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                                                               Exhibit 10.1

                              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 15th day of August, 2002 (the "Effective Date").

      WHEREAS, the Executive and the Company previously entered into an
employment agreement, dated as of January 26, 2002 (the "Prior Employment
Agreement");

      WHEREAS, the parties desire to enter into this Agreement to specify the
terms and conditions of the Executive's employment with the Company;

      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; and

      WHEREAS, as of the Effective Date, the Executive and the Company agree
that the terms of this Agreement shall supercede, in its entirety, the terms of
the Prior Employment Agreement.

      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 February 1, 2006 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


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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.


            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) 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.

                  (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"); and (ii) 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".


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                  (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 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


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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 on the same basis as provided to the Executive immediately
prior to the Effective Date.

                  (j) Vacation. During the Term, the Executive shall be entitled
to six (6) 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 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.


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            (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. 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


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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
                        Section 12(c) of this Agreement.

For purposes of this Section 5(c)(ii), any good faith determination of "Good
Reason"


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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 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");


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                  (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").

                  (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 (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


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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
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


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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 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


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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 Prior Employment 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 Prior
Employment Agreement, and that such Prior Employment 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 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


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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,

                  (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


                                     - 12 -
<PAGE>
                  (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 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


                                     - 13 -
<PAGE>
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 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,


                                     - 14 -
<PAGE>
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.

            (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


                                     - 15 -
<PAGE>
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 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


                                     - 16 -
<PAGE>
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 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


                                     - 17 -
<PAGE>
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.

            (e) Agreement. 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.

      17. Company Car. Upon the earlier of: (i) the expiration of this
Agreement, (ii) the Executive's voluntary resignation for Good Reason or (iii)
any termination of the Executive's employment (other than for Cause or the
Executive's voluntary resignation


                                     - 18 -
<PAGE>
without Good Reason) (the "Transfer Date"), the Company shall promptly transfer
to the Executive the title of the Volkswagen Bug that the Executive currently
uses as his company car or the company car that the Executive uses as of the
Transfer Date, and the Company shall gross-up the Executive for any taxes he
incurs as a result of such transfer. Prior to Transfer Date, the Company shall
provide the Executive with the full-time use of the Volkswagen Bug or another
company car, and the Company shall pay for all expenses associated with such
use, including, without limitation, gasoline, maintenance, repair and insurance
expenses.


            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/James E. Oesterreicher
                                 ------------------------------
                                 James E. Oesterreicher
                                 Member of the Executive
                                         Compensation Committee


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





                                     - 19 -