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                              EMPLOYMENT AGREEMENT
                              --------------------


         AGREEMENT made as of March 26, 1997, between USA Detergents, Inc., a
Delaware corporation with its principal office at 1735 Jersey Avenue, North
Brunswick, New Jersey 08902 (the "Company"), and Richard D. Coslow (the
"Executive"), residing at 16 Cavan Lane, Hazlet, New Jersey 07730.

         WHEREAS, the parties desire to enter into this Agreement in order to
assure the Company of the services of the Executive and to set forth the duties
and compensation of the Executive, all upon the terms and conditions
hereinafter set forth;

         NOW, THEREFORE, in consideration of the foregoing and of the mutual
promises, representations and covenants contained herein, the parties hereto
agree as follows:

         1. Duties. The Company shall employ the Executive, and the Executive
shall serve, as Senior Vice President and Chief Financial Officer of the
Company during the Employment Term (as hereinafter defined). During the
Employment Term, Executive shall perform such duties and functions as the
Company's Board of Directors, Chief Executive Officer or President shall from
time to time determine and Executive shall comply in the performance of his
duties with the policies, and be subject to the direction, of the Board of
Directors, the Chief Executive Officer and the President of the Company.

         Except as may be expressly otherwise consented to in writing by the
Board of Directors or the Chief Executive Officer of the Company, Executive
covenants and

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agrees to and shall devote his full working time, attention and efforts toward
the performance of his duties and responsibilities hereunder. Executive shall
not, directly or indirectly, without the prior consent of the Company's Board
of Directors, as owner, partner, joint venturer, stockholder, employee,
corporate officer or director, engage or become financially interested in, or
be concerned with any other duties or pursuits which interfere with the
performance of his duties hereunder, or which even if non-interfering, may be
inimical or contrary to the best interests of the Company.

         2. Term. The term of this Agreement and the term of employment (the
"Employment Term") of the Executive shall commence on April 14, 1997 and
continue for three years therefrom (the "Termination Date") unless sooner
terminated in accordance with the terms hereof; provided, however, that the
Termination Date shall be extended automatically for successive one year
periods unless either party hereto gives the other such party written notice of
its or his intention to terminate this Agreement thirty (30) days prior to the
Termination Date (or, if applicable, any extension of the Termination Date).

         In the event the Company terminates this Agreement for any reason
other than cause (as defined in Section 5 hereof), or the permanent disability
(as defined in Section 6 hereof) or death of the Executive, the parties hereto
agree that damages to the Executive shall be difficult to ascertain in any such
event, but in order to limit the liability of the Company in any such event,
the Executive shall be entitled to receive as liquidated damages and not as a
penalty, and the Company shall pay to the Executive, the lesser of (i) the base
salary of the Executive for a period of six months from any such date of
termination or (ii) the entire amount of the base salary remaining due and

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payable from any such date of termination to the expiration of this Agreement,
in either such instance to be paid ratably over the remaining term of the
Agreement, provided, however, that if the Company terminates this Agreement for
any reason other than cause (as defined in Section 5 hereof), or the permanent
disability (as defined in Section 6 hereof) or death of the Executive, in any
such instance during the first year of the Employment Term, the parties hereto
agree the Executive shall be entitled to receive as liquidated damages and not
as a penalty, the base salary of the Executive for a period of twelve months
from any such date of termination, to be paid ratably over such twelve-month
period. Any amounts so paid to the Executive pursuant to the provisions of this
Section 2 shall be in lieu of any and all other payments due and owing to the
Executive under the terms of this Agreement or otherwise. In the event the
Company terminates this Agreement for cause (as defined in Section 5 hereof),
the Executive shall not be entitled to receive any further payment hereunder
other than for accrued but unpaid compensation.

         3. Base Compensation.

              a. Salary. In each of the three years of the Employment Term, the
Executive shall receive a base salary at the rate of $156,000 per annum as well
as such bonuses as may be authorized from time to time by the Board of
Directors. The Executive's compensation shall be payable in installments in
accordance with the Company's normal salary payment policies, and shall be
subject to such payroll deductions as are required by law or applicable
employee benefit programs.

              b. Bonus. It is understood and agreed that the Company presently
has and expects, during the Term of this Agreement, to maintain a bonus

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program, pursuant to which certain employees of the Company receive a
percentage of the operating gross margin (the "OGM Plan") of the Company, to
the extent such operating gross margin exceeds ten percent. During the
Employment Term, the Executive shall be entitled to receive, on a per annum
basis, eight percent (8%) of the allocated OGM Plan amount.

              c. Expenses. In addition to the base salary provided for in
Section 3(a) hereof, the Company shall reimburse the Executive, upon
presentation by the Executive of suitable documented expense accounts, for any
reasonable travel or other out-of-pocket business expenses incurred by the
Executive in rendering the services hereunder on behalf of the Company and
which are incurred pursuant to the Company's expense reimbursement policies.
The Executive shall comply with restrictions and shall keep records in
compliance with the Company's policy and procedures related to travel and
entertainment expenses.

              d. Stock Option Plan. The Executive shall be entitled to
participate in the Company's 1995 Stock Option Plan (the "Plan"). Under the
Plan, the Executive shall receive an option (the "Option") to purchase 15,000
shares of the Company's common stock, $.01 par value per share (the "Common
Stock"), available for issuance under the Plan at an exercise price (the
"Exercise Price") equal to the per share price of the Common Stock on the
Nasdaq National Market on the date of the grant (or, if later, the first date
that the Executive is employed by the Company). Except as specifically provided
otherwise herein, the Option will become exercisable in accordance with the
following schedule based upon the period of the Executive's continuous
employment with the Company following the date hereof:

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Period                            Incremental                    Cumulative
of Continuous                     Percentage of                  Percentage of
Employment/                       Option                         Option
Service                           Exercisable                    Exercisable
-------                           -----------                    -----------

Less than 1 year                        0%                              0%

1 year                                 25%                             25%

2 years                                25%                             50%

3 or more years                        50%                            100%



              e. Vacations. The Executive shall be entitled to three weeks of
paid vacation in each calendar year, which vacation time shall vest on a
pro-rata basis during the calendar year. The Executive shall also be entitled
to the same standard paid holidays given by the Company to senior executives
generally, all as determined from time to time by the Board of Directors of the
Company or appropriate committee thereof. Vacation time shall not cumulate from
year to year.

              f. Health and Disability Insurance. The Executive shall be
entitled to the same health and disability insurance given by the Company to
senior executives generally, all as determined from time to time by the Board
of Directors of the Company or appropriate committee thereof.

              g. Parking Space. The Executive shall be entitled to a reserved
parking space in the parking lot customarily used by the Company's senior
executives generally.

         4. Place of Performance. In connection with his employment by the
Company, the Executive shall be based at the principal executive offices of the
Company, presently located in the North Brunswick, New Jersey area, except for
travel required for Company business.

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         5. Termination by the Company. The Company may terminate this
Agreement at any time, upon notice by the Company to the Executive, for cause
or for any other reason which would not constitute cause. Termination by the
Company for "cause" shall mean termination because of: (a) Executive's refusal
to perform, or continual neglect of, his duties or obligations hereunder (other
than breaches of the covenants set forth in Sections 1, 7 and 8 hereof which
events are governed by clause (f) below); (b) Executive's conviction (which,
through lapse of time or otherwise, is not subject to appeal) of any crime or
offense involving money or other property of the Company or any of its
subsidiaries or which constitutes a felony in the jurisdiction involved, (c)
Executive's performance of any act or his failure to act, for which if
Executive were prosecuted and convicted, a crime or offense involving money or
property of the Company or any of its subsidiaries, or which would constitute a
felony in the jurisdiction involved, would have occurred, (d) any attempt by
Executive to improperly secure any personal profit in connection with the
business of the Company or any of its subsidiaries, (e) chronic alcoholism or
drug addiction or (f) any breach by Executive of any of the terms of Section 1,
7 or 8 of this Agreement.

         6. Death; Disability. If the Executive shall die or become
"permanently disabled" during the term of this Agreement, this Agreement and
all benefits hereunder shall terminate, except that such termination shall not
affect any vested rights which the Executive may have at the time of his death
pursuant to any insurance or other death benefit plans or arrangements of the
Company, which rights shall continue to be governed by the provisions of such
plans and agreements. For the purposes of this Agreement, the Executive shall
be deemed to be "permanently disabled"

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if, during the term hereof, because of ill health, physical or mental
disability, or for other causes beyond the Executive's control, the Executive
shall have been unable or unwilling, or shall have failed to perform his duties
hereunder for ninety (90) consecutive days or for a total period of one hundred
twenty (120) days in any twelve month period during the term of this Agreement,
whether consecutive or not. Notwithstanding anything to the contrary contained
herein, during any period that the Executive fails to perform his duties
hereunder as a result of his disability (but prior to the termination of this
Agreement as a result of such disability), (i) the Executive shall continue to
receive his full salary at the rate then in effect and all benefits provided
herein, provided that payments made to the Executive pursuant to this Section 6
shall be reduced by the sum of the amounts, if any, payable to the Executive at
or prior to the time of any such payment under any disability benefit plan or
program of, or provided by, the Company and (ii) the Company shall have the
right to hire any other individual or individuals to perform such duties and
functions as the Company shall desire, including those duties heretofore
performed by the Executive.

         7. Protection of Confidential Information.

              a. The Executive acknowledges that his employment by the Company
will, throughout the term of this Agreement, bring him in contact with many
confidential affairs of the Company not readily available to the public, and
plans for future developments. In recognition of the foregoing, the Executive
covenants and agrees that he will not, directly or indirectly, use or
intentionally disclose or permit to be known to anyone outside of the Company
any material confidential matters of the Company which are not otherwise in the
public domain, either during or for a period

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of twelve months after the termination of his employment with the Company,
except with the Company's prior written consent or as required by court order,
law or subpoena, or other legal compulsion to disclose.

              b. All information and documents relating to the Company shall be
the exclusive property of the Company and the Executive shall use commercially
reasonable best efforts to prevent any publication or disclosure thereof. Upon
termination of the Executive's employment with the Company, all documents,
records, reports, writings and other similar documents containing confidential
information, including copies thereof, then in the Executive's possession or
control shall be returned and left with the Company.

              c. The Executive will execute the form of "USA Detergents, Inc.
Non-Disclosure and Non-Solicitation Agreement" in the form of Exhibit A hereto,
all the terms and provisions of which are incorporated herein as if fully set
forth herein.

         8. Covenant Not To Compete.

              a. The Executive agrees that during his employment by the Company
(which shall be deemed to include the period during which the Executive is
receiving any severance payments, as set forth in Section 2 hereof) and for the
twenty-four months immediately following the Employment Term (including any
extensions thereof, as provided herein), the Executive shall not either
directly or indirectly, whether by establishing a new business or by joining an
existing one, and whether as a principal, employee, stockholder, officer,
director, broker, agent, consultant, corporate officer, licensor or in any
other capacity, compete with the Company or become associated with a business
enterprise which competes with any business operation of

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the Company, or any business operation of the Company planned prior to the
Executive's termination of employment, in the geographical areas in which the
Company is then doing or proposes to do business during such twenty-four month
period; provided, however, that if the Company terminates this Agreement
without cause (as defined in Section 5 hereof), Executive shall not be subject
to the provisions of this Section 8.

              b. The Executive and the Company intend that this covenant not to
compete shall be construed as a series of separate covenants, one for each
county and each product line. If, in any judicial proceeding, a court shall
refuse to enforce any one or more of the separate covenants deemed included in
subsection (a) of this Section 8, then such unenforceable covenant shall be
deemed severed from this Agreement for the purposes of such judicial proceeding
to the extent necessary to permit the remaining separate covenants to be
enforced.

              c. The Executive acknowledges that the Company conducts business
on a world-wide basis, that its sales and marketing prospects are for continued
expansion into world markets and that, therefore, the territorial and time
limitations set forth in this Section 8 are reasonable and properly required
for the adequate protection of the business of the Company and its
subsidiaries. In the event any such territorial or time limitation is deemed to
be unreasonable by a court of competent jurisdiction, the Executive agrees to
the reduction of the territorial or time limitation to the area or period which
such court deems reasonable.

              d. The existence of any claim or cause of action by the Executive
against the Company shall not constitute a defense to the enforcement by the
Company

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of the foregoing restrictive covenants, but such claim or cause of action shall
be litigated separately.

         9. Successors; Binding Agreement. This Agreement and all rights of the
Executive hereunder shall inure to the benefit of, and shall be enforceable by,
the Executive's personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If the Executive should
die while any amount would still be payable to him hereunder if he had
continued to live, all such amounts, unless otherwise provided herein, shall be
paid in accordance with the terms of this Agreement to the Executive's devisee,
legatee or other designee or, if there be no such designee, to the Executive's
estate.

         10. Notice. For the purposes of this Agreement, notices, demands and
all other communications provided for in the Agreement shall be in writing and
shall be deemed to have been duly given when delivered against receipt therefor
or three days after being mailed by United States certified mail, return
receipt requested, postage prepaid, addressed as follows:

         If to the Executive:     Richard D. Coslow
                                  16 Cavan Lane
                                  Hazlet, New Jersey 07730

         If to the Company:       1735 Jersey Avenue
                                  North Brunswick, New Jersey  08902
                                  Attention:  Frederick J. Horowitz

         With a copy to:          Sheldon G. Nussbaum, Esq.
                                  Fulbright & Jaworski L.L.P.
                                  666 Fifth Avenue
                                  New York, New York  10103

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or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that notice of change of address shall
be effective only upon receipt.

         11. Miscellaneous. No provisions of this Agreement may be modified,
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by the Executive and such officers of the Company as may
be specifically designated by its Board of Directors. No waiver by either party
hereto at any time of any breach by the other party hereto of, or compliance
with, any condition or provision of this Agreement to be performed by such
other party shall be deemed a waiver of similar or dissimilar provisions or
conditions at the same or at any prior or subsequent time.

         12. Validity. The invalidity or unenforceability of any provision or
provisions of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement, which shall remain in full force and
effect.

         13. Entire Agreement. This Agreement sets forth the entire agreement
and understanding of the parties hereto in respect of the subject matter
contained herein, and supersedes all prior agreements, promises, covenants,
arrangements, communications, representations or warranties, whether oral or
written, by any officer, employee or representative of any party hereto or any
predecessor of any party hereto.

         14. Non-Assignability. This Agreement is entered into in consideration
of the personal qualities of the Executive and may not be, nor may any right or
interest hereunder be, assigned by him without the prior written consent of
Company. It is expressly understood and agreed that this Agreement, and the
rights accruing and

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obligations owed to the Company hereunder, and the obligations to be performed
by the Company hereunder, may be assigned by the Company to any of its
successors or assigns.

         15. Equitable Relief. The Executive recognizes that the services to be
rendered by him hereunder are of a special, unique, extraordinary and
intellectual character involving skill of the highest order and giving them
peculiar value, the loss of which cannot be adequately compensated for in
damages. In the event of a breach of this Agreement by the Executive, the
Company shall be entitled to injunctive relief or any other legal or equitable
remedies. The remedies provided in this Agreement shall be deemed cumulative
and the exercise of one shall not preclude the exercise of any other remedy at
law or in equity for the same event or any other event.

         16. Choice of Law. This Agreement is to be governed by and interpreted
under the laws of the State of Delaware without regard to its conflict of laws
principles.

         17. Representations And Agreements of the Executive. (a) The Executive
represents and warrants that he is free to enter into this Agreement and to
perform the duties required hereunder, and that there are no employment
contracts or understandings, restrictive covenants or other restrictions,
whether written or oral, preventing the performance of his duties hereunder.

         (b) The Executive agrees to submit to a medical examination and to
cooperate and supply such other information and documents as may be required by
any insurance company in connection with the Executives' inclusion in any
insurance or fringe benefit plan or program as the Company shall determine from
time to time to

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obtain, or in connection with, in the Company's sole discretion, the Company's
obtaining life insurance for its benefit on the life of the Executive.

         18. Survival. The termination of the Executive's employment hereunder
shall not affect the enforceability of Sections 2, 6, 7, 8, 15, 16 and 17
hereof.

         19. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.

         20. HEADINGS. The Section headings appearing in this Agreement are for
the purposes of easy reference and shall not be considered a part of this
Agreement or in any way modify, demand or affect its provisions.

         IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the day and year first-above written.

                                            USA DETERGENTS, INC.


                                            By: /s/ Uri Evan
                                               ---------------------------


                                            EXECUTIVE


                                            /s/ Richard D. Coslow
                                            ------------------------------
                                            Richard D. Coslow

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