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                                                                  EXHIBIT 10.21


                            PHANTOM STOCK AGREEMENT

     THIS PHANTOM STOCK AGREEMENT (this "Agreement") made and entered into as
of the 5th day of September, 1997, by and between CLARK/BARDES, INC., a Texas 
corporation (the "Company"), and STEVEN J. COCHLAN (the "Participant").

                             W I T N E S S E T H:

     WHEREAS, the Company and the Participant, together with others, have
entered into a Stock Purchase Agreement of even date (the "Stock Purchase
Agreement") under which among other related transactions, certain shares of the
Company's Common Stock owned by the Participant (the "Shares") are to be
purchased by the Company at a closing as provided therein (the "Stock
Closing"); and

     WHEREAS, as part of the Stock Purchase Agreement transaction, the Company
has agreed to provide the Participant certain incentive compensation based on
the value of the Company's Common Stock.

     NOW, THEREFORE, for and in consideration of the above premises and of the
mutual covenants and promises contained herein, the parties hereto agree as
follows:

     1.  Purpose.  The purpose of this Agreement is to promote the interests of
the Company by providing incentive compensation to the Participant based on the
value of the Company's Common Stock. This Agreement will enhance the Company's
ability to attract, retain and motivate such key personnel as the Participant
and will promote a closer identity of interests between the Participant and the
Company's stockholders.

     2.  Definitions.

         (a)  "Board of Directors" or "Board" means the Board of Directors of
the Company.

         (b)  "Common Stock" means the Common Stock, no par value per share,
of the Company.

         (c)  "Company" means Clark/Bardes, Inc. and any successors or assigns,
including but not limited to, any corporation or corporations with or into
which Clark/Bardes, Inc. may be consolidated or merged or any corporation which
purchases 50% or more of the outstanding Common Stock of the Company or which
purchases substantially all of the assets of the Company.


     
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          (d) "Dollar Value of a Participant's Incentive Unit Account" as of a 
given date shall be computed as the Value per share/Incentive Unit multiplied
by the number of all Incentive Units computed in accordance with Section 4
hereof as of such date.

          (e) "Effective Date" means the date as determined pursuant to Section
18 hereof.

          (f) "Fair Market Value" means the market value of the Common Stock
calculated on a per share basis, as determined by an independent appraisal firm,
investment banking firm, accounting firm or other organization which is
recognized for, and experienced in, valuing insurance agencies and brokers and
similar financial services firms (the "Independent Evaluator"), which is, in any
case, selected by the Company. In the event the Company proposes an Independent
Evaluator and the Participant cannot agree on that or any other proposed
Independent Evaluator within 30 days of the Company's proposal of such
Independent Evaluator to the Participant, the Participant and the Company shall
each hire an Independent Evaluator, at their own expense, within 15 days of such
date to perform an appraisal of the Company. The determination of the market
value by the Independent Evaluator shall be set forth within 45 days of the
engagement in a written opinion addressed to the Board of Directors and to the
Participant and shall be final, conclusive and binding upon the Company and the
Participant. In the event that the Company and the Participant hire two
Independent Evaluators, the market value shall be the average of the two values
established unless there is a difference of more than 10%, in which case the
Independent Evaluators shall select a third Independent Evaluator who shall
establish a market value within 30 days of such engagement and the Fair Market
Value price shall be the average of the two closest prices established by the
Independent Evaluators. In the event a third Independent Evaluator is hired, the
cost of such evaluation shall be split evenly between the Company and the
Participant.

          (g) "Incentive Unit" means the award credited to the Participant
under this Agreement and expressed in numbers of units.
     
          (h) "Principal Office Agreements" means that certain Principal Office
Agreement dated as of September 12, 1993, between the Company and the
Participant, as amended.

          (i) "Principals" means any principal pursuant to the Principal Office
Agreement between the Company and any third party.

          (j) "Qualifying Revenues" means cash received by the Company directly
resulting from compensation generated by the Participant through the 



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SOP-FS Program less (i) the cost of the Company to perform any services or
deliver any products under the SOP-FS Program, (ii) any revenues received from
1997 sales to The Dow Chemical Company under the SOP-FS Program and any
add-ons, replacements or exchanges related thereto, (iii) any revenue received
by the Company under the SOP-FS Program which is owed to Citicorp Securities and
Principals or other third parties and (iv) any and all returns, refunds, charge
backs, rebates, discounts, credits or allowances of any nature related or
attributable to such Qualifying Revenues.

         (k) "SOP-FS Program" means the case or revenue opportunities for the
Company arising under that certain Supplemental Offset Plan and Financing
Structure as jointly developed and marketed by Citicorp, Participant and CBI.

         (l) "Subsidiary" means any entity in which the Company owns more than
50% of the issued and outstanding equity.

         (m) "Total Disability" means the complete inability of the Participant,
due to injury or sickness, to perform any and every duty owed to the Company or
a Subsidiary for a period of six months.

         (n) "Value per share/Incentive Unit" as of a given date means the Fair
Market Value per share of Common Stock of the Company at the close of the fiscal
year of the Company immediately preceding said date.

         (o) "Year" means a fiscal year of the Company.

     3.   Administration. This Agreement shall be administered by the Board of
Directors of the Company in its sole discretion. Subject to the express
provisions of the terms hereof, the Board shall have sole and complete
authority to:

              (i)  determine all computations required under this Agreement in
                   good faith; and

              (ii) interpret and construe this Agreement in good faith, and make
                   all determinations deemed necessary or advisable for the
                   administration of this Agreement.

     4.   Determination of Awards. The Participant shall be entitled to an
award of Incentive Units which shall be based on the following Schedule as to
the level of Qualifying Revenues on a cumulative basis received by the Company
measured as of the end of each fiscal quarter of the Company on any SOP-FS
sales from the Effective Date through December 31, 2007, which are generated by
the Participant in accordance herewith:



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<TABLE>
<CAPTION>
<S>                                      <C>
CUMULATIVE UNITS OWED                       CUMULATIVE QUALIFYING
     PARTICIPANT                              REVENUES OF COMPANY
------------------------------------------------------------------------
         0                                    Less than $5,000,000
------------------------------------------------------------------------
     200,000                               $5,000,000 to $9,999,999.99
------------------------------------------------------------------------
     400,000                              $10,000,000 to $14,999,999.99
------------------------------------------------------------------------
     600,000                              $15,000,000 to $19,999,999.99
------------------------------------------------------------------------
     800,000                              $20,000,000 to $24,999,999.99
------------------------------------------------------------------------
    1,000,000                             $25,000,000 to $29,999,999.99
------------------------------------------------------------------------
    1,200,000                             $30,000,000 to $34,999,999.99
------------------------------------------------------------------------
    1,400,000                             $35,000,000 to $39,999,999.99
------------------------------------------------------------------------
    1,500,000                                 $40,000,000 and over
------------------------------------------------------------------------
</TABLE>

         The maximum number of Incentive Units which Participant is eligible to
receive hereunder is One Million Five Hundred Thousand Incentive Units. Upon the
consummation of an initial public offering of the Company's equity securities at
any time prior to a Payment Date (as defined in Section 7 below), each
outstanding Incentive Unit shall automatically convert into a share of Common
Stock.

     5. INCENTIVE UNIT AMOUNTS. The Company shall record in an account with
respect to Participant, to be known as the Participant's Incentive Unit Account,
within a reasonable time after any award of Incentive Units, the number of
Incentive Units awarded to Participant and the date of such award.

     6. ADJUSTMENT. On the occurrence of any of the following events, the
following adjustments shall be made:

          (i)  In case the number of outstanding shares of Common Stock of the
               Company shall be increased by way of a stock dividend, stock
               split, recapitalization, or other similar means, the number of
               Incentive Units available to be awarded referred to in Section 4
               of this Agreement and the number of Incentive Units theretofore
               awarded under this Agreement shall be proportionately increased;
               and


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          (ii) In case the number of outstanding shares of Common Stock of the
               Company shall be reduced by recapitalization or otherwise (other
               than by purchase by the Company of outstanding shares) the number
               of Incentive Units available to be awarded referred to in Section
               4 of this Agreement and the number of Incentive Units theretofore
               awarded under this Agreement shall be proportionately reduced.

     7.   Payment for Incentive Units. Except as otherwise provided in
paragraph 8 below, Participant shall receive payments for the accrued Dollar
Value of his Incentive Unit Account on April 1 of 2003, 2004, 2005, 2006, 2007
and 2008 (each, a "Payment Date"), with the Dollar Value determined as of the
immediately preceding December 31.

     8.   Final Computation and Payment of Incentive Unit Account. The Board of
Directors shall make a final computation in good faith of the Dollar Value of
the Participant's Incentive Unit Account as of a Payment Date. In no event
shall the Dollar Value of the Participant's Incentive Unit Account increase in
value after the occurrence of a Payment Date.

          If the Participant's engagement with the Company or a Subsidiary is
terminated because of the Participant's death, the Company shall pay to the
Participant's designated beneficiary, or, in the absence of an effective
beneficiary designation, to his estate, the final Dollar Value of the
Participant's Incentive Unit Account, which Account shall be valued and paid at
the end of the then current fiscal year. If the Participant's relationship with
the Company pursuant to the Principal Office Agreement is terminated for any
reason, including Total Disability, the final Dollar Value of the Participant's
Incentive Unit Account shall be valued and paid to the Participant at the
end of the then current fiscal year. The Company shall have the option to pay
the final Dollar Value of the Participant's Incentive Unit Account in a lump
sum or in equal annual installments over a period of not more than four years.
If the Company elects to pay such amount in installments, the Company shall
also pay interest on the unpaid amount from time to time (payable annually with
each installment) at an annual rate equal to the prime rate announced from time
to time by Harris Bank, as published in The Wall Street Journal, Midwest
Edition, plus 1%.

     9.   Designation of Beneficiary. Participant may designate a beneficiary or
beneficiaries to receive any remaining amounts in his Incentive Unit Account in
the event of his death, and may change such designation from time to time, by
filing a written designation of beneficiaries with the Board of Directors on a
form to be prescribed by the Board, provided that no such designation shall be
effective unless so filed prior to the death of Participant. The Board may adopt
reasonable



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restrictions as to the number of beneficiaries and the types of interest which
may pass to beneficiaries.

     10. Absence of Liability. No member of the Board of Directors or officer
of the Company or any Subsidiary shall be liable for any act or action
hereunder, whether of commission or omission, taken by any other member, or by
any officer, agent, or employee, or, except in circumstances involving his bad
faith, for anything done or omitted to be done by himself.

     11. No Segregation of Cash or Shares. The Company shall not be required to
segregate or reserve any cash or any shares of Common Stock which may at any
time be represented by Incentive Unit awards under this Agreement. No interest
at any time shall be allowable or payable with respect to any Incentive Units
except as expressly provided herein.

     12. No Rights as a Shareholder. Participant shall not have voting rights
or privileges of a shareholder of Common Stock, or be entitled to receive any
shares of Common Stock, by reason of an award of Incentive Units under this
Agreement.

     13. Company Not Trustee. The Company shall not, by an provisions of this
Agreement be deemed to be a trustee of any property, and the liabilities of the
Company to Participant pursuant to this Agreement shall be those of a debtor
pursuant to such contract obligations as are created by this Agreement, and no
such obligation of the Company shall be deemed to be secured by any pledge or
other encumbrance on any property of the Company.

     14. Assignment and Transfers. The rights and transfers of the Participant
under this Agreement may not be assigned, encumbered, pledged or transferred
except, in the event of the death of the Participant, to his designated
beneficiary, or, in the absence of an effective beneficiary designation, to his
estate. Any such attempted action shall be void and no such interest shall be
in any manner liable for or subject to debts, contracts, liabilities,
engagements or torts of the Participant. If the Participant shall become
bankrupt or shall attempt to assign, encumber, pledge or transfer any interest
in this Agreement, then the Board of Directors in its discretion may hold or
apply such interest or any part thereof to or for the benefit of the
Participant or his designated beneficiary, his spouse, children, blood
relatives, or other dependents, or any of them, in such manner and in such
proportions as the Board of Directors may consider proper.

     15. Texas Law To Govern. All questions pertaining to the construction,
regulation, validity and effect of the provisions of this Agreement shall be
determined in accordance with the laws of the State of Texas.


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     16. Withholding Tax. The Company shall have the right to deduct from any
cash payment made to the Participant, his designated beneficiary or his estate
any taxes required by law to be withheld with respect thereto.

     17. Gender. Wherever from the context of this Agreement it appears
appropriate, each term shall in either the singular or plural shall include the
singular and the plural, and pronouns stated in either the masculine, the
feminine or the neuter gender shall include the masculine, feminine and neuter.


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     18.  Effective Date. This Agreement shall take effect upon the Stock
Closing.

     IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement
as of the date first above written.

CLARK/BARDES, INC.



By: /s/ Mel G. Todd                          /s/ Steven J. Cochlan
    --------------------------               ---------------------------
    Mel G. Todd                              Steven J. Cochlan
    President and CEO