the Company’s fiscal year in which termination
occurs, payable at the same time and in the same manner as the Company pays
bonuses to active employees for such fiscal year; provided, however, if the
termination is following a Change in Control, but during the same fiscal year of
the Company in which the Change in Control occurred and the Company’s bonus plan
as in effect prior to the Change in Control is not continued following the
Change in Control, then an amount equal to the pro rated target bonus the
Eligible Executive would have received multiplied by the Company Funded Rate,
determined as if the date the Change in Control occurs were the last day of the
fiscal year but projected on an annualized basis, up to a maximum of 50% of full
target bonus, payable in a lump sum.

 
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·
If such termination occurs after the first anniversary of the Eligible
Executive’s designation as an EMG member, (a) one year (twelve months) salary
payable in installments according to the Company’s regularly payroll practices
plus (b) target bonus multiplied by the Company Funded Rate up to a maximum of
100% of full target bonus for the Company’s fiscal year in which termination
occurs, payable at the same time and in the same manner as the Company pays
bonuses to active employees for such fiscal year; provided, however, if the
termination is following a Change in Control but in the same fiscal year of the
Company in which the Change in Control occurred and the Company’s bonus plan as
in effect prior to the Change in Control is not continued following the Change
in Control, then an amount equal to the pro rated target bonus the Eligible
Executive would have received multiplied by the Company Funded Rate, determined
as if the date that the Change in Control occurs were the last day of the fiscal
year but projected on an annualized basis, up to a maximum of 100% of full
target bonus, payable in a lump sum.

 
·
Should the Eligible Executive elect to continue medical benefits under COBRA,
the Company shall continue to subsidize premiums at the employer contribution
rate for the number of months covered by severance payments. Thereafter, should
the Eligible Executive elect to continue medical benefits under COBRA, he or she
will be responsible for the full premium.

 
·
Twelve months executive outplacement services from a provider selected or
approved by the Company.

 
·
In the event that the termination is Without Cause or for Good Reason within the
period immediately following the consummation of the event constituting a Change
of Control and ending twenty-four (24) months following the Change in Control,
in addition to the benefits outlined above, all of the Eligible Executive’s
unvested stock options or other stock incentives shall vest immediately.
Exercise rights shall be governed by the applicable stock incentive agreement.

 
·
All salary and accrued but unused vacation, as well as rights under all employee
benefit plans of the Company earned through the termination date.

 
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Parachute Payment Excise Taxes
 
In the event that the benefits provided for under this policy, when aggregated
with any other payments or benefits received by the Eligible Executive, would if
payable (i) constitute "parachute payments" within the meaning of Section 280G
of the Internal Revenue Code of 1986, as amended (the "Code"), and (ii) be
subject to the excise tax imposed by Section 4999 of the Code (the "Excise
Tax"), then the amount of benefits which otherwise would be provided for under
the terms of this Policy may, at the election of the Eligible Executive made
prior to his termination of employment, be reduced to the extent necessary so
that the Excise Tax would not apply to the Eligible Executive. In such case the
Eligible Executive may elect which benefits will be reduced in order that the
Excise Tax does not so apply. In the event that the Eligible Executive elects
not to reduce his benefits and is subject to the Excise Tax, then the Executive
will be solely responsible for payment of (i) the amount of the Excise Tax and
(ii) any interest, penalties, fines or additions to any tax which are imposed on
the Eligible Executive in connection with the imposition of such Excise Tax. In
all events the Eligible Executive shall be responsible for all income taxes and
applicable employment taxes (other than the portion of the employment taxes for
which the Company is responsible) on any benefits and payments under this
policy.
 
Terminations that Do Not Qualify for Severance
 
An Eligible Executive may not receive severance benefits under this policy if he
or she is

·
Terminated by the Company “For Cause”

·
Terminated by the Company for reasons related to death or disability

 
Benefits if the Termination does not Qualify for Severance
 
The executive is entitled to earned salary for the period ending on the
termination date plus accrued but unused vacation and any employee benefits
earned under the Company’s employee benefit plans through the termination date.
Stock options or other stock incentives shall be treated in accordance with the
applicable stock incentive agreement.
 
 
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