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                                                                   Exhibit 10(o)


                              EMPLOYMENT AGREEMENT

         EMPLOYMENT AGREEMENT (the "Agreement") by and between The Dial
Corporation, a Delaware corporation (the "Company") and Herbert M. Baum (the
"Executive"), dated as of the 26th day of January, 2001 (the "Effective Date").

         WHEREAS, the parties desire to enter into an employment agreement
specifying the terms and conditions of the Executive's employment with the
Company; and

         WHEREAS, the Board of Directors of the Company (the "Board") has
determined that it is in the best interests of the Company and its stockholders
to assure that the Company will have the continued dedication of the Executive,
notwithstanding the possibility, threat or occurrence of a Change of Control (as
defined herein) of the Company.

         NOW, THEREFORE, in consideration of the premises and the respective
covenants and agreements of the parties herein contained, and intending to be
legally bound hereby, the parties agree as follows:

              1. Term. The term of employment of the Executive by the Company
hereunder shall be for a period commencing on the Effective Date and ending on
the earlier of January 25, 2004 the ("Final Date") or the Date of Termination
(as defined herein) (the "Term").

              2. Nature of Duties. The Executive shall serve as Chairman,
President and Chief Executive Officer of the Company and, subject to the
direction of the Company's Board, shall have full authority for management of
the Company and all of its operations, financial affairs, facilities and
investments, provided, however, that the Board may at any time designate another
person to serve as the President of the Company. The Executive shall serve as a
member of the Board, shall act as the duly authorized representative of the
Board and shall be an ex officio member of all committees of the Board. The
Executive shall devote substantially all of his working time and efforts to the
business and affairs of the Company, provided that the Executive shall be free
to serve as a director or officer or both of such not-for-profit corporations as
he may desire, to join and participate in such committees for community or
national affairs as he may select and to join and serve on business corporation
boards of directors, so long as such activities do not significantly interfere
with the performance of the Executive's duties hereunder and, in the case of
public business corporation boards of which the Executive was not a member when
he executed this Agreement, only with the prior approval of the Board.

              3. Place of Performance. The Executive shall be based at the
principal executive offices of the Company in the city of Scottsdale, Arizona,
except for required business travel.


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              4.   Compensation.

                   (a)  Annual Base Salary. During the Term, the Executive shall
receive an annual base salary of $800,000 (the "Annual Base Salary"), which
shall be paid in conformity with the Company's policies relating to salaried
employees. The Executive shall be eligible for periodic salary increases, but
not decreases, as determined in the sole discretion of the Executive
Compensation Committee of the Board (the "Committee"). Unless increased by the
Committee in its sole discretion, the Annual Base Salary shall apply for each
year during the Term. Any increase in Annual Base Salary shall not serve to
limit or reduce any other obligation to the Executive under this Agreement. The
Annual Base Salary shall not be reduced after any such increase and the term
Annual Base Salary as utilized in this Agreement shall refer to Annual Base
Salary as so increased.

                   (b)  Bonus.

                        (i)   Annual Bonus.  Except as provided herein, in each
fiscal year ending during the Term, the Executive shall be eligible to
participate in such bonus programs as are available to senior executives of the
Company. The terms and conditions of such bonus opportunities shall be
established by the Committee; provided, however, that the aggregate targeted
payout level for achievement of the Executive's annual incentive performance
objectives shall be no less than 70% of the Executive's Annual Base Salary (for
this purpose, the Annual Base Salary shall be the Executive's actual base
earnings for the performance period to which such bonus opportunity pertains).
Each such annual bonus (the "Annual Bonus") shall be paid no later than the end
of the third month of the fiscal year next following the fiscal year for which
the Annual Bonus is awarded, unless the Executive shall elect to defer the
receipt of such Annual Bonus.

                        (ii)  Initial Bonus.  Notwithstanding anything in this
Agreement to the contrary, the Executive shall receive an initial bonus of
$500,000 ("Initial Bonus") payable on the earliest of the following events: (x)
termination of the Executive's employment by the Company for reasons other than
Cause, Disability or death; (y) termination of employment by the Executive with
the consent of the Board; or (z) August 7, 2001, provided, however, that the
Executive's Annual Bonus for the fiscal year 2001 (payable in 2002) shall be
reduced by $292,000.

                   (c)  Stock Options. The Executive shall be eligible for
annual grants of stock options as determined in the sole discretion of the
Committee, subject to such terms and conditions as the Committee deems
appropriate. Notwithstanding any other agreement to the contrary, but subject to
the terms of this Agreement: (i) any stock options granted to the Executive
during the Term shall continue to vest after the expiration of the Term,
provided that the Executive is or becomes a member of the Board immediately
following such expiration, and while the Executive thereafter remains a member
of the Board (the "Board Service Period"); (ii) any options granted to the
Executive prior to the Effective Date as a non-employee Director shall continue
vesting


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through the later of the expiration of the Term or the last day of the
Executive's Board Service Period; and (iii) if the Executive's employment
terminates upon expiration of the Term on or after the Final Date, he will be
treated with regard to all stock options as a "retiree".

                   (d)  Annuity. Upon the later of the expiration of the Term or
the Executive's 65th birthday, the Executive will be entitled to receive, in
monthly installments, a minimum guaranteed life annuity payment of $67,000,
provided that if at the time of commencement of the benefit the Executive is
married to his current spouse, the payment will instead be made in the form of a
100% joint and survivor annuity based on the Executive's life and the life of
his current spouse equal to the actuarial equivalent (calculated by using the
actuarial assumptions contained in the Company's supplemental retirement plan)
of a $67,000 single life annuity on the Executive (the "Annuity"), and further
provided that such Annuity will be reduced by any defined pension benefits
earned by the Executive from the Company. In the event of the Executive's death
prior to commencement of the Annuity, such Annuity shall be paid to his current
spouse as if he had commenced benefits immediately preceding his death.

                   (e)  Management Deferred Compensation Plan. If the
Executive's employment terminates due to Disability or death, by the Company
without Cause, by the Executive for Good Reason, by the Executive with consent
of the Board, or upon expiration of the Term on or after the Final Date, the
Executive shall be treated as a "retiree" for purposes of vesting in any
discounted or other restricted stock units acquired pursuant to the Management
Deferred Compensation Plan (the "Deferred Compensation Plan"). If the Executive
is or becomes a member of the Board immediately following such termination of
employment, the Executive will be entitled to maintain his account balance in
the Deferred Compensation Plan through the Board Service Period.

                   (f)  Other Benefits. During the Term, the Executive (i) shall
be entitled to participate in all employee benefit plans which are generally
available to the Company's senior executives (subject to, and on a basis
consistent with, the terms, conditions and overall administration of such plans,
programs and arrangements); (ii) shall receive pension benefits and supplemental
executive retirement benefits (collectively, "Pension Benefits") which are
generally available to other senior executives of the Company; and (iii) shall
receive health insurance programs, executive medical benefits, life insurance,
accidental death and dismemberment benefits (collectively, "Welfare Benefits")
which are generally available to other senior executives of the Company.

                   (g)  Fringe Benefits and Relocation. During the Term, the
Executive shall be entitled to fringe benefits generally available to other
senior executives of the Company, including, without limitation, payment of
health club dues and expenses related to an annual physical in line with the
Executive's historical practices, use of a Company automobile and cell phone and
payment of related expenses (collectively, the "Fringe Benefits"). If the
Executive so requests, the


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Company will pay for all expenses relating to Executive's relocation from
Florida to Scottsdale, Arizona, and prior to such relocation, the Executive
shall be entitled to weekly-first class airfare between Scottsdale and Florida
and temporary housing in Scottsdale. Upon expiration of the Term, the Company
will pay for any expenses relating to the Executive's relocation from Scottsdale
to Florida. All payments made pursuant to this Section 4(g) shall be grossed-up
and paid on an after-tax basis.

                   (h)  Reimbursement for Expenses. During the Term, the
Executive shall be entitled to receive prompt reimbursement for all reasonable
expenses incurred by the Executive in accordance with the Company's policies,
practices and procedures.

                   (i)  Office and Support Staff. During the Term, the Executive
shall be provided with an appropriate office and with such secretarial and other
support facilities as are commensurate with former Chief Executive Officers of
the Company.

                   (j)  Vacation. During the Term, the Executive shall be
entitled to four (4) weeks' paid vacation per year.

                   (k)  Insurance; Indemnification. During the Term and
thereafter while the Executive could have any liability, the Executive shall be
named as an insured party in any liability insurance policy (including any
director and officer liability policy) maintained by the Company for its
directors and/or senior executive officers. In addition, the Company shall, as
set forth in its respective charter and/or by-laws, or in a separate
indemnification agreement, indemnify the Executive to the fullest extent
permitted under Delaware law. The Company shall also indemnify the Executive, to
the extent permitted by law, with respect to public service activities and
not-for-profit board membership he undertakes in accordance with Section 2.

              5.   Termination of Employment.

                   (a)  Death or Disability. The Executive's employment shall
terminate automatically upon the Executive's death during the Term. If the
Company determines in good faith that the Disability of the Executive has
occurred during the Term (pursuant to the definition of Disability set forth
below), it may give to the Executive written notice in accordance with Section
16(b) of this Agreement of its intention to terminate the Executive's
employment. In such event, the Executive's employment with the Company shall
terminate effective on the 30th day after receipt of such notice by the
Executive (the "Disability Effective Date"), provided that, within the 30 days
after such receipt, the Executive shall not have returned to full-time
performance of the Executive's duties. Prior to the Disability Effective Date,
the Executive shall continue to be treated as if fully and actively employed by
the Company for purposes of this Agreement, and without respect to whether or
not the Executive is or is determined to be Disabled. For purposes of this
Agreement, "Disability" shall mean the absence of the Executive from the
Executive's duties with the Company on a full-time basis for 180 consecutive
business


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days as a result of incapacity due to mental or physical illness which is
determined to be total and permanent by a physician selected by the Company or
its insurers and reasonably acceptable to the Executive or the Executive's legal
representative.

                   (b)  By the Company.

                   (i)  Without Cause. The Company may terminate the Executive's
                   employment without Cause.

                   (ii) For Cause. The Company may terminate the Executive's
                   employment during the Term for Cause. For purposes of this
                   Agreement, "Cause" shall mean:

                        (1)  the Executive's conviction of, or plea of nolo
                             contendere to, any felony (other than vicarious
                             liability which results solely from Executive's
                             position as Chief Executive Officer, provided that
                             Executive did not know, or should not have known,
                             of any act or failure to act upon which such
                             conviction or plea is based, or knew, but acted on
                             the advice of counsel);

                        (2)  the Executive's willful misconduct with regard to
                             the Company having a material and demonstrable
                             adverse effect on the Company;

                        (3)  the Executive's willful failure to attempt to
                             perform the services to be rendered hereunder
                             (except in the event of the Executive's incapacity
                             due to mental or physical illness) after receipt of
                             written notice from the Board and a reasonable
                             opportunity for the Executive to cure such willful
                             non-performance; or

                        (4)  the Executive's failure to attempt to adhere to, or
                             take affirmative steps to carry out, any legal and
                             proper directive of the Board, after receipt of
                             written notice from the Board and a reasonable
                             opportunity to cure such non-adherence or failure
                             to act.

The termination of Executive's employment shall not be deemed to be for Cause
unless and until there shall have been delivered to the Executive a copy of a
resolution duly adopted by the affirmative vote of not less than three-quarters
of the entire membership of the Board at a meeting of the Board called and held
for such purpose (after reasonable notice is provided to the Executive and the
Executive is given an opportunity, together with counsel, to be heard before the
Board), finding that, in the good faith opinion of the Board, the Executive is
guilty of the conduct described in subparagraph (1), (2), (3) or (4) above, and
specifying the particulars thereof in detail.


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For purposes of this Agreement, no act, or failure to act, on Executive's part
shall be considered willful unless done, or omitted to be done, by Executive in
bad faith and without reasonable belief that Executive's act or failure to act
was in the Company's best interests. Any act, or failure to act, based upon
authority granted pursuant to a duly adopted Board resolution or advice of
counsel shall be conclusively presumed to be done, or omitted to be done, by
Executive in good faith and in the Company's best interests.

                   (c)  By the Executive.

                   (i) Without Good Reason. The Executive may terminate
                   employment under this Agreement by giving Notice of
                   Termination to the Company in accordance with Section 16(b)
                   of this Agreement no less than 90 days prior to such
                   termination, unless such termination is pursuant to Section
                   (5)(c)(ii) below, or the Company elects to waive or reduce
                   such notice requirement.

                   (ii) With Good Reason. The Executive's employment may be
                   terminated by the Executive for Good Reason. For purposes of
                   this Agreement, "Good Reason" shall mean:

                        (1)  except as contemplated in Section 2 of this
                             Agreement, any diminution in the Executive's title
                             or position or material diminution in authority,
                             duties or responsibilities as set forth herein;

                        (2)  the assignment of any duties or responsibilities to
                             the Executive that are not commensurate with the
                             Executive's title, authority or position as set
                             forth herein;

                        (3)  a decrease in Annual Base Salary or a decrease in
                             the Executive's target annual incentive below 70%
                             of the Annual Base Salary;

                        (4)  any material diminution of benefits described in
                             Sections 4(f), (g), (h), (i) or (j) of this
                             Agreement;

                        (5)  the relocation of the Executive's principal place
                             of employment to a location more than 35 miles from
                             the Company's Scottsdale, Arizona headquarters;

                        (6)  any material breach of this Agreement by the
                             Company after written notice from the Executive and
                             a reasonable opportunity for the Company to cure
                             such breach; or

                        (7)  any failure by the Company to comply with and
                             satisfy


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                             Section 12(c) of this Agreement.

For purposes of this Section 5(c)(ii), any good faith determination of "Good
Reason" made by the Executive following a Change of Control shall be conclusive.

                   (d) Notice of Termination. Any termination by the Company for
Cause, or by the Executive, shall be communicated by Notice of Termination to
the other party hereto given in accordance with Section 16(b) of this Agreement.
For purposes of this Agreement, a "Notice of Termination" means a written notice
which (i) indicates the specific termination provision in this Agreement relied
upon, (ii) to the extent applicable, sets forth in reasonable detail the facts
and circumstances claimed to provide a basis for termination of the Executive's
employment under the provision so indicated and (iii) if the Date of Termination
(as defined below) is other than the date of receipt of such notice, specifies
the termination date (which date shall be not more than thirty days after the
giving of such notice). The failure by the Executive or the Company to set forth
in the Notice of Termination any fact or circumstance which contributes to a
showing of Good Reason or Cause shall not waive any right of the Executive or
the Company, respectively, hereunder or preclude the Executive or the Company,
respectively, from asserting such fact or circumstance in enforcing the
Executive's or the Company's rights hereunder.

                   (e) Date of Termination. "Date of Termination" means (i) if
the Executive's employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein, as the case may be, (ii) if the Executive's
employment is terminated by the Company other than for Cause or Disability or by
the Executive without Good Reason, the Date of Termination shall be the date on
which the Company notifies the Executive of such termination or 90 days after
the date on which the Executive notifies the Company of such termination (or
such earlier date if approved by the Company), respectively, and (iii) if the
Executive's employment is terminated by reason of death or Disability, the Date
of Termination shall be the date of death of the Executive or the Disability
Effective Date, as the case may be.

              6.   Obligations of the Company upon Termination

                   (a)  Good Reason; Other Than for Cause or Disability Prior to
a Change of Control. If, during the Term, and prior to a Change of Control, the
Company terminates the Executive's employment other than for Cause or Disability
or the Executive shall terminate employment for Good Reason:

                        (i)   the Company shall pay to the Executive in a lump
sum in cash within 30 days after the Date of Termination an amount equal to the
sum of: (1) the Executive's Annual Base Salary through the Date of Termination
to the extent not theretofore paid; (2) and any bonus earned during the prior
fiscal year but not yet paid to Executive; and (3) any compensation previously
deferred by the Executive (together with any accrued interest or earnings
thereon) and any accrued vacation pay, in each case to


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the extent not theretofore paid (the sum of the amounts described in clauses
(1), (2) and (3) shall be hereinafter referred to as the "Accrued Obligations");

                        (ii)  the Company shall make 24 equal monthly payments
to the Executive equal in the aggregate to the greater of: (x) the total amount
the Executive would have been paid in Annual Base Salary for a period commencing
on the Date of Termination and ending on the Final Date (the "Severance
Protection Period"); or (y) one times (1x) the sum of the Annual Base Salary
plus the full target bonus with respect to the fiscal year in which the Date of
Termination occurs (the "Current Target Bonus");

                        (iii) the Company shall treat the Executive as a
"retiree" with respect to treatment of his outstanding stock options, as well as
with respect to participation in all employee benefit plans, including but not
limited to the Company's annual incentive plan, supplemental retirement plan,
and Deferred Compensation Plan;

                        (iv)  the Executive shall continue to be eligible to
receive Welfare Benefits and Fringe Benefits from the Date of Termination
through the later of: (x) the end of the Severance Protection Period; or (y) the
first anniversary of the Date of Termination (the "Welfare Protection Period");
and

                        (v)   to the extent not theretofore paid or provided,
the Company shall timely pay or provide to the Executive any other amounts or
benefits required to be paid or provided or which the Executive is eligible to
receive under any plan, program, policy or practice or contract or agreement of
the Company (such other amounts and benefits shall be hereinafter referred to as
the "Other Benefits").

                   (b)  Good Reason; Other Than for Cause or Disability
following a Change of Control. If, during the Term, and upon or after the
occurrence of a Change of Control, the Company terminates the Executive's
employment other than for Cause or Disability or the Executive shall terminate
employment for Good Reason:

                        (i)   the Company shall pay to the Executive in a lump
sum in cash within 30 days after the Date of Termination the aggregate of all
Accrued Obligations, plus the product of (x) the Current Target Bonus, and (y) a
fraction, the numerator of which is the number of days in the current fiscal
year through the Date of Termination, and the denominator of which is 365 (the
"Pro-Rata Bonus"); provided, however, that if the Date of Termination occurs on
or prior to August 7, 2001, the Pro-Rata Bonus shall be no less than $500,000,
and further provided that if the Date of Termination occurs after August 7, 2001
and on or before December 31, 2001, the Pro-Rata Bonus shall be reduced by
$292,000;

                        (ii)  the Company shall pay to the Executive in a lump
sum in cash within 30 days after the Date of Termination an amount equal to
three times (3x) the sum of the Annual Base Salary and the greater of: (1) the
highest Annual Bonus received by the Executive from the Company in the three
fiscal years immediately preceding the Date of Termination, provided, however,
that for purposes of this Section


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6(b)(ii), the Annual Bonus for the year 2001 shall not be reduced by $292,000,
or (2) the Current Target Bonus (the "Highest Annual Bonus");

                        (iii) the Company shall treat the Executive as a
"retiree" with respect to treatment of his outstanding stock options, as well as
with respect to participation in all employee benefit plans, including but not
limited to the Company's annual incentive plan, supplemental retirement plan,
and Deferred Compensation Plan;

                        (iv)  the Executive shall continue to be eligible to
receive Welfare Benefits and Fringe Benefits from the Date of Termination
through the later of: (x) the end of the Severance Protection Period; or (y) the
end of the Welfare Protection Period, and the Executive shall continue to accrue
pension credit with respect to his Pension Benefits during such time period; and

                        (v)   to the extent not theretofore paid or provided,
the Company shall timely pay or provide to the Executive the Other Benefits.

              For purposes of this Agreement, a Change of Control shall mean:

                   (1)  The acquisition by any individual, entity or group
(within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
Act of 1934, as amended (the "Exchange Act")) (a "Person") of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act)
of 20% or more of either (i) the then outstanding shares of common stock of the
Company (the "Outstanding Company Common Stock") or (ii) the combined voting
power of the then outstanding voting securities of the Company entitled to vote
generally in the election of directors (the "Outstanding Company Voting
Securities"); provided, however, that for purposes of this subsection (1), the
following acquisitions shall not constitute a Change of Control: (i) any
acquisition directly from the Company, (ii) any acquisition by the Company,
(iii) any acquisition by any employee benefit plan (or related trust) sponsored
or maintained by the Company or any corporation controlled by the Company or
(iv) any acquisition by any corporation pursuant to a transaction which complies
with clauses (i), (ii) and (iii) of subsection (3) of this definition of a
Change of Control; or

                   (2)  Individuals who, as of the date hereof, constitute the
Board (the "Incumbent Board") cease for any reason to constitute at least a
majority of the Board; provided, however, that any individual becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or

                   (3)  Consummation of a reorganization, merger or
consolidation or


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sale or other disposition of all or substantially all of the assets of the
Company (a "Business Combination"), in each case, unless, following such
Business Combination, (i) all or substantially all of the individuals and
entities who were the beneficial owners, respectively, of the Outstanding
Company Common Stock and Outstanding Company Voting Securities immediately prior
to such Business Combination beneficially own, directly or indirectly, more than
50% of, respectively, the then outstanding shares of common stock and the
combined voting power of the then outstanding voting securities entitled to vote
generally in the election of directors, as the case may be, of the corporation
resulting from such Business Combination (including, without limitation, a
corporation which as a result of such transaction owns the Company or all or
substantially all of the Company's assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Business Combination of the Outstanding Company Common
Stock and Outstanding Company Voting Securities, as the case may be, (ii) no
Person (excluding any corporation resulting from such Business Combination or
any employee benefit plan (or related trust) of the Company or such corporation
resulting from such Business Combination) beneficially owns, directly or
indirectly, 20% or more of, respectively, the then outstanding shares of common
stock of the corporation resulting from such Business Combination or the
combined voting power of the then outstanding voting securities of such
corporation except to the extent that such ownership existed prior to the
Business Combination and (iii) at least a majority of the members of the board
of directors of the corporation resulting from such Business Combination were
members of the Incumbent Board at the time of the execution of the initial
agreement, or of the action of the Board, providing for such Business
Combination; or

                   (4)  Approval by the stockholders of the Company of a
complete liquidation or dissolution of the Company.

                   Anything in this Agreement to the contrary notwithstanding,
if the Executive's employment with the Company is terminated without Cause prior
to the date on which the Change of Control occurs, but the Executive reasonably
demonstrates that the termination (i) was at the request of a third party who
has taken steps reasonably calculated to effect a Change of Control or (ii)
otherwise arose in connection with or in anticipation of a Change of Control
which has been threatened or proposed, such termination shall be deemed to have
occurred after a Change of Control for purposes of this Agreement provided a
Change in Control shall actually have occurred.

                   (c)  Death. If the Executive's employment is terminated by
reason of the Executive's death during the Term, this Agreement shall terminate
without further obligations to the Executive's legal representatives under this
Agreement, other than for payment of Accrued Obligations and the timely payment
or provision of Other Benefits. Accrued Obligations shall be paid to the
Executive's estate or beneficiary, as applicable, in a lump sum in cash within
30 days of the Date of Termination.

                   (d)  Disability. If the Executive's employment is terminated
by reason of the Executive's Disability during the Term, this Agreement shall
terminate without


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further obligations to the Executive, other than for payment of Accrued
Obligations and the timely payment or provision of Other Benefits. Accrued
Obligations shall be paid to the Executive in a lump sum in cash within 30 days
of the Date of Termination.

                   (e)  Cause; Other than for Good Reason. If the Executive's
employment shall be terminated for Cause during the Term or if Executive
voluntarily terminates employment during the Term (excluding a termination for
Good Reason), this Agreement shall terminate without further obligations to the
Executive other than the obligation to pay to the Executive (i) his or her
Annual Base Salary through the Date of Termination, (ii) the amount of any
compensation previously deferred by the Executive, and (iii) Other Benefits, in
each case to the extent theretofore unpaid.

              7.  Non-exclusivity of Rights. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in any plan,
program, policy or practice provided by the Company and for which the Executive
may qualify, nor shall anything herein limit or otherwise affect such rights as
the Executive may have under any contract or agreement with the Company, other
than the Letter Agreement, as defined herein. Amounts which are vested benefits
or which the Executive is otherwise entitled to receive under any plan, policy,
practice or program of or any contract or agreement with the Company at or
subsequent to the Date of Termination shall be payable in accordance with such
plan, policy, practice or program or contract or agreement except as explicitly
modified by this Agreement.

              8.   Entire Agreement. This Agreement and other documents executed
concurrently herewith or referred to herein contain the sole and entire
agreement and understanding of the parties with respect to the subject matters
contained herein, and the parties agree that this Agreement supercedes the
letter agreement dated August 7, 2000 from the Company to the Executive (the
"Letter Agreement"), and that such Letter Agreement is rendered null and void as
of the Effective Date of this Agreement.

              9.   Certain Additional Payments by the Company.

                   (a)  Anything in this Agreement to the contrary
notwithstanding and except as set forth below, in the event it shall be
determined that any payment or distribution by the Company to or for the benefit
of the Executive (whether paid or payable or distributed or distributable
pursuant to the terms of this Agreement or otherwise, but determined without
regard to any additional payments required under this Section 9) (a "Payment")
would be subject to the excise tax imposed by Section 4999 of the Internal
Revenue Code of 1986, as amended (the "Code") or any interest or penalties are
incurred by the Executive with respect to such excise tax (such excise tax,
together with any such interest and penalties, are hereinafter collectively
referred to as the "Excise Tax"), then the Executive shall be entitled to
receive: (i) an additional payment (a "Gross-Up Payment") in an amount such that
after payment by the Executive of all taxes (including any interest or penalties
imposed with respect to such taxes), including, without limitation, any income
taxes (and any interest and penalties imposed with respect thereto) and Excise
Tax imposed upon the Gross-Up Payment, the


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Executive retains an amount of the Gross-Up Payment equal to the Excise Tax
imposed upon the Payments, and (ii) an amount equal to the product of any
deductions disallowed for federal, state or local income tax purposes because of
the inclusion of the Gross-Up Payment in the Executive's adjusted gross income
multiplied by the highest applicable marginal rate of federal, state, or local
income taxation, respectively, for the calendar year in which the Gross-Up
Payment is to be made.

                   (b)  Subject to the provisions of Section 9(c), all
determinations required to be made under this Section 9, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination, shall be made
by Deloitte & Touche LLP or such other certified public accounting firm as may
be designated by the Executive (the "Accounting Firm") which shall provide
detailed supporting calculations both to the Company and the Executive within 15
business days of the receipt of notice from the Executive that there has been a
Payment, or such earlier time as is requested by the Company. In the event that
the Accounting Firm is serving as accountant or auditor for the individual,
entity or group effecting the Change of Control, the Executive shall appoint
another nationally recognized account firm to make the determinations required
hereunder (which accounting firm shall then be referred to as the Accounting
Firm hereunder). All fees and expenses of the Accounting Firm shall be borne
solely by the Company. Any Gross-Up Payment, as determined pursuant to this
Section 9, shall be paid by the Company to the Executive within five days of the
receipt of the Accounting Firm's determination. Any determination by the
Accounting Firm shall be binding upon the Company and the Executive. As a result
of the uncertainty in the application of Section 4999 of the Code at the time of
the initial determination by the Accounting Firm hereunder, it is possible that
Gross-Up Payments which will not have been made by the Company should have been
made ("Underpayment"), consistent with the calculations required to be made
hereunder. In the event that the Company exhausts its remedies pursuant to
Section 9(c) and the Executive thereafter is required to make a payment of any
Excise Tax, the Accounting Firm shall determine the amount of the Underpayment
that has occurred and any such Underpayment shall be promptly paid by the
Company to or for the benefit of the Executive.

                   (c)  The Executive shall notify the Company in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Gross-Up Payment. Such notification shall be given
as soon as practicable but no later than ten business days after the Executive
is informed in writing of such claim and shall apprise the Company of the nature
of such claim and the date on which such claim is requested to be paid. The
Executive shall not pay such claim prior to the expiration of the 30-day period
following the date on which it gives such notice to the Company (or such shorter
period ending on the date that any payment of taxes with respect to such claim
is due). If the Company notifies the Executive in writing prior to the
expiration of such period that it desires to contest such claim, the Executive
shall:

                        (i)   give the Company any information reasonably
requested by the Company relating to such claim,


                                      -12-
<PAGE>   13
                        (ii)  take such action in connection with contesting
such claim as the Company shall reasonably request in writing from time to time,
including, without limitation, accepting legal representation with respect to
such claim by an attorney reasonably selected by the Company,

                        (iii) cooperate with the Company in good faith in order
to effectively contest such claim, and

                        (iv)  permit the Company to participate in any
proceedings relating to such claim; provided, however, that the Company shall
bear and pay directly all costs and expenses (including additional interest and
penalties) incurred in connection with such contest and shall indemnify and hold
the Executive harmless, on an after-tax basis, for any Excise Tax or income tax
(including interest and penalties with respect thereto) imposed as a result of
such representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 9(c), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct the Executive to pay the tax claimed and sue for a
refund or contest the claim in any permissible manner, and the Executive agrees
to prosecute such contest to a determination before any administrative tribunal,
in a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided, however, that if the Company directs the
Executive to pay such claim and sue for a refund, the Company shall advance the
amount of such payment to the Executive, on an interest-free basis and shall
indemnify and hold the Executive harmless, on an after-tax basis, from any
Excise Tax or income tax (including interest or penalties with respect thereto)
imposed with respect to such advance or with respect to any imputed income with
respect to such advance; and further provided that any extension of the statute
of limitations relating to payment of taxes for the taxable year of the
Executive with respect to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore, the Company's control of
the contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable hereunder and the Executive shall be entitled to settle or
contest, as the case may be, any other issue raised by the Internal Revenue
Service or any other taxing authority.

              (d)  If, after the receipt by the Executive of an amount advanced
by the Company pursuant to Section 9(c), the Executive becomes entitled to
receive any refund with respect to such claim, the Executive shall (subject to
the Company's complying with the requirements of Section 9(c)) promptly pay to
the Company the amount of such refund (together with any interest paid or
credited thereon after taxes applicable thereto). If, after the receipt by the
Executive of an amount advanced by the Company pursuant to Section 9(c), a
determination is made that the Executive shall not be entitled to any refund
with respect to such claim and the Company does not notify the Executive in
writing of its intent to contest such denial of refund prior to the expiration
of 30 days after such determination, then such advance shall be forgiven and
shall not be required to be


                                      -13-
<PAGE>   14
repaid and the amount of such advance shall offset, to the extent thereof, the
amount of Gross-Up Payment required to be paid.

              10.  Confidentiality; Cooperation with Regard to Litigation;
Non-disparagement.

                   (a)  While employed by the Company and thereafter, the
Executive shall not, without the prior written consent of the Company, disclose
to anyone (except in good faith in the ordinary course of business to a person
who will be advised by the Executive to keep such information confidential) or
make use of any Confidential Information (as defined below) except in the
performance of his duties hereunder, or when required to do so by legal process
by any governmental agency having supervisory authority over the business of the
Company or by any administrative or legislative body (including a committee
thereof) or judicial authority that requires him to divulge, disclose or make
accessible such Confidential Information. In the event that the Executive is so
ordered, he shall give prompt written notice to the Company to allow the Company
the opportunity to object to or otherwise resist such order.

                   (b)  "Confidential Information" shall mean all information
concerning the business of the Company or any Subsidiary (as defined below)
relating to any of their products, product development, trade secrets,
customers, suppliers, finances, and business plans and strategies. Excluded from
the definition of Confidential Information is information (i) that is or becomes
part of the public domain, other than through the breach of this Agreement by
the Executive or (ii) regarding the Company's business or industry properly
acquired by the Executive in the course of his career as an executive in the
Company's industry and independent of the Executive's employment by the Company.
For this purpose, information known or available generally within the trade or
industry of the Company or any Subsidiary shall be deemed to be known or
available to the public.

                   (c)  "Subsidiary" shall mean any corporation controlled
directly or indirectly by the Company.

                   (d)  While employed by the Company and thereafter, the
Executive agrees to cooperate with the Company by making himself reasonably
available to testify on behalf of the Company or any Subsidiary in any action,
suit, or proceeding, whether civil, criminal, administrative, or investigative,
and to assist the Company or any Subsidiary in any such action, suit, or
proceeding by providing information and meeting and consulting with the Board or
its representatives or counsel, or representatives or counsel to the Company or
any Subsidiary, as reasonably requested with regard to matters that relate to
the Executive's employment period as an officer of the Company; provided,
however, that the same does not materially interfere with the Executive's then
current professional activities, involve a conflict between the Executive and
the Company or would cause a violation of any court order or governmental
requirement. The Company agrees to reimburse the Executive, on an after-tax
basis, for all


                                      -14-
<PAGE>   15
reasonable expenses actually incurred in connection with his provision of
testimony or assistance, including reasonable legal fees.

                   (e)  While employed by the Company and thereafter, the
Executive agrees that he will not make public statements or representations, or
otherwise communicate, directly or indirectly, in writing, orally, or otherwise,
or take any action (except as Executive reasonably believes is necessary in the
course of performing his duties) which may, directly or indirectly, disparage
the Company or any Subsidiary or their respective officers, directors,
employees, advisors, businesses or reputations. The Company agrees that, while
the Executive is employed by the Company and thereafter, the Company will not
make statements or representations, or otherwise communicate, directly or
indirectly, in writing, orally, or otherwise, or take any action which may,
directly or indirectly, disparage the Executive or his business or reputation.
Notwithstanding the foregoing, nothing in this Agreement shall preclude either
the Executive or the Company from making truthful statements or disclosures that
are required by applicable law, regulation or legal process. Notwithstanding the
foregoing, this Section 10(e) shall be of no further force and effect in the
event that the Executive's employment terminates upon or after the occurrence of
a Change of Control.

              11.  Non-competition and Non-solicitation.

                   (a)  While employed by the Company and for a period of 24
months thereafter (the "Restricted Period"), the Executive shall not engage in
Competition with the Company or any Subsidiary. "Competition" shall mean
engaging in any activity, except as provided below, for a Competitor of the
Company or any Subsidiary, whether as an employee, consultant, principal, agent,
officer, director, partner, shareholder (except as a less than three percent
shareholder of a publicly traded company) or otherwise (together "Employment").
A "Competitor" shall mean any corporation or other entity which derives at least
15% or more of its revenues from the conduct of business which competes,
directly or indirectly, with the business conducted by the Company, as
determined on the Date of Termination of the Executive's employment. If the
Executive commences Employment with any entity that is not a Competitor at the
time the Executive initially becomes employed or becomes a consultant,
principal, agent, officer, director, partner, or shareholder of the entity,
future activities of such entity shall not result in a violation of this
provision unless (i) such activities were contemplated by the Executive at the
time the Executive initially commenced Employment or (ii) the Executive
commences directly or indirectly overseeing or managing the activities of an
entity which becomes a Competitor during the Restricted Period, which activities
are competitive with the activities of the Company or Subsidiary. In addition,
the Executive may be employed by, or otherwise associated with, noncompeting
portions of the competing entity so long as he does not directly or indirectly
oversee, manage or contribute to the competing activities of the Competitor. The
Executive shall not be deemed to be indirectly overseeing, managing or
contributing to the Competitor's activities which are competitive with the
activities of the Company or Subsidiary so long as he does not participate in
any discussions with regard to the conduct of, or take any act intended to
facilitate the success of, the competing business.


                                      -15-
<PAGE>   16
                   (b) Notwithstanding the foregoing Section 11(a), in the event
the Executive desires to accept Employment with a Competitor which, in the
Executive's reasonable judgment, competes with an insignificant portion of the
business conducted by the Company or Subsidiary, the Executive shall have the
right, prior to accepting such Employment, to submit a written request to the
Company for a limited waiver of the Company's right to enforce the provisions of
this Section 11. If the Company determines, in its good faith reasonable
judgment, that the Executive's proposed Employment with the Competitor would not
result in more than an insignificant level of competition with the business
conducted by the Company or Subsidiary at either the time such request is made
or in the then foreseeable future, the Company shall grant the Executive the
requested waiver.

                   (c) During the Restricted Period, the Executive shall not
induce employees of the Company or any Subsidiary to terminate their employment,
nor shall the Executive solicit or encourage any corporation or other entity in
a joint venture relationship, directly or indirectly, with the Company or any
Subsidiary, to terminate or diminish their relationship with the Company or any
Subsidiary or to violate any agreement with any of them. During such period, the
Executive shall not hire, either directly or through any employee, agent or
representative, any employee of the Company or any Subsidiary or any person who
was employed by the Company or any Subsidiary within 90 days of such hiring.

                   (d) The Executive's compliance with the non-competition and
non-solicitation provisions of this Section 11 shall be deemed compliance with
any other non-competition or non-solicitation provision agreed to between the
Executive and the Company, including but not limited to any stock option or
equity grants.

                   (e) Notwithstanding the foregoing, in the event that the
Executive's employment terminates upon or after the occurrence of a Change of
Control, Sections 11(a) and (b) of this Agreement shall be of no further force
and effect.

              12.  Successors.

                   (a) This Agreement is personal to the Executive and without
the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
legal representatives.

                   (b) This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and assigns.

                   (c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be


                                      -16-
<PAGE>   17
required to perform it if no such succession had taken place. As used in this
Agreement, "Company" shall mean the Company as hereinbefore defined and any
successor to its business and/or assets as aforesaid which assumes and agrees to
perform this Agreement by operation of law, or otherwise.

              13.  Full Settlement; No Mitigation; No Offset. The Company's
obligation to make the payments provided for in this Agreement and otherwise to
perform its obligations hereunder shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action which the
Company may have against the Executive or others. In the event of any
termination of employment, the Executive shall be under no obligation to seek
other employment, and amounts due the Executive under this Agreement shall not
be offset by any remuneration attributable to any subsequent employment that he
may maintain other than substantially comparable welfare benefits provided by a
new employer.

              14.  Remedies. If the Executive materially breaches any of the
provisions contained in Sections 10 or 11 above, the Company (a) shall have the
right to immediately terminate all remaining severance payments and benefits due
under Sections 6(a) and (b) of this Agreement and (b) shall have the right to
seek injunctive relief. The Executive acknowledges that such a breach of
Sections 10 or 11 would cause irreparable injury and that money damages would
not provide an adequate remedy for the Company; provided, however, the foregoing
shall not prevent the Executive from contesting the issuance of any such
injunction on the ground that no violation or threatened violation of Sections
10 or 11 has occurred.

              15.  Resolution of Disputes and Legal Fees.

                   (a) Any controversy or claim arising out of or relating to
this Agreement or any breach or asserted breach hereof or questioning the
validity and binding effect hereof arising under or in connection with this
Agreement, other than seeking injunctive relief under Section 14, shall be
resolved by binding arbitration, to be held at an office closest to the
Company's principal offices in accordance with the rules and procedures of the
American Arbitration Association. Judgment upon the award rendered by the
arbitrator(s) may be entered in any court having jurisdiction thereof.

                   (b) Upon or after the occurrence of a Change of Control, the
Company agrees to pay as incurred, to the full extent permitted by law, all
legal fees, costs of arbitration and related expenses which the Executive may
reasonably incur as a result of any contest (regardless of the outcome thereof)
by the Company, the Executive or others of the validity or enforceability of, or
liability under, any provision of this Agreement or any guarantee of performance
thereof (including as a result of any contest by the Executive about the amount
of any payment pursuant to this Agreement), plus in each case interest on any
delayed payment at the applicable Federal rate provided for in Section
7872(f)(2)(A) of the Code (such payments referred to herein as "Legal Fees").
Prior to a Change of Control, the Company agrees to reimburse the Executive for
such Legal Fees after the resolution of a dispute with the Company concerning
enforcement


                                      -17-
<PAGE>   18
or payments pursuant to this Agreement, provided that the Executive prevails in
such dispute. The Company also agrees to reimburse the Executive for any legal
expenses incurred in connection with the Executive's termination of employment
with Hasbro, regardless of the time such expenses are incurred, and regardless
of the outcome of such dispute.

              16.  Miscellaneous.

                   (a) This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware, without reference to
principles of conflict of laws. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect. This Agreement may not
be amended or modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal representatives.

                   (b) All notices and other communications hereunder shall be
in writing and shall be given by hand delivery to the other party or by
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:

                   If to the Executive:

                        Herbert M. Baum
                        Chairman, President and Chief Executive Officer
                        The Dial Corporation
                        15501 North Dial Boulevard
                        Scottsdale, AZ  85260-1619

                   If to the Company:

                        The Dial Corporation
                        15501 North Dial Boulevard
                        Scottsdale, AZ 85260-1619
                        Attention:  General Counsel

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.

                   (c) The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

                   (d) The Company may withhold from any amounts payable under
this Agreement such Federal, state, local or foreign taxes as shall be required
to be withheld pursuant to any applicable law or regulation.


                                      -18-
<PAGE>   19
                   (e) The Executive's or the Company's failure to insist upon
strict compliance with any provision of this Agreement or the failure to assert
any right the Executive or the Company may have hereunder, including, without
limitation, the right of the Executive to terminate employment for Good Reason
pursuant to Section 5(c)(i)-(v) of this Agreement, shall not be deemed to be a
waiver of such provision or right or any other provision or right of this
Agreement.

                   IN WITNESS WHEREOF, the Executive has hereunto set the
Executive's hand and, pursuant to the authorization from its Board of Directors,
the Company has caused these presents to be executed in its name on its behalf,
all as of the day and year first above written.

                                       The Dial Corporation

                                       By: /s/ Michael T. Riordan
                                           --------------------------
                                           Michael T. Riordan
                                           Chairman of the Executive
                                           Compensation Committee

                                       /s/ Herbert M. Baum
                                       ------------------------------
                                       Herbert M. Baum




                                      -19-