UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13
OF THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 28, 1996
Commission file number 1-11793
THE DIAL CORPORATION
(Exact Name of Registrant as Specified in its Charter)
DELAWARE 51-0374887
(State or Other Jurisdiction of (I.R.S. Employer
Incorporation or Organization) Identification No.)
1850 NORTH CENTRAL AVENUE
PHOENIX, ARIZONA 85004-4525
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (602) 207-2800
Indicate by check mark whether the registrant (1) has filed all Exchange Act
reports required to be filed by Section 13 or 15 (d) of the Securities
Exchange Act of 1934 during the preceding 12 months, and (2) has been subject
to such filing requirements for the past 90 days.
Yes X No
----------- -----------
The number of shares of Common Stock, $.01 par value, outstanding as the close
of business on September 30, 1996 was 95,345,517.
<PAGE>
PART I. FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
THE DIAL CORPORATION
CONSOLIDATED BALANCE SHEET
(000 omitted)
<TABLE>
<CAPTION>
September 28, December 30,
1996 1995
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $ 8,889 $ 5,884
Receivables, net 41,520 39,647
Inventories 143,691 153,813
Deferred income taxes 49,509 32,301
Other current assets 18,573 3,418
--------- --------
Total current assets 262,182 235,063
Property and equipment 218,293 201,076
Deferred income taxes 93,966 26,881
Intangibles 323,994 334,708
Other assets 1,777 677
--------- --------
$900,212 $798,405
========= ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Short-term bank loans $ $ 317
Trade accounts payable 85,280 79,502
Income taxes payable 23,398 2,765
Other current liabilities 112,569 106,266
Current portion of long-term debt 550
-------- --------
Total current liabilities 221,247 189,400
Long-term debt 295,000 2,453
Pension and other benefits 235,687 103,137
Other liabilities 20,461 7,185
-------- --------
Total liabilities 772,395 302,175
--------- --------
Stockholders' Equity
Common stock, $.01 par value, 310,000,000 shares
authorized, 95,345,517 shares issued 953
Additional capital 238,123
Unearned employee benefits (79,688)
Cumulative translation adjustment (1,953)
Retained deficit (29,618)
Dial investment and advances 496,230
------- --------
Total stockholders' equity 127,817 496,230
--------- --------
$900,212 $798,405
========= ========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
THE DIAL CORPORATION
STATEMENT OF CONSOLIDATED OPERATIONS
(000 omitted, except per share data)
<TABLE>
<CAPTION>
Quarter Ended
September 28, September 30,
1996 1995
<S> <C> <C>
Net sales $350,508 $ 308,110
--------- ----------
Costs and expenses:
Cost of products sold 184,193 168,439
Write down of discontinued product inventories 27,924
---------
212,117 168,439
Selling, general and administrative expenses 142,708 128,515
Restructuring charges and other asset write-downs 27,076 135,600
--------- ----------
381,901 432,554
--------- ----------
Operating loss (31,393) (124,444)
--------- ----------
Interest and other expenses 6,361 6,648
Spin-off transaction costs 1,000
--------- ----------
7,361 6,648
--------- ----------
Loss before income taxes (38,754) (131,092)
Income taxes (benefit) (13,268) (52,983)
--------- ----------
NET LOSS $(25,486) $ (78,109)
========= ==========
NET LOSS PER SHARE $ (0.28)
=========
Average outstanding common shares 89,675
=========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
THE DIAL CORPORATION
STATEMENT OF CONSOLIDATED OPERATIONS
(000 omitted, except per share data)
<TABLE>
<CAPTION> Nine Months Ended
September 28, September 30,
1996 1995
<S> <C> <C>
Net sales $1,056,658 $1,009,865
---------- -----------
Costs and expenses:
Cost of products sold 543,016 526,994
Write down of discontinued product inventories 27,924
---------- -----------
570,940 526,994
Selling, general and administrative expenses 410,696 386,779
Restructuring charges and other asset write-downs 27,076 135,600
---------- -----------
1,008,712 1,049,373
---------- -----------
Operating income (loss) 47,946 (39,508)
---------- -----------
Spin-off transaction costs 5,000
Interest and other expenses 16,146 16,195
---------- -----------
21,146 16,195
---------- -----------
Income (loss) before income taxes 26,800 (55,703)
Income taxes (benefit) 13,389 (23,709)
---------- -----------
NET INCOME (LOSS) $ 13,411 $ (31,994)
========== ===========
INCOME (LOSS) PER SHARE $ .15
==========
Average outstanding common and equivalent shares 90,618
==========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
THE DIAL CORPORATION
STATEMENT OF CONSOLIDATED CASH FLOWS
(000 omitted)
<TABLE>
<CAPTION>
Nine Months Ended
September 28, September 30,
1996 1995
<S> <C> <C>
CASH FLOWS PROVIDED (USED) BY OPERATING ACTIVITIES:
Net income (loss) $ 13,411 $(31,994)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation and amortization 21,920 21,680
Deferred income taxes (16,419) (43,135)
Restructuring charges and asset write-downs 55,000 156,000
Change in operating assets and liabilities:
Receivables (2,165) 73,458
Inventories (12,390) (19,663)
Trade accounts payable 5,778 (30,639)
Other assets and liabilities, net (18,795) (61,174)
--------- ---------
Net cash provided by operating activities 46,340 64,533
--------- ---------
CASH FLOWS PROVIDED (USED) BY INVESTING ACTIVITIES:
Capital expenditures (34,442) (18,581)
Acquisition of business, net of cash acquired (23,558)
Proceeds from sales of property and equipment 509 2,654
--------- ---------
Net cash used by investing activities (33,933) (39,485)
--------- ---------
CASH FLOWS PROVIDED (USED) BY FINANCING ACTIVITIES:
Proceeds from long-term borrowings 15,000
Payments on long-term borrowings (3,003) (523)
Net change in short-term bank loans (317) (16)
Net change in receivables sold 292 (14,553)
Dividends (7,174)
Cash transfers (to) from Dial, net (14,200) (10,636)
--------- ---------
Net cash used by financing activities (9,402) (25,728)
--------- ---------
Net increase (decrease) in cash and cash equivalents 3,005 (680)
Cash and cash equivalents, beginning of year 5,884 5,897
--------- ---------
CASH AND CASH EQUIVALENTS, END OF PERIOD $ 8,889 $ 5,217
========= =========
</TABLE>
See Notes to Consolidated Financial Statements.
<PAGE>
THE DIAL CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
NOTE A. BASIS OF PREPARATION
On July 25, 1996, the Board of Directors of The Dial Corp ("Dial") declared a
dividend (the "Distribution") to effect the spin-off of its Consumer Products
Business. The dividend was paid on August 15, 1996 to stockholders of record
as of August 5, 1996. Each Dial stockholder received a dividend of one share
of common stock of The Dial Corporation ("the Company") which after the
Distribution owns and operates the Consumer Products Business previously
conducted by Dial. Concurrently with the Distribution, the name of The Dial
Corp was changed to Viad Corp.
The Consolidated Financial Statements present the financial position, results
of operations and cash flows of the divisions and subsidiaries comprising The
Dial Corporation, as if it had been formed as a separate entity for all
periods presented. Dial's historical cost basis of the assets and liabilities
have been carried over to the new company. Concurrent with the spin-off, the
Company was capitalized through settlement of the Dial Corp's investment and
advances account of $502.5 million by the assumption of $280 million of
long-term debt and $80 million (net of income taxes) in Armour employee
benefit liabilities, with the net amount remaining of $159.4 million
comprising the Company's beginning stockholders' equity. Accordingly, the
retained deficit at September 28, 1996 represents the results of operations of
the Company from August 15 to September 28, 1996, plus a cash dividend of $7.2
million. All material intercompany balances and transactions among the
entities comprising the Company have been eliminated.
Per share data is not presented on a historical basis because the Company was
not a publicly-held company during the periods presented. Income (loss) per
share is presented as pro forma information for 1996 as the Company's common
shares were not publicly-traded until August 15, 1996. Accordingly, the
calculation of income (loss) per share assumes that the common shares and
common share equivalents were outstanding for the entire period presented.
The 5.67 million common shares held by the Company's Employee Equity Trust
have been excluded from the computation of income (loss) per share. Shares
held by the Trust are not considered outstanding for income (loss) per share
calculations until the shares are released from the Trust. Common equivalent
shares have been excluded from the weighted average number of common shares
outstanding for the calculation of loss per share for the quarter ended
September 28, 1996 because their effect is antidilutive.
These financial statements should be read in conjunction with the financial
statements set forth in The Dial Corp Consumer Products Business Combined
Financial Statements and the notes thereto set forth in The Dial Corporation
Form 10/A (Amendment No. 2) declared effective by the Securities and Exchange
Commission on July 30, 1996.
<PAGE>
Accounting policies utilized in the preparation of these financial statements
are the same as set forth in such Combined Financial Statements except as
modified for interim accounting policies which are within the guidelines set
forth in Accounting Principles Board Opinion No. 28, "Interim Financial
Reporting."
The interim combined financial statements are unaudited. In the opinion of
management, all adjustments, consisting only of normal recurring accruals,
necessary to present fairly the financial position as of September 28, 1996,
the results of operations for the quarters and nine months ended September 28,
1996 and September 30, 1995, and the cash flows for the nine months ended
September 28, 1996 and September 30, 1995 have been included. Interim results
of operations are not necessarily indicative of the results of operations for
the full year.
NOTE B. INCOME TAXES
A reconciliation of the provision for income taxes and the amount that would
be computed using statutory federal income tax rates on income before income
taxes for the nine months ended September 28, 1996 and September 30, 1995 is
as follows:
<TABLE>
<CAPTION>
1996 1995
(Millions)
<S> <C> <C>
Computed income taxes (benefit) at statutory
federal income tax rate of 35% $ 9.4 $(19.5)
Nondeductible goodwill amortization 0.7 0.8
State income taxes 1.2 (3.0)
Nondeductible restructure costs 1.8
Other, net 0.3 (2.0)
----- -------
Provision (benefit) for income taxes $13.4 $(23.7)
===== =======
</TABLE>
NOTE C. RESTRUCTURING CHARGES AND INVENTORY AND OTHER ASSET WRITE-DOWNS
In the third quarter of 1996, the Company announced that it would take a
one-time restructuring charge to provide for a business based reorganization
through work force reductions and rationalization of product lines. The
management and administrative organization was streamlined by eliminating
approximately 250 positions and by discontinuing a number of under performing
brands and related assets. Provision has also been made for The Dial
Corporation to vacate its present leased headquarters space and secure a more
economical location to house its corporate staff. Future earnings are
expected to benefit from the cost savings of the streamlined organization and
the efficiencies provided by increased focus on core brands.
The charges recorded in the quarter ended September 28, 1996 were $55.0
million ($35.4 million after tax) of which $27.9 million is included in cost
of products sold and $27.1 million is classified as restructuring and other
charges.
<PAGE>
<TABLE>
<CAPTION>
(Millions)
<S> <C>
Write-down of inventories $ 27.9
Other asset write-downs 12.3
Severance pay and benefits 6.2
Building exit costs 8.6
-------
Total Restructuring Charges and Inventory
and Other Asset Write-downs $ 55.0
Tax benefit (19.6)
Net Restructuring Charges and Inventory
and Other Asset Write-downs $ 35.4
=======
</TABLE>
Based upon the discontinuation and product rationalization analysis completed,
the assets and intangibles were determined to be impaired and were written
down to their net realizable value. Severance pay and benefits and exit
costs, have been recognized in accordance with Emerging Issues Task Force
Issue No. 94-3 (EITF No. 94-3), "Liability Recognition for Certain Employee
Termination Benefits and Other Costs to Exit an Activity (including Certain
Costs Incurred in a Restructuring)." As of September 28, 1996, severance
costs totaling $1.6 million had been paid and charged against these reserves.
Remaining severance and exit cost reserves of $13.2 million at September 28,
1996, are believed to be adequate and are expected to be paid utilizing cash
flow from operating activities.
Included in the statement of consolidated operations are the results of
certain product groups which the Company intends to sell or discontinue in the
near future. The following is a summary of such results for all periods
presented:
<TABLE>
<CAPTION>
(In Millions)
Quarter Ended Nine Months Ended
Sept. 28, Sept. 30, Sept. 28, Sept. 30,
1996 1995 1996 1995
<S> <C> <C> <C> <C>
Net sales $53.3 $67.1 $167.9 $225.5
=================== ===================
Operating (loss) income
before restructuring
charges and other
asset write-downs $ (3.6) $.8 $ (12.6) $7.4
=================== ===================
</TABLE>
In the third quarter of 1995, the Company recorded restructuring charges and
inventory and other asset write-downs totaling $156 million ($94.9 million
after tax) to provide for a business-based reorganization through plant
closings, workforce reductions and correction of certain product lines.
Approximately $20.4 million of the charge related to inventories and is
included in cost of products sold.
Severance pay and benefits and exit costs, primarily facility closure costs,
were also recognized in accordance with EITF No. 94-3. Remaining severance
and exit cost reserves of $14.2 million at September 28, 1996, are believed to
be adequate and are expected to be paid utilizing cash flow from operating
activities. Severance and exit costs paid and charged against such reserves
in the first nine months of 1996 amounted to $10.6 million.
<PAGE>
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
FINANCIAL CONDITION
On September 25, 1996, the Company announced business based reorganization to
streamline its management and administrative staff, eliminate approximately
250 positions, sell or discontinue a number of underperforming brands, and
exit the current corporate headquarters. The Company recognized a $55 million
($35.4 million after tax) restructuring charge in the third quarter of 1996
for severance costs, asset write downs and building exit costs. Approximately
$15 million of the charge will ultimately be paid in cash provided by
operations with the remainder consisting of the reduction of asset carrying
values.
COMPARISON OF THIRD QUARTER 1996 WITH THIRD QUARTER 1995
Net sales for the third quarter of 1996 were $350.5 million, an increase of
13.8% over the comparable period in 1995. Unit sales for the third quarter of
1996 increased 18% over 1995 third quarter unit sales. The increase in sales
was driven by increases in market share of the Dial, Purex, Renuzit and Armour
franchises and a rebound from 1995 sales levels depressed by the Company's
trade inventories destocking program. Net sales from new products were
consistent between periods.
The loss before income tax benefit for the third quarter of 1996 was $38.8
million, which is $92.3 million less than the loss of $131.1 million in the
third quarter of 1995. Included in losses before income tax benefit is a
restructuring charge and spin-off transaction costs of $56 million in the
third quarter of 1996 and restructuring and other charges of $156 million in
the third quarter of 1995. Operating income, before restructuring and
spin-off transaction expenses, for the third quarter of 1996 was $23.6
million, which was $8 million less than operating income before restructuring
charges of $31.6 million for the third quarter of 1995. The decrease in
operating income in the third quarter of 1996 is primarily the result of
increased sales and marketing expenses, specifically, advertising of the Dial
Soap franchise (double 1995's levels), and secondarily, the expenses
associated with being a public company. Such expense increases were only
partially offset by the additional income produced by the increase in net
sales.
<PAGE>
COMPARISON OF THE FIRST NINE MONTHS OF 1996 TO THE FIRST NINE MONTHS OF 1995
Net sales for the nine months ended September 28, 1996 were $1.06 billion, an
increase of 4.6% over net sales of $1.01 billion for the comparable period in
1995. The increase in net sales was driven by sales of Dial and Renuzit
branded new products as well as overall increases in market share for the
Dial, Purex, Renuzit and Armour core franchises.
Income before income taxes for the nine months ended September 28, 1996 was
$26.8 million, an improvement of $82.5 million over the loss before income tax
benefit of $55.7 million for the first nine months of 1995. Included in
operating income was a restructuring charge and spin off transaction costs of
$60 million for the first nine months of 1996 and a restructuring charge and
other expenses of $156 million in the first nine months of 1995.
Operating income before restructuring and other charges for the first nine
months of 1996 was $102.9 million, which is $13.5 million below 1995 operating
income before restructuring and other charges. The decrease in operating
income is due to increases in selling and marketing expenses, primarily, a 28%
increase in controllable marketing spending for the Company's core franchises,
and, to a lesser degree, increased raw material costs, and the increased
administrative costs associated with being a public company. Such expense
increases were only partially offset by the additional income produced by the
increase in net sales during the first nine months of 1996.
INCOME TAXES
The effective tax rate for the first nine months 1996 was approximately 50%,
up from 42.6% for the comparable period in 1995. The increase in the
effective rate is the result of a lower tax benefit for the 1996 restructuring
charges and spin-off transaction costs.
LIQUIDITY AND CAPITAL RESOURCES
The Company generated cash from operations of $46.3 million during the first
nine months of 1996, a decrease of $18.2 million from the comparable period in
1995. The decrease was attributable primarily to the decrease in operating
income as discussed above, coupled with the increases in receivable and
inventories balances associated with higher sales levels during the first nine
months of 1996. Capital expenditures for the first nine months of 1996 (net
of asset dispositions) were $34.4 million, an increase of $15.8 million over
the comparable period of 1995.
<PAGE>
The Company's financing plan includes the sale of receivables to accelerate
cash flow. Receivables sold but not yet collected under this plan at
September 28, 1996 and September 30, 1995 were $77 million and $76.4
million, respectively.
As of September 28, 1996, the Company had approximately $94 million in
deferred tax benefits, which the Company believes are fully realizable in
future years. The realization of such benefits will require average annual
taxable income of approximately $18 million over the next fifteen years. The
Company's average annual United States taxable income over the past three
years has been approximately $81 million.
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) Exhibits
10. Material Contracts
(a) Directors Indemnification Agreement
(b) Officers Indemnification Agreement
(c) Supplemental Capital Accumulation Plan
(d) Supplemental Pension Plan
27. Financial Data Schedule.
(B) Reports filed on Form 8-K
1. A report on Form 8-K dated August 16, 1996 was filed by the registrant
during the quarter for which this report is filed. The Form 8-K reported
under Item 5 that the Company's shares were listed on the New York Stock
Exchange (ticker symbol:DL).
2. A report on Form 8-K dated September 25, 1996 was filed by the registrant
during the quarter for which this report is filed. The Form 8-K reported
under Item 5 that the Company was undertaking an administrative and business
reorganization and would recognize an estimated $31 million after tax charge
in third quarter 1996 earnings.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
The Dial Corporation
(Registrant)
November 11, 1996
\s\ Lowell L. Robertson
Lowell L. Robertson
Vice President and Controller
(Chief Accounting Officer and Authorized Officer)
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE DIAL
CORPORATION'S FORM 10-Q FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 28, 1996 AND
IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-28-1996
<PERIOD-END> SEP-28-1996
<CASH> 8,889
<SECURITIES> 0
<RECEIVABLES> 41,520
<ALLOWANCES> 5,689
<INVENTORY> 143,691
<CURRENT-ASSETS> 262,182
<PP&E> 218,293
<DEPRECIATION> 16,807
<TOTAL-ASSETS> 900,212
<CURRENT-LIABILITIES> 221,247
<BONDS> 295,000
0
0
<COMMON> 953
<OTHER-SE> 126,864
<TOTAL-LIABILITY-AND-EQUITY> 900,212
<SALES> 1,056,658
<TOTAL-REVENUES> 1,056,658
<CGS> 565,528
<TOTAL-COSTS> 565,528
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> 16,146
<INCOME-PRETAX> 26,800
<INCOME-TAX> 13,389
<INCOME-CONTINUING> 13,411
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 13,411
<EPS-PRIMARY> .15
<EPS-DILUTED> .15
</TABLE>
INDEMNIFICATION AGREEMENT
(Non-Employee Director)
This Indemnification Agreement ("Agreement") is made as of the 15th
day of August, 1996, by and between The Dial Corporation (the "Corporation"),
a Delaware corporation, and _______________, a Director of the Corporation
(the "Director").
Recitals
A. The Director has been elected to serve as a director of the
Corporation and the Corporation desires the Director to continue in such
capacity.
B. In addition to the indemnification to which the Director is
entitled under the Restated Certificate of Incorporation of the Corporation
(the "Charter") and the Bylaws of the Corporation (the "Bylaws"), the
Corporation at its sole expense maintains insurance protecting its officers
and directors against certain losses arising out of actual or threatened
actions, suits or proceedings to which such persons may be made or threatened
to be made parties ("D & O Insurance"). However, the Corporation and the
Director cannot be sure that insurance coverage will continue to be available
in the future or, if available, that it will not be unreasonably expensive to
purchase and maintain.
C. The Charter, the Bylaws and the Delaware General Corporation Law
specifically provide that they are not exclusive, and thereby contemplate that
contracts may be entered into between the Corporation and the members of its
Board of Directors with respect to indemnification of such directors.
Agreement
In order to induce the Director to continue to serve in the
Director's capacity as a director and in consideration of the Director's
valuable services for the Corporation, the Corporation and the Director agree
as follows:
1. Continued Service. The Director will continue to serve at the
will of the Corporation, or in accordance with separate contract to the extent
that such a contract is in effect at the time in question, as a director of
the Corporation so long as the Director is duly elected and qualified in
accordance with the Charter and the Bylaws or until the Director resigns in
accordance with applicable law.
2. Indemnity of Director. The Corporation shall hold harmless
and indemnify the Director to the fullest extent authorized or permitted by
the provisions of the Delaware General Corporation Law or by any amendment
thereof or other statutory provisions authorizing or permitting such
indemnification which is adopted after the date hereof.
3. Maintenance of Insurance and Self Insurance.
(a) Subject only to the provisions of Section 3(b) hereof, so long
as the Director shall continue to serve as a director of the Corporation (or
shall continue at the request of the Corporation to serve as a director of
another corporation, partnership, joint venture, trust or other enterprise)
and thereafter so long as the Director shall be subject to any possible claim
or threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative by reason of the fact that the
Director was a director of the Corporation or served in any of said other
capacities, the Corporation will purchase and maintain in effect for the
benefit of the Director one or more valid, binding and enforceable policies of
D & O Insurance providing, in all respects, coverage at least comparable to
that presently provided.
(b) The Corporation shall not be required to maintain said policies
of D & O Insurance in effect if said insurance is not reasonably available or
if, in the reasonable business judgment of the then directors of the
Corporation, either (i) the premium cost for such insurance is substantially
disproportionate to the amount of coverage or (ii) the coverage provided by
such insurance is so limited by exclusions that there is insufficient benefit
from such insurance.
(c) In the event the Corporation does not purchase and maintain in
effect said policies of D & O Insurance pursuant to the provisions of Section
3(b) hereof, the Corporation shall hold harmless and indemnify the Director to
the full extent of the coverage which would otherwise have been provided for
the benefit of the Director pursuant to such D & O Insurance.
4. Additional Indemnity. Subject only to the exclusions set
forth in Section 5 hereof, and without limiting any right which the Director
may have now or in the future pursuant to the Delaware General Corporation
Law, the Charter, the Bylaws, any other agreement, any resolution, any policy
of insurance or otherwise, the Corporation hereby further agrees to hold
harmless and indemnify the Director:
Against any and all expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by the
Director in connection with any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative,
whether by third parties or by or in the right of the Corporation to which the
Director at any time becomes a party, or is threatened to be made a party, by
reason of the fact that the Director is or was a director of the Corporation,
or is or was serving or at any time serves at the request of the Corporation
as a director of another corporation, partnership, joint venture, trust or
other enterprise.
5. Limitations on Additional Indemnity. No indemnity pursuant to
Section 4 hereof shall be paid by the Corporation:
(a) for which and to the extent that payment is actually made to
the Director under a valid and collectible insurance policy;
(b) for which and to the extent that the Director is indemnified or
receives a recovery otherwise than pursuant to Section 4;
(c) on account of any suit in which judgment is rendered against
the Director for an accounting of profits made from the purchase or sale by
the Director of securities of the Corporation pursuant to the provisions of
Section 16(b) of the Securities Exchange Act of 1934 and amendments thereto or
similar provisions of any federal, state or local statutory law;
(d) with respect to acts or omissions which are not in good faith
or which constitute intentional misconduct or a knowing violation of law;
(e) with respect to authorization by the Director of the unlawful
payment of a dividend or other distribution on the Corporation's capital stock
or the unlawful purchase of its capital stock;
(f) with respect to any transaction from which the Director derived
an improper personal benefit; or
(g) if a final decision by a court having jurisdiction in the
matter shall determine that such indemnification is not lawful.
6. Notification and Defense of Claim. Promptly after receipt by
the Director of notice of the commencement of any action, suit or proceeding,
the Director will, if a claim in respect thereof is to be made against the
Corporation under this Agreement, notify the Corporation of the commencement
thereof; but the omission so to notify the Corporation will not relieve it
from any liability which it may have to the Director otherwise than under this
Agreement or from any liability which is not directly related to the failure
of the Director promptly to so notify the Corporation. With respect to any
such action, suit or proceeding as to which the Director notifies the
Corporation of the commencement thereof:
(a) The Corporation will be entitled to participate therein at its
own expense; and,
(b) Except as otherwise provided below, to the extent that it may
wish, the Corporation jointly with any other indemnifying party similarly
notified will be entitled to assume the defense thereof, with counsel
satisfactory to the Director. After notice from the Corporation to the
Director of its election so to assume the defense thereof, the Corporation
will not be liable to the Director under this Agreement for any legal or other
expenses subsequently incurred by the Director in connection with the defense
thereof other than reasonable costs of investigation or as otherwise provided
below. The Director shall have the right to employ the Director's counsel in
such action, suit or proceeding, but the fees and expenses of such counsel
incurred after notice from the Corporation of its assumption of the defense
thereof shall be at the expense of the Director unless (i) the employment of
counsel by the Director has been authorized by the Corporation (ii) the
Director shall have reasonably concluded that there may be a conflict of
interest between the Corporation and the Director in the conduct of the
defense of such action or (iii) the Corporation shall not in fact have
employed counsel to assume the defense of such action, in each of which cases
the fees and expenses of counsel shall be at the expense of the Corporation.
The Corporation shall not be entitled to continue the defense of any action,
suit or proceeding properly brought by or on behalf of the Corporation or as
to which the Director shall have made the conclusion provided for in (ii)
above.
(c) The Corporation shall not be required to indemnify the Director
under this Agreement for any amounts paid in settlement of any action or claim
effected without its written consent. The Corporation shall not settle any
action or claim in any manner which would impose any penalty or limitation on
the Director without the Director's written consent. Neither the Corporation
nor the Director will unreasonably withhold its or his or her consent to any
proposed settlement.
7. Advance Payments.
(a) The Director shall be entitled to receive advance payments in
the amount of all costs, charges, and expenses, including attorney and other
fees and expenses, actually and reasonably incurred or reasonably to be
incurred by the Director in defense of any action, suit or proceeding as
described in Section 4 hereof.
(b) The Director agrees that the Director will reimburse the
Corporation for all costs, charges and reasonable expenses paid or advanced by
the Corporation in defending any civil, criminal, administrative or
investigative action, suit or proceeding against the Director in the event and
only to the extent that it shall be determined by a court in a final
adjudication from which there is no further right of appeal that the Director
is not entitled to be indemnified by the Corporation for such costs, charges
and expenses under the provisions of this Agreement.
8. Indemnification Request.
1. Advancement.
(a) The Director shall in order to request advanced payments
according to Section 7 hereof, submit to the Board of Directors a sworn
statement of request for advancement of expenses in the form of Exhibit 1
attached hereto and made a part hereof (the "Advancement Request"), stating
that (i) the Director has incurred or will incur actual expenses in defending
an action, suit, or proceeding as described in Section 4 hereof and (ii) the
Director undertakes to repay such amount if it shall be determined by a court
in a final adjudication from which there is no further right of appeal that
the Director is not entitled to be indemnified by the Corporation under this
Agreement.
(b) Upon receipt of the Advancement Request the Chairman of the
Board, the President or any Vice President shall authorize immediate payment
of the expenses stated in the Advancement Request within 10 calendar days,
whereupon such payments shall immediately be made by the Corporation. No
security shall be required in connection with any Advancement Request and it
shall be accepted without reference to the Director's ability to make
repayment.
2. Indemnification.
(a) The Director, in order to request indemnification pursuant to
Section 4 hereof, shall submit to the Board of Directors a sworn statement of
request for indemnification in the form of Exhibit 2 attached hereto and made
a part hereof (the "Indemnification Request") stating that the Director is
entitled to indemnification under this Agreement. Such Indemnification
Request shall contain a summary of the action, suit or proceeding and an
itemized list of all payments made or to be made with respect to which
indemnification is requested.
(b) The Board of Directors shall be deemed to have determined that
the Director is entitled to such indemnification unless, within 30 days
after submission of the Indemnification Request, the Board of Directors shall
have notified the Director in writing that it has determined, by a majority
vote of directors who were not parties to such action, suit or proceeding
("Disinterested Directors"), based upon clear and convincing evidence, that
the Director is not entitled to indemnification under this Agreement. The
evidence shall be disclosed to the Director in such notice which shall be
sworn to by all directors who participated in the determination and voted to
deny indemnification.
(c) In the event that (i) there are not sufficient Disinterested
Directors to cast a majority vote or (ii) there is a Change in Control (as
defined in The Dial Corporation 1996 Stock Incentive Plan) of the Corporation
(other than a Change in Control which has been approved by members of the
Board of Directors who were directors prior to such Change in Control), the
following procedure shall take place:
(aa) The Director shall choose subject to Corporation approval (which
approval shall not be unreasonably withheld) counsel who has not performed any
services for the Corporation or the Director within the last five years and
who is in good standing ("Independent Legal Counsel").
(bb) Independent Legal Counsel shall then determine within (i) thirty
(30) days after submission of the Indemnification Request, or (ii) thirty (30)
days after the appointment of the Independent Counsel to act as such, or (iii)
such reasonable time as is required under the circumstances, whichever comes
latest, whether the Director is entitled to indemnification under this
Agreement. Indemnification may only be denied according to Section 5 hereof
and only based upon clear and convincing evidence. In the case of a denial,
Independent Legal Counsel shall submit to the Board of Directors and to the
Director within 10 days after the decision a written opinion disclosing the
grounds and the evidence upon which such decision was based. The decision of
Independent Legal Counsel shall be final.
(d) The termination of any action, suit or proceeding by judgment,
order, settlement or conviction, or upon a plea of no contest or its
equivalent, shall not, of itself, create a presumption that the Director's
conduct was such that indemnity is not available pursuant to Section 5.
9. Continuation of Indemnity. All agreements and obligations of
the Corporation contained herein shall continue during the period the Director
is a director of the Corporation (including service at the request of the
Corporation as a director of another corporation, partnership, joint venture,
trust or other enterprise) and shall continue thereafter so long as the
Director shall be subject to any possible claim or threatened, pending or
completed action, suit or proceeding, whether civil, criminal, administrative
or investigative, by reason of the fact that the Director was a director of
the Corporation or serving in any other capacity referred to herein.
10. Enforcement.
(a) The Corporation expressly confirms and agrees that it has
entered into this Agreement and assumes the obligations imposed on the
Corporation hereby in order to induce the Director to serve or continue to
serve as a director of the Corporation, and acknowledges that the Director is
relying upon this Agreement in continuing in such capacity.
(b) In the event the Director is required to bring any action to
enforce rights or to collect moneys due under this Agreement and is successful
in such action, the Corporation shall reimburse the Director for all of the
Director's reasonable fees and expenses in bringing and pursuing such action.
11. Severability. If any provision of this Agreement or the
application of any provision hereof to any person or circumstance is held
invalid, unenforceable or otherwise illegal, the remainder of this Agreement
and the application of such provision to other persons or circumstances shall
not be affected, and the provision so held to be invalid, unenforceable or
otherwise illegal shall be reformed to the extent (and only to the extent)
necessary to make it enforceable, valid and legal.
12. Governing Law; Binding Effect; Amendment and Termination.
(a) This Agreement shall be interpreted and enforced in accordance
with the laws of the State of Delaware.
(b) This Agreement shall be binding upon the Director and upon the
Corporation, its successors and assigns (including any transferee of all or
substantially all of its assets and any successor by merger or otherwise by
operation of law), and shall inure to the benefit of the Director, the
Director's heirs, personal representatives and assigns and to the benefit of
the Corporation, its successors and assigns.
(c) No amendment, modification, termination or cancellation of this
Agreement shall be effective unless in writing signed by both parties hereto.
13. Consent to Jurisdiction. The Corporation and the Director
each hereby irrevocably consent to the jurisdiction of the courts of the State
of Delaware for all purposes in connection with any action or proceeding which
arises out of or relates to this Agreement and agree that any action
instituted under this Agreement shall be brought only in the state courts of
the State of Delaware.
14. Rights Not Exclusive. The rights provided hereunder shall
not be deemed exclusive of any other rights to which the Director may be
entitled under any bylaw, agreement, vote of stockholders or of disinterested
directors or otherwise, both as to action in his official capacity and as to
action in any other capacity by holding such office, and shall continue after
the Director ceases to serve the Corporation as a member of the Corporation's
Board of Directors.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above written.
THE DIAL CORPORATION
By
Name:
Title:
Director
<PAGE>
Exhibit 1
Advancement Request
State of )
)
County of )
I,, being first duly sworn, do depose and say as follows:
1. This Advancement Request is submitted pursuant to the
Indemnification Agreement, dated as of August 15, 1996 ("Indemnification
Agreement"), between The Dial Corporation (the "Corporation"), a Delaware
corporation, and the undersigned.
2. I am requesting advancement of certain costs, charges and
expenses which I have incurred or will incur in defending a civil, criminal,
administrative or investigative action, suit, proceeding or claim as described
below.
3. I hereby undertake to repay amounts advanced by the Corporation
if it shall be determined by a court in a final adjudication from which there
is no further right of appeal that I am not entitled to be indemnified by the
Corporation under the aforesaid Indemnification Agreement.
4. The costs, charges and expenses for which advance is requested
have been or will be incurred as follows (summarize proceeding and itemize
expenses):
Director
Subscribed and sworn to before me, a Notary Public in and for said
County and State, this day of, 19.
(Seal)
My commission expires the day of, 19.
<PAGE>
Exhibit 2
Indemnification Request
State of )
)
County of )
I,, being first duly sworn, do depose and say as follows:
1. This Indemnification Request is submitted pursuant to the
Indemnification Agreement, dated August 15, 1996 ("Indemnification
Agreement"), between The Dial Corporation (the "Corporation"), a Delaware
corporation, and the undersigned.
2. I am requesting indemnification against charges, costs, expenses
(including attorneys' fees and expenses), judgments, fines and amounts paid in
settlement, all of which (collectively, "Liabilities") have been incurred by
me in connection with any action, suit, proceeding or claim to which I was a
party.
3. With respect to all matters related to such action, suit,
proceeding or claim, I am entitled to be indemnified pursuant to the aforesaid
Indemnification Agreement.
4. Without limiting any other rights which I have or may have, I am
requesting indemnification against Liabilities which have arisen as follows
(describe proceedings and itemize Liabilities):
Director
Subscribed and sworn to before me, a Notary Public in and for said
County and State, this day of, 19.
(Seal)
My commission expires the day of, 19.
INDEMNIFICATION AGREEMENT
(Officer)
This Indemnification Agreement ("Agreement") is made as of the 15th
day of August, 1996, by and between The Dial Corporation (the "Corporation"),
a Delaware corporation, and _______________, an Officer of the Corporation
(the "Officer").
Recitals
A. The Officer has been elected to serve as an officer of the
Corporation and the Corporation desires the Officer to continue in such
capacity.
B. In addition to the indemnification to which the Officer is
entitled under the Restated Certificate of Incorporation of the Corporation
(the "Charter") and the Bylaws of the Corporation (the "Bylaws"), the
Corporation at its sole expense maintains insurance protecting its officers
and directors against certain losses arising out of actual or threatened
actions, suits or proceedings to which such persons may be made or threatened
to be made parties ("D & O Insurance"). However, the Corporation and the
Officer cannot be sure that insurance coverage will continue to be available
in the future or, if available, that it will not be unreasonably expensive to
purchase and maintain.
C. The Charter, the Bylaws and the Delaware General Corporation Law
specifically provide that they are not exclusive, and thereby contemplate that
contracts may be entered into between the Corporation and its officers with
respect to indemnification of such officers.
Agreement
In order to induce the Officer to continue to serve in the Officer's
capacity as an officer and in consideration of the Officer's valuable services
for the Corporation, the Corporation and the Officer agree as follows:
1. Continued Service. The Officer will continue to serve at the
will of the Corporation, or in accordance with separate contract to the extent
that such a contract is in effect at the time in question, as an officer of
the Corporation so long as the Officer is duly elected and qualified in
accordance with the Charter and the Bylaws or until the Officer resigns in
accordance with applicable law.
2. Indemnity of Officer. The Corporation shall hold harmless and
indemnify the Officer to the fullest extent authorized or permitted by the
provisions of the Delaware General Corporation Law or by any amendment thereof
or other statutory provisions authorizing or permitting such indemnification
which is adopted after the date hereof.
3. Maintenance of Insurance and Self Insurance.
(a) Subject only to the provisions of Section 3(b) hereof, so long
as the Officer shall continue to serve as an officer of the Corporation (or
shall continue at the request of the Corporation to serve as a director or
officer of another corporation, partnership, joint venture, trust or other
enterprise) and thereafter so long as the Officer shall be subject to any
possible claim or threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative by reason of the fact
that the Officer was an officer or director of the Corporation or served in
any of said other capacities, the Corporation will purchase and maintain in
effect for the benefit of the Officer one or more valid, binding and
enforceable policies of D & O Insurance providing, in all respects, coverage
at least comparable to that presently provided.
(b) The Corporation shall not be required to maintain said policies
of D & O Insurance in effect if said insurance is not reasonably available or
if, in the reasonable business judgment of the then directors of the
Corporation, either (i) the premium cost for such insurance is substantially
disproportionate to the amount of coverage or (ii) the coverage provided by
such insurance is so limited by exclusions that there is insufficient benefit
from such insurance.
(c) In the event the Corporation does not purchase and maintain in
effect said policies of D & O Insurance pursuant to the provisions of Section
3(b) hereof, the Corporation shall hold harmless and indemnify the Officer to
the full extent of the coverage which would otherwise have been provided for
the benefit of the Officer pursuant to such D & O Insurance.
4. Additional Indemnity. Subject only to the exclusions set
forth in Section 5 hereof, and without limiting any right which the Officer
may have now or in the future pursuant to the Delaware General Corporation
Law, the Charter, the Bylaws, any other agreement, any resolution, any policy
of insurance or otherwise, the Corporation hereby further agrees to hold
harmless and indemnify the Officer:
Against any and all expenses (including attorneys' fees), judgments,
fines and amounts paid in settlement actually and reasonably incurred by the
Officer in connection with any threatened, pending or completed action, suit
or proceeding, whether civil, criminal, administrative or investigative,
whether by third parties or by or in the right of the Corporation to which the
Officer at any time becomes a party, or is threatened to be made a party, by
reason of the fact that the Officer is or was an officer or director of the
Corporation, or is or was serving or at any time serves at the request of the
Corporation as an officer or director of another corporation, partnership,
joint venture, trust or other enterprise.
5. Limitations on Additional Indemnity. No indemnity pursuant to
Section 4 hereof shall be paid by the Corporation:
(a) for which and to the extent that payment is actually made to
the Officer under a valid and collectible insurance policy;
(b) for which and to the extent that the Officer is indemnified or
receives a recovery otherwise than pursuant to Section 4;
(c) on account of any suit in which judgment is rendered against
the Officer for an accounting of profits made from the purchase or sale by the
Officer of securities of the Corporation pursuant to the provisions of Section
16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar
provisions of any federal, state or local statutory law;
(d) with respect to acts or omissions which are not in good faith
or which constitute intentional misconduct or a knowing violation of law;
(e) with respect to authorization by the Officer as a director of
the Corporation of the unlawful payment of a dividend or other distribution on
the Corporation's capital stock or the unlawful purchase of its capital stock;
(f) with respect to any transaction from which the Officer derived
an improper personal benefit; or
(g) if a final decision by a court having jurisdiction in the
matter shall determine that such indemnification is not lawful.
6. Notification and Defense of Claim. Promptly after receipt by
the Officer of notice of the commencement of any action, suit or proceeding,
the Officer will, if a claim in respect thereof is to be made against the
Corporation under this Agreement, notify the Corporation of the commencement
thereof; but the omission so to notify the Corporation will not relieve it
from any liability which it may have to the Officer otherwise than under this
Agreement or from any liability which is not directly related to the failure
of the Officer promptly to so notify the Corporation. With respect to any
such action, suit or proceeding as to which the Officer notifies the
Corporation of the commencement thereof:
(a) The Corporation will be entitled to participate therein at its
own expense; and,
(b) Except as otherwise provided below, to the extent that it may
wish, the Corporation jointly with any other indemnifying party similarly
notified will be entitled to assume the defense thereof, with counsel
satisfactory to the Officer. After notice from the Corporation to the Officer
of its election so to assume the defense thereof, the Corporation will not be
liable to the Officer under this Agreement for any legal or other expenses
subsequently incurred by the Officer in connection with the defense thereof
other than reasonable costs of investigation or as otherwise provided below.
The Officer shall have the right to employ the Officer's counsel in such
action, suit or proceeding, but the fees and expenses of such counsel incurred
after notice from the Corporation of its assumption of the defense thereof
shall be at the expense of the Officer unless (i) the employment of counsel by
the Officer has been authorized by the Corporation (ii) the Officer shall have
reasonably concluded that there may be a conflict of interest between the
Corporation and the Officer in the conduct of the defense of such action or
(iii) the Corporation shall not in fact have employed counsel to assume the
defense of such action, in each of which cases the fees and expenses of
counsel shall be at the expense of the Corporation. The Corporation shall not
be entitled to continue the defense of any action, suit or proceeding properly
brought by or on behalf of the Corporation or as to which the Officer shall
have made the conclusion provided for in (ii) above.
(c) The Corporation shall not be required to indemnify the Officer
under this Agreement for any amounts paid in settlement of any action or claim
effected without its written consent. The Corporation shall not settle any
action or claim in any manner which would impose any penalty or limitation on
the Officer without the Officer's written consent. Neither the Corporation
nor the Officer will unreasonably withhold its or his or her consent to any
proposed settlement.
7. Advance Payments.
(a) The Officer shall be entitled to receive advance payments in
the amount of all costs, charges, and expenses, including attorney and other
fees and expenses, actually and reasonably incurred or reasonably to be
incurred by the Officer in defense of any action, suit or proceeding as
described in Section 4 hereof.
(b) The Officer agrees that the Officer will reimburse the
Corporation for all costs, charges and reasonable expenses paid or advanced by
the Corporation in defending any civil, criminal, administrative or
investigative action, suit or proceeding against the Officer in the event and
only to the extent that it shall be determined by a court in a final
adjudication from which there is no further right of appeal that the Officer
is not entitled to be indemnified by the Corporation for such costs, charges
and expenses under the provisions of this Agreement.
8. Indemnification Request.
1. Advancement.
(a) The Officer shall in order to request advanced payments
according to Section 7 hereof, submit to the Board of Directors a sworn
statement of request for advancement of expenses in the form of Exhibit 1
attached hereto and made a part hereof (the "Advancement Request"), stating
that (i) the Officer has incurred or will incur actual expenses in defending
an action, suit, or proceeding as described in Section 4 hereof and (ii) the
Officer undertakes to repay such amount if it shall be determined by a court
in a final adjudication from which there is no further right of appeal that
the Officer is not entitled to be indemnified by the Corporation under this
Agreement.
(b) Upon receipt of the Advancement Request the Chairman of the
Board, the President or any Vice President shall authorize immediate payment
of the expenses stated in the Advancement Request within 10 calendar days,
whereupon such payments shall immediately be made by the Corporation. No
security shall be required in connection with any Advancement Request and it
shall be accepted without reference to the Officer's ability to make
repayment.
2. Indemnification.
(a) The Officer, in order to request indemnification pursuant to
Section 4 hereof, shall submit to the Board of Directors a sworn statement of
request for indemnification in the form of Exhibit 2 attached hereto and made
a part hereof (the "Indemnification Request") stating that the Officer is
entitled to indemnification under this Agreement. Such Indemnification
Request shall contain a summary of the action, suit or proceeding and an
itemized list of all payments made or to be made with respect to which
indemnification is requested.
(b) The Board of Directors shall be deemed to have determined that
the Officer is entitled to such indemnification unless, within 30 days after
submission of the Indemnification Request, the Board of Directors shall have
notified the Officer in writing that it has determined, by a majority vote of
directors who were not parties to such action, suit or proceeding
("Disinterested Directors") based upon clear and convincing evidence, that the
Officer is not entitled to indemnification under this Agreement. The evidence
shall be disclosed to the Officer in such notice which shall be sworn to by
all directors who participated in the determination and voted to deny
indemnification.
(c) In the event that (i) there are not sufficient Disinterested
Directors to cast a majority vote or (ii) there is a Change in Control (as
defined in The Dial Corporation 1996 Stock Incentive Plan) of the Corporation
(other than a Change in Control which has been approved by members of the
Board of Directors who were directors prior to such Change in Control), the
following procedure shall take place:
(aa) The Officer shall choose subject to Corporation approval (which
approval shall not be unreasonably withheld) counsel who has not performed any
services for the Corporation or the Officer within the last five years and who
is in good standing ("Independent Legal Counsel").
(bb) Independent Legal Counsel shall then determine within (i) thirty
(30) days after submission of the Indemnification Request, or (ii) thirty (30)
days after the appointment of the Independent Counsel to act as such, or (iii)
such reasonable time as is required under the circumstances, whichever comes
latest, whether the Officer is entitled to indemnification under this
Agreement. Indemnification may only be denied according to Section 5 hereof
and only based upon clear and convincing evidence. In the case of a denial,
Independent Legal Counsel shall submit to the Board of Directors and to the
Officer within 10 days after the decision a written opinion disclosing the
grounds and the evidence upon which such decision was based. The decision of
Independent Legal Counsel shall be final.
(d) The termination of any action, suit or proceeding by judgment,
order, settlement or conviction, or upon a plea of no contest or its
equivalent, shall not, of itself, create a presumption that the Officer's
conduct was such that indemnity is not available pursuant to Section 5.
9. Continuation of Indemnity. All agreements and obligations of
the Corporation contained herein shall continue during the period the Officer
is an officer of the Corporation (including service at the request of the
Corporation as an officer or director of another corporation, partnership,
joint venture, trust or other enterprise) and shall continue thereafter so
long as the Officer shall be subject to any possible claim or threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative, by reason of the fact that the Officer was an
officer or director of the Corporation or serving in any other capacity
referred to herein.
10. Enforcement.
(a) The Corporation expressly confirms and agrees that it has
entered into this Agreement and assumes the obligations imposed on the
Corporation hereby in order to induce the Officer to serve or continue to
serve as an officer of the Corporation, and acknowledges that the Officer is
relying upon this Agreement in continuing in such capacity.
(b) In the event the Officer is required to bring any action to
enforce rights or to collect moneys due under this Agreement and is successful
in such action, the Corporation shall reimburse the Officer for all of the
Officer's reasonable fees and expenses in bringing and pursuing such action.
11. Severability. If any provision of this Agreement or the
application of any provision hereof to any person or circumstance is held
invalid, unenforceable or otherwise illegal, the remainder of this Agreement
and the application of such provision to other persons or circumstances shall
not be affected, and the provision so held to be invalid, unenforceable or
otherwise illegal shall be reformed to the extent (and only to the extent)
necessary to make it enforceable, valid and legal.
12. Governing Law; Binding Effect; Amendment and Termination.
(a) This Agreement shall be interpreted and enforced in accordance
with the laws of the State of Delaware.
(b) This Agreement shall be binding upon the Officer and upon the
Corporation, its successors and assigns (including any transferee of all or
substantially all of its assets and any successor by merger or otherwise by
operation of law), and shall inure to the benefit of the Officer, the
Officer's heirs, personal representatives and assigns and to the benefit of
the Corporation, its successors and assigns.
(c) No amendment, modification, termination or cancellation of this
Agreement shall be effective unless in writing signed by both parties hereto.
13. Consent to Jurisdiction. The Corporation and the Officer
each hereby irrevocably consent to the jurisdiction of the courts of the State
of Delaware for all purposes in connection with any action or proceeding which
arises out of or relates to this Agreement and agree that any action
instituted under this Agreement shall be brought only in the state courts of
the State of Delaware.
14. Rights Not Exclusive. The rights provided hereunder shall
not be deemed exclusive of any other rights to which the Officer may be
entitled under any bylaw, agreement, vote of stockholders or of disinterested
directors or otherwise, both as to action in his official capacity and as to
action in any other capacity by holding such office, and shall continue after
the Officer ceases to serve the Corporation as an officer or director.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first above written.
THE DIAL CORPORATION
By
Name:
Title:
Officer
<PAGE>
Exhibit 1
Advancement Request
State of )
)
County of )
I,, being first duly sworn, do depose and say as follows:
1. This Advancement Request is submitted pursuant to the
Indemnification Agreement, dated as of August 15, 1996 ("Indemnification
Agreement"), between The Dial Corporation (the "Corporation"), a Delaware
corporation, and the undersigned.
2. I am requesting advancement of certain costs, charges and
expenses which I have incurred or will incur in defending a civil, criminal,
administrative or investigative action, suit, proceeding or claim as described
below.
3. I hereby undertake to repay amounts advanced by the Corporation
if it shall be determined by a court in a final adjudication from which there
is no further right of appeal that I am not entitled to be indemnified by the
Corporation under the aforesaid Indemnification Agreement.
4. The costs, charges and expenses for which advance is requested
have been or will be incurred as follows (summarize proceeding and itemize
expenses):
Officer
Subscribed and sworn to before me, a Notary Public in and for said
County and State, this day of, 19.
(Seal)
My commission expires the day of, 19.
<PAGE>
Exhibit 2
Indemnification Request
State of )
)
County of )
I,, being first duly sworn, do depose and say as follows:
1. This Indemnification Request is submitted pursuant to the
Indemnification Agreement, dated August 15, 1996 ("Indemnification
Agreement"), between The Dial Corporation (the "Corporation"), a Delaware
corporation, and the undersigned.
2. I am requesting indemnification against charges, costs, expenses
(including attorneys' fees and expenses), judgments, fines and amounts paid in
settlement, all of which (collectively, "Liabilities") have been incurred by
me in connection with any action, suit, proceeding or claim to which I was a
party.
3. With respect to all matters related to such action, suit,
proceeding or claim, I am entitled to be indemnified pursuant to the aforesaid
Indemnification Agreement.
4. Without limiting any other rights which I have or may have, I am
requesting indemnification against Liabilities which have arisen as follows
(describe proceedings and itemize Liabilities):
Officer
Subscribed and sworn to before me, a Notary Public in and for said
County and State, this day of, 19.
(Seal)
My commission expires the day of, 19.
THE DIAL CORPORATION
SUPPLEMENTAL CAPITAL ACCUMULATION PLAN
(Effective August 15, 1996)
1. Purpose of the Plan
The purpose of The Dial Corporation Supplemental Capital Accumulation
Plan (the Plan) is to provide a select group of management or highly
compensated employees who are officers and key employees of The Dial
Corporation (the Company) and its subsidiaries with an opportunity to
accumulate pre-tax savings for retirement.
Pursuant to the terms and provisions of the Distribution Agreement entered
into between the Company, ViadCorp (formerly The Dial Corp) ("Viad") and
Exhibitgroup/Giltspur Inc., the Company has assumed all liabilities and
obligations in connection with any claims under The Dial Corp Supplemental
TRIM Plan (the "Prior Plan") in respect of any individuals classified as
"Consumer Products Individuals" pursuant to the Distribution Agreement and
Viad has been relieved of any such liabilities or obligations. In
satisfaction of this obligation, the account balances of Consumer Products
Individuals who formerly participated in the Prior Plan are being credited to
said individuals under this Plan, all as provided in Section 6(a)(i). Each
Consumer Products Individual who participated in the Prior Plan would be
deemed to be a "participant" in this Plan.
2. Administration of the Plan
The Plan shall be administered by The Dial Corporation Supplemental
Capital Accumulation Plan Committee (the Committee) the members of which shall
be appointed by the Chief Executive Officer of the Company. Subject to the
express provisions of the Plan, the Committee shall have the authority to
adopt, amend and rescind such rules and regulations, and to make such
determinations and interpretations relating to the Plan, which it deems
necessary or advisable for the administration of the Plan, but it shall not
have the power to amend, suspend or terminate the Plan. All such rules,
regulations, determinations and interpretations shall be conclusive and
binding on all parties.
3. Participation in the Plan
(a) Participation in the Plan shall be restricted to those officers
and key employees of the Company and its subsidiaries whose pre-tax, elective
deferrals to The Dial Corporation Capital Accumulation Plan (hereinafter
referred to as the "Qualified Plan") are actually limited by the elective
deferral limitations contained in Section 402 of the Internal Revenue Code to
the extent such deferrals do not reach the maximum employer-matchable
percentage of their base salary under the Qualified Plan and whose timely
written requests to defer the receipt of compensation, which may be owed to
them for services rendered, are honored in whole or in part by the Committee,
in its sole discretion. The Committee may, in its discretion, offer to any
employee who is part of the select group of management or highly compensated
employees who does not meet the requirements of the preceding sentence, the
opportunity to participate in the Plan. A written request for deferral under
paragraph 4 shall not be timely in any event unless it is duly submitted to
the Committee before the services to which the base salary to be deferred is
related have been rendered. No deferral of compensation need be made by a
participant in the Plan as a condition to entitlement to the benefit described
in paragraph 6(a)(iii).
(b) If a participant in the Plan shall (1) sever his or her
employment with the Company or one of its subsidiaries during or following
such employment, (2) engage in any activity in competition with the Company or
any of its subsidiaries during or following such employment, or (3) remain in
the employ of a corporation which for any reason ceases to be a subsidiary of
the Company, his or her participation in the Plan shall automatically
terminate, and the Committee may direct, in its sole discretion, that he or
she be paid in a lump sum the aggregate amount credited to his or her deferred
compensation account as of the date his or her employment is severed or the
Committee determines that he or she has engaged in such competitive activity
or that his or her employer is no longer a subsidiary of the Company.
4. Requests for Deferral
All requests for deferral of compensation must be made in writing 30 days
prior to the beginning of each quarter and shall be in such form and shall
contain such terms and conditions as the Committee may determine. Each such
request shall specify the percentage or dollar amount of base salary, if any,
to be deferred, but in no event shall the amount to be deferred in a Plan year
be greater than the lesser of (i) $30,000 less the total amount of all
contributions of whatever nature, to the participant's Qualified Plan account
during the same time period, and (ii) 12% of the participant's base salary in
the Plan year. Each such request shall also specify (1) the date when payment
of the aggregate amount credited to the deferred compensation account is to
commence (which shall not be earlier than age 55 nor later than the actual
retirement date) and (2) whether such payment is then to be made in a lump sum
or in quarterly or annual installments, and the period of time (not in excess
of ten years) over which the installments are to be paid. The Committee shall
not, under any circumstances, accept any request for deferral greater than the
limits defined above, or any request which is not in writing or which is not
timely submitted.
5. Deferral of Compensation
The Committee shall notify each individual who has submitted a request
for deferral of compensation whether or not such request has been accepted and
honored. If the request has been honored in whole or in part, the Committee
shall advise the participant of the percentage of his or her compensation
which the Committee has determined to be deferred. The Committee shall
further advise the participant of its determination as to the date when
payment of the aggregate amount credited to the participant's deferred
compensation account is to commence, whether payment of the amount so credited
as of that date will then be made in a lump sum or in quarterly or annual
installments, and if payment is to be made in installments, the period of time
over which the installments will be paid. Upon subsequently being advised of
the existence of special circumstances which are beyond the participant's
control and which impose a severe financial hardship on the participant or his
or her beneficiary, the Committee may, in its sole and exclusive discretion,
modify the deferral arrangement established for that participant to the extent
necessary to remedy such financial hardship.
6. Deferred Compensation Account
(a) A deferred compensation account shall be maintained for each
participant of this Plan by his or her employer. The employer shall credit to
each participant's account the following amounts, as appropriate:
(i) The account balance of the participant in the Prior Plan as
of the effective date of this Plan, which account balance shall first be
adjusted on the same basis as if the effective date of this Plan
were the first day of a calendar quarter;
(ii) The deferral duly elected under this Plan on the date the participant
would have received such deferral as base salary;
(iii) Based on the provision of the Qualified Plan in effect at the time,
an amount with respect to the deferrals in (ii), above, calculated on the same
basis as the employer's then current matching contribution on elective
deferrals under the Qualified Plan on the first day of each quarter. In no
event shall this amount exceed the maximum amount of matching contributions
which would be available, assuming the participant elects the maximum
deferrals allowed under the Qualified Plan and the limitations on elective
deferrals contained in Code Section 402 do not apply, less the amount of
actual matching contributions made by the employer to the participant's
Qualified Plan account, if any, for the same period;
(iv) Based on the provisions of the Qualified Plan in effect at the time,
and not withstanding the amount, if any, of deferrals in (ii) above, an amount
equal to the employer matching contributions which would have been made to the
participant's Qualified Plan account based on the amount of elective deferrals
actually made by said participant to the Qualified Plan, but for the
application of Code Section 401(a)(17) or any other similar law on the first
day of each quarter; and
(v) Interest on the participant account balance at a per annum rate equal
to the yield as of January 1, April 1, July 1, and October 1 on Merrill Lynch
Taxable Bond Index--Long Term Medium Quality (A3) Industrial Bonds or such
other rate the Committee may determine in its sole discretion, credited
quarterly prior to the termination of the participant's deferral period, or if
the deferred compensation account is to be paid in installments, prior to the
termination of such installment period.
(b) The Company or employer, as the case may be, shall not be
required to physically segregate any amounts of money or property or otherwise
provide for funding of any amounts credited to the deferred compensation
accounts of participants in the Plan. Participants have no claim, interest or
right to any particular funds or property that the Company or any employer may
choose to reserve or otherwise use to provide for its liabilities under this
Plan and the participants of this Plan shall have the rights of general
creditor only with respect to their interests in the Plan.
7. Designation of Beneficiary
Each participant in the Plan shall deliver to the Committee a written
instrument, in the form provided by the Committee, designating one or more
beneficiaries to whom payment of the amount credited to his or her deferred
compensation account shall be made in the event of his or her death. Unless
the Committee shall otherwise determine, such payments shall be made in such
amounts and at such times as they would otherwise have been paid to the
participant if he had survived.
8. Nonassignability of Participant Rights
No right, interest or benefit under the Plan shall be assignable or
transferable under any circumstances other than to a participant's designated
beneficiary in the event of his or her death, nor shall any such right,
interest or benefit be subject to or liable for any debt, obligation,
liability or default of any participant. In the event of any attempt to
assign or transfer any right, interest or benefit under the Plan, or to
subject any such right, interest or benefit to a debt, obligation, liability
or default of a participant, his or her participation in the Plan shall
terminate on the date such an attempt is made, and he or she shall be paid in
a lump sum the aggregate amount credited to his or her deferred compensation
account as of that date.
9. Rights of Participants
A participant in the Plan shall have only those rights, interest or
benefits as are expressly provided in the Plan. This Plan does not create for
any employee or participant any right to be retained in service by Company or
any other employer nor affect the right of any such Company or any such
employer to discharge any employee or participant from employment.
10. Amendment, Suspension or Termination of the Plan
(a) The Board of Directors of the Company (the Board) may from time
to time amend, suspend or terminate the Plan, in whole or in part, and if the
Plan is suspended or terminated, the Board may reinstate any or all provisions
of the Plan, except that no amendment, suspension or termination of the Plan
shall, without consent of a participant, adversely affect such participant's
right to receive payment of the entire amount credited to his or her deferred
compensation account on the date of such Board action. In the event the Plan
is suspended or terminated, the Board may, in its discretion, direct the
Committee to pay to each participant the amount credited to his or her account
either in a lump sum or in accordance with the Committee's prior determination
regarding the method of payment.
(b) Any action by The Dial Corporation under the Plan may be by
resolution of its Board of Directors, or by any person or persons duly
authorized by resolution of said Board to take such action.
11. Effective Date
The Plan shall become effective on August 15, 1996. The Plan year is
January 1, to December 31.
12. Claim for Benefits
Claims for benefits under this Plan shall be filed with any member of
the Committee. Written notice of the disposition of a claim shall be
furnished the claimant within sixty (60) days after the application therefor
is filed. In the event the claim is denied, the reasons for the denial shall
be specifically set forth. Pertinent provisions of the Plan shall be cited.
In addition, the written notice shall describe any additional material or
information necessary for the claimant to perfect the claim (along with an
explanation of why such material or information is needed), and the written
notice will fully describe the claim review procedures of Section 13, below.
In any event, if a claim is not determined within sixty (60) days after
submission, it shall be deemed denied, and the claimant may proceed under
Section 13, below.
<PAGE>
13. Claim Review
Any claimant who has been denied a benefit shall be entitled, upon a
request to the Committee, to receive a written notice of such action, together
with a full and clear statement of the reasons for the action. The claimant
may also review this Plan if he or she chooses. If the claimant wishes
further consideration of his or her position, he or she may request a hearing.
The request, together with a written statement of the claimant's position,
shall be filed with a member of the Committee no later than sixty (60) days
after receipt of the written notification provided for above. The Committee
shall schedule an opportunity for a full and fair hearing of the issues within
the next sixty (60) days. The decision following the hearing shall be
communicated in writing to the claimant. If the claimant requests, the
hearing may be waived, in which case the Committee's decision shall be made
within sixty (60) days from the date on which the hearing is waived and shall
be communicated in writing to the claimant.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by
its duly authorized representatives on this ___________ day of ________, 1996.
THE DIAL CORPORATION
By:_____________________
Its:____________________
THE DIAL CORPORATION SUPPLEMENTAL PENSION PLAN
1. PURPOSE
The purpose of The Dial Corporation Supplemental Pension Plan
(hereinafter referred to as the "Plan") is to provide deferred compensation to
Eligible Employees (as defined in paragraph 2) on and after August 15, 1996.
It is the intention of The Dial Corporation (hereinafter called the "Company")
that Eligible Employees are those employees designated by the Company, or the
Chief Executive Officer of the Company, pursuant to paragraph 2, from a select
group of management or highly-compensated employees of the Company, or any
of its subsidiaries or affiliates (hereinafter referred to as "Subsidiaries")
and that the Plan continue to be eligible for exemptions under Parts 1, 2, 3
and 4 of Title 1 of ERISA and the U.S. Department of Labor regulations. It
also is the intention of the Company that the Plan be unfunded, that any
Eligible Employee's rights under the Plan are those of a general creditor
only, and that there be no elections with respect to any benefits under the
plan by Eligible Employees. Subject to rights and benefits expressly fixed by
the terms hereof, the Company also intends that the Plan may be amended or
terminated and that benefits may be reduced or eliminated as the Board of
Directors of the Company determines from time to time and that individuals'
rights may be altered.
Pursuant to the terms and provisions of a Distribution Agreement between the
Company, ViadCorp (formerly The Dial Corp) ("Viad") and Exhibitgroup/Giltspur
Inc., the Company is obligated to assume all liabilities and obligations
whatsoever in connection with claims under The Dial Corp Supplemental Pension
Plan (the "Prior Plan") in respect of any individual who is classified as a
"Consumer Products Individual" pursuant to the terms and provisions of the
Distribution Agreement and Viad ceases to have any such liability or
obligation. In order to effectuate the terms and provisions of the
Distribution Agreement, each Consumer Products Individual (as such term is
defined in the Distribution Agreement) shall be entitled to receive a benefit
from this Plan in the amount that such individual was entitled to receive from
the Prior Plan. In addition, each Consumer Products Individual shall be
granted credit under this Plan for the term of service and benefits credited
to such Individual, as of August 15, 1996, under the Prior Plan as if such
service had been rendered to the Company and as if such benefit had originally
been credited to such Individual under this Plan.
2. PARTICIPATION
An employee of the Company (or any of its Subsidiaries) may become
eligible to participate in the Plan (referred to herein as "Eligible
Employee") when approved by the Board of Directors of the Company (or a
committee thereof), or by the Chief Executive Officer of the Company, as
specifically designated in each Schedule of Benefits (which is attached
hereto, and by this reference made a part hereof). A list of Eligible
Employees with respect to each Schedule of Benefits is correspondingly
denominated and attached as an exhibit to the Plan (referred to herein as
"Exhibit") and each such Exhibit shall be periodically updated. Participants
in this Plan may also participant in The Dial Corporation Retirement Income
Plan ( hereinafter referred to as the "Qualified Plan").
3. FUNDING
No fund shall be established to provide for payment of benefits under the
Plan. No trust, other than one which will not cause the Plan to be "funded"
under current Internal Revenue Service and U.S. Department of Labor
regulations and rulings, shall be created. Any rights of an Eligible Employee
or any other person claiming by or through him or her shall be those of a
general creditor of the Company only. The Company may create book reserves or
take such other steps as it deems appropriate to provide for its expected
liabilities under the Plan.
4. CATEGORIES OF BENEFIT PAYMENTS TO ELIGIBLE EMPLOYEES
Benefits shall be payable by the Company in accordance with the terms and
conditions of the Plan and as described in each Schedule of Benefits to the
Eligible Employees described in each such Schedule of Benefits and its
corresponding Exhibit.
5. RETIREMENT BENEFIT
Except as otherwise expressly provided in the Plan or in a Schedule of
Benefits, the Plan shall make monthly payments to an Eligible Employee at the
same time such Eligible Employee receives or would be deemed to receive under
any Schedule of Benefits his or her pension benefits under the Qualified Plan
or any other pension plan(s) sponsored by the Company, or any of its
Subsidiaries, (herein, and in any Schedule of Benefits, referred to for the
purposes of the Plan as "the time of his or her retirement"), but in no event
shall monthly payments begin before such Eligible Employee has attained the
age of 55 and has actually left the employ of the Company or its Subsidiaries.
Unless otherwise expressly stated in a Schedule of Benefits, such monthly
payments shall be equal to the amount by which the sum of the monthly pension
benefits payable to the Eligible Employee from the Qualified Plan and any and
all other pension plans qualified under Internal Revenue Code 401 and
sponsored by the Company or any of its Subsidiaries, other than this Plan and
a plan qualified under Internal Revenue Service Code 401(k), (hereinafter
called "Pension Plans"), is less than the aggregate amount(s) determined under
the applicable Schedule(s) of Benefits. In making this determination, the
amount(s) from such Pension Plan(s) shall be determined prior to the election
of any payment options (such as joint and survivor elections). In addition,
when an Eligible Employee is a participant in more than one Pension Plan and
benefits under any one of such Pension Plans are not available immediately on
account of early retirement provisions, then, for the purposes of the Plan,
such benefits shall be taken into account as though payable immediately on an
actuarially equivalent basis, as reasonably determined by the Committee in its
sole discretion.
6. FINAL AVERAGE EARNINGS
Final Average Earnings for purposes of Schedules A and B shall be as
defined in the Qualified Plan plus amounts that were not included in Final
Average Earnings because such amounts were deferred and the average of the
highest five calendar years of Management Incentive Plan (or its successor
Plan) awards (whether paid or deferred) made to him or her while in continuos
service. Any deferrals included in Final Average Earnings by reason hereof
shall only be used once in calculating such Final Average Earnings.
Final Average Earnings for purposes of all other Schedule(s) of Benefits
shall be as defined above, except that the average of the final five years of
Management Incentive Plan awards rather than the average of the highest five
years of awards shall be used in the calculation of Final Average Earnings.
7. OPTIONAL FORMS
If any pension benefit is payable to an Eligible Employee from a Pension
Plan, and an optional form is elected under that Pension Plan, then a similar
election will be deemed made under the Plan. If two or more such pensions are
payable from such other Pension Plans, then the option selected for the
Pension Plan generating the largest monthly pension payment (including the
beneficiary designation in connection with such option and benefits, if
applicable) shall prevail for the purposes of the Plan. Notwithstanding the
forgoing, no lump sum distribution shall occur or be permitted hereunder.
8. LISTING OF ELIGIBLE EMPLOYEES
A listing of Eligible Employees shall be maintained in the form of the
Exhibits to the Plan. Exhibit A shall contain those covered under Schedule A
and so on for B and any additional Schedules. If an employee is incorrectly
included or excluded from an Exhibit, actual entitlement to participation and
benefits under the Plan shall be reasonably determined by The Dial Corporation
Retirement Committee ("Committee") in its sole discretion.
9. SURVIVOR'S BENEFIT
If while covered by this program, for purposes other than a terminated
vested benefit, an Eligible Employee dies and if on the date of his or her
death such Eligible Employee is :
a) Covered under Schedule A and has 10 or more years of service;
b) Covered under Schedule B and has 20 or more years of service ; or
c) 55 years of age or older:
Then his or her Eligible Spouse, as defined in the Qualified Plan, shall be
entitled to a survivor's benefit. This survivor's benefit shall be calculated
by assuming that the Eligible Employee (i) was 55 years of age (or his or her
actual age if older) on the date of death; (ii) retired under the Qualified
Plan and this Plan on the first day of the month following his or her death;
and (iii) elected a Single Life Annuity. The Eligible Spouse will be entitled
to receive 1/2 of the aggregate amount that would have been payable to the
participant under the Pension Plan(s) and this Plan, based on these
assumptions, reduced as provided in the next paragraph and further reduced by
1/6 of 1% for each month the Eligible Spouse is more than 60 months younger
than the Eligible Employee.
The survivor's benefit under this paragraph 9 shall be reduced by any spousal
survivor's benefit payable from any Pension Plan (other than a Section 401(k)
plan) sponsored by the Company when such benefit becomes payable, as
reasonably determined by the Committee in its sole discretion.
10. VESTING
In addition to all the terms and conditions of the Plan, no Eligible
Employee or beneficiary shall be entitled to a benefit under the Plan unless
such Eligible Employee has actually attained fully vested status in the
Qualified Plan or any other pension plan which is which is mentioned in any
Schedule of Benefits covering the Eligible Employee, as reasonably determined
by the Committee in its sole discretion. Notwithstanding any other provision
hereof, any Eligible Employee hereunder who has accumulated five years of
service with the Company and its Subsidiaries taken as a whole, ignoring
breaks in service, shall be fully vested and entitled to benefits hereunder.
11. ADMINISTRATION
The Board of Directors of The Dial Corporation may terminate the Plan
or any Schedule of Benefits at any time. Any amounts vested under the Plan
prior to any such termination shall continue to be subject to the terms,
conditions, and elections in effect under the Plan when the Plan is
terminated. The Plan may be amended at any time or from time to time by the
Board of Directors of the Company. The Company shall have full power and
authority to interpret and administer the Plan, to promulgate rules of Plan
administration, to adopt a claims procedure, to conclusively settle any
disputes as to rights or benefits arising from the Plan, and to make such
decisions or take such actions as the Company, in its sole discretion,
reasonably deems necessary or advisable to aid in the proper administration
and maintenance of the Plan.
12. MISCELLANEOUS
The Plan, and any determination made by the Committee or the Company in
connection therewith, shall be binding upon each Eligible Employee, his or
her beneficiary or beneficiaries, heirs, executors, administrators,
successors, and assigns. Notwithstanding the foregoing sentence, no benefit
under the Plan may be sold, assigned, transferred, conveyed, hypothecated,
encumbered, anticipated or otherwise disposed of, and any attempt to do so
shall be void. No such benefit
payment shall be, prior to actual receipt thereof by the Eligible Employee, or
his or her beneficiary or beneficiaries, as the case may be, in any manner
subject to the debts, contracts, liabilities or engagements of such Eligible
Employee or beneficiary(ies). The Plan shall not constitute, nor be deemed to
constitute, a contract of employment between the Company, or any of its
Subsidiaries, and any Eligible Employee, nor shall any provision hereof
restrict the right of the Company or any of its Subsidiaries to discharge any
Eligible Employee from his or her employment, with or without cause.
IN WITNESS WHEREOF, the Company has caused this Plan to be executed by its
duly authorized representative on this _______ day of _________, 1996
THE DIAL CORPORATION
By:_____________________
Its: ____________________
<PAGE>
SCHEDULE A
The benefits payable under this Schedule of Benefits are in lieu of, not in
addition to, any other benefit provided for in this Plan, it being the intent
of the Company that (i) benefits shall be payable under this Schedule of
Benefits only if it generates the largest monthly benefits when compared to
other benefits to which the Eligible Employee is otherwise entitled under the
Plan, and (ii) benefits payable under this Schedule of Benefits shall be the
only benefits payable to an Eligible Employee under the Plan. The provisions
of this Schedule A shall not be construed to modify or limit the provisions of
any other Schedule of Benefits to the extent such other Schedule of Benefits
deems certain facts to be true for the purposes of the Plan.
Benefits may be payable under this Schedule of Benefits in respect of persons
employed by the Company who are selected by the Board of Directors for
inclusion under this Schedule of Benefits., The amount used to determine the
monthly benefit payable to an Eligible Employee under paragraph 5 of the Plan
is as follows:
A monthly Pension calculated as though the selected person was a member of
The Dial Corporation Retirement Income Plan and based on the rules of that
Plan applicable at the time of his or her retirement, except that the
following Table of retirement benefits expressed as a percentage of Final
Average Earnings shall be used. For purposes of this Schedule of Benefits,
Final Average Earnings shall be as defined in paragraph 6 of the Plan.
<TABLE>
<CAPTION>
Years of % of % of Years of % of % of
Service FAE Soc. Sec. Service FAE Soc. Sec.
<S> <C> <C> <C> <C> <C>
1 3 2.5 11 33 27.5
2 6 5.0 12 36 30.0
3 9 7.5 13 39 32.5
4 12 10.0 14 42 35.0
5 15 12.5 15 45 37.5
6 18 15.0 16 48 40.0
7 21 17.5 17 51 42.5
8 24 20.0 18 54 45.0
9 27 22.5 19 57 47.5
10 30 25.0 20 60 50.0
----
</TABLE>
Notwithstanding the foregoing, as the term Final Average Earnings in The Dial
Corporation Retirement Income Plan includes awards under the Management
Incentive Plan, such awards shall be counted only once for purposes of this
Schedule of Benefits, but on the basis generating the largest Final Average
Earnings.
The benefit derived from this Table of Benefits shall be payable on the later
of the first day of the month following termination of employment or the first
day of the month following the month in which the participant attains age 55.
The benefit shall not be subject to any reduction resulting from the Eligible
Employee's election to retire prior to his or her normal retirement date. If
the Eligible Employee is married on the date of his or her retirement, the
benefit shall be paid in the form of a 50% Joint Survivorship Annuity and
shall not be reduced to reflect such form of payment.
If the Eligible Employee elects any other optional form of payment under The
Dial Corporation Retirement Income Plan then the reduction in such optional
form of benefit shall be based on the unreduced, 50% Joint Survivorship
Annuity benefit.
Eligible Employees under this Schedule are listed on Exhibit A to this Plan.
<PAGE>
SCHEDULE B
Benefits may be payable under this Schedule of Benefits in respect of persons
employed by the Company who are selected by the Chief Executive Officer of the
Company. The amount used to determine the monthly benefit payable to an
Eligible Employee under paragraph 5 of the plan is as follows:
A monthly pension based on the rules of the Qualified Plan for the Eligible
Employee applicable at the time of his or her retirement. For the purposes of
this Schedule of Benefits, Final Average Earnings shall be as defined in
paragraph 6 of the Plan. The Benefit shall not be subject to any reduction
if the Eligible Employee retires coincident with or following his or her 60th
birthday; and shall be subject to a reduction of .25% for each month his or
her retirement precedes his or her 60th birthday. In no event, however, may
an Eligible Employee retire prior to his or her 55th birthday. If the
Eligible Employee is married on the date of his or her retirement, the benefit
shall be paid in the form of a 50% Joint Survivorship Annuity and shall not be
reduced to reflect such form of payment.
If the Eligible Employee elects any other optional form of payment under the
Qualified Plan the reduction in such optional form of benefit shall be based
on unreduced 50% Joint Survivorship Annuity benefit.
Eligible Employees under this Schedule B are listed on Exhibit B to the Plan.
<PAGE>
SCHEDULE C
Employees who participate in the Qualified Plan automatically become Eligible
Employees under this Schedule C if their benefits under the Qualified Plan are
limited by Internal Revenue Code 401(a)(17) or 415. The Company shall
administratively identify Eligible Employees under this Schedule C, based on
the effect of such Internal Revenue Code provisions on the Qualified Plan
benefits, and shall list them on Exhibit C. Notwithstanding, any other
provision in this Plan Exhibit C shall not require separate approval of the
Board of Directors or the Chief Executive Officer.
Coverage of an Eligible Employee under this Schedule C neither requires nor
precludes the Eligible Employee's coverage under another Schedule of Benefits.
However, coverage under this Schedule C also does not provide duplications of
benefits for an Eligible Employee who, in addition to being covered under this
Schedule C, is covered under another Schedule of Benefits. The Company may
determine and communicate an Eligible Employee's aggregate benefit under this
Plan by considering this Schedule C together with any other Schedule of
Benefits that happens to cover the Eligible Employee. Subject to the
foregoing, the amount of benefit attributable to this Schedule C and payable
to an Eligible Employee pursuant to paragraph 5 of the Plan shall be
determined as:
A monthly pension based on the benefit schedule(s) and rules of the Qualified
Plan applicable to the Eligible Employee at the time of his or her retirement.
For purposes of this Schedule of Benefits, Final Average Earnings shall be as
defined in the Qualified Plan (subject to any modifications under paragraph 6
of this Plan, if applicable) with respect to the Eligible Employee, and shall
be determined without regard to the annual limit of $150,000(as adjusted)
that applied under the Qualified Plan pursuant to Internal Revenue Code
401(a)(17). In addition, the pension computed in this manner shall not be
reduced on account of the Internal Revenue Code 415 limitations that apply
under the Qualified Plan.
