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REGISTRATION NO.
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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HOUSEHOLD INTERNATIONAL, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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DELAWARE
(STATE OR OTHER JURISDICTION
OF INCORPORATION OR ORGANIZATION)
36-3121988
(I.R.S. EMPLOYER
IDENTIFICATION NO.)
2700 SANDERS ROAD
PROSPECT HEIGHTS, ILLINOIS 60070
708-564-5000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
PATRICK D. SCHWARTZ, ASSOCIATE GENERAL COUNSEL
HOUSEHOLD INTERNATIONAL, INC.
2700 SANDERS ROAD
PROSPECT HEIGHTS, ILLINOIS 60070
708-564-6301
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
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WITH A COPY TO:
SCOTT N. GIERKE
MCDERMOTT, WILL & EMERY
227 WEST MONROE STREET
CHICAGO, ILLINOIS 60606
312-984-7521
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO PUBLIC: From time to
time after the effective date of this Registration Statement as determined by
market conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. /X/
CALCULATION OF REGISTRATION FEE
<TABLE>
<S> <C> <C> <C> <C>
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PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF AMOUNT TO BE OFFERING PRICE PER AGGREGATE OFFERING AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED(1) UNIT PRICE(1) REGISTRATION FEE
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Debt Securities and Warrants to
Purchase Debt Securities(3)...........
Preferred Stock (without par value).... (2) (2) $500,000,000 $172,415
Depositary Shares(4)...................
Common Stock ($1 par value)............
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</TABLE>
(1) The maximum aggregate offering price of Debt Securities and Warrants to
Purchase Debt Securities, Preferred Stock (without par value), Depositary
Shares and Common Stock ($1 par value) registered hereunder shall not exceed
$500,000,000. PURSUANT TO RULE 429 UNDER THE SECURITIES ACT OF 1933, THE
PROSPECTUS INCLUDED IN THIS REGISTRATION STATEMENT ALSO RELATES TO
$50,000,000 OF SECURITIES PREVIOUSLY REGISTERED PURSUANT TO FORM S-3
(REGISTRATION NO. 33-50619), AS TO WHICH THIS REGISTRATION STATEMENT
CONSTITUTES A POST-EFFECTIVE AMENDMENT.
(2) Not applicable pursuant to General Instruction II.D. of Form S-3 under the
Securities Act of 1933.
(3) Any offering of Debt Securities or Warrants denominated in any foreign
currency or foreign currency units will be treated as the equivalent in U.S.
dollars based on the exchange rate applicable to the purchase of such Debt
Securities or Warrants from the Registrant.
(4) There are also being registered hereunder an indeterminate number of
Depositary Shares to be evidenced by Depositary Receipts issued pursuant to
a Deposit Agreement. In the event that fractional interests in shares of the
Preferred Stock registered hereunder are offered, Depositary Receipts may be
distributed to those persons purchasing such fractional interests and the
shares of Preferred Stock will be deposited with the Depositary under the
Deposit Agreement.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR
MAY OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT
BECOMES EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE
SECURITIES IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE
UNLAWFUL PRIOR TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION DATED JANUARY 12, 1995
HOUSEHOLD INTERNATIONAL, INC.
DEBT SECURITIES
AND
WARRANTS TO PURCHASE DEBT SECURITIES
PREFERRED STOCK (WITHOUT PAR VALUE)
COMMON STOCK (PAR VALUE $1.00 PER SHARE)
Household International, Inc. ("Household International" or the "Company")
from time to time may offer one or more series of debt securities ("Debt
Securities") and warrants ("Warrants") to purchase Debt Securities, shares of
one or more series of its preferred stock, without par value ("Preferred
Shares"), or shares of its common stock, par value $1.00 per share ("Common
Stock"; collectively with the Debt Securities, Warrants and Preferred Shares
being hereinafter called "Securities"), or any combination of the foregoing, for
proceeds of up to $550,000,000, or the equivalent thereof if any of the Debt
Securities or Warrants are denominated in a foreign currency or a foreign
currency unit. All specified terms of the offering and sale of the Securities
shall be set forth in one or more supplements to this Prospectus ("Prospectus
Supplement") including (a) in the case of Debt Securities, the designations,
aggregate principal amount, the currency or currency unit for which the Debt
Securities may be purchased, the currency or currency unit in which the
principal and any interest is payable, the rate (or method of calculation) and
time of payment of any interest, authorized denominations, maturity, offering
price and any redemption terms, (b) in the case of Preferred Shares, the
designations, rights, preferences, privileges, and restrictions applicable
thereto, including dividend rate or rates (or method of ascertaining the same),
dividend payment dates, voting rights, liquidation preferences, and any
conversion, exchange, redemption or sinking fund provisions, (c) in the case of
Common Stock, the number of shares of Common Stock, and (d) in the case of the
Securities generally, the initial public offering price, listing on a securities
exchange, if any, and any other specific terms relating to the Securities in
respect of which this Prospectus is being delivered. With regard to the
Warrants, if any, in respect of which this Prospectus is being delivered, the
Prospectus Supplement shall set forth a description of the Debt Securities for
which each Warrant is exercisable and the offering price, if any, exercise
price, duration, detachability and other terms of the Warrants.
The Debt Securities and Warrants may be sold for U.S. dollars, foreign
currencies or foreign currency units, and the principal of and any interest on
the Debt Securities may be payable in U.S. dollars, foreign currencies or
foreign currency units. The Debt Securities will be unsecured obligations of
Household International and will rank on a parity with other unsecured senior
indebtedness of Household International.
The shares of any series of Preferred Shares may be represented by
Depositary Shares as described herein.
Household International may sell Securities through underwriting syndicates
led by one or more managing underwriters or through one or more underwriting
firms acting alone, to or through dealers, acting as principals for their own
account or as agents, and also may sell Securities directly to other purchasers.
See "Plan of Distribution". The names of any underwriters or agents involved in
the sale of the Securities in respect to which this Prospectus is being
delivered and their compensation are set forth in the Prospectus Supplement.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR
HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
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THE DATE OF THIS PROSPECTUS IS , 1995.
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AVAILABLE INFORMATION
Household International is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended ("Exchange Act"), and in accordance
therewith files reports, proxy statements and other information with the
Securities and Exchange Commission ("Commission"). Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities of the Commission at 450 Fifth Street, N.W., Washington,
D.C. 20549, and at the Commission's Regional Offices at the Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and Seven
World Trade Center, New York, New York 10048. Copies of such material can also
be obtained at prescribed rates by writing to the Public Reference Section of
the Commission at 450 Fifth Street, N.W., Washington, D.C. 20549. In addition,
reports, proxy statements and other material concerning Household International
can be inspected at the offices of the New York Stock Exchange, Inc., 20 Broad
Street, New York, New York 10005, and the Chicago Stock Exchange, 440 South
LaSalle Street, Chicago, Illinois 60605. Although Household International may
not be required to send a copy of its latest Annual Report to Shareholders to
holders of Debt Securities, Warrants or Preferred Shares, Household
International will, upon request, send to any holder of Securities a copy of its
latest Annual Report to Shareholders, as filed with the Commission, which
contains financial information that has been examined and reported upon, with an
opinion expressed, by independent certified public accountants.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents have been filed with the Commission (File No.
1-8198) pursuant to the Exchange Act and are incorporated herein by reference
and made a part of this Prospectus:
(a) Household International's Annual Report on Form 10-K for the
fiscal year ended December 31, 1993;
(b) Household International's Quarterly Reports on Form 10-Q for the
quarters ended March 31, 1994, June 30, 1994 and September 30, 1994; and
(c) Household International's Current Reports on Form 8-K dated
February 1, May 11, June 28, August 8, August 10, and October 11, 1994.
All documents filed by Household International with the Commission pursuant
to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date
of this Prospectus and prior to the termination of the offering of the
Securities shall be deemed to be incorporated herein by reference and made a
part of this Prospectus from the date of filing of such documents. Any statement
contained in a document incorporated or deemed to be incorporated by reference
herein shall be deemed to be modified or superseded for purposes of this
Prospectus to the extent that a statement contained herein or in any other
subsequently filed document which also is or is deemed to be incorporated by
reference herein modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
HOUSEHOLD INTERNATIONAL WILL PROVIDE WITHOUT CHARGE TO EACH PERSON TO WHOM
THIS PROSPECTUS IS DELIVERED, ON THE WRITTEN OR ORAL REQUEST OF ANY SUCH PERSON,
A COPY OF ANY OR ALL DOCUMENTS INCORPORATED HEREIN BY REFERENCE (WITHOUT
EXHIBITS OTHER THAN EXHIBITS SPECIFICALLY INCORPORATED BY REFERENCE). REQUESTS
SHOULD BE DIRECTED TO:
HOUSEHOLD INTERNATIONAL, INC.
2700 SANDERS ROAD
PROSPECT HEIGHTS, ILLINOIS 60070
ATTENTION: OFFICE OF THE SECRETARY
TELEPHONE: 708-564-6989
2
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HOUSEHOLD INTERNATIONAL
Household International was formed in 1981 as a holding company for various
subsidiaries which operated in the financial services, manufacturing,
transportation and merchandising industries. In 1985 the Company initiated a
restructuring program that has resulted in the disposition of its merchandising,
transportation and manufacturing businesses. This has enabled the Company to
focus its resources in the financial services industry through the operation of
businesses involved in finance and banking, and insurance. The Company's
principal executive office is located at 2700 Sanders Road, Prospect Heights,
Illinois 60070 (telephone: 708-564-5000).
The finance and banking business of the Company is the largest segment of
the Company's operations. Through subsidiaries, such as Household Finance
Corporation ("HFC"), Household Bank, f.s.b., Household Retail Services, Inc.,
Household Bank (Illinois), National Association, Household Financial Corporation
Limited, Household Trust Company and HFC Bank plc, the Company offers numerous
consumer finance products, including home equity credit lines, revolving and
closed-end unsecured personal loans, private label credit cards, and VISA* and
MasterCard* credit cards. Also, in conjunction with its consumer finance
business, and where applicable laws permit, the Company makes credit life,
credit accident and health, household contents, and term insurance available to
its customers. This insurance is generally directly written by or reinsured with
the Company's insurance subsidiary, Alexander Hamilton Life Insurance Company of
America ("Alexander Hamilton").
The Company has included its ongoing commercial finance operations in the
finance and banking segment. These operations are generally administered by
Household Commercial Financial Services, Inc. ("Household Commercial"), a
subsidiary of HFC. Products offered by Household Commercial include loan and
lease financing to businesses for capital equipment, including aircraft and
other transportation equipment, and specialized secured corporate loans. In
addition, Household Commercial also invests in publicly issued or privately
placed term preferred stocks of unaffiliated entities.
The Company's individual life insurance products are offered by Alexander
Hamilton. These products include universal life, whole life and term insurance
policies, as well as annuity products, and are sold through a network of
independent agents in the United States.
Household International is principally a holding company whose primary
source of funds is dividends from its subsidiaries. Dividend distributions to
the Company from its savings and loan, banking and insurance subsidiaries may be
restricted by federal and state laws and regulations. Dividend distributions
from its foreign subsidiaries may also be restricted by exchange controls of the
country in which the subsidiary is located. Also, as a holding company the
rights of any creditors or stockholders of Household International to
participate in the assets of any subsidiary upon the latter's liquidation or
recapitalization will be subject to the prior claims of the subsidiary's
creditors, except to the extent that the Company may itself be a creditor with
recognized claims against the subsidiary. Nevertheless, there are no
restrictions that currently materially limit the Company's ability to make
payments to its creditors or to pay dividends on its Preferred Stock or Common
Stock at current levels nor are there any restrictions which Household
International reasonably believes are likely to limit materially such payments
in the future.
USE OF PROCEEDS
Household International will apply the net proceeds from the sale of the
Securities to its general funds to be used to fund investments in, or extensions
of credit to, its subsidiaries; to reduce other outstanding indebtedness (which
may include indebtedness owed to its subsidiaries); to fund acquisitions by
Household International and its subsidiaries of other companies; or for such
other purposes as may be set forth in the Prospectus Supplement. Pending such
application, such net proceeds may be temporarily invested or applied to the
reduction of short-term debt.
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* VISA and MasterCard are registered trademarks of VISA, USA, Inc. and
MasterCard International Incorporated, respectively.
3
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SELECTED FINANCIAL INFORMATION
The financial information which is set forth below for the three years
ended December 31, 1993 has been derived from the financial statements of the
Company which have been audited by Arthur Andersen LLP, independent certified
public accountants. All financial information of the Company and subsidiaries
presented below should be read in conjunction with the detailed financial
statements included in documents on file with the Commission and listed under
"Incorporation of Certain Documents by Reference" in the Prospectus. The results
of operations of the Company and subsidiaries for the nine month periods ended
September 30, 1994 and 1993 reflect all adjustments of a normal recurring nature
which are, in the opinion of the Company's management, necessary for a fair
statement of the results for the interim period and such results are not
necessarily indicative of the results of operations that may be expected for the
entire year. In addition, certain prior period amounts have been reclassified to
conform with the current period's presentation. All dollar amounts stated below
are in millions.
<TABLE>
<CAPTION>
(UNAUDITED)
NINE MONTHS ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
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1994 1993 1993 1992 1991
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<S> <C> <C> <C> <C> <C>
STATEMENT OF INCOME DATA:
Finance income............................................... $1,945.6 $1,932.9 $2,561.4 $2,584.4 $3,037.5
Interest income from noninsurance investment securities...... 90.7 101.8 129.3 152.8 187.4
Interest expense............................................. 878.6 878.2 1,149.5 1,420.2 1,886.9
-------- -------- -------- -------- --------
Interest margin.............................................. 1,157.7 1,156.5 1,541.2 1,317.0 1,338.0
Provision for credit losses on owned receivables............. 502.2 561.1 735.8 671.5 843.2
-------- -------- -------- -------- --------
Interest margin after provision for credit losses............ 655.5 595.4 805.4 645.5 494.8
-------- -------- -------- -------- --------
Securitization and servicing fee income...................... 520.9 301.3 460.0 376.0 398.3
Insurance premiums and contract revenues..................... 196.1 216.0 288.3 281.2 288.4
Investment income............................................ 388.1 441.7 574.0 523.7 471.5
Fee income................................................... 193.9 219.8 292.6 164.5 104.0
Other income................................................. 68.2 98.5 148.9 98.0 106.8
-------- -------- -------- -------- --------
Other revenues............................................... 1,367.2 1,277.3 1,763.8 1,443.4 1,369.0
-------- -------- -------- -------- --------
Interest margin after provision for credit losses and other
revenues................................................... 2,022.7 1,872.7 2,569.2 2,088.9 1,863.8
-------- -------- -------- -------- --------
Salaries and fringe benefits................................. 497.0 450.8 615.4 535.9 507.9
Other operating expenses..................................... 799.7 707.6 964.0 761.1 683.9
Policyholders' benefits...................................... 343.9 405.4 539.1 513.9 472.2
-------- -------- -------- -------- --------
Total costs and expenses..................................... 1,640.6 1,563.8 2,118.5 1,810.9 1,664.0
-------- -------- -------- -------- --------
Income before income taxes................................... 382.1 308.9 450.7 278.0 199.8
Income taxes................................................. 125.5 103.2 152.0 87.1 50.0
-------- -------- -------- -------- --------
Net income................................................... $ 256.6 $ 205.7 $ 298.7 $ 190.9 $ 149.8
======= ======= ======= ======= =======
</TABLE>
<TABLE>
<CAPTION>
(UNAUDITED) YEAR ENDED DECEMBER 31,
SEPTEMBER 30, ------------------------------------------------------
1994 1993 1992 1991
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<S> <C> <C> <C> <C>
PERIOD END BALANCE SHEET DATA:
Total assets..................................... $ 34,804.5 $ 32,961.5 $ 31,128.4 $ 29,982.3
Total debt....................................... 23,824.8 22,272.0 22,298.0 21,906.5
Deposits......................................... 7,490.9 7,516.1 8,030.3 7,969.6
Convertible preferred stock subject to mandatory
redemption..................................... 3.7 19.3 36.0 54.4
Preferred stock.................................. 320.0 320.0 300.0 250.0
Common shareholders' equity...................... $ 2,122.1 $ 2,078.3 $ 1,545.6 $ 1,462.1
</TABLE>
4
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SELECTED RATIOS
The ratio of earnings to fixed charges and the ratio of earnings to
combined fixed charges and preferred stock dividends for Household International
and subsidiaries for the periods indicated below was as follows:
<TABLE>
<CAPTION>
NINE MONTHS
ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
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1994 1993 1993 1992 1991 1990 1989
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<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges............. 1.42 1.34 1.38 1.19 1.10 1.17 1.19
Ratio of Earnings to Combined Fixed Charges and
Preferred Stock Dividends.................... 1.37 1.29 1.33 1.15 1.08 1.15 1.18
</TABLE>
For purposes of calculating the above ratios, earnings consist of income
from continuing operations to which has been added income taxes and fixed
charges. Fixed charges consist of interest on all indebtedness (including
capitalized interest) and one-third of rental expense (approximate portion
representing interest). Preferred stock dividends represent an amount equal to
income, before income tax, which would be required to meet the dividends on
preferred stocks.
DESCRIPTION OF DEBT SECURITIES
The following description of the Debt Securities sets forth certain general
terms and provisions of the Debt Securities to which any Prospectus Supplement
may relate. The particular terms of the Debt Securities offered by any
Prospectus Supplement (the "Offered Debt Securities") and the extent to which
such general terms and provisions may apply to the Offered Debt Securities will
be described in the Prospectus Supplement relating to such Offered Debt
Securities.
GENERAL
The Offered Debt Securities will constitute unsecured senior debt of
Household International and will rank on a parity with other unsecured senior
debt of Household International. The Offered Debt Securities will be issued
under one of three indentures specified elsewhere herein ("Indentures"). Copies
of the Indentures are included as exhibits to Household International's
Registration Statement which registers the Debt Securities with the Commission.
The following summaries do not purport to be complete and, where particular
provisions of the Indentures are referred to, such provisions, including
definitions of certain terms, are incorporated by reference as part of such
summaries, which are qualified in their entirety by such reference.
The Indentures provide that Debt Securities may be issued thereunder from
time to time in one or more series and do not limit the aggregate principal
amount of the Debt Securities, except as may be otherwise provided with respect
to any particular series of Offered Debt Securities.
Unless otherwise indicated in the Prospectus Supplement with respect to any
particular series of Offered Debt Securities, the Debt Securities will be issued
in definitive registered form without coupons, will be exchangeable for
authorized denominations and will be transferable at any time or from time to
time. No charge will be made to any Holder for any exchange or registration of
transfer except for any tax or governmental charge incident thereto.
Reference is made to the Prospectus Supplement relating to the particular
series of Debt Securities offered thereby for the following terms and other
information to the extent applicable with respect to the Offered Debt
Securities: (1) the title of the Offered Debt Securities; (2) any limit on the
aggregate principal amount of the Offered Debt Securities; (3) the price
(expressed as a percentage of the aggregate principal amount thereof) Household
International will be paid for the Offered Debt Securities and the initial
offering price, if any, at which the Offered Debt Securities will be offered to
the public; (4) the currency, currencies or currency units for which the Offered
Debt Securities may be purchased and the currency, currencies or currency units
in which the principal of and any interest on such Offered Debt Securities may
be payable;
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(5) the date or dates on which the Offered Debt Securities will mature; (6) the
rate or rates (which may be fixed or variable) per annum at which the Offered
Debt Securities will bear interest, if any; (7) the date from which such
interest, if any, on the Offered Debt Securities will accrue, the dates on which
such interest, if any, will be payable, the date on which payment of such
interest, if any, will commence and the Regular Record Dates for such Interest
Payment Dates, if any; (8) the dates, if any, on which and the price or prices
at which the Offered Debt Securities will, pursuant to any mandatory sinking
fund provisions, or may, pursuant to any optional sinking fund or to any
purchase fund provisions, be redeemed by Household International, and the other
detailed terms and provisions of such sinking and/or purchase funds; (9) the
date, if any, after which and the price or prices at which the Offered Debt
Securities may, pursuant to any optional redemption provisions, be redeemed at
the option of Household International or of the Holder thereof and the other
detailed terms and provisions of such optional redemption; (10) the
denominations in which the Offered Debt Securities are authorized to be issued;
(11) the securities exchange, if any, on which the Offered Debt Securities will
be listed; (12) additional provisions, if any, with respect to the Offered Debt
Securities; and (13) the Indenture under which the Offered Debt Securities are
to be issued. With respect to Offered Debt Securities sold through dealers
acting as agents, however, the maturities and interest rates of such Offered
Debt Securities may be established by Household International from time to time
and, if not set forth in the Prospectus Supplement relating thereto, will be
made available through such dealers.
If any of the Debt Securities are sold for foreign currencies or foreign
currency units or if the principal of or any interest on any series of Debt
Securities is payable in foreign currencies or foreign currency units, the
restrictions, elections, tax consequences, specific terms and other information
with respect to such issue of Debt Securities and such currencies or currency
units will be set forth in the Prospectus Supplement relating thereto.
Debt Securities may be issued as Original Issue Discount Securities to be
offered and sold at a discount below their stated principal amount. "Original
Issue Discount Securities" means any Debt Securities that provide for an amount
less than the principal amount thereof to be due and payable upon a declaration
of acceleration of the maturity thereof upon the occurrence of an Event of
Default and the continuance thereof. As used in the following summary of certain
terms of the Debt Securities, the term "principal amount" means, in the case of
any Original Issue Discount Security, the amount that would then be due and
payable upon acceleration of the maturity thereof, as specified in such Debt
Securities.
INDENTURES
Offered Debt Securities will be issued under (i) an Indenture dated as of
October 1, 1993, between Household International and The First National Bank of
Maryland, as Trustee, (ii) an Indenture dated as of February 1, 1993, between
Household International and First Interstate Bank of California, as Trustee, or
(iii) an Indenture dated as of January 1, 1995, between Household International
and Harris Trust and Savings Bank, as Trustee (collectively, the "Trustees").
Unless a different place is specified in the Prospectus Supplement with
respect to any particular series of Debt Securities, principal of and interest,
if any, on Debt Securities will be payable at the office or agency of Household
International in either Baltimore, Maryland, with respect to the Indenture with
The First National Bank of Maryland, in Los Angeles, California, with respect to
the Indenture with First Interstate Bank of California, or in Chicago, Illinois,
with respect to the Indenture with Harris Trust and Savings Bank; provided,
however, that payment of interest may be made at the option of Household
International by check or draft mailed to the person entitled thereto.
COVENANT AGAINST CREATION OF PLEDGES OR LIENS
All Debt Securities issued under the Indentures will be unsecured.
Household International covenants that, with the exceptions listed below, it
will not issue, assume or guarantee any indebtedness for borrowed money secured
by a mortgage, security interest, pledge or lien ("security interest") of or
upon any of its property, now owned or hereafter acquired, unless the Debt
Securities then outstanding are, by supplemental indenture, effectively secured
by such security interest equally and ratably with all other indebtedness
secured
6
<PAGE> 8
thereby. The term "indebtedness for borrowed money" does not include any
guarantee or other recourse obligation in connection with the sale or discount
by Household International or any of its subsidiaries of finance or accounts
receivable, trade acceptances, or other paper arising in the ordinary course of
its business.
The foregoing covenant does not apply to (a) security interests to secure
the payment of the purchase price on property, shares of capital stock, or
indebtedness acquired by Household International or the cost of construction or
improvement of such property or the refinancing of all or any part of such
secured indebtedness, provided that such security interests do not apply to any
other property, shares of capital stock, or indebtedness of Household
International; (b) security interests on property, shares of capital stock, or
indebtedness existing at the time of acquisition by Household International; (c)
security interests on property of a corporation which security interests exist
at the time such corporation merges or consolidates with or into Household
International or which security interests exist at the time of the sale or
transfer of all or substantially all of the assets of such corporation to
Household International; (d) security interests of Household International to
secure any of its indebtedness to a subsidiary; (e) security interests in
property of Household International in favor of the United States of America or
any state or agency or instrumentality thereof, or in favor of any other country
or political subdivision, to secure partial, progress, advance, or other
payments pursuant to any contract or statute or to secure any indebtedness
incurred for the purpose of financing or refinancing all or any part of the
purchase price or the cost of construction of the property subject to such
security interests; (f) security interests on properties financed through tax
exempt municipal obligations, provided that such security interests are limited
to the property so financed; (g) security interests existing on the date of the
applicable Indenture; and (h) any extension, renewal, refunding, or replacement
(or successive extensions, renewals, refundings, or replacements), in whole or
in part, of any security interest referred to in the foregoing clauses (a)
through (g) inclusive, provided, however, that the principal amount of
indebtedness secured in such extension, renewal, refunding, or replacement does
not exceed the principal amount of indebtedness secured at the time by such
security interest, and provided further, that such extension, renewal,
refunding, or replacement of such security interest is limited to all or part of
the property subject to such security interest so extended, renewed, refunded,
or replaced.
Notwithstanding the foregoing, Household International may, without equally
and ratably securing the Debt Securities, issue, assume, or guarantee
indebtedness secured by a security interest not excepted pursuant to clauses (a)
through (h) above, if the aggregate amount of such indebtedness, together with
all other indebtedness of, or guaranteed by, Household International existing at
such time and secured by security interests not so excepted, does not at the
time exceed 10% of Household International's Consolidated Net Worth (as
defined). In addition, an arrangement with any person providing for the leasing
by Household International of any property, which property has been or is to be
sold or transferred by Household International to such person with the intention
that such property be leased back to Household International, shall not be
deemed to create any indebtedness secured by a security interest if the
obligation in respect to such lease would not be included as liabilities on a
consolidated balance sheet of Household International. The Holders of not less
than a majority in principal amount of the Debt Securities at the time
outstanding under an Indenture, on behalf of the Holders of all of the Debt
Securities issued under such Indenture, may waive compliance with the foregoing
covenant. (Section 3.08)
SATISFACTION, DISCHARGE AND DEFEASANCE OF THE INDENTURES AND DEBT SECURITIES
If there is deposited irrevocably with the Trustee as trust funds for the
benefit of the Holders of Debt Securities of a particular series, for the
purpose hereinafter stated, an amount, in money or the equivalent in securities
of the United States or securities the principal of and interest on which is
fully guaranteed by the United States, sufficient to pay the principal, premium,
if any, and interest, if any, on such series of Debt Securities on the dates
such payments are due in accordance with the terms of such series of Debt
Securities through their maturity, and if Household International has paid or
caused to be paid all other sums payable by it under the applicable Indenture
with respect to such series, then Household International will be deemed to have
satisfied and discharged the entire indebtedness represented by such series of
Debt Securities and all the obligations of Household International under such
Indenture with respect to such series, except as otherwise provided in such
Indenture. In the event of any such defeasance, Holders of such Debt Securities
will be able
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to look only to such trust funds for payment of principal, premium, if any, and
interest, if any, on their Debt Securities. (Section 6.03)
For federal income tax purposes, any such defeasance may be treated as a
taxable exchange of the related Debt Securities for an issue of obligations of
the trust or a direct interest in the cash and securities held in the trust. In
that case, Holders of such Debt Securities may recognize a gain or loss as if
the trust obligations or the cash or securities deposited, as the case may be,
had actually been received by them in exchange for their Debt Securities. Such
Holders thereafter would be required to include in income a share of the income,
gain or loss of the trust. The amount so required to be included in income could
be a different amount than would be includable in the absence of defeasance.
Prospective investors are urged to consult their own tax advisors as to the
specific consequences to them of defeasance.
THE TRUSTEES
Household International and certain of its subsidiaries maintain banking
relationships with each of the Trustees or affiliates thereof. Certain of the
Trustees are also trustees under other indentures of Household International or
its subsidiaries under which outstanding senior or subordinated unsecured debt
securities of such entities have been issued. The Trustees or affiliates thereof
may also have other financial relationships with Household International and its
subsidiaries.
MODIFICATION OF INDENTURES
Each Indenture provides that the Holders of not less than a majority in
principal amount of each series of Debt Securities at the time outstanding under
such Indenture may enter into supplemental indentures for the purpose of
amending or modifying, in any manner, provisions of the Indenture or of any
supplemental indenture modifying the rights of Holders of such series of Debt
Securities. However, no such supplemental indenture, without the consent of the
Holder of each outstanding Debt Security affected thereby, shall, among other
things, (i) change the maturity of the principal of, or any installment of
interest on any Debt Security, or reduce the principal amount thereof or the
interest thereon or any premium payable upon the redemption thereof, or (ii)
reduce the aforesaid percentage of the Debt Securities, the consent of the
Holders of which is required for the execution of any such supplemental
indenture or for any waiver of compliance with any covenant or condition in such
Indenture. (Section 11.02)
Each Indenture may be amended or supplemented without the consent of any
Holder of Debt Securities under certain circumstances, including (i) to cure any
ambiguity, defect or inconsistency in the Indenture, any supplemental indenture,
or in the Debt Securities of any series; (ii) to evidence the succession of
another corporation to the Company and to provide for the assumption of all the
obligations of the Company under the Debt Securities and the Indenture by such
corporation; (iii) to provide for uncertificated debt securities in addition to
certificated debt securities; (iv) to make any change that does not adversely
affect the rights of Holders of Debt Securities issued thereunder; (v) to
provide for a new series of Debt Securities; or (vi) to add to rights of Holders
of Debt Securities or add additional Events of Default. (Section 11.01)
SUCCESSOR ENTITY
The Company may not consolidate with or merge into, or transfer, sell or
lease its properties and assets as, or substantially as, an entirety to another
entity unless the successor entity is a corporation incorporated within the
United States and, after giving effect thereto, no default under the Indenture
shall have occurred and be continuing. Thereafter, except in the case of a
lease, all obligations of the Company under the Indenture terminate. (Sections
10.01 and 10.02)
EVENTS OF DEFAULT
Each Indenture defines the following as Events of Default with respect to
any series of Debt Securities: default for 30 days in the payment of any
interest upon any Debt Security of such series issued under such Indenture;
default in the payment of any principal of or premium on any such Debt Security;
default for 30 days in the deposit of any sinking fund or similar payment for
such series of Debt Securities; default for 60
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days after notice in the performance of any other covenant in the Indenture;
certain defaults for 30 days after notice in the payment of principal or
interest, or in the performance of other covenants, with respect to borrowed
money under another indenture in which the Trustee for such Debt Securities is
trustee which results in the principal amount of such indebtedness becoming due
and payable prior to maturity, which acceleration has not been rescinded or
annulled; and certain events of bankruptcy, insolvency or reorganization.
Household International is required to file with each Trustee annually an
Officers' Certificate as to the absence of certain defaults under the Indenture.
(Sections 7.01 and 3.05)
If an Event of Default with respect to Debt Securities of any series at the
time outstanding occurs and is continuing, either the Trustee or the Holders of
not less than 25% in principal amount of the outstanding Debt Securities of such
series by notice as provided in the Indenture may declare the principal amount
and all accrued but unpaid interest of all the Debt Securities of such series to
be due and payable immediately. At any time after a declaration of acceleration
with respect to Debt Securities of any series has been made, but before a
judgment or decree for payment of money has been obtained by the Trustee, the
Holders of not less than a majority in principal amount of outstanding Debt
Securities of such series may, under certain circumstances, rescind or annul
such declaration of acceleration. (Section 7.02)
The Holders of not less than a majority in principal amount of the
outstanding Debt Securities of each series may, on behalf of all Holders of Debt
Securities of such series, waive any past default under the Indenture and its
consequences with respect to Debt Securities of such series, except a default
(a) in the payment of principal of or premium, if any, or interest, if any, on
any Debt Securities of such series, or (b) in respect of a covenant or provision
of the Indenture which cannot be modified or amended without the consent of the
Holder of each outstanding Debt Security of such series affected. (Section 7.13)
Each Indenture provides that the Trustee thereunder may withhold notice to
Holders of Debt Securities of any default (except in payment of the principal of
(or premium, if any) or interest on any Debt Security issued under such
Indenture or in the payment of any sinking fund or similar payment) if it
considers it in the interest of Holders of Debt Securities to do so. (Section
8.02)
Holders of Debt Securities may not enforce an Indenture except as provided
therein. (Section 7.07) Each Indenture provides that the Holders of a majority
in principal amount of the outstanding Debt Securities issued under such
Indenture have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the Trustee or exercising any trust or
power conferred on the Trustee. (Section 7.12) The Trustee will not be required
to comply with any request or direction of Holders of Debt Securities pursuant
to the Indenture unless offered indemnity against costs and liabilities which
might be incurred by the Trustee as a result of such compliance. (Section
8.03(e))
DESCRIPTION OF WARRANTS
Household International may issue, together with any Debt Securities
offered by any Prospectus Supplement or separately, Warrants for the purchase of
other Debt Securities. The Warrants are to be issued under warrant agreements
(each a "Warrant Agreement") to be entered into between Household International
and a bank or trust company, as warrant agent ("Warrant Agent"), all as set
forth in the Prospectus Supplement relating to the particular issue of Warrants
("Offered Warrants"). A copy of the forms of Warrant Agreement, including the
form of warrant certificates representing the Warrants ("Warrant Certificates"),
reflecting the alternative provisions to be included in the Warrant Agreements
that will be entered into with respect to particular offerings of Warrants, is
filed as an exhibit to the Registration Statement. The following summaries of
certain provisions of the Warrant Agreement and the Warrant Certificates do not
purport to be complete and are subject to, and are qualified in their entirety
by reference to, all the provisions of the Warrant Agreement and the Warrant
Certificates, respectively, including the definitions therein of certain terms.
GENERAL
The Prospectus Supplement describes the terms of the Offered Warrants, the
Warrant Agreement relating to the Offered Warrants and the Warrant Certificates
representing the Offered Warrants, including
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the following: (i) the designation, aggregate principal amount, and terms of the
Debt Securities purchasable upon exercise of the Offered Warrants; (2) the
designation and terms of any related Debt Securities with which the Offered
Warrants are issued and the number of Offered Warrants issued with each such
Debt Security; (3) the date, if any, on and after which the Offered Warrants and
the related Offered Debt Securities will be separately transferable; (4) the
principal amount of Debt Securities purchasable upon exercise of one Offered
Warrant and the price at which such principal amount of Debt Securities may be
purchased upon such exercise; (5) the date on which the right to exercise the
Offered Warrants shall commence and the date ("Expiration Date") on which such
right shall expire; (6) whether the Warrants represented by the Warrant
Certificates will be issued in registered or bearer form, and if registered,
where they may be transferred and registered; and (7) any other terms of the
Offered Warrants.
Warrant Certificates will be exchangeable on the terms specified in the
Prospectus Supplement for new Warrant Certificates of different denominations,
and Warrants may be exercised at the corporate trust office of the Warrant Agent
or any other office indicated in the Prospectus Supplement. Prior to the
exercise of their Warrants, holders of Warrants will not have any of the rights
of holders of the Debt Securities purchasable upon such exercise and will not be
entitled to payments of principal of, premium, if any, or interest, if any, on
the Debt Securities purchasable upon such exercise.
EXERCISE OF WARRANTS
Each Offered Warrant will entitle the holder to purchase such principal
amount of Debt Securities at such exercise price as shall in each case be set
forth in, or be determinable as set forth in, the Prospectus Supplement relating
to the Offered Warrants by payment of such exercise price in full in the manner
specified in the Prospectus Supplement. Offered Warrants may be exercised at any
time up to the close of business on the Expiration Date set forth in the
Prospectus Supplement relating to the Offered Warrants. After the close of
business on the Expiration Date, unexercised Warrants will become void.
Upon receipt of payment of the exercise price and the Warrant Certificate
properly completed and duly executed at the corporate trust office of the
Warrant Agent or any other office indicated in the Prospectus Supplement,
Household International will, as soon as practicable, forward the Debt
Securities purchasable upon such exercise. If less than all of the Warrants
represented by such Warrant Certificate are exercised, a new Warrant Certificate
will be issued for the remaining amount of Warrants.
DESCRIPTION OF CAPITAL STOCK
GENERAL
The following description of the capital stock of the Company is qualified
in its entirety by reference to the Company's Restated Certificate of
Incorporation, as amended, which has been filed with and is available from the
offices of the Commission as referred to under "Available Information".
The Company's Restated Certificate of Incorporation authorizes the issuance
of 158,155,004 shares of capital stock of which 8,155,004 shares shall be
designated preferred stock, without par value ("Preferred Stock"), and
150,000,000 shares shall be designated common stock, par value $1.00 per share
("Common Stock"). As of September 30, 1994, there were 5,304,635 shares of
Preferred Stock authorized and issued or reserved for issuance as follows:
3,454,635 shares of $6.25 Cumulative Convertible Voting Preferred Stock ("$6.25
Preferred"), 750,000 shares of 9 1/2% Cumulative Preferred Stock, Series 1989-A
("1989 Preferred"), 400,000 shares of Flexible Rate Auction Preferred Stock,
Series B ("Series B Flex APS"), 550,000 shares of 9 1/2% Cumulative Preferred
Stock, Series 1991-A ("1991 Preferred"), 50,000 shares of 8 1/4% Cumulative
Preferred Stock, Series 1992-A ("1992 Preferred") and 100,000 shares of 7.35%
Cumulative Preferred Stock, Series 1993-A ("1993 Preferred"). As of September
30, 1994, 74,219 shares of $6.25 Preferred, 400,000 shares of Series B Flex APS,
750,000 shares of 1989 Preferred, 550,000 shares of 1991 Preferred, 50,000
shares of 1992 Preferred, 100,000 shares of 1993 Preferred, and 96,234,160
shares of the Company's Common Stock were issued and outstanding. All
outstanding shares of Common Stock and Preferred Stock are fully paid and
non-assessable.
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PREFERRED STOCK
The Preferred Stock of the Company may be issued from time to time in one
or more series as authorized by the Board of Directors or a duly authorized
committee of the Board of Directors. The Board of Directors has adopted a
resolution creating an Offering Committee of the Board with the power to
authorize the issuance and sale of one or more series of Preferred Stock
("Preferred Shares") and to determine the particular designations, powers,
preferences and relative, participating, optional or other special rights (other
than voting rights which shall be fixed by the Board of Directors) and
qualifications, limitations or restrictions of the Preferred Shares. The
following description sets forth certain general terms and provisions of the
Preferred Stock of the Company. Certain other terms of any series of Preferred
Shares, including the dividend rate, liquidation preference, redemption rights,
if any, voting rights, conversion or sinking fund provisions, if any, and other
special terms as determined by the Offering Committee will be set forth in the
Prospectus Supplement relating to such series.
Dividends. Holders of shares of Preferred Stock are entitled to receive,
when and as declared by the Board of Directors of the Company out of any funds
legally available for that purpose, dividends in cash at such respective rates,
payable on such dates in each year and in respect of such dividend periods, as
stated in the Company's Restated Certificate of Incorporation or applicable
Certificate of Designation, Preferences and Rights for each series of Preferred
Stock, before any dividends may be declared or paid or set apart for payment
upon the Common Stock. No dividend may be declared or paid on any series of
Preferred Stock unless at the same time a dividend in like proportion to the
respectively designated dividend rates shall be declared or paid on each other
series of Preferred Stock then issued and outstanding ranking prior to or on a
parity with such particular series with respect to the payment of dividends.
Dividends may be either cumulative or non-cumulative.
Liquidation Preference. In the event of dissolution, liquidation or
winding up of the Company, whether voluntary or involuntary, holders of
Preferred Stock of each series (if any shares thereof are then issued and
outstanding) will be entitled to payment of the applicable liquidation price or
prices, out of the available assets of the Company, after payment to the
Company's creditors but in preference to the holders of the Common Stock. The
Company's Restated Certificate of Incorporation, as amended, provides that a
consolidation, merger or sale by the Company of its assets as an entirety or
substantially as an entirety shall not be deemed to be a liquidation,
dissolution or winding up of the Company.
Redemption. No Preferred Stock or Common Stock may be purchased by the
Company if any dividends on any shares of Preferred Stock are in arrears, and no
Preferred Stock may be redeemed in such case unless all shares of issued and
outstanding Preferred Stock are redeemed.
Voting Rights. Voting rights of the holders of Preferred Stock are
non-cumulative. Holders of Preferred Stock have such voting rights as are set
forth in the Company's Restated Certificate of Incorporation, as amended, or
applicable Certificate of Designation, Preferences and Rights or as otherwise
provided for by law.
The Company's Restated Certificate of Incorporation, as amended, provides
that, without the vote or consent of the holders of at least two-thirds of the
outstanding shares of all series of Preferred Stock (except for a series of
Preferred Stock in which the right is expressly withheld) voting as a single
class, the Company may not (i) consolidate or merge with another corporation or
corporations or sell its assets as an entirety or substantially as an entirety;
(ii) issue any shares of Preferred Stock of any series if the cumulative
dividends payable on shares of any series of outstanding Preferred Stock are in
arrears; (iii) adopt any amendment to the Company's Restated Certificate of
Incorporation which adversely alters the preferences, powers and special rights
of the Preferred Stock, provided, however, that if any such amendment would
adversely alter any preference, power or special right of one or more but not
all of the series of the Preferred Stock, then only the vote or consent of the
outstanding shares of all series of Preferred Stock so affected, voting as one
class, shall be required; or (iv) increase the authorized amount of the
Preferred Stock, or create or issue any class of stock ranking prior to or on a
parity with the Preferred Stock, or any series thereof, as to the payment of
dividends or the distribution of assets. In addition, the holders of the
outstanding shares of all series of Preferred Stock (except for a series of
Preferred Stock in which the right is expressly withheld) shall be entitled to
elect one-third of the members of the Board of Directors of the Company out of
the number fixed by the Company's
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Bylaws in the event the Company fails to declare and pay any four quarterly
cumulative dividends, whether consecutive or not, on any series of Preferred
Stock and shall be entitled to elect a majority of said directors should any
eight quarterly cumulative dividends, whether consecutive or not, be unpaid. Any
such right to elect members of the Board of Directors of the Company shall
continue until all unpaid dividends upon all series of Preferred Stock shall
have been paid in full.
Under current provisions of the General Corporation Law of the State of
Delaware, the holders of issued and outstanding Preferred Stock are entitled to
vote as a class upon a proposed amendment to the Company's Restated Certificate
of Incorporation (whether or not entitled to vote thereon by the Company's
Restated Certificate of Incorporation), with the consent of a majority of said
class being required to increase or decrease the aggregate number of authorized
shares of Preferred Stock, increase or decrease the par value of shares of
Preferred Stock, or alter or change the powers, preferences or special rights of
the Preferred Stock as to affect them adversely. If any proposed amendment would
alter or change the powers, preferences or special rights of one or more series
of Preferred Stock as to affect them adversely, but would not affect the entire
class of Preferred Stock, then only the shares of the series so affected by the
amendment would be considered a separate class for the purpose of determining
who is entitled to vote on the proposed amendment.
Preemptive Rights. Holders of Preferred Stock have no preemptive rights to
purchase any securities of the Company.
DEPOSITARY SHARES
General. The Company may, at its option, elect to issue fractional shares
of Preferred Shares, rather than full shares of Preferred Shares. In the event
such option is exercised, the Company may elect to have a Depositary (as defined
below) issue receipts for Depositary Shares, each receipt representing a
fraction (to be set forth in the Prospectus Supplement relating to a particular
series of Preferred Shares) of a share of a particular series of Preferred
Shares as described below.
The shares of any series of Preferred Shares represented by Depositary
Shares will be deposited under a Deposit Agreement ("Deposit Agreement") between
the Company and a bank or trust company selected by the Company having its
principal office in the United States and having a combined capital and surplus
of at least $50,000,000 ("Depositary"). Subject to the terms of the Deposit
Agreement, each owner of a Depositary Share will be entitled, in proportion to
the applicable fraction of a share of Preferred Shares represented by such
Depositary Share, to all the rights and preferences of the Preferred Share
represented thereby (including dividend, voting, redemption and liquidation
rights).
The Depositary Shares will be evidenced by depositary receipts issued
pursuant to the Deposit Agreement ("Depositary Receipts"). Depositary Receipts
will be distributed to those persons purchasing the fractional shares of
Preferred Shares in accordance with the terms of an offering of the Preferred
Shares. Copies of the forms of Deposit Agreement and Depositary Receipt are
filed as exhibits to the Registration Statement of which this Prospectus is a
part, and the following summary is qualified in its entirety by reference to
such exhibits.
Pending the preparation of definitive engraved Depositary Receipts, the
Depositary may, upon the written order of the Company, issue temporary
Depositary Receipts substantially identical to (and entitling the holders
thereof to all the rights pertaining to) the definitive Depositary Receipts but
not in definitive form. Definitive Depositary Receipts will be prepared
thereafter without unreasonable delay, and temporary Depositary Receipts will be
exchangeable for definitive Depositary Receipts at the Company's expense.
Upon surrender of Depositary Receipts at the office of the Depositary and
upon payment of the charges provided in the Deposit Agreement and subject to the
terms thereof, a holder of Depositary Receipts is entitled to have the
Depositary deliver to such holder the whole shares of Preferred Shares relating
to the surrendered Depositary Receipts. Holders of Depositary Shares will be
entitled to receive whole shares of the related series of Preferred Shares on
the basis set forth in the related Prospectus Supplement for such series of
Preferred Shares, but holders of such whole shares will not thereafter be
entitled to receive Depositary Shares therefor. If the Depositary Receipts
delivered by the holder evidence a number of Depositary Shares in excess
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of the number of Depositary Shares representing the number of whole shares of
the related series of Preferred Shares to be withdrawn, the Depositary will
deliver to such holder at the same time a new Depositary Receipt evidencing such
excess number of Depositary Shares.
Dividends and Other Distributions. The Depositary will distribute all cash
dividends or other cash distributions received in respect of the Preferred
Shares to the record holders of Depositary Shares relating to such Preferred
Shares in proportion to the numbers of such Depositary Shares owned by such
holders.
In the event of a distribution other than in cash, the Depositary will
distribute property received by it to the record holders of Depositary Shares
entitled thereto, unless the Depositary determines that it is not feasible to
make such distribution, in which case the Depositary may, with the approval of
the Company, sell such property and distribute the net proceeds from such sale
to such holders.
Redemption of Depositary Shares. If a series of Preferred Shares
represented by Depositary Shares is subject to redemption, the Depositary Shares
will be redeemed from the proceeds received by the Depositary resulting from the
redemption, in whole or in part, of such series of Preferred Shares held by the
Depositary. The redemption price per Depositary Share will be equal to the
applicable fraction of the redemption price per share payable with respect to
such series of the Preferred Stock. Whenever the Company redeems shares of
Preferred Shares held by the Depositary, the Depositary will redeem as of the
same redemption date the number of Depositary Shares representing shares of
Preferred Shares so redeemed. If less than all the Depositary Shares are to be
redeemed, the Depositary Shares to be redeemed will be selected by lot or pro
rata as may be determined by the Depositary.
Voting the Preferred Shares. Upon receipt of notice of any meeting at
which the holders of the Preferred Shares are entitled to vote, the Depositary
will mail the information contained in such notice of meeting to the record
holders of the Depositary Shares relating to such Preferred Shares. Each record
holder of such Depositary Shares on the record date (which will be the same date
as the record date for the Preferred Shares) will be entitled to instruct the
Depositary as to the exercise of the voting rights pertaining to the amount of
the Preferred Shares represented by such holder's Depositary Shares. The
Depositary will endeavor, insofar as practicable, to vote the amount of the
Preferred Shares represented by such Depositary Shares in accordance with such
instructions, and the Company will agree to take all action which may be deemed
necessary by the Depositary in order to enable the Depositary to do so. The
Depositary will abstain from voting shares of the Preferred Shares to the extent
it does not receive specific instructions from the holders of Depositary Shares
representing such Preferred Shares.
Amendment and Termination of the Deposit Agreement. The form of Depositary
Receipt evidencing the Depositary Shares and any provision of the Deposit
Agreement may at any time be amended by agreement between the Company and the
Depositary. However, any amendment which materially and adversely alters the
rights of the holders of Depositary Shares will not be effective unless such
amendment has been approved by the holders of at least a majority of the
Depositary Shares then outstanding. The Deposit Agreement may be terminated by
the Company or the Depositary only if (i) all outstanding Depositary Shares have
been redeemed or (ii) there has been a final distribution in respect of the
Preferred Shares in connection with any liquidation, dissolution or winding up
of the Company and such distribution has been distributed to the holders of
Depositary Receipts.
Charges of Depositary. The Company will pay all transfer and other taxes
and governmental charges arising solely from the existence of the depositary
arrangements. The Company will pay charges of the Depositary in connection with
the initial deposit of the Preferred Shares and any redemption of the Preferred
Shares. Holders of Depositary Receipts will pay other transfer and other taxes
and governmental charges and such other charges as are expressly provided in the
Deposit Agreement to be for their accounts.
Miscellaneous. The Depositary will forward to the record holders of the
Depositary Shares relating to such Preferred Shares all reports and
communications from the Company which are delivered to the Depositary.
Neither the Depositary or the Company will be liable if it is prevented or
delayed by law or any circumstance beyond its control in performing its
obligations under the Deposit Agreement. The obligations of
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the Company and the Depositary under the Deposit Agreement will be limited to
performance in good faith of their duties thereunder, and they will not be
obligated to prosecute or defend any legal proceeding in respect of any
Depositary Shares or Preferred Shares unless satisfactory indemnity is
furnished. They may rely upon written advice of counsel or accountants, or
information provided by persons presenting Preferred Shares for deposit, holders
of Depositary Receipts or other persons believed to be competent and on
documents believed to be genuine.
Resignation and Removal of Depositary. The Depositary may resign at any
time by delivering to the Company notice of its election to do so, and the
Company may at any time remove the Depositary, any such resignation or removal
to take effect upon the appointment of a successor Depositary and its acceptance
of such appointment. Such successor Depositary must be appointed within 60 days
after delivery of the notice of resignation or removal and must be a bank or
trust company having its principal office in the United States and having a
combined capital and surplus of at least $50,000,000.
DESCRIPTION OF AUTHORIZED SERIES OF PREFERRED STOCK
The following summary descriptions of the authorized series of Preferred
Stock of the Company are qualified in their entirety by reference to the
Company's Restated Certificate of Incorporation, as amended (including the
respective Certificates of Designation, Preferences and Rights relating to such
series).
$6.25 PREFERRED
Dividends. Holders of the $6.25 Preferred are entitled to receive
quarterly cumulative dividends at an annual rate of $6.25 per share. All
dividends on the $6.25 Preferred have been paid to date.
Conversion Rights. Holders of the $6.25 Preferred have the right to
convert such shares into shares of Common Stock at a conversion rate of 4.654
shares of Common Stock for each share of $6.25 Preferred.
The conversion rate is subject to adjustment in certain events, including
(i) the issuance of Common Stock as a dividend by the Company on its Common
Stock; (ii) subdivision, combination, reclassification or change of the Common
Stock; (iii) consolidation or merger of the Company or sale or conveyance of all
or substantially all of the property of the Company; (iv) unless holders of the
$6.25 Preferred are issued rights or warrants on a reasonably equivalent basis,
the issuance to holders of the Company's Preferred Stock (other than holders of
the $6.25 Preferred) or Common Stock of rights or warrants entitling them to
subscribe for or purchase shares of the Company's Common Stock at less than the
then current market price; provided that if such rights or warrants have a term
not exceeding 45 days and if any such rights or warrants expire unexercised,
then the conversion rate will be readjusted to the rate which would have been
obtained had such unexercised rights or warrants not been issued; and (v) unless
holders of $6.25 Preferred are issued evidences of indebtedness or assets on a
reasonably equivalent basis, the distribution to holders of Common Stock of
evidences of indebtedness or other assets of the Company (other than cash
dividends to the extent paid out of retained earnings, dividends in shares of
Common Stock and rights and warrants for Common Stock, but including securities
convertible into capital stock of the Company).
Sinking Fund. Pursuant to a cumulative sinking fund, the Company is
required to call for redemption, but only from retained earnings, at a
redemption price of $50 per share plus accrued and unpaid dividends, in 1991 and
each year thereafter to 2010, a number of shares of the $6.25 Preferred equal to
at least 4% of the shares originally issued (but not more than 8%), and all
remaining shares during the year 2011. In 1991, 1992, 1993 and 1994 the Company
called for redemption 276,371 shares of the $6.25 Preferred in each year (the
maximum amount permitted) and the Company intends to call the remaining shares
outstanding for redemption in 1995. Sinking fund payments may be made only if
there is not an arrearage in dividends on any series of Preferred Stock and if
the Company is not and would not be rendered insolvent or have its capital
impaired by such payments.
Optional Redemption. The $6.25 Preferred may be redeemed at the option of
the Company at any time, in whole or in part, at a redemption price equal to $50
per share plus accrued and unpaid dividends provided
14
<PAGE> 16
the aggregate amount of regular annual dividends per share on the Common Stock
multiplied by the conversion rate then in effect on the $6.25 Preferred has
equalled or exceeded $6.25 at all times during the twelve consecutive months
preceding the date of the notice of redemption. Currently, the $6.25 Preferred
may not be redeemed at the option of the Company.
Voting Rights. The $6.25 Preferred is entitled to one vote per share on
each matter submitted to a vote at a meeting of stockholders in addition to the
voting rights generally available to all series of Preferred Stock as described
above.
Liquidation Rights. In the event of the liquidation, dissolution or
winding up of the Company, whether voluntary or involuntary, holders of the
$6.25 Preferred are entitled to receive $50 per share plus accrued and unpaid
dividends.
1989 PREFERRED, SERIES B FLEX APS, 1991 PREFERRED, 1992 PREFERRED AND 1993
PREFERRED
General. The 1989 Preferred, Series B Flex APS, 1991 Preferred, 1992
Preferred and 1993 Preferred rank on a parity with the $6.25 Preferred as to the
payment of dividends and distribution of assets of the Company upon the
voluntary or involuntary liquidation, dissolution, or winding up of the Company.
1989 Preferred. Holders of the 1989 Preferred are entitled to receive
quarterly cumulative dividends at an annual rate of $9.50 per share. All
dividends on the 1989 Preferred have been paid to date. In the event of the
liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary, holders of the 1989 Preferred are entitled to receive $100 per
share plus accrued and unpaid dividends. The 1989 Preferred is redeemable, at
the option of the Company, in whole or in part from time to time at a premium
until November 9, 1999, and at $100 per share thereafter. The 1989 Preferred
Stock is not entitled to the benefits of any sinking fund.
Series B Flex APS. Holders of the Series B Flex APS are entitled to
receive quarterly cumulative dividends at an annual rate of $9.50 per share from
the date of original issue to July 15, 1995. Thereafter, dividends will be paid
at rates established every 49 days (or such longer period of time as is
established by an agent of the Company in accordance with the terms of the
Series B Flex APS) pursuant to auction procedures. All dividends on the Series B
Flex APS have been paid to date. In the event of the liquidation, dissolution or
winding up of the Company, whether voluntary or involuntary, holders of the
Series B Flex APS are entitled to receive $100 per share plus accrued and unpaid
dividends. The Series B Flex APS are redeemable, at the option of the Company,
in whole or in part, in July 1995, at $100 per share plus an amount equal to
accrued and unpaid dividends to the redemption date (the "Flex APS Redemption
Price"). Thereafter, during periods in which dividends rates on the Series B
Flex APS are set pursuant to auction every 49 days, shares of such Series B Flex
APS will be redeemable, at the option of the Company, in whole or in part, on
each dividend payment date at the Flex APS Redemption Price. If the dividend
rate on the Series B Flex APS is set pursuant to auction for a period longer
than 49 days, the Series B Flex APS will be redeemable during such period on
such dates and upon such terms as specified by an agent of the Company. The
Series B Flex APS is not entitled to the benefits of any sinking fund.
1991 Preferred. Holders of the 1991 Preferred are entitled to receive
quarterly cumulative dividends at an annual rate of $9.50 per share. All
dividends on the 1991 Preferred have been paid to date. In the event of the
liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary, holders of the 1991 Preferred are entitled to receive $100 per
share plus accrued and unpaid dividends. The 1991 Preferred is not redeemable
prior to August 13, 1996. The 1991 Preferred is redeemable, at the option of the
Company, in whole or in part from time to time on or after August 13, 1996, at
$100 per share plus an amount equal to accrued and unpaid dividends. The 1991
Preferred is not entitled to the benefits of any sinking fund.
1992 Preferred. Holders of the 1992 Preferred are entitled to receive
quarterly cumulative dividends at an annual rate of $82.50 per share. All
dividends on the 1992 Preferred have been paid to date. In the event of the
liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary, holders of the 1992 Preferred are entitled to receive $1,000 per
share plus accrued and unpaid dividends. The 1992 Preferred is not redeemable
prior to October 15, 2002. The 1992 Preferred is redeemable, at the option of
the Company,
15
<PAGE> 17
in whole or in part from time to time on or after October 15, 2002, at $1,000
per share plus an amount equal to accrued and unpaid dividends. The 1992
Preferred is not entitled to the benefits of any sinking fund.
1993 Preferred. Holders of the 1993 Preferred are entitled to receive
quarterly cumulative dividends at an annual rate of $73.50 per share. All
dividends on the 1993 Preferred have been paid to date. In the event of the
liquidation, dissolution or winding up of the Company, whether voluntary or
involuntary, holders of the 1993 Preferred are entitled to receive $1,000 per
share plus accrued and unpaid dividends. The 1993 Preferred is not redeemable
prior to October 15, 1998. The 1993 Preferred is redeemable, at the option of
the Company, in whole or in part, from time to time on or after October 15,
1998, at $1,000 per share plus an amount equal to accrued and unpaid dividends.
The 1993 Preferred is not entitled to the benefits of any sinking fund.
Voting Rights. The 1989 Preferred, Series B Flex APS, 1991 Preferred, 1992
Preferred and 1993 Preferred have the right, voting as a class with each other
and any other series of Preferred Stock ranking on a parity thereto as to the
payment of dividends or the distribution of assets and upon which like voting
rights have been conferred and are exercisable, to elect two members of the
Board of Directors of the Company at the meeting of stockholders called for such
purpose after six quarterly cumulative dividends on such Preferred Stock,
whether consecutive or not, shall be in arrears. The right of such holders of
Preferred Stock to elect said members to the Board of Directors shall continue
until such time as all dividends accrued on such stock shall have been paid in
full, at which time such right shall terminate.
On any item with respect to which the holders of the 1989 Preferred, Series
B Flex APS, 1991 Preferred, 1992 Preferred and 1993 Preferred are entitled to
vote, such holders shall be entitled to one vote for each share held.
Conversion Rights. The holders of the 1989 Preferred, Series B Flex APS,
1991 Preferred, 1992 Preferred and 1993 Preferred do not have any rights to
convert the shares thereof into shares of any other class or series of capital
stock (or any other security) of the Company.
COMMON STOCK
If shares of Common Stock are offered, the Prospectus Supplement relating
thereto will set forth the number of shares offered, the public offering price
and information regarding Household International's dividend history and Common
Stock prices as reflected on the New York Stock Exchange Composite Tape,
including a recent last sale price of the Common Stock.
Holders of Common Stock are entitled to receive dividends out of any funds
legally available for that purpose as and if declared by the Board of Directors
of the Company, subject to the prior dividend rights of Preferred Stock.
Subject to certain voting rights of the Preferred Stock described elsewhere
herein, the holders of shares of Common Stock are entitled to vote at all
meetings of the stockholders and are entitled to one vote for each share of
Common Stock held. Subject to certain voting rights of the $6.25 Preferred
described elsewhere herein, holders of Common Stock currently vote together as a
class with the $6.25 Preferred Stock.
The issued and outstanding shares of Common Stock are fully paid and
non-assessable. The holders of Common Stock are not entitled to preemptive
rights or conversion or redemption rights. The Common Stock does not have
cumulative voting rights in the election of directors.
In the event of the voluntary dissolution, liquidation or winding up of the
Company, holders of Common Stock will be entitled to receive, pro rata, after
satisfaction in full of the prior rights of creditors and holders of Preferred
Stock, all of the remaining assets of the Company available for distribution.
SPECIAL CHARTER PROVISIONS
The Company's Restated Certificate of Incorporation, as amended, contains
provisions, in accordance with Section 102(b)(7) of the General Corporation Law
of the State of Delaware, eliminating the personal liability of a director to
the Company or its stockholders for money damages for breach of fiduciary duty
as a
16
<PAGE> 18
director, provided that the liability of a director may not be eliminated or
limited (i) for any breach of the directors' duty of loyalty to the Company or
its stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
(relating to liability for unauthorized acquisitions or redemptions of, or
dividends on, capital stock) of the Delaware General Corporation Law, or (iv)
for any transaction from which the director derived an improper personal
benefit.
PLAN OF DISTRIBUTION
Household International may sell the Securities in any of three ways: (i)
through underwriters or dealers; (ii) directly to a limited number of purchasers
or to a single purchaser; or (iii) through agents. The Prospectus Supplement
sets forth the terms of the offering of the Securities (collectively, the
"Offered Securities"), including the name or names of any underwriters, dealers
or agents, the purchase price of the Offered Securities and the proceeds to
Household International from such sale, any underwriting discounts and other
items constituting underwriters' compensation, and any discounts and commissions
allowed or paid to dealers. Any initial public offering price and any discounts
or concessions allowed or reallowed or paid to dealers may be changed from time
to time.
If the Offered Securities are sold through underwriters, the Prospectus
Supplement relating thereto describes the nature of the obligation of the
underwriters to take the Offered Securities. The Offered Securities may be
offered to the public either through underwriting syndicates represented by one
or more managing underwriters or directly by one or more underwriting firms
acting alone. The underwriter or underwriters with respect to a particular
underwritten offering of Offered Securities are named in the Prospectus
Supplement relating to such offering, and, if an underwriting syndicate is used,
the managing underwriter or underwriters are set forth on the cover of such
Prospectus Supplement. Unless otherwise set forth in the Prospectus Supplement,
the obligations of the underwriters to purchase the Offered Securities will be
subject to certain conditions precedent, and the underwriters will be obligated
to purchase all the Offered Securities if any are purchased.
The Offered Securities may be sold directly by Household International or
through agents designated by Household International from time to time. Any
agent involved in the offer or sale of the Offered Securities in respect of
which this Prospectus is delivered is named, and any commissions payable by
Household International to such agent are set forth, in the Prospectus
Supplement relating thereto.
Underwriters and agents who participate in the distribution of the Offered
Securities may be entitled under agreements which may be entered into by
Household International to indemnification by Household International against
certain liabilities, including liabilities under the Securities Act of 1933, or
to contribution with respect to payments which the underwriters or agents may be
required to make in respect thereof.
If so indicated in the Prospectus Supplement, Household International will
authorize underwriters, dealers or other persons acting as Household
International's agents to solicit offers by certain institutions to purchase
Offered Securities from Household International pursuant to contracts providing
for payment and delivery on a future date. Institutions with which such
contracts may be made include commercial and savings banks, insurance companies,
pension funds, investment companies, educational and charitable institutions and
others, but in all cases such institutions must be approved by Household
International. The obligations of any purchaser under any such contract will not
be subject to any conditions except that (i) the purchase of the Offered
Securities shall not at the time of delivery be prohibited under the laws of the
jurisdiction to which such purchaser is subject, and (ii) if the Offered
Securities are also being sold to underwriters, Household International shall
have sold to such underwriters the Offered Securities not sold for delayed
delivery. The underwriters, dealers and such other persons will not have any
responsibility in respect to the validity or performance of such contracts.
There can be no assurance that a secondary market will be created for the
Offered Securities or, if it is created, that it will continue.
17
<PAGE> 19
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Estimated Expenses:
<TABLE>
<S> <C>
Printing and Engraving............................................. $150,000
Fees of Trustees/Transfer Agents/Registrars........................ 50,000
Accountants' Fees.................................................. 50,000
Blue Sky Qualifications Fees....................................... 15,000
SEC Filing Fee..................................................... 172,415*
Rating Service Fees................................................ 500,000
Stock Exchange Listing Fees........................................ 20,000
Legal Fees and Expenses............................................ 10,000
Miscellaneous...................................................... 12,585
--------
Total......................................................... $980,000
</TABLE>
- ---------------
* Actual
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The General Corporation Law of Delaware (Section 102) allows a corporation
to eliminate the personal liability of directors of a corporation to the
corporation or to any of its stockholders for monetary damage for a breach of
his/her fiduciary duty as a director, except in the case where the director
breached his/her duty of loyalty, failed to act in good faith, engaged in
intentional misconduct or knowingly violated a law, authorized the payment of a
dividend or approved a stock repurchase in violation of Delaware corporate law
or obtained an improper personal benefit. The Restated Certificate of
Incorporation, as amended, of Household International, Inc. (the "Company"),
contains a provision which eliminates directors' personal liability as set forth
above.
The General Corporation Law of Delaware (Section 145) gives Delaware
corporations broad powers to indemnify their present and former directors and
officers and those of affiliated corporations against expenses incurred in the
defense of any lawsuit to which they are made parties by reason of being or
having been such directors or officers, subject to specified conditions and
exclusions; gives a director or officer who successfully defends an action the
right to be so indemnified; and authorizes the Company to buy directors' and
officers' liability insurance. Such indemnification is not exclusive of any
other right to which those indemnified may be entitled under any bylaw,
agreement, vote of stockholders or otherwise.
The Company's Restated Certificate of Incorporation, as amended, provides
for indemnification to the fullest extent as expressly authorized by Section 145
of the General Corporation Law of Delaware for directors, officers and employees
of the Company and also to persons who are serving at the request of the Company
as directors, officers or employees of other corporations (including
subsidiaries). This right of indemnification is not exclusive of any other right
which any person may acquire under any statute, bylaw, agreement, contract, vote
of stockholders or otherwise.
The Company has purchased liability policies which indemnify its officers
and directors against loss arising from claims by reason of their legal
liability for acts as officers, subject to limitations and conditions as set
forth in the policies.
Pursuant to agreements which the Company may enter into with underwriters
or agents (forms of which are or will be filed as exhibits to this Registration
Statement) officers and directors of the Company may be entitled to
indemnification by such underwriters or agents against certain liabilities,
including liabilities under the Securities Act of 1933, as amended, arising from
information appearing in the Registration Statement or any Prospectus or
Prospectus Supplement which has been furnished to the Company by such
underwriters or agents.
II-1
<PAGE> 20
ITEM 16. EXHIBITS.
<TABLE>
<S> <C>
1(a) Form of Underwriting Agreement for Debt Securities and Warrants to Purchase
Debt Securities.
1(b)* Form of Underwriting Agreement for Preferred Shares.
1(c)* Forms of Underwriting Agreement for Common Stock.
3(a) Restated Certificate of Incorporation, as amended, of Household International,
Inc.
3(b) Bylaws of Household International, Inc.
4(a) Indenture dated as of October 1, 1993, between Household International, Inc.
and The First National Bank of Maryland, as Trustee.
4(b)+ Indenture between Household International, Inc. and First Interstate Bank of
California, as Trustee.
4(c)+ Indenture between Household International, Inc. and Harris Trust and Savings
Bank, as Trustee.
4(d) Forms of Warrant Agreement, including form of Warrant Certificates.
4(e) Form of Deposit Agreement.
4(f)* Form of Certificate of Designation, Preferences and Rights for Preferred
Shares.
5 Opinion and Consent of Mr. John W. Blenke, Assistant General Counsel and
Secretary of Household International, Inc.
12 Statement on the Computation of Ratio of Earnings to Fixed Charges and to
Combined Fixed Charges and Preferred Stock Dividends (incorporated herein by
reference from Exhibit 12 to the Annual Report on Form 10-K for the fiscal year
ended December 31, 1993 and from Exhibit 12 to the Quarterly Report on Form
10-Q for the quarter ended September 30, 1994 of Household International, Inc.
(File No. 1-8198)).
23(a) Consent of Arthur Andersen LLP, Certified Public Accountants.
23(b) Consent of Mr. John W. Blenke, Assistant General Counsel and Assistant
Secretary of Household International, Inc. is contained in his opinion (Exhibit
5).
24 Powers of Attorney (included on signature page)
25(a) Statement of eligibility and qualification of The First National Bank of
Maryland.
25(b) Statement of eligibility and qualification of First Interstate Bank of
California.
25(c) Statement of eligibility and qualification of Harris Trust and Savings Bank.
</TABLE>
- ---------------
* To be filed as an exhibit to Form 8-K in reference to the specific offering of
Securities, if any, to which it relates.
+ Filing omitted pursuant to Instruction 2 to Item 601 of Regulation S-K because
the exhibit is substantially identical in all material respects to Exhibit
4(a), except as to parties thereto.
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made of
the Securities registered hereby, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in this
Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or any
material change to such information in this Registration Statement;
II-2
<PAGE> 21
provided, however, that the undertakings set forth in paragraphs (i) and (ii)
above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic reports
filed by the Registrant pursuant to section 13 or section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, each such post-effective amendment shall be deemed to be a new
registration statement relating to the Securities offered herein, and the
offering of such Securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment any
of the Securities being registered which remain unsold at the termination of the
offering.
(4) That for purposes of determining any liability under the Securities Act
of 1933, each filing of the Registrant's annual report pursuant to section 13(a)
or section 15(d) of the Securities Exchange Act of 1934 that is incorporated by
reference in this Registration Statement shall be deemed to be a new
registration statement relating to the Securities offered herein, and the
offering of such Securities at that time shall be deemed to be the initial bona
fide offering thereof.
(5) That for purposes of determining any liability under the Securities Act
of 1933, the information omitted from the form of prospectus filed as part of
this Registration Statement in reliance upon Rule 430A and contained in a form
of prospectus filed by the Registrant pursuant to Rule 424(b)(1) or (4) under
the Securities Act of 1933 shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(6) That for purposes of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of prospectus shall
be deemed to be a new Registration Statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the provisions set forth or described in Item 15 of this
Registration Statement, or otherwise, the Registrant has been advised that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Act and is, therefore, unenforceable.
In the event that a claim for indemnification against such liabilities (other
than the payment by the Registrant of expenses incurred or paid by a director,
officer or controlling person in the successful defense of any action, suit or
proceeding) is asserted against the Registrant by such director, officer or
controlling person, in connection with the Securities registered hereby, the
Registrant will, unless in the opinion of its counsel the matter has been
settled by controlling precedent, submit to a court of appropriate jurisdiction
the question whether such indemnification by it is against public policy as
expressed in the Act and will be governed by the final adjudication of such
issue.
II-3
<PAGE> 22
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THIS REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED, IN THE CITY OF PROSPECT HEIGHTS, AND STATE OF ILLINOIS, ON THE 12TH
DAY OF JANUARY, 1995.
HOUSEHOLD INTERNATIONAL, INC.
By: WILLIAM F. ALDINGER
William F. Aldinger
President and
Chief Executive Officer
EACH PERSON WHOSE SIGNATURE APPEARS BELOW CONSTITUTES AND APPOINTS J. W.
BLENKE, L. S. MATTENSON, J. M. POWELL AND P. D. SCHWARTZ AND EACH OR ANY OF THEM
(WITH FULL POWER TO ACT ALONE), HIS/HER TRUE AND LAWFUL ATTORNEY-IN-FACT AND
AGENT, WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION, FOR HIM/HER IN
HIS/HER NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN AND FILE, WITH
THE SECURITIES AND EXCHANGE COMMISSION, ANY AND ALL AMENDMENTS (INCLUDING
POST-EFFECTIVE AMENDMENTS) TO THE REGISTRATION STATEMENT, GRANTING UNTO EACH
SUCH ATTORNEY-IN-FACT AND AGENT FULL POWER AND AUTHORITY TO DO AND PERFORM EACH
AND EVERY ACT AND THING REQUISITE AND NECESSARY TO BE DONE, AS FULLY TO ALL
INTENTS AND PURPOSES AS HE/SHE MIGHT OR COULD DO IN PERSON, HEREBY RATIFYING AND
CONFIRMING ALL THAT SUCH ATTORNEY-IN-FACT AND AGENT OR THEIR SUBSTITUTES MAY
LAWFULLY DO OR CAUSE TO BE DONE BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED AND ON THE 12TH DAY OF JANUARY, 1995.
<TABLE>
<CAPTION>
SIGNATURE TITLE
- --------------------------------------------- ----------------------------------------------
<S> <C>
WILLIAM F. ALDINGER President, Chief Executive Officer, and
- --------------------------------------------- Director (as Principal Executive Officer)
(William F. Aldinger)
DONALD C. CLARK Chairman of the Board and Director
- ---------------------------------------------
(Donald C. Clark)
ROBERT J. DARNALL Director
- ---------------------------------------------
(Robert J. Darnall)
GARY G. DILLON Director
- ---------------------------------------------
(Gary G. Dillon)
- --------------------------------------------- Director
(Mary Johnston Evans)
CYRUS F. FREIDHEIM, JR. Director
- ---------------------------------------------
(Cyrus F. Freidheim, Jr.)
LOUIS E. LEVY Director
- ---------------------------------------------
(Louis E. Levy)
</TABLE>
II-4
<PAGE> 23
<TABLE>
<CAPTION>
SIGNATURE TITLE
- --------------------------------------------- ----------------------------------------------
<C> <S>
Director
- ---------------------------------------------
(George A. Lorch)
JOHN D. NICHOLS Director
- ---------------------------------------------
(John D. Nichols)
GORDON P. OSLER Director
- ---------------------------------------------
(Gordon P. Osler)
Director
- ---------------------------------------------
(James B. Pitblado)
ARTHUR E. RASMUSSEN Director
- ---------------------------------------------
(Arthur E. Rasmussen)
S. JAY STEWART Director
- ---------------------------------------------
(S. Jay Stewart)
LOUIS W. SULLIVAN, M.D. Director
- ---------------------------------------------
(Louis W. Sullivan, M.D.)
RAYMOND C. TOWER Director
- ---------------------------------------------
(Raymond C. Tower)
DAVID A. SCHOENHOLZ Senior Vice President-Chief Financial Officer
- --------------------------------------------- (as Principal Accounting and Financial
(David A. Schoenholz) Officer)
</TABLE>
The Registrant reasonably believes that the security rating to be assigned
to the Securities registered hereunder will make the Securities "investment
grade securities" pursuant to Transaction Requirement B.2 of Form S-3.
II-5
<PAGE> 24
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NO. DESCRIPTION PAGE
- ---------- -------------------------------------------------------------------- ------------
<S> <C> <C>
1(a) Form of Underwriting Agreement for Debt Securities and Warrants to
Purchase Debt Securities.
1(b)* Form of Underwriting Agreement for Preferred Shares.
1(c)* Forms of Underwriting Agreement for Common Stock.
3(a) Restated Certificate of Incorporation, as amended, of Household
International, Inc.
3(b) Bylaws of Household International, Inc.
4(a) Indenture dated as of October 1, 1993, between Household
International, Inc. and The First National Bank of Maryland, as
Trustee.
4(b)+ Indenture between Household International, Inc. and First Interstate
Bank of California, as Trustee.
4(c)+ Indenture between Household International, Inc. and Harris Trust and
Savings Bank, as Trustee.
4(d) Forms of Warrant Agreement, including form of Warrant Certificates.
4(e) Form of Deposit Agreement.
4(f)* Form of Certificate of Designation, Preferences and Rights for
Preferred Shares.
5 Opinion and Consent of Mr. John W. Blenke, Assistant General Counsel
and Assistant Secretary of Household International, Inc.
12 Statement on the Computation of Ratio of Earnings to Fixed Charges
and to Combined Fixed Charges and Preferred Stock Dividends
(incorporated herein by reference from Exhibit 12 to the Annual
Report on Form 10-K for the fiscal year ended December 31, 1993 and
from Exhibit 12 to the Quarterly Report on Form 10-Q for the quarter
ended September 30, 1994 of Household International, Inc. (File No.
1-8198)).
23(a) Consent of Arthur Andersen LLP, Certified Public Accountants.
23(b) Consent of Mr. John W. Blenke, Assistant General Counsel and
Secretary of Household International, Inc. is contained in his
opinion (Exhibit 5).
24 Powers of Attorney (included on signature page)
25(a) Statement of eligibility and qualification of The First National
Bank of Maryland.
25(b) Statement of eligibility and qualification of First Interstate Bank
of California.
25(c) Statement of eligibility and qualification of Harris Trust and
Savings Bank.
</TABLE>
- ---------------
* To be filed as an exhibit to Form 8-K in reference to the specific offering of
Securities, if any, to which it relates.
+ Filing omitted pursuant to Instruction 2 to Item 601 of Regulation S-K because
the exhibit is substantially identical in all material respects to Exhibit
4(a), except as to parties thereto.
<PAGE> 1
Exhibit 1(a)
Household International, Inc.
Underwriting Agreement
[Names of Representative(s)]
[Address]
, 199
Dear Sirs:
From time to time Household International, Inc., a Delaware
corporation (the "Company"), proposes to enter into one or more Pricing
Agreements (each a "Pricing Agreement" and together the "Pricing Agreements")
in the form of Annex I hereto, with such additions and deletions as the parties
thereto may determine, and, subject to the terms and conditions stated herein
and therein, to issue and sell to the underwriters named in Schedule I to the
applicable Pricing Agreement (with respect to each such Pricing Agreement, the
"Underwriters") certain of its debt securities (the "Debt Securities") and, if
applicable, warrants to purchase Debt Securities (the "Warrants") specified in
Schedule II to such Pricing Agreement (with respect to each such Pricing
Agreement, the "Designated Debt Securities" and the "Designated Warrants").
The terms and rights of any particular issuance of Designated
Debt Securities shall be as specified in the applicable Pricing Agreement and
in the indenture, as it may be supplemented from time to time (the
"Indenture"), identified in such Pricing Agreement. The terms and rights of
any particular issuance of Designated Warrants shall be as specified in the
applicable Pricing Agreement and in the warrant agreement (the "Warrant
Agreement") identified in such Pricing Agreement. Each Pricing Agreement shall
constitute an agreement by the Company and the Underwriters to be bound by all
of the provisions of this Underwriting Agreement.
1. Particular sales of Designated Debt Securities and
Designated Warrants may be made from time to time to the Underwriters of such
Debt Securities and Warrants for whom the firms designated as representatives
of the Underwriters of such Debt Securities and Warrants in the Pricing
Agreement relating thereto will act as representatives (the "Representatives").
The term "Representatives" also refers to a single firm acting as sole
representative of the Underwriters and to Underwriters who
<PAGE> 2
act without any firm being designated as their representative. This
Underwriting Agreement shall not be construed as an obligation of the Company
to sell any of the Debt Securities or Warrants or as an obligation of any of
the Underwriters to purchase any of the Debt Securities or Warrants. The
obligation of the Company to issue and sell any of the Debt Securities or
Warrants shall be evidenced by the Pricing Agreement with respect to the
Designated Debt Securities and Designated Warrants specified therein. Each
Pricing Agreement shall specify the aggregate principal amount of such
Designated Debt Securities and the number of Designated Warrants, the public
offering price of such Designated Debt Securities, the purchase price to the
Underwriters of such Designated Debt Securities, the names of the Underwriters
of such Designated Debt Securities, the names of the Representatives of such
Underwriters and the principal amount of such Designated Debt Securities and
the number of Designated Warrants to be purchased by each Underwriter, whether
any of such Designated Debt Securities and Designated Warrants are to be
purchased from the Company pursuant to delayed delivery contracts on terms to
be specified in the Pricing Agreement and such contracts ("Delayed Delivery
Contracts") and shall set forth the date, time and manner of delivery of such
Designated Debt Securities and Designated Warrants and payment for such
Designated Debt Securities and Designated Warrants. The Pricing Agreement
shall also specify (to the extent not set forth in the registration statement
and prospectus with respect thereto) the terms of such Designated Debt
Securities and Designated Warrants. A Pricing Agreement shall be in the form
of an executed writing (which may be in counterparts), and may be evidenced by
an exchange of telegraphic communications or any other rapid transmission
device designed to produce a written record of communications transmitted. The
obligations of the Underwriters under this Agreement and each Pricing Agreement
shall be several and not joint.
2. The Company represents and warrants to, and agrees with,
each of the Underwriters that:
(a) A registration statement (Registration No. 33- ) in
respect of the Debt Securities and the Warrants has been filed with
the Securities and Exchange Commission (the "Commission") in the form
heretofore delivered or to be delivered to the Representatives and,
excluding exhibits to such registration statement, but including all
documents incorporated by reference therein, to the Representatives
for each of the other Underwriters and such registration statement in
such form has been declared effective by the Commission and no stop
order suspending the effectiveness of such registration
-2-
<PAGE> 3
statement has been issued and no proceeding for that purpose has been
initiated or threatened by the Commission (any preliminary prospectus
included in such registration statement being hereinafter called a
"Preliminary Prospectus"; such registration statement, including all
exhibits thereto but excluding each Form T-1, as amended at the time
such registration statement or any part thereof became effective,
being hereinafter called the "Registration Statement"; the prospectus
included in the Registration Statement, in the form in which it has
most recently been filed with, or transmitted for filing to, the
Commission pursuant to Rule 424 of Regulation C on or prior to the
date of this Agreement being hereinafter called the "Prospectus"); any
reference herein to any Preliminary Prospectus or the Prospectus shall
be deemed to refer to and include the documents, if any, incorporated
by reference therein pursuant to the applicable form under the
Securities Act of 1933, as amended (the "Act"), as of the date of such
Preliminary Prospectus or Prospectus, as the case may be; any
reference to any amendment or supplement to any Preliminary Prospectus
or the Prospectus shall be deemed to refer to and include any
documents filed after the date of such Preliminary Prospectus or
Prospectus, as the case may be, under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), and so incorporated by
reference; and any reference to the Prospectus as amended or
supplemented shall be deemed to refer to the Prospectus as amended or
supplemented in relation to the applicable Designated Debt Securities
and Designated Warrants in the form in which it is filed with the
Commission pursuant to Rule 424 under the Act in accordance with
Section 5(a) hereof including any documents incorporated by reference
therein as of the date of such filing or transmission;
(b) The documents incorporated by reference in the
Prospectus, when they became effective or were filed with Commission,
as the case may be, conformed in all material respects to the
requirements of the Act or the Exchange Act, as applicable, and the
rules and regulations of the Commission thereunder, and none of such
documents contained an untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; and any further documents
so filed and incorporated by reference in the Prospectus and in the
Prospectus as amended or supplemented, when they become effective or
are filed
-3-
<PAGE> 4
with the Commission, as the case may be, will conform in all material
respects to the requirements of the Act or the Exchange Act, as
applicable, and the rules and regulations of the Commission thereunder
and will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to
make the statements therein not misleading; provided, however, that
this representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter of Designated
Debt Securities and Designated Warrants through the Representatives
expressly for use in the Prospectus as amended or supplemented
relating to such Debt Securities and Warrants;
(c) The Registration Statement and the Prospectus conform,
and any amendments or supplements thereto will conform, in all
material respects to the requirements of the Act and the Trust
Indenture Act of 1939, as amended (the "Trust Indenture Act"), and the
rules and regulations of the Commission thereunder; the Registration
Statement and any amendment thereof (including the filing of any
annual report on Form 10-K) at the time it became effective, did not
contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading; and the Prospectus, at the time the
Registration Statement became effective did not, as of the date hereof
does not and as of the Time of Delivery (as hereinafter defined) will
not, contain an untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not
misleading; provided, however, that this representation and warranty
shall not apply to any statements or omissions made in reliance upon
and in conformity with information furnished in writing to the Company
by an Underwriter of Designated Debt Securities and Designated
Warrants through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Debt Securities
and Warrants;
(d) The financial statements included or incorporated by
reference in the Registration Statement present fairly the financial
position of the Company and subsidiaries as of the dates indicated and
the
-4-
<PAGE> 5
results of operations and changes in financial position for the
periods specified; and said financial statements have been prepared in
conformity with generally accepted accounting principles applied on a
basis which is consistent in all material respects during the periods
involved;
(e) Since the date of the latest audited financial statements
in the Prospectus there has not been any material change in the
capital stock or long-term debt of the Company (except for changes
resulting from the purchase by the Company of its outstanding
securities for sinking fund purposes) or any material adverse change
in the general affairs or management or the consolidated financial
position, shareholders' equity or results of operations of the Company
and its subsidiaries, taken as a whole, otherwise than as set forth or
contemplated in the Prospectus;
(f) The Company and its significant subsidiaries, within the
meaning of Rule 1-02 of Regulation S-X under the Act (the "Significant
Subsidiaries") are validly organized and existing corporations under
the laws of their respective jurisdictions of incorporation; and the
Company and its Significant Subsidiaries are duly authorized to
conduct in the various jurisdictions in which they do business the
respective businesses therein conducted by them as described in the
Prospectus, except where failure to be so authorized or permitted will
not have a material adverse effect on the business or consolidated
financial condition of the Company and its subsidiaries taken as a
whole;
(g) There are no legal or governmental proceedings pending,
other than those referred to in the Prospectus, to which the Company
or any of its subsidiaries is a party or of which any property of the
Company or any of its subsidiaries is the subject, other than
proceedings which are not reasonably expected, individually or in the
aggregate, to have a material adverse effect on the consolidated
financial position, shareholders' equity or results of operations of
the Company and its subsidiaries taken as a whole; and, to the best of
the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(h) The Debt Securities and the Warrants have been duly
authorized, and, when issued and delivered
-5-
<PAGE> 6
pursuant to this Agreement, the Pricing Agreement and any Delayed
Delivery Contracts will have been duly executed, authenticated, issued
and delivered and will constitute valid and legally binding
obligations of the Company entitled to the benefits provided by the
Indenture and the Warrant Agreement under which such Debt Securities
and Warrants are to be issued, the Indenture and the Warrant Agreement
to be substantially in the forms filed as exhibits to the Registration
Statement; the Indenture has been duly authorized and, when executed
and delivered by the Company and the Trustee thereunder, the Indenture
and the Warrant Agreement will constitute valid and legally binding
instruments enforceable in accordance with their respective terms
except as enforceability may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or affecting the enforcement
of creditors' rights or by general principles of equity; and the Debt
Securities, the Warrants, the Indenture and the Warrant Agreement
conform to the descriptions thereof in the Prospectus as originally
filed with the Commission, and will conform to the descriptions
thereof in the Prospectus as amended or supplemented;
(i) The issue and sale of the Debt Securities and the
Warrants and compliance by the Company with all of the provisions of
the Debt Securities, the Warrants, the Indenture, the Warrant
Agreement, this Agreement, any Pricing Agreement and any Delayed
Delivery Contracts will not conflict with or result in a breach of any
of the terms or provisions of, or constitute a default under, or
result in the creation or imposition of any lien, charge or
encumbrance upon any of the property or assets of the Company or any
of its subsidiaries pursuant to the terms of any indenture, mortgage,
deed of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which
the Company or any of its subsidiaries may be bound or to which any of
the property or assets of the Company or any of its subsidiaries is
subject (except for conflicts, breaches and defaults which would not,
individually or in the aggregate, be materially adverse to the Company
and its subsidiaries taken as a whole or materially adverse to the
transactions contemplated by this Agreement), nor will such action
result in any violation of the provisions of the Certificate or
Articles of Incorporation, as amended, or the By-Laws of the Company
or any of its subsidiaries or any statute or any order, rule or
regulation applicable to the Company
-6-
<PAGE> 7
or any of its subsidiaries of any court or of any Federal, State or
other regulatory authority or other governmental body having
jurisdiction over the Company or any of its subsidiaries; and no
consent, approval, authorization, order, registration or qualification
of or with any court or any such regulatory authority or other
governmental body is required for the issue and sale of the Debt
Securities and the Warrants or the consummation of the other
transactions contemplated in this Agreement, any Pricing Agreement, or
any Delayed Delivery Contracts except the registration under the Act
of the Debt Securities and the Warrants, the qualification of the
Indenture under the Trust Indenture Act and such consents, approvals,
authorizations, registrations or qualifications as may be required
under State securities or Blue Sky laws in connection with the
purchase and distribution of the Debt Securities and the Warrants by
the Underwriters; and
(j) Arthur Andersen & Co., who have certified certain
financial statements included in the Registration Statement and the
Prospectus, are independent public accountants as required by the Act
and the rules and regulations of the Commission thereunder.
3. Upon the execution of the Pricing Agreement applicable to
any Designated Debt Securities and Designated Warrants and authorization by the
Representatives of the release of such Designated Debt Securities and
Designated Warrants, the several Underwriters propose to offer such Designated
Debt Securities and Designated Warrants for sale upon the terms and conditions
set forth in the Prospectus and any amendment or supplement thereto relating to
such Designated Debt Securities and Designated Warrants.
4. Designated Debt Securities and Designated Warrants to be
purchased by each Underwriter pursuant to the Pricing Agreement relating
thereto, in definitive form to the extent practicable, and in such authorized
denominations and registered in such names as the Representatives may request
upon at least forty-eight hours' prior notice to the Company, shall be
delivered by or on behalf of the Company to the Representatives for the account
of such Underwriter, against payment by such Underwriter or on its behalf of
the purchase price therefor by certified or official bank check or checks,
payable to the order of the Company in the funds specified in such Pricing
Agreement, all at the place and time and date specified in such Pricing
Agreement or at such other place and time and date as the
-7-
<PAGE> 8
Representatives and the Company may agree upon in writing, such time and date
being herein called the "Time of Delivery" for such Designated Debt Securities
and Designated Warrants.
5. The Company agrees with each of the Underwriters of any
Designated Debt Securities and Designated Warrants:
(a) To make no further amendment or any supplement to the
Registration Statement or Prospectus as amended or supplemented after
the date of the Pricing Agreement relating to such Debt Securities and
Warrants and prior to the Time of Delivery for such Debt Securities
and Warrants which shall be disapproved by the Representatives
promptly after reasonable notice thereof; to advise the
Representatives promptly of any such amendment or supplement after
such Time of Delivery and furnish the Representatives with copies
thereof and to file promptly all reports and any definitive proxy or
information statements required to be filed by the Company with the
Commission pursuant to Section 13, 14 or 15(d) of the Exchange Act for
so long as the delivery of a prospectus is required in connection with
the offering or sale of such Debt Securities and Warrants, and during
such same period to advise the Representatives, promptly after it
receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or any
supplement to the Prospectus or any amended Prospectus has been filed
or transmitted for filing, of the issuance by the Commission of any
stop order or of any order preventing or suspending the use of any
Prospectus, of the suspension of the qualification of such Debt
Securities and Warrants for offering or sale in any jurisdiction, of
the initiation or threatening of any proceeding for any such purpose,
or of any request by the Commission for the amending or supplementing
of the Registration Statement or Prospectus or for additional
information; and in the event of the issuance of any such stop order
or of any such order preventing or suspending the use of any
Prospectus or suspending any such qualification, to use promptly its
best efforts to obtain its withdrawal;
(b) Promptly from time to time to take such action as the
Representatives may reasonably request to qualify such Debt Securities
and Warrants for offering and sale under the securities laws of such
jurisdictions as the Representatives may request and to comply with
such laws so as to permit the continuance
-8-
<PAGE> 9
of sales and dealings therein in such jurisdictions for as long as may
be necessary to complete the distribution of such Debt Securities and
Warrants, provided that in connection therewith the Company shall not
be required to qualify as a foreign corporation or to file a general
consent to service of process in any jurisdiction;
(c) To furnish the Underwriters with copies of the Prospectus
as amended or supplemented in such quantities as the Representatives
may from time to time reasonably request, and, if the delivery of a
prospectus is required at any time in connection with the offering or
sale of such Debt Securities and Warrants and if at such time any
event shall have occurred as a result of which the Prospectus as then
amended or supplemented would include an untrue statement of a
material fact or omit to state any material fact necessary in order to
make the statements therein, in the light of the circumstances under
which they were made when such Prospectus is delivered, not
misleading, or, if for any other reason it shall be necessary during
such same period to amend or supplement the Prospectus or to file
under the Exchange Act any document incorporated by reference in the
Prospectus in order to comply with the Act, the Exchange Act or the
Trust Indenture Act, to notify the Representatives and upon their
request to file such document and to prepare and furnish without
charge to each Underwriter and to any dealer in securities as many
copies as the Representatives may from time to time reasonably request
of an amended Prospectus or a supplement to the Prospectus which will
correct such statement or omission or effect such compliance;
(d) To make generally available to its security holders as
soon as practicable, but in any event not later than ninety days after
the close of the period covered thereby, an earnings statement of the
Company and its subsidiaries (which need not be audited) complying
with Section 11(a) of the Act and covering a period of at least twelve
consecutive months beginning not later than the first day of the
fiscal quarter following the Time of Delivery; and
(e) During the period beginning from the date of the Pricing
Agreement for such Designated Debt Securities and Designated Warrants
and continuing to and including the later of (i) the termination of
trading restrictions on such Designated Debt Securities
-9-
<PAGE> 10
and Designated Warrants, as notified to the Company by the
Representatives and (ii) the Time of Delivery for such Designated Debt
Securities and Designated Warrants, not to offer, sell, contract to
sell or otherwise dispose of any debt securities of the Company
(except for Debt Securities issued upon exercise of warrants) which
mature more than nine months after such Time of Delivery and which are
substantially similar to such Designated Debt Securities, without the
prior written consent of the Representatives, provided, however, that
in no event shall the foregoing period extend more than fifteen
calendar days from the date of the Pricing Agreement.
6. The Company covenants and agrees with the several
Underwriters that the Company will pay or cause to be paid the following: (i)
the fees, disbursements and expenses of the Company's counsel and accountants
in connection with the registration of the Debt Securities and the Warrants
under the Act and all other expenses in connection with the preparation,
printing and filing of the Registration Statement, any Preliminary Prospectus
and the Prospectus and amendments and supplements thereto and the mailing and
delivering of copies thereof to the Underwriters and dealers; (ii) the cost of
printing or reproducing this Agreement, any Pricing Agreement, any Delayed
Delivery Contract, any Indenture and supplements thereto, any Warrant Agreement
and amendments thereto, and any Blue Sky Survey and Legal Investment
Memorandum; (iii) all expenses in connection with the qualification of the Debt
Securities and the Warrants for offering and sale under state securities laws
as provided in Section 5(b) hereof, including the fees and disbursements of
counsel for the Underwriters in connection with such qualification and in
connection with the Blue Sky Survey and Legal Investment Memorandum; (iv) any
fees charged by securities rating services for rating the Debt Securities; (v)
any filing fees incident to any required review by the National Association of
Securities Dealers, Inc. of the terms of the sale of the Debt Securities and
the Warrants; (vi) the cost of preparing the Debt Securities and the Warrants;
(vii) the fees and expenses of any Trustee and any agent of any Trustee, the
fees and expenses of any warrant agent, and the fees and disbursements of
counsel for any Trustee or any warrant agent in connection with any Indenture,
Warrant Agreement, the Debt Securities and the Warrants; and (viii) all other
costs and expenses incident to the performance of its obligations hereunder
which are not otherwise specifically provided for in this Section. It is
understood, however, that, except as provided in this Section, Section 8 and
Section 11 hereof, the Underwriters will pay all of their own costs and
expenses, including the fees of their counsel, transfer taxes on resale of any
of the Debt
-10-
<PAGE> 11
Securities or Warrants by them, and any advertising expenses connected with any
offers they may make.
7. The obligations of the Underwriters of any Designated Debt
Securities and any Designated Warrants hereunder shall be subject, in their
discretion, to the condition that all representations and warranties and other
statements of the Company herein are, at and as of the Time of Delivery for
such Designated Debt Securities and Designated Warrants, true and correct, the
condition that the Company shall have performed all of its obligations
hereunder theretofore to be performed, and the following additional conditions:
(a) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceeding for
that purpose shall have been initiated or threatened by the
Commission; and all requests for additional information on the part of
the Commission shall have been complied with to the Representatives'
reasonable satisfaction;
(b) Counsel for the Underwriters shall have furnished to the
Representatives such opinion or opinions, dated the Time of Delivery
for such Designated Debt Securities and Designated Warrants, with
respect to the incorporation of the Company, the validity of the
Indenture, the Designated Debt Securities, the Designated Warrants,
the Warrant Agreement, the Registration Statement, the Prospectus as
amended or supplemented and other related matters as the
Representatives may reasonably request and such counsel shall have
received such papers and information as they may reasonably request to
enable them to pass upon such matters;
(c) Counsel for the Company shall have furnished to you his
written opinion, dated the Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Delaware;
(ii) The Significant Subsidiaries of the Company are
validly organized and existing corporations under the laws of
their respective jurisdictions of incorporation; and all of
the issued shares of capital stock
-11-
<PAGE> 12
of each Significant Subsidiary have been duly and
validly authorized and issued, are fully paid and
non-assessable and (other then certain preferred shares issued
by Household Finance Corporation and Household Global Funding,
Inc.) are owned directly or indirectly by the Company, free
and clear of all liens, encumbrances, equities or claims;
(iii) The Company and its Significant Subsidiaries
are duly authorized to conduct in the various jurisdictions in
which they do business the respective businesses therein
conducted by them as described in the Prospectus, except where
failure to be so permitted or failure to be so authorized will
not have a material adverse effect on the business or
consolidated financial condition of the Company and its
subsidiaries taken as a whole;
(iv) The Company has an authorized capitalization as
set forth in the Prospectus as amended or supplemented and all
of the outstanding shares of its common and preferred stock
have been duly and validly authorized and issued and are fully
paid and nonassessable;
(v) To the best of such counsel's knowledge, there
are no legal or governmental proceedings pending, other than
those referred to or incorporated in the Prospectus, to which
the Company or any of its subsidiaries is a party or of which
any property of the Company or any of its subsidiaries is the
subject which individually or in the aggregate is material,
and, to the best of such counsel's knowledge, no such
proceedings are threatened or contemplated by governmental
authorities or threatened by others;
(vi) This Agreement and the Pricing Agreement with
respect to the Designated Debt Securities and the Designated
Warrants have been duly authorized, executed and delivered by
the Company;
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<PAGE> 13
(vii) Each Delayed Delivery Contract has been duly
authorized, executed and delivered by the Company and is a
valid and legally binding agreement of the Company in
accordance with its terms;
(viii) The Indenture and the Warrant Agreement have
been duly authorized, executed and delivered by the Company,
and constitute valid and legally binding instruments of the
Company enforceable in accordance with their respective terms
except as enforcement of the provisions thereof may be limited
by bankruptcy, insolvency, reorganization or other laws
relating to or affecting the enforcement of creditors' rights
or by general principles of equity; the Indenture has been
duly qualified under the Trust Indenture Act; and all taxes
and fees required to be paid with respect to the execution of
the Indenture and the Warrant Agreement and the issuance of
the Designated Debt Securities and the Designated Warrants
have been paid;
(ix) The Designated Debt Securities and the
Designated Warrants have been duly authorized and executed
and, when the Designated Debt Securities and the Designated
Warrants have been duly authenticated, issued and delivered
against payment of the agreed consideration therefor, the
Designated Debt Securities and the Designated Warrants will
constitute valid and legally binding obligations of the
Company and, with like exception as noted in subdivision
(viii) above, will be entitled to the benefits provided by the
Indenture and the Warrant Agreement; and the Designated Debt
Securities, the Designated Warrants, the Indenture and the
Warrant Agreement conform to the descriptions thereof in the
Prospectus as amended or supplemented;
(x) The issue and sale of the Designated Debt
Securities and the Designated Warrants, and the compliance of
the Company with all of the provisions of the Designated Debt
Securities, the Designated Warrants, the Indenture, the
Warrant Agreement and this
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<PAGE> 14
Agreement, will not conflict with or result in a breach of any
of the terms or provisions of, or constitute a default under,
or result in the creation or imposition of any lien, charge or
encumbrance upon any of the property or assets of the Company
or any of its subsidiaries pursuant to the terms of, any
indenture, mortgage, deed of trust, loan agreement, or other
agreement or instrument, known to such counsel to which the
Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries may be bound or to which
any of the property or assets of the Company or any of its
subsidiaries is subject (except for conflicts, breaches and
defaults which would not, individually or in the aggregate, be
materially adverse to the Company and its subsidiaries taken
as a whole or materially adverse to the transactions
contemplated by this Agreement), nor will such action result
in any violation of the provisions of the Certificate or
Articles of Incorporation, as amended, or the By-Laws of the
Company or any of its subsidiaries or, to the best of such
counsel's knowledge, any statute or any order, rule or
regulation applicable to the Company or any of its
subsidiaries of any court or of any Federal, State or other
regulatory authority or other governmental body having
jurisdiction over the Company or any of its subsidiaries; and
no consent, approval, authorization, order, registration or
qualification of or with any court or any such regulatory
authority or other governmental body is required for the issue
and sale of the Designated Debt Securities and Designated
Warrants or the consummation of the other transactions
contemplated in this Agreement and the Pricing Agreement,
except the registration under the Act of the Designated Debt
Securities and the Designated Warrants, the qualification of
the Indenture under the Trust Indenture Act and such consents,
approvals, authorizations, registrations or qualifications as
may be required under State securities or Blue Sky laws in
connection with the public offering of the Designated Debt
Securities and the Designated Warrants by the Underwriters;
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<PAGE> 15
(xi) The documents incorporated by reference in the
Prospectus as amended or supplemented (other than the
financial statements and related schedules therein, as to
which such counsel need express no opinion), when they became
effective or were filed with the Commission, as the case may
be, complied as to form in all material respects with the
requirements of the Act or the Exchange Act, as applicable,
and the rules and regulations of the Commission thereunder;
and such counsel has no reason to believe that any of such
documents, when they became effective or were so filed, as the
case may be, contained, in the case of documents which became
effective under the Act, an untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading, and, in the case of documents which were filed
under the Exchange Act with the Commission, an untrue
statement of a material fact or omitted to state a material
fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made when
such documents were so filed, not misleading;
(xii) The Registration Statement has become and is
now effective under the Act and, to the best of such counsel's
knowledge, no proceedings for a stop order in respect of the
Registration Statement are pending or threatened under Section
8(d) or 8(e) of the Act; and
(xiii) The Registration Statement and the Prospectus
as amended or supplemented and any further amendments and
supplements thereto made by the Company prior to the Time of
Delivery for the Designated Debt Securities and the Designated
Warrants (other than the financial statements and related
schedules therein, as to which such counsel need express no
opinion) comply as to form in all material respects with the
requirements of the Act and the Trust Indenture Act and the
rules and regulations thereunder; such counsel has no reason
to believe that either
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<PAGE> 16
the Registration Statement or any amendment
thereof (including the filing of any annual report on Form
10-K) at the time it became effective contained an untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading or that the Prospectus as
amended or supplemented at the time it was filed or
transmitted for filing pursuant to Rule 424 under the Act
contained or as amended or supplemented at the Time of
Delivery contains an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order
to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and
such counsel does not know of any contracts required to be
filed with the Registration Statement which are not so filed;
(d) At the Time of Delivery for the Designated Debt
Securities and the Designated Warrants, the independent accountants of
the Company who have certified the financial statements of the Company
and its subsidiaries included or incorporated by reference in the
Registration Statement shall have furnished to the Representatives a
letter, dated such Time of Delivery, in form and substance
satisfactory to the Representatives, to the effect set forth in the
letter furnished to counsel for the Underwriters by said independent
accountants at the time the Registration Statement was filed under the
Act, and as to such other matters as the Representatives may
reasonably request;
(e)(i) The Company and its subsidiaries taken as a whole
shall not have sustained since the date of the latest audited
financial statements included or incorporated by reference in the
Prospectus as amended or supplemented any material loss or
interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree and (ii)
since the respective dates as of which information is given in the
Prospectus as amended or supplemented there shall not have been any
material change in the general affairs of management, or the
consolidated financial position, stockholders' equity or results of
operations of the Company and its
-16-
<PAGE> 17
subsidiaries taken as a whole, otherwise than as set forth or
contemplated in the Prospectus as amended or supplemented, the effect
of which in any such case described in clause (i) or (ii) is in the
judgment of the Representatives so material and adverse as to make it
impracticable or inadvisable to proceed with the public offering or
the delivery of the Designated Debt Securities and the Designated
Warrants on the terms and in the manner contemplated in the Prospectus
as amended or supplemented;
(f) Subsequent to the date of the Pricing Agreement relating
to the Designated Debt Securities and the Designated Warrants no
downgrading shall have occurred in the rating accorded the Company's
senior debt securities by any "nationally recognized statistical
rating organization," as that term is defined by the Commission for
purposes of Rule 436(g) of the Act;
(g) Subsequent to the date of the Pricing Agreement relating
to the Designated Debt Securities and the Designated Warrants there
shall not have occurred any of the following: (i) a suspension or
material limitation in trading in securities generally on the New York
Stock Exchange; (ii) a general moratorium on commercial banking
activities in New York declared by either Federal or New York State
authorities; or (iii) the outbreak or material escalation of
hostilities or the declaration of a national emergency or war, if the
effect of any such event specified in this clause (iii) in the
reasonable judgment of the Representatives makes it impracticable or
inadvisable to proceed with the public offering or the delivery of the
Designated Debt Securities and the Designated Warrants on the terms
and in the manner contemplated in the Prospectus as amended or
supplemented; and
(h) The Company shall have furnished or caused to be
furnished to the Representatives at the Time of Delivery for the
Designated Debt Securities and the Designated Warrants certificates of
officers of the Company satisfactory to the Representatives as to the
accuracy of the representations and warranties of the Company herein
at and as of such Time of Delivery (provided that, each representation
and warranty which refers to the Prospectus in Section 2 hereof shall
be in relation to the Prospectus as amended or supplemented relating
to the Designated Debt Securities
-17-
<PAGE> 18
and the Designated Warrants), as to the performance by
the Company of all of its obligations hereunder to be
performed at or prior to such Time of Delivery, and as to such
other matters as the Representatives may reasonably request.
8. (a) The Company will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon an untrue statement or
alleged untrue statement of a material fact contained in any Preliminary
Prospectus, Preliminary Prospectus Supplement, the Registration Statement, the
Prospectus or the Prospectus as amended or supplemented, or any amendment or
supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will reimburse
each Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such action or
claim, as such expenses are incurred; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any Preliminary
Prospectus, Preliminary Prospectus Supplement, the Registration Statement, the
Prospectus or the Prospectus as amended or supplemented or any such amendment
or supplement in reliance upon and in conformity with written information
furnished to the Company by any Underwriter of Designated Debt Securities and
Designated Warrants through the Representatives expressly for use in the
Prospectus as amended or supplemented relating to such Securities.
(b) Each Underwriter will indemnify and hold harmless the
Company against any losses, claims, damages or liabilities to which the Company
may become subject, under the Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, any Preliminary Prospectus Supplement,
the Registration Statement, the Prospectus or the Prospectus as amended or
supplemented, or any amendment or supplement thereto, or arise out of or are
based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue
-18-
<PAGE> 19
statement or omission or alleged omission was made in any Preliminary
Prospectus, any Preliminary Prospectus Supplement, the Registration Statement,
the Prospectus or the Prospectus as amended or supplemented, or any such
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company by such Underwriter through the
Representatives expressly for use therein; and will reimburse the Company for
any legal or other expenses reasonably incurred by the Company in connection
with investigating or defending any such action or claim, as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against
the indemnifying party under such subsection, notify the indemnifying party in
writing of the commencement thereof; but the omission so to notify the
indemnifying party shall not relieve it from any liability which it may have to
any indemnified party otherwise than under such subsection. In case any such
action shall be brought against any indemnified party and it shall notify the
indemnifying party of the commencement thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it shall wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel satisfactory to such indemnified party (who shall not,
except with the consent of the indemnified party, be counsel to the
indemnifying party), and, after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party under such
subsection for any legal expenses of other counsel or any other expenses, in
each case subsequently incurred by such indemnified party, in connection with
the defense thereof other than reasonable costs of investigation.
(d) If the indemnification provided for in this Section 8 is
unavailable to an indemnified party under subsection (a) or (b) above in
respect of any losses, claims, damages or liabilities (or actions in respect
thereof) referred to therein, then each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a result of such
losses, claims, damages or liabilities (or actions in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received by the
Company on the one hand and the Underwriters of the Designated Debt Securities
and the Designated Warrants on the other from the offering of the Designated
Debt Securities and the Designated Warrants to which such loss, claim, damage
or liability (or action in respect thereof) relates. If, however, the
allocation provided by the immediately preceding
-19-
<PAGE> 20
sentence is not permitted by applicable law or if the indemnified party failed
to give the notice required under subsection (c) above, then each indemnifying
party shall contribute to such amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the Company on the one hand and the Underwriters
of the Designated Debt Securities and the Designated Warrants on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions in respect thereof), as well as any
other relevant equitable considerations. The relative benefits received by the
Company on the one hand and such Underwriters on the other shall be deemed to
be in the same proportion as the total net proceeds from such offering (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by such Underwriters. The relative fault
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statements of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company or such Underwriters and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The Company and the Underwriters agree that it would not be just and
equitable if contribution pursuant to this subsection (d) were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this subsection (d). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or action in respect thereof) referred to above
in this subsection (d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (d), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the applicable
Designated Debt Securities and the Designated Warrants underwritten by it and
distributed to the public were offered to the public exceeds the amount of any
damages which such Underwriter has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. The obligations of the
Underwriters of Designated Debt Securities and Designated Warrants in this
subsection (d) to contribute are several in proportion to their respective
underwriting obligations with respect to such Debt Securities and Warrants and
not joint.
-20-
<PAGE> 21
(e) The obligations of the Company under this Section 8 shall
be in addition to any liability which the Company may otherwise have and shall
extend, upon the same terms and conditions, to each person, if any, who
controls any Underwriter within the meaning of the Act; and the obligations of
the Underwriters under this Section 8 shall be in addition to any liability
which the respective Underwriters may otherwise have and shall extend, upon the
same terms and conditions, to each officer and director of the Company and to
each person, if any, who controls the Company within the meaning of the Act.
9. (a) If any Underwriter shall default in its obligation to
purchase the Designated Debt Securities and the Designated Warrants which it
has agreed to purchase under the Pricing Agreement relating to such Designated
Debt Securities and Designated Warrants, the Representatives may in their
discretion arrange for themselves or another party or other parties to purchase
such Designated Debt Securities and Designated Warrants on the terms contained
herein. If within thirty-six hours after such default by any Underwriter the
Representatives do not arrange for the purchase of such Designated Debt
Securities and Designated Warrants, then the Company shall be entitled to a
further period of thirty-six hours within which to procure another party or
other parties satisfactory to the Representatives to purchase such Designated
Debt Securities and Designated Warrants on such terms. In the event that,
within the respective prescribed period, the Representatives notify the Company
that they have so arranged for the purchase of such Designated Debt Securities
and Designated Warrants, or the Company notifies the Representatives that it
has so arranged for the purchase of such Designated Debt Securities and
Designated Warrants, the Representatives or the Company shall have the right to
postpone the Time of Delivery for such Designated Debt Securities and
Designated Warrants for a period of not more than seven days, in order to
effect whatever changes may thereby be made necessary in the Registration
Statement or the Prospectus as amended or supplemented, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments or supplements to the Registration Statement or the Prospectus which
in the opinion of the Representatives may thereby be made necessary. The term
"Underwriter" as used in this Agreement shall include any person substituted
under this Section with like effect as if such person had originally been a
party to the Pricing Agreement with respect to such Designated Debt Securities
and Designated Warrants.
(b) If, after giving effect to any arrangements for the
purchase of the Designated Debt Securities and the Designated Warrants of a
defaulting Underwriter or Underwriters by the Representatives and the Company
as provided in subsection (a)
-21-
<PAGE> 22
above, the aggregate principal amount of such Designated Debt Securities which
remains unpurchased does not exceed one-eleventh of the aggregate principal
amount of the Designated Debt Securities to be purchased at the Time of
Delivery for such Designated Debt Securities, then the Company shall have the
right to require each non-defaulting Underwriter to purchase the principal
amount of Designated Debt Securities and the number of Designated Warrants
which such Underwriter agreed to purchase under the Pricing Agreement relating
to such Designated Debt Securities and Designated Warrants and, in addition, to
require each non-defaulting Underwriter to purchase its pro rata share (based
on the principal amount of Designated Debt Securities and the number of
Designated Warrants which such Underwriter agreed to purchase under such
Pricing Agreement) of the Designated Debt Securities and the Designated
Warrants of such defaulting Underwriter or Underwriters for which such
arrangements have not been made; but nothing herein shall relieve a defaulting
Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the
purchase of the Designated Debt Securities and the Designated Warrants of a
defaulting Underwriter or Underwriters by the Representatives and the Company
as provided in subsection (a) above, the aggregate principal amount of
Designated Debt Securities and the number of Designated Warrants which remain
unpurchased exceeds one-eleventh of the aggregate principal amount of the
Designated Debt Securities to be purchased at the Time of Delivery for such
Designated Debt Securities, as referred to in subsection (b) above, or if the
Company shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase Designated Debt Securities and
Designated Warrants of a defaulting Underwriter or Underwriters, then the
Pricing Agreement relating to such Designated Debt Securities and Designated
Warrants shall thereupon terminate, without liability on the part of any
non-defaulting Underwriter or the Company, except for the expenses to be borne
by the Company and the Underwriters as provided in Section 6 hereof and the
indemnity and contribution agreements in Section 8 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
10. The respective indemnities, agreements, representations,
warranties and other statements of the Company and the several Underwriters, as
set forth in this Agreement or made by or on behalf of them, respectively,
pursuant to this Agreement, shall remain in full force and effect, regardless
of any investigation (or any statement as to the results thereof) made by or on
behalf of any Underwriter or any controlling person of any Underwriter, or the
Company, or any officer or director or controlling person of the Company, and
shall survive delivery of
-22-
<PAGE> 23
and payment for the Designated Debt Securities and the Designated Warrants.
11. If any Pricing Agreement shall be terminated pursuant to
Section 9 hereof, the Company shall not then be under any liability to any
Underwriter with respect to the Designated Debt Securities and the Designated
Warrants covered by such Pricing Agreement except as provided in Section 6 and
Section 8 hereof; but, if for any other reason Designated Debt Securities and
Designated Warrants are not delivered by or on behalf of the Company as
provided herein, the Company will reimburse the Underwriters through the
Representatives for all out-of-pocket expenses approved in writing by the
Representatives, including fees and disbursements of counsel, reasonably
incurred by the Underwriters in making preparations for the purchase, sale and
delivery of such Designated Debt Securities and Designated Warrants, but the
Company shall then be under no further liability to any Underwriter with
respect to such Designated Debt Securities and Designated Warrants except as
provided in Section 6 and Section 8 hereof.
12. In all dealings hereunder, the Representatives of the
Underwriters of Designated Debt Securities and Designated Warrants shall act on
behalf of each of such Underwriters, and the parties hereto shall be entitled
to act and rely upon any statement, request, notice or agreement on behalf of
any Underwriter made or given by such Representatives.
All statements, requests, notices and agreements hereunder
shall be in writing or by telegram if promptly confirmed in writing and if to
the Underwriters shall be sufficient in all respects, if delivered or sent by
registered mail to the address of the Representatives as set forth in the
Pricing Agreement; and if to the Company shall be sufficient in all respects if
delivered or sent by registered mail to the address of the Company set forth in
the Registration Statement: Attention: Secretary; provided, however, that any
notice to an Underwriter pursuant to Section 8(c) hereof shall be delivered or
sent by registered mail to such Underwriter at its address set forth in its
Underwriters' Questionnaire delivered to the Company.
13. This Agreement and each Pricing Agreement shall be
binding upon, and inure solely to the benefit of, the Underwriters, the Company
and, to the extent provided in Section 8 and Section 10 hereof, the officers
and directors of the Company and each person who controls the Company or any
Underwriter, and their respective heirs, executors, administrators, successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement or
-23-
<PAGE> 24
any such Pricing Agreement. No purchaser of any of the Debt Securities or
Warrants from any Underwriter shall be deemed a successor or assign by reason
merely of such purchase.
14. Time shall be of the essence of each Pricing Agreement.
15. This Agreement and each Pricing Agreement shall be
construed in accordance with the laws of the State of Illinois.
16. This Agreement and each Pricing Agreement may be executed
by any one or more of the parties hereto and thereto in any number of
counterparts, each of which shall be deemed to be an original, but all such
respective counterparts shall together constitute one and the same instrument.
If the foregoing is in accordance with your understanding,
please sign and return to us counterparts hereof.
Very truly yours,
HOUSEHOLD INTERNATIONAL, INC.
By:____________________________________
[Title]
Accepted as of the date hereof:
[Name(s) of Representative(s)]
By: __________________________
[Title]
-24-
<PAGE> 25
ANNEX I
PRICING AGREEMENT
[Names of Representative(s)]
As Representatives of the several
Underwriters named in Schedule I hereto,
[Address]
, 19
Dear Sirs:
Household International, Inc. (the "Company") proposes,
subject to the terms and conditions stated herein and in the Underwriting
Agreement dated , (the "Underwriting Agreement"), between the
Company on the one hand and [names of representative[s] named therein] on the
other hand, to issue and sell to the Underwriters named in Schedule I hereto
(the "Underwriters") the Designated Debt Securities and the Designated Warrants
specified in Schedule II hereto less the principal amount of Designated Debt
Securities and the number of Designated Warrants covered by Delayed Delivery
Contracts ("Delayed Delivery Contracts") as provided below (such Designated
Debt Securities and Designated Warrants covered by Delayed Delivery Contracts
being hereinafter referred to collectively as Contract Securities). Each of
the provisions of the Underwriting Agreement to be a part of this Agreement is
incorporated herein by reference in its entirety, and shall be deemed to be a
part of this Agreement to the same extent as if such provision had been set
forth in full herein; and each of the representations and warranties set forth
therein shall be deemed to have been made at and as of the date of this Pricing
Agreement, except that each of the representations and warranties set forth in
Section 2 of the Underwriting Agreement with respect to the Prospectus or the
information contained in the Prospectus shall constitute a representation or
warranty thereof (a) as of the date of the Underwriting Agreement with respect
to the Prospectus, and also (b) as of the date of this Pricing Agreement with
respect to the Prospectus as amended or supplemented. Each reference to the
Representatives herein and in the provisions of the Underwriting Agreement so
incorporated by reference shall be deemed to refer to you. Unless otherwise
defined herein, terms defined in the Underwriting Agreement are used herein as
therein defined.
An amendment to the Registration Statement, or a supplement to
the Prospectus, as the case may be, relating to the Designated Securities, in
the form heretofore delivered to you is
<PAGE> 26
now proposed to be filed with, or in the case of a supplement transmitted for
filing to, the Commission.
The Company hereby authorizes the Underwriters to solicit
offers to purchase Designated Debt Securities and Designated Warrants from the
Company pursuant to Delayed Delivery Contracts, substantially in the form of
Schedule III attached hereto but with such changes therein as you and the
Company may authorize or approve. The Underwriters will endeavor to make such
arrangements, and as compensation therefor the Company will pay to you, for the
accounts of the Underwriters, at the Time of Delivery, a commission of % of
the principal amount of Designated Debt Securities for which Delayed Delivery
Contracts have been made. Delayed Delivery Contracts are to be with
institutional investors of the types mentioned in the last paragraph under the
caption "Plan of Distribution" in the Prospectus and subject to other
conditions therein set forth. The Company will enter into a Delayed Delivery
Contract in each case arranged by the Underwriters where the Company has
advised you of its approval of the proposed sale of Contract Securities to the
purchaser thereunder; provided, however, that the minimum principal amount of
Designated Debt Securities covered by any Delayed Delivery Contract with any
purchaser or any Delayed Delivery Contract with affiliated purchasers shall be
$ and the aggregate principal amount of Designated Debt Securities
covered by Delayed Delivery Contracts shall not exceed $ , unless
the Company shall otherwise agree in writing. However, if the aggregate
principal amount of Designated Debt Securities requested for delayed delivery
is less than $ , the Company will have the right to reject all
requests. The Underwriters will not have any responsibility in respect of the
validity or performance of Delayed Delivery Contracts.
The amount of Contract Securities to be deducted from the
principal amount of Designated Debt Securities and the number of Designated
Warrants to be purchased by each Underwriter as set forth in Schedule I hereto
shall be, in each case, the amount of Contract Securities which the Company has
been advised by you have been attributed to such Underwriter, provided that if
the Company has not been so advised, the amount of Contract Securities to be so
deducted shall be, in each case, that proportion of Contract Securities which
the principal amount of Designated Debt Securities and the number of Designated
Warrants to be purchased by such Underwriter under this Agreement bears to the
total principal amount of the Designated Debt Securities (rounded as you may
determine to the nearest $1,000 principal amount) and the total number of
Designated Warrants. The total principal amount of Designated Debt Securities
to be purchased by all the Underwriters shall be $ less the
principal
-2-
<PAGE> 27
amount of the Designated Debt Securities covered by Delayed Delivery Contracts
and the total number of Designated Warrants so purchased shall be less
the number of Designated Warrants covered by such Contracts. The Company will
deliver to you not later than 3:30 p.m., Chicago time, on the business day
preceding the Time of Delivery (or such other time and date as you and the
Company may agree upon in writing) a written notice setting forth the principal
amount of Designated Debt Securities and the number of Designated Warrants
covered by Delayed Delivery Contracts.
Subject to the terms and conditions set forth herein and in
the Underwriting Agreement, the Company agrees to issue and sell to each of the
Underwriters, and each of the Underwriters agrees, severally and not jointly,
to purchase from the Company, at a purchase price to the Underwriters set forth
in Schedule II hereto, the principal amount of Designated Debt Securities and
number of Designated Warrants set forth opposite the name of such Underwriter
in Schedule I hereto less such Underwriter's portion of Contract Securities
determined as provided in the preceding paragraph.
If the foregoing is in accordance with your understanding,
please sign and return to us six counterparts hereof, and upon acceptance
hereof by you, on behalf of each of the Underwriters, this letter and such
acceptance hereof, including the provisions of the Underwriting Agreement
incorporated herein by reference, shall constitute a binding agreement between
each of the Underwriters and the Company. It is understood that your
acceptance of this letter on behalf of each of the Underwriters is or will be
pursuant to the authority set forth in a form of Agreement among Underwriters,
the form of which shall be supplied to the Company upon request.
Very truly yours,
HOUSEHOLD INTERNATIONAL, INC.
By
---------------------------
-3-
<PAGE> 28
Accepted as of the date hereof:
[Name(s) of Representative(s)]
By
----------------------------
(Title)
On behalf of each of the Underwriters
-4-
<PAGE> 1
EXHIBIT 3(a)
HOUSEHOLD INTERNATIONAL, INC.
RESTATED CERTIFICATE OF INCORPORATION INDEX
<TABLE>
<CAPTION>
PAGE DATE DESCRIPTION
- ---- -------- -----------
<S> <C> <C>
2 9/4/81 Restated Certificate of Incorporation
16 7/25/84 Certificate of Change of Address of Registered Office and of Registered Agent
18 11/14/94 Certificate of Elimination for Series A Junior Participating Preferred Stock and
Certificate of Designation, Preferences and Rights of Series A Junior Participating Preferred
Stock
26 5/13/87 Certificate of Amendment (Article VII)
29 7/11/89 Certificate of Elimination for $2.375 Cumulative Convertible Voting Preferred Stock and $2.50
Cumulative Convertible Voting Preferred Stock, Certificate of Designation, Preferences and Rights
of $2.375 Cumulative Convertible Voting Preferred Stock (dated 6/25/81) and $2.50 Cumulative
Convertible Voting Preferred Stock (dated 6/25/81)
40 11/6/89 Certificate of Designation, Preferences and Rights of 9-1/2% Cumulative Preferred Stock, Series
1989-A
47 7/18/90 Certificate of Designation, Preferences and Rights of Flexible Rate Auction Preferred Stock,
Series A and B
89 11/14/94 Certificate of Elimination for 11-1/4% Enhanced Rate Cumulative Preferred Stock and
Certificate of Designation, Preferences and Rights of 11-1/4% Enhanced Rate Cumulative Preferred
Stock
96 8/5/91 Certificate of Designation, Preferences and Rights of 9-1/2% Cumulative Preferred Stock, Series
1991-A
103 10/14/92 Certificate of Designation, Preferences and Rights of 8-1/4% Cumulative Preferred Stock, Series
1992-A
110 5/12/93 Certificate of Amendment (Article IV)
111 7/13/93 Certificate of Elimination for Flexible Rate Auction Preferred Stock, Series A
112 9/1/93 Certificate of Designation, Preferences and Rights of 7.35% Cumulative Preferred Stock, Series
1993-A
</TABLE>
- 1 -
<PAGE> 2
RESTATED
CERTIFICATE OF INCORPORATION
OF
HOUSEHOLD INTERNATIONAL, INC.
This Restated Certificate of Incorporation was duly adopted by the
Board of Directors of Household International, Inc. in accordance with the
provisions of Section 245 of the General Corporation Law of the State of
Delaware. This Restated Certificate of Incorporation only restates and
integrates and does not further amend the provisions of the Corporation's
certificate of incorporation as heretofore amended or supplemented, and there
is no discrepancy between those provisions and the provisions of this Restated
Certificate of Incorporation. The original Certificate of Incorporation was
filed with the Secretary of State of Delaware on February 20, 1981.
ARTICLE I
The name of the corporation is Household International, Inc.
ARTICLE II
The address of the Corporation's registered office in the State of
Delaware is 100 West Tenth Street, Wilmington, Delaware 19899. The name of its
registered agent at such address is The Corporation Trust Company, in the
county of New Castle.
ARTICLE III
The Corporation is to engage in any lawful act or activity for which
corporations may be organized under the General Corporation Law of Delaware.
ARTICLE IV
The total number of shares that may be issued by the Corporation is
75,655,004 of which 8,155,004 shares shall be Preferred Stock without par value
and 67,500,000 shares shall be Common Stock of the par value of $1 per share.
The 8,155,004 shares of Preferred Stock may be issued from time to
time in one or more series, which may have such designations, powers,
preferences and relative, participating, optional or other special rights, and
qualifications, limitations or restrictions thereof, as shall be stated in the
resolution or resolutions (authorizing resolutions) providing for the issue of
such shares adopted by the Board of Directors. Without otherwise limiting the
generality of the foregoing provision, the Board of Directors is expressly
authorized to provide, with respect to each such series, that:
- 2 -
<PAGE> 3
(a) the shares of such series shall be subject to redemption
(including redemption through a sinking fund or analogous fund) at such time or
times and at such price or prices as shall be stated in the authorizing
resolutions;
(b) the holders of the shares of such series shall be entitled to
receive dividends at such rates, on such conditions and at such times, payable
in preference, or in such relation, to the dividends payable on any other class
or classes or of any other series of stock of the Corporation, and cumulative
or non-cumulative, all as shall be stated in the authorizing resolutions;
(c) the holders of the shares of such series shall be entitled to such
rights upon the dissolution, or upon any distribution of the assets, of the
Corporation as shall be stated in the authorizing resolutions;
(d) the shares of such series shall be convertible into, or
exchangeable for, shares of any other class or classes of stock, or of any
series thereof, of the Corporation at such price or prices or at such rate or
rates and with such adjustments, all as shall be stated in the authorizing
resolutions;
(e) the shares of such series shall have such voting powers, full or
limited, or no voting powers, as shall be stated in the authorizing
resolutions.
The following is a statement of the powers, preferences, and rights,
and the qualifications, limitations or restrictions thereof, in respect of the
Preferred Stock, except such thereof as the Board of Directors is herein
authorized to provide for, and in respect of the Common Stock:
(1) Except as otherwise provided in authorizing resolutions creating
series of Preferred Stock, each share of Preferred Stock shall rank on a parity
with each other share of Preferred Stock, regardless of series, in preference
to the Common Stock, with respect to the payment of dividends at the
respectively designated rates. No dividend shall be declared or paid on the
shares of any particular series of Preferred Stock unless at the same time a
dividend in like proportion to the respectively designated dividend rates shall
be declared or paid on the shares of each other series of Preferred Stock then
issued and outstanding ranking prior to or on a parity with such particular
series with respect to the payment of dividends. Except as otherwise provided
in the authorizing resolutions creating additional series of Preferred Stock,
each share of Preferred Stock shall rank on a parity with each other share of
Preferred Stock, regardless of series, in preference to the Common Stock, with
respect to the distribution of assets according to the amounts to which the
shares of the respective series are thereupon entitled.
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<PAGE> 4
(2) The holders of shares of the Preferred Stock shall be entitled to
receive, when and as declared by the Board of Directors, out of any funds
legally available for that purpose, dividends in cash at such respective rates,
payable on such dates in each year and in respect of such dividend periods, all
as stated in the authorizing resolutions, before any dividends shall be
declared or paid or set apart for payment upon the Common Stock. Dividends on
the shares of each series of the Preferred Stock shall be cumulative or
non-cumulative and, if cumulative, shall be cumulative from such date, all as
stated in the authorizing resolutions.
At any time after all dividends shall have been paid, as above
provided, on the Preferred Stock of all series then outstanding and after, or
concurrently with, the declaration and setting aside of a sum for the payment
of full dividends on the Preferred Stock of each series then outstanding for
the then current dividend period established for such series, then, but not
prior thereto, such dividends (payable either in cash, stock, or otherwise) as
may be determined by the Board of Directors may be declared and paid on the
Common Stock out of any remaining assets legally available for the declaration
of dividends and the Preferred Stock shall not be entitled to participate in
any such dividends whether payable in cash, stock, or otherwise. No Preferred
Stock or Common Stock may be purchased by the Corporation if any Preferred
Stock dividends are in arrears, and no Preferred Stock may be redeemed in such
case unless all issued and outstanding shares of Preferred Stock are redeemed.
(3) The whole or any part of the Preferred Stock, of any one or more
series, redeemable pursuant to provisions stated in the respective authorizing
resolutions, at the time outstanding, may, at the option of the Board of
Directors, be redeemed, in accordance with such authorizing resolutions, at any
time or from time to time, by the payment or by making provision for payment of
such price or prices per share in the case of every such redemption as shall be
stated in such authorizing resolutions, and, in every case, a sum equal to
accrued and unpaid dividends, if any, with respect to each such share to be so
redeemed, at the rate of the dividends fixed therefor, to the date fixed for
redemption.
In case of redemption of a part only of any series of the Preferred
Stock at the time outstanding, such redemption shall be made by lot or pro rata
in such manner as may be prescribed by resolution of the Board of Directors.
The Board of Directors shall have full power and authority, subject to the
limitations and provisions herein contained and stated in the respective
authorizing resolutions, to prescribe the manner in which and the terms and
conditions upon which Preferred Stock shall be redeemed from time to time.
Notice of the Corporation's intention to redeem Preferred
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<PAGE> 5
Stock, specifying the date of redemption, shall be published in newspapers of
general circulation in New York, New York, and Chicago, Illinois, and shall be
mailed not less than forty-five nor more than ninety days before the redemption
date to the holders of record of such stock to be redeemed at their respective
addresses as the same shall appear on the books of the Corporation, and, if
less than all the shares owned by any such stockholder are then to be redeemed,
the notice shall specify the number of shares thereof which are to be redeemed.
If notice shall be given as aforesaid and the funds necessary to
redeem such stock shall have been set aside by the Corporation (other than by
the trust deposit hereinafter provided for) separate and apart from its other
funds for the benefit of the holders of the shares called for redemption, such
stock shall be redeemed upon such date of redemption and shall cease to be
outstanding; the right to receive dividends thereon shall cease to accrue from
and after such date of redemption and all rights of holders of the Preferred
Stock so called for redemption shall forthwith on such redemption date cease
and terminate except only the right of the holders thereof, upon presentation
and surrender of their respective certificates representing said shares, to
receive the redemption price therefor but without interest, and the right of
conversion, if any.
Anything herein contained to the contrary notwithstanding, if notice
shall be given as aforesaid and before the redemption date an amount sufficient
to redeem the shares so called for redemption shall be deposited in trust to be
applied to such redemption with a bank or with bankers authorized to conduct
banking business or with a trust company, in the Borough of Manhattan, City of
New York, or in the City of Chicago, having a combined capital and surplus of
at least $5,000,000, then, from and after the date of such deposit, such shares
shall be deemed to be redeemed and to cease to be outstanding, and all rights
of the holders of the shares called for redemption, as stockholders of the
Corporation, shall cease except (i) the right, upon presentation and surrender
of their respective certificates representing said shares, to receive from such
bank or bankers or trust company on or after such redemption date the moneys so
deposited in trust, but without interest, and (ii) the right of conversion, if
any. The Corporation shall be entitled to any interest payable on the funds so
deposited. Any redemption funds unclaimed at the end of six years shall be
repaid to the Corporation, after which holders of the redeemed shares shall
look only to the Corporation for payment of the redemption price, but without
interest thereon.
(4) In the event of any voluntary or involuntary liquidation,
dissolution, or winding up of the Corporation, the holders of the Preferred
Stock shall be entitled to be paid or to have set apart for payment such sum or
sums per share as shall be stated in the respective authorizing resolutions,
together in
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<PAGE> 6
each case with a sum equal to accrued and unpaid dividends, if any, at the rate
of the dividends fixed therefor, to the date fixed for payment of such price or
prices, before any distribution or payment shall be made to the holders of the
Common Stock. No consolidation or merger of the Corporation with another
corporation or corporations and no sale by the Corporation of its assets as an
entirety or substantially as an entirety shall be deemed to be a liquidation,
dissolution, or winding up of the Corporation within the meaning of this
subdivision (4).
(5) The Corporation shall not, without the consent (expressed either
in writing or by affirmative vote at a meeting called for that purpose) of the
holders of two-thirds of the then outstanding Preferred Stock of all series,
other than series in respect of which the authorizing resolutions expressly
provide that such consent shall not be required:
(i) consolidate or merge with another corporation or
corporations or sell its assets as an entirety or substantially as an
entirety, provided, however, that the purchase for cash, stock, or
otherwise by the Corporation of all or any part of the assets, stock
or other securities of another corporation or corporations shall not
be deemed to be a consolidation or merger;
(ii) issue Preferred Stock of any series if there shall be
cumulative dividends in arrears on outstanding Preferred Stock,
irrespective of series;
(iii) increase the authorized amount of the Preferred Stock,
or create or issue any class of stock ranking prior to or on a parity
with the Preferred Stock, or any series thereof, as to the payment of
dividends or the distribution of assets;
(iv) adopt any amendment to the Certificate of Incorporation
of the Corporation which adversely alters any preference, power, or
special right of the Preferred Stock, or of the holders thereof;
provided, however, that if any such amendment would adversely alter
any preference, power, or special right of one or more but not all of
the series of the Preferred Stock or of the holders thereof, then the
consent (expressed as above provided) only of the holders of
two-thirds of the then outstanding shares of all series so affected,
voting as a class, other than series in respect of which the
authorizing resolutions expressly provide that such consent shall not
be required, shall be required for the adoption of such amendment.
(6) In the event that any four quarterly cumulative dividends, whether
consecutive or not, upon the Preferred Stock, or any series thereof, shall be
in arrears, the holders of
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<PAGE> 7
Preferred Stock of all series, other than series in respect of which the right
is expressly withheld by the authorizing resolutions, shall have the right, at
the next meeting of stockholders called for the election of directors, to elect
one-third of the members of the Board of Directors out of the number fixed by
the by-laws, and the holders of such Preferred Stock shall continue to have
such right until all unpaid dividends upon the Preferred Stock shall have been
paid in full. In the event that any eight quarterly cumulative dividends,
whether consecutive or not, upon the Preferred Stock, or any series thereof,
shall be in arrears, the holders of Preferred Stock of all series, other than
series in respect of which the right is expressly withheld by the authorizing
resolutions, shall have the right, at the next meeting of stockholders called
for the election of directors, to elect a majority of the members of the Board
of Directors out of the numbers fixed by the by-laws, and the holders of such
Preferred Stock shall continue to have such right until all unpaid dividends
upon the Preferred Stock shall have been paid in full.
(7) The holders of the Common Stock shall be entitled to vote at all
meetings of the stockholders and, subject to the rights of holders of Preferred
Stock to elect directors in accordance with the provisions of the foregoing
subdivision (6), shall be entitled to one vote for each share of Common Stock
held.
ARTICLE V
There is hereby created a series of Preferred Stock of the
Corporation, such series to be within the class of Preferred Stock authorized
by Article IV hereof; to be designated $6.25 Cumulative Convertible Voting
Preferred Stock (the "$6.25 Preferred Stock"); to consist of 3,454,635 shares;
to have the powers, preferences and rights and the qualifications, limitations
and restrictions set forth in, and to be subject to all of the terms and
provisions of, Article IV hereof (except to the extent that the same may be
inconsistent with this Article V); and to have the following additional powers,
preferences, rights, qualifications, limitations, restrictions, terms and
provisions:
(a) $6.25 per share is fixed as the amount per annum at which the
holders of $6.25 Preferred Stock shall be entitled to receive dividends when
and as declared by the Board of Directors, such dividends to be paid only from
retained earnings of the Corporation; and such dividends shall be cumulative
and shall accrue, whether or not earned or declared, from the Issue Date (as
hereinafter defined), and shall be payable quarterly on the fifteenth day of
January, April, July and October in each year to holders of record on the
respective business days next preceding the first days of those months (and the
quarterly dividend periods shall commence on the first days of those months);
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<PAGE> 8
provided, however, that as to any shares of $6.25 Preferred Stock issued less
than 60 days prior to a dividend payment date, the dividend that would
otherwise be payable on such dividend payment date will be payable on the next
succeeding dividend payment date; and provided, further, that no dividend shall
be declared or paid if (i) the Corporation is insolvent or would be rendered
insolvent by payment of such dividend or (ii) the payment of such dividend
would impair the Corporation's capital (i.e., the fair market value of the
remaining assets of the Corporation would be less than the sum of its
liabilities and the liquidation value of any classes and series of its
Preferred Stock ranking prior to or on a parity with the $6.25 Preferred
Stock). The "Issue Date" shall mean the day on which occurs the merger of
Wallace-Murray Corporation, a Delaware corporation, into Household Acquisition
Corporation Second, a Delaware corporation, or other subsidiary of the
Corporation. An "Anniversary Date" shall mean any anniversary date of the
Issue Date.
(b) The shares of $6.25 Preferred Stock shall be subject to redemption
at the option of the Corporation at any time, and from time to time, in whole
or in part, at the redemption price of $50 per share plus the amount of accrued
and unpaid dividends, if any, thereon to the date fixed for redemption;
provided, however, that no such optional redemption shall be made unless (i)
the date fixed for redemption is on or after the fifth Anniversary Date, and
(ii) at all times during the twelve-month period terminating on the date on
which notice of such redemption is first given, the annualized rate of
dividends in respect of the outstanding shares of Common Stock of the
Corporation shall have equalled or exceeded the quotient obtained by dividing
$6.25 by the conversion rate specified in paragraph (d) hereof (as said
conversion rate may have been adjusted pursuant to the provisions of said
paragraph). As used herein, the term "annualized rate of dividends" shall
mean, as of any particular time, the aggregate per share amount of regular cash
dividends (excluding special and extraordinary dividends) paid on shares of the
Common Stock of the Corporation generally, in respect of the most recently
completed twelve-month period.
(c) The amount to which shares of $6.25 Preferred Stock shall be
entitled upon liquidation, dissolution, or winding up of the Corporation,
whether voluntary or involuntary, shall be $50 per share, plus the amount of
accrued and unpaid dividends, if any, thereon to the date fixed for payment,
and no more.
(d) The shares of $6.25 Preferred Stock shall be convertible at any
time after issue at the option of the record holder thereof, in the manner
hereinafter provided, into fully paid and nonassessable shares of Common Stock
of the Corporation at the rate of 1.923 shares (adjusted to 2.327 shares as of
close of business on April 7, 1989 and 4.654 shares as of close of business on
October 15, 1993) of Common Stock for each share of $6.25 Preferred Stock;
provided, however, that as to any shares of $6.25 Preferred Stock which shall
have been called for
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<PAGE> 9
redemption, the right of conversion shall terminate at the close of business on
the fifth full business day prior to the date fixed for redemption. No payment
or adjustment shall be made for dividends accrued on any shares of $6.25
Preferred Stock that shall be converted or for dividends on any shares of
Common Stock that shall be issuable upon such conversion, but all dividends
accrued and unpaid on such shares of $6.25 Preferred Stock up to the dividend
payment date immediately preceding the date of conversion shall be payable to
the converting shareholder, and no dividend shall be paid upon the shares of
Common Stock until the same shall be paid or sufficient funds set apart for the
payment thereof.
The conversion rate provided for above shall be subject to the
following adjustments:
(i) In case the Corporation shall declare and pay to the
holders of the shares of Common Stock a dividend in shares of Common
Stock, the conversion rate in effect immediately prior to the time
fixed for the determination of shareholders entitled to such dividend
shall be proportionately increased (adjusted to the nearest, or if
there shall be no nearest then to the next lower, one-thousandth of a
share of Common Stock), such adjustment to become effective
immediately after the time fixed for such determination.
(ii) In case the Corporation shall subdivide the outstanding
shares of Common Stock into a greater number of shares of Common Stock
or combine the outstanding shares of Common Stock into a smaller
number of shares of Common Stock, the conversion rate in effective
immediately prior to such subdivision or combination, as the case may
be, shall be proportionately increased or decreased (adjusted to the
nearest, or if there shall be no nearest then to the next lower,
one-thousandth of a share of Common Stock), as the case may require,
such increase or decrease, as the case may be, to become effective
when such subdivision or combination becomes effective.
(iii) In case of any reclassification or change of outstanding
shares of Common Stock of the class issuable upon conversion of the
shares of $6.25 Preferred Stock, or in case of any consolidation or
merger of the Corporation with or into another corporation, or in case
of any sale or conveyance to another corporation of all or
substantially all of the property of the Corporation, the holder of
each share of $6.25 Preferred Stock then outstanding shall have the
right thereafter, so long as his conversion right hereunder shall
exist, to convert such share into the kind and amount of shares of
stock and other securities and property receivable upon such
reclassification, change, consolidation, merger, sale or conveyance by
a holder of the
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<PAGE> 10
number of shares of Common Stock of the Corporation into which such
shares of $6.25 Preferred Stock might have been converted immediately
prior to such reclassification, change, consolidation, merger, sale or
conveyance, and shall have no other conversion rights under these
provisions; provided, however, that effective provision shall be made,
in the Articles or Certificate of Incorporation of the resulting,
surviving, or successor corporation or otherwise, so that the
provisions set forth herein for the protection of the conversion
rights of the shares of $6.25 Preferred Stock shall thereafter be
applicable, as nearly as reasonably may be, to any such other shares
of stock and other securities and property deliverable upon conversion
of the shares of $6.25 Preferred Stock remaining outstanding or other
convertible preferred shares received by the holders in place thereof;
and provided, further, that any such resulting, surviving, or
successor corporation shall expressly assume the obligation to
deliver, upon the exercise of the conversion privilege, such shares,
securities, or property as the holders of the shares of $6.25
Preferred Stock remaining outstanding, or other convertible preferred
shares received by the holders in place thereof, shall be entitled to
receive pursuant to the provisions hereof, and to make provision for
the protection of the conversion right as above provided. In case
securities or property other than shares of Common Stock shall be
issuable or deliverable upon conversion as aforesaid, then all
references in this paragraph shall be deemed to apply, so far as
appropriate and as nearly as may be, to such other securities or
property. The subdivision or combination of shares of Common Stock at
any time outstanding into a greater or lesser number of shares of
Common Stock (whether with or without par value) shall not be deemed
to be a reclassification of the Common Stock of the Corporation for
the purposes of this subparagraph (iii).
(iv) Unless the holders of shares of the $6.25 Preferred Stock
shall be issued subscription rights or warrants on a reasonably
equivalent basis, in case the Corporation shall issue to the holders
of shares of any class of its capital stock subscription rights or
warrants entitling them to subscribe for or purchase shares of Common
Stock at a price per share less than the Average Market Price (as
hereinafter defined) at the time fixed for determination of
shareholders entitled to such subscription rights or warrants, the
conversion rate in effect immediately prior to the time of said
determination shall be increased (adjusted to the nearest, or if there
shall be no nearest then to the next lower, one-thousandth of a share
of Common Stock) by multiplying said rate by a fraction of which the
numerator shall be the sum of the number of shares of Common Stock
outstanding at the time of such determination and the number of
additional shares of Common
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<PAGE> 11
Stock so offered for subscription or purchase, and of which the
denominator shall be the sum of the number of shares of Common Stock
outstanding at the time of such determination and the number of shares
of Common Stock which the aggregate subscription price of the total
number of shares so offered would purchase at the Average Market
Price, such adjustment to become effective immediately after the time
fixed for such determination; provided, however, that if such
subscription rights or warrants shall have a term not exceeding 45
days and if any such subscription rights or warrants expire
unexercised, then the conversion rate will be readjusted, effective
immediately after the expiration of such term, to the conversion rate
which would have obtained if such unexercised subscription rights or
warrants had not been issued.
For the purposes of any computation under this subparagraph
(iv) or subparagraph (v), the "Average Market Price" per share of
Common Stock for any time shall be the average of the daily closing
prices for the 30 consecutive business days commencing 45 business
days before the time in question. The closing price for each day
shall be the last sales price regular way or, in case no such sale
takes place on such day, the average of the closing bid and asked
prices regular way, in either case as recorded on the New York Stock
Exchange (or, if the Common Stock is not regularly traded on the New
York Stock Exchange, on the principal market or system on which trades
in the Common Stock are recorded).
(v) Unless the holders of shares of the $6.25 Preferred Stock
shall be distributed evidences of indebtedness or other assets on a
reasonably equivalent basis, in case the Corporation shall distribute
to the holders of the shares of Common Stock evidences of indebtedness
of the Corporation or other assets of the Corporation (other than cash
dividends to the extent paid from retained earnings, dividends in
shares of Common Stock or subscription rights or warrants entitling
them to subscribe for or purchase shares of Common Stock, but
including securities convertible into capital stock of the
Corporation), the conversion rate in effect immediately prior to the
time fixed for determination of shareholders entitled to such
distribution shall be increased (adjusted to the nearest, or if there
shall be no nearest then to the next lower, one-thousandth of a share
of Common Stock) by multiplying said rate by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding at
the time of such determination, and of which the denominator shall be
the difference between the number of shares of Common Stock
outstanding at the time of such determination and a number of shares
of Common Stock having an aggregate Average Market Price at the time
of such determination equal to the fair value (as determined by the
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<PAGE> 12
Board of Directors of the Corporation in good faith) of the evidences
of indebtedness or other assets so distributed, such adjustment to
become effective immediately after the time fixed for such
determination.
Except as provided in the foregoing subparagraphs (i) through (v),
there shall be no adjustments to the conversion rate set forth above.
In order to convert shares of $6.25 Preferred Stock into shares of
Common Stock, the holder thereof shall surrender the certificate or
certificates for shares of $6.25 Preferred Stock, duly endorsed to the
Corporation or in blank, at the office of any Transfer Agent for the shares of
$6.25 Preferred Stock (or such other place as may be designated by the
Corporation), and shall give written notice to the Corporation at said office
that he elects to convert the same and shall state in writing therein the name
or names in which he wishes the certificate or certificates for shares of
Common Stock to be issued. The Corporation shall, as soon as practicable
thereafter, deliver at said office to such holder of shares of $6.25 Preferred
Stock or to his nominee or nominees, a certificate or certificates for the
number of full shares of Common Stock to which he shall be entitled as
aforesaid and shall make appropriate payment in cash for any fractional shares.
Shares of $6.25 Preferred Stock shall be deemed to have been converted as of
the date of the surrender of such shares for conversion as provided above, and
the person or persons entitled to receive the shares of Common Stock issuable
upon such conversion shall be treated for all purposes as the record holder or
holders of such shares of Common Stock on such date.
No fractions of shares of Common Stock shall be issued upon
conversion, but in lieu thereof the Corporation shall adjust such fractional
interest by payment to the holders of an amount in cash equal (computed to the
nearest cent) to the same fraction of the closing price (as defined in
subparagraph (iv) above) on the business day immediately preceding such
conversion.
A number of authorized shares of Common Stock sufficient to provide
for the conversion of the shares of $6.25 Preferred Stock outstanding upon the
bases hereinbefore provided shall at all times be reserved for such conversion.
(e) There shall be a sinking fund (the "Sinking Fund") for the benefit
of the shares of $6.25 Preferred Stock. For the purposes of the Sinking Fund,
out of any net assets of the Corporation legally available therefor (but only
from retained earnings and subject to the provisions of the last sentence of
paragraph (2) of Article IV of the Certificate of Incorporation), before any
dividends, in cash or property, shall be paid or declared, or any distribution
ordered or made on the Common Stock of the Corporation, and before any shares
of Common Stock of the
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<PAGE> 13
Corporation shall be purchased, redeemed, or otherwise acquired for value by
the Corporation or any subsidiary, the Corporation shall have paid or set aside
in cash annually on the day prior to each Anniversary Date commencing with the
tenth Anniversary Date, so long as there shall be outstanding any shares of
$6.25 Preferred Stock, an amount sufficient to redeem, on the day prior to each
such Anniversary Date prior to the thirtieth, 4% of the number of shares of
$6.25 Preferred Stock issued on the Issue Date (or such lesser number as
remains outstanding) and, on the day prior to the thirtieth Anniversary Date,
all such shares of $6.25 Preferred Stock as remain outstanding, at a price of
$50 per share plus the amount of accrued and unpaid dividends, if any, thereon
to the date so fixed for redemption; provided, however, that there shall be
allowed to the Corporation as a credit thereagainst any shares of $6.25
Preferred Stock which the Corporation may have acquired (as a result of the
conversion of such shares or otherwise, which it may have redeemed pursuant to
paragraph (b) hereof, or which it may have redeemed pursuant to this paragraph
(e) (otherwise than through the operation of the Sinking Fund), which have not
theretofore been used for the purpose of any such credit or any credit against
a redemption of $6.25 Preferred Stock at the Corporation's election as
hereinafter in this paragraph (e) provided for and which shares shall have been
set aside by the Corporation for the purpose of the Sinking Fund; and provided,
further, that no monies shall be paid or set aside for the Sinking Fund if at
the day prior to any such Anniversary Date the Corporation is in arrears in
respect of a sinking fund obligation under any other series of Preferred Stock
ranking prior to or on a parity with the $6.25 Preferred Stock except to the
extent that, in the case of any series ranking on a parity with the $6.25
Preferred Stock, provision is made for the payment or setting aside of monies
for the Sinking Fund and for the sinking funds of such other series in
proportion to the respective aggregate amounts then required to be paid or set
aside therefor; and provided, further, that no monies shall be paid or set
aside for the Sinking Fund if (i) the Corporation is insolvent or would be
rendered insolvent by the payment or setting aside of such monies or (ii) the
payment or setting aside of such monies would impair the Corporation's capital
(i.e., the fair market value of the remaining assets of the Corporation would
be less than the sum of its liabilities and the liquidation value of classes
and series of its Preferred Stock ranking prior to or on a parity with the
$6.25 Preferred Stock). The Sinking Fund shall be cumulative so that if on the
day prior to any such Anniversary Date, the net assets of the Corporation
legally available therefor or the retained earnings of the Corporation shall be
insufficient to permit any such amount be paid or set aside in full, or if for
any other reason such amount shall not have been paid or set aside in full, the
amount of the deficiency shall be paid or set aside, but without interest,
before any dividend, in cash or property, shall be paid or declared, or any
other distribution ordered or made, on the Common Stock of the Corporation, and
before any shares of Common Stock of the
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<PAGE> 14
Corporation shall be purchased, redeemed or otherwise acquired for value by the
Corporation or by any subsidiary of the Corporation. The Corporation may elect
to redeem, on any Sinking Fund redemption date, up to an additional 4% of the
number of shares of $6.25 Preferred Stock issued on the Issue Date, at a price
of $50 per share plus the amount of accrued and unpaid dividends, if any,
thereon to the date fixed for redemption; provided, however, that there shall
be allowed to the Corporation as a credit thereagainst any shares of $6.25
Preferred Stock which the Corporation may have acquired or redeemed otherwise
than pursuant to paragraph (b) above and this paragraph (e) which have not
theretofore been used for the purpose of any such credit or for the purpose of
any credit against a redemption of $6.25 Preferred Stock pursuant to the
Sinking Fund. Such optional right shall not be cumulative and, if unexercised
in a particular year, may not be carried forward to subsequent years.
(f) The holders of $6.25 Preferred Stock shall be entitled to vote at
all meetings of the stockholders, and at each such meeting shall be entitled to
one vote for each share held.
(g) To the extent that the Board of Directors is authorized to fix the
designations, powers, preferences and relative, participating, optional or
other special rights, and qualifications, limitations or restrictions thereof,
in respect of additional series of Preferred Stock, none of the preferences or
rights of any such additional series as fixed by the Board of Directors shall
be prior or superior in any respect to those of the $6.25 Preferred Stock.
Without limiting the rights conferred by paragraph (5) of Article IV of the
Certificate of Incorporation of the Corporation, the Corporation shall not,
without the consent of the holders of two-thirds of the then outstanding shares
of $6.25 Preferred Stock, adopt any amendment to the Certificate of
Incorporation of the Corporation or take other action, whether by the Board of
Directors or stockholders, which adversely alters the preferences, powers and
special rights conferred by the provisions of paragraphs (b), d(iv), d(v) or
(e) hereof.
ARTICLE VI
In furtherance, and not in limitation, of the powers conferred by
statute, the Board of Directors of the Corporation is expressly authorized:
(1) To make, alter, amend and rescind the by-laws of the
Corporation.
(2) To determine from time to time, whether and to what
extent, and at what times and places, and under what conditions and
regulations the accounts and books of the Corporation (other than the
stock ledger) or any of them shall be open to inspection of the
stockholders; and no
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<PAGE> 15
stockholder shall have any right to inspect any account, book or
document of the Corporation, except as conferred by statute, unless
authorized by a resolution of the stockholders then entitled to vote
thereon or the Board of Directors.
IN WITNESS WHEREOF, said Household International, Inc. has caused its
corporate seal to be hereunto affixed and this certificate to be signed by D.
C. Clark, its President, and attested by J. D. Pinkerton, its Secretary, this
4th day of September, 1981.
Household International, Inc.
By: /s/ D. C. Clark
------------------------
President
[SEAL]
Attest:
By: /s/ J. D. Pinkerton
-------------------
Secretary
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<PAGE> 16
CERTIFICATE OF CHANGE OF ADDRESS OF
REGISTERED OFFICE AND OF REGISTERED AGENT
PURSUANT TO SECTION 134 OF TITLE 8 OF THE DELAWARE CODE
To: DEPARTMENT OF STATE
Division of Corporations
Townsend Building
Federal Street
Dover, Delaware 19903
Pursuant to the provisions of Section 134 of Title 8 of the Delaware
Code, the undersigned Agent for service of process, in order to change the
address of the registered office of the corporations for which it is registered
agent, hereby certifies that:
1. The name of the agent is: The Corporate Trust Company
2. The address of the old registered office was:
100 West Tenth Street
Wilmington, Delaware 19801
3. The address to which the registered office is to be changed is:
Corporation Trust Center
1209 Orange Street
Wilmington, Delaware 19801
The new address will be effective on July 30, 1984.
4. The names of the corporation represented by said agent are set
forth on the list annexed to this certificate and made a part
hereof by reference.
IN WITNESS WHEREOF, said agent has caused this certificate to be
signed on its behalf by its Vice-President and Assistant Secretary this 25th
day of July, 1984.
THE CORPORATION TRUST COMPANY
(Name of Registered Agent)
By: Virginia Colwell
----------------
(Vice-President)
Attest:
Mick Nurman
- ---------------------
(Assistant Secretary)
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<PAGE> 17
PAGE 796
STATE OF DELAWARE - DIVISION OF CORPORATIONS
CHANGE OF ADDRESS FILING FOR
CORPORATION TRUST AS OF JULY 27, 1984
DOMESTIC
0908612 HOUSEHOLD INTERNATIONAL, INC. 02/21/1981 D DE
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<PAGE> 18
CERTIFICATE OF HOUSEHOLD INTERNATIONAL, INC.
UNDER SECTION 151(g) OF THE GENERAL
CORPORATION LAW OF THE STATE OF DELAWARE
Household International, Inc., a Delaware corporation (hereinafter
referred to as the "Corporation"), does hereby certify that the following
resolution was duly adopted by the Corporation's Board of Directors:
"WHEREAS, no shares of the Corporation's Series A Junior
Participating Preferred Stock (the "Junior Preferred") have been
issued or are outstanding;
"NOW THEREFORE, BE IT RESOLVED, that no shares of the Junior
Preferred will be issued pursuant to the terms of the Certificate of
Designation, Preferences and Rights for such series of the
Corporation's Preferred Stock; and
"FURTHER RESOLVED, that the officers of the Corporation are
duly authorized to file a certificate with the Secretary of State of
the State of Delaware eliminating from the Corporation's Certificate
of Incorporation all matters set forth in the Certificate of
Designation, Preferences and Rights for the Junior Preferred."
Upon the effective date of the filing of this Certificate, it shall
eliminate from the Corporation's Certificate of Incorporation all matters set
forth in the Certificate of Designation, Preferences and Rights with respect to
the Corporation's Series A Junior Participating Preferred Stock, and all of
such shares of Series A Junior Participating Preferred Stock shall resume the
status of authorized and unissued shares of the Corporation's class of
Preferred Stock.
IN WITNESS WHEREOF, said Household International, Inc., has caused its
corporate seal to be hereunto affixed and this Certificate to be signed by John
W. Blenke, its Secretary, and attested by Susan E. Casey, its Assistant
Secretary, this 14th day of November, 1994.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ J. W. Blenke
------------------------
Secretary
Attest:
By: /s/ S. E. Casey
-----------------------
Assistant Secretary
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<PAGE> 19
CERTIFICATE OF DESIGNATION, PREFERENCES AND
RIGHTS OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
of
HOUSEHOLD INTERNATIONAL, INC.
Pursuant to Section 151 of the General Corporation Law
of the State of Delaware
We, D. C. Clark, Chairman of the Board and Chief Executive Officer,
and J. D. Pinkerton, Secretary, of Household International, Inc., a corporation
organized and existing under the General Corporation Law of the State of
Delaware, in accordance with the provisions of Section 103 thereof, DO HEREBY
CERTIFY:
That pursuant to the authority conferred upon the Board of Directors
by the Restated Certificate of Incorporation of the said Corporation, the said
Board of Directors on August 14, 1984 adopted the following resolution creating
a series of seven hundred thousand (700,000) shares of Preferred Stock
designated as Series A Junior Participating Preferred Stock:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of this Corporation in accordance with the provisions of its Restated
Certificate of Incorporation, a series of Preferred Stock of the Corporation be
and it hereby is created, and that the designation and amount thereof and the
voting powers, preferences and relative, participating, optional and other
special rights of the shares of such series, and the qualifications,
limitations or restrictions thereof are as follows:
Section 1. Designation and Amount. The shares of such series shall
be designated as "Series A Junior Participating Preferred Stock" (the "Series A
Preferred Stock") and the number of shares constituting such series shall be
700,000.
Section 2. Dividends and Distributions.
(A) The holders of shares of Series A Preferred Stock shall be
entitled to receive, when, as and if declared by the Board of Directors out of
funds legally available for the purpose, quarterly dividends payable in cash on
the fifteenth day of January, April, July and October in each year (each such
date being referred to herein as a "Quarterly Dividend Payment Date"),
commencing on the first Quarterly Dividend Payment Date after the first
issuance of a share or fraction of a share of Series A Preferred Stock, in an
amount per share (rounded to the nearest cent) equal to the greater of (a)
$25.00 or (b) subject to the provision for adjustment hereinafter set forth,
100 times the aggregate per share amount of all cash dividends, and 100 times
the aggregate per share amount (payable in kind) of all non-cash dividends or
other distributions other than a dividend payable in shares of Common Stock or
a subdivision of the outstanding shares
- 19 -
<PAGE> 20
of Common Stock (by reclassification or otherwise), declared on the Common
Stock, par value $1.00 per share, of the Corporation (the "Common Stock") since
the immediately preceding Quarterly Dividend Payment Date or, with respect to
the first Quarterly Dividend Payment Date, since the first issuance of any
share or fraction of a share of Series A Preferred Stock. In the event the
Corporation shall at any time declare or pay any dividend on Common Stock
payable in shares of Common Stock, or effect a subdivision or combination or
consolidation of the outstanding shares of Common Stock (by reclassification
or otherwise than by payment of a dividend in shares of Common Stock) into a
greater or lesser number of shares of Common Stock, then in each such case the
amount to which holders of shares of Series A Preferred Stock were entitled
immediately prior to such event under clause (b) of the preceding sentence
shall be adjusted by multiplying such amount by a fraction the numerator of
which is the number of shares of Common Stock outstanding immediately after
such event and the denominator of which is the number of share of Common Stock
that were outstanding immediately prior to such event.
The Corporation shall declare a dividend or distribution on the Series
A Preferred Stock as provided in this paragraph (A) immediately after it
declares a dividend or distribution on the Common Stock (other than a dividend
payable in shares of Common Stock); provided that, in the event no dividend or
distribution shall have been declared on the Common Stock during the period
between any Quarterly Dividend Payment Date and the next subsequent Quarterly
Dividend Payment Date, a dividend of $25.00 per share on the Series A Preferred
Stock shall nevertheless be payable on such subsequent Quarterly Dividend
Payment Date.
Dividends shall begin to accrue and be cumulative on outstanding
shares of Series A Preferred Stock from the Quarterly Dividend Payment Date
next preceding the date of issue of such shares of Series A Preferred Stock,
unless the date of issue of such shares is prior to the record date for the
first Quarterly Dividend Payment Date, in which case dividends on such shares
shall begin to accrue from the date of issue of such shares, or unless the date
of issue is a Quarterly Dividend Payment Date or is a date after the record
date for the determination of holders of shares of Series A Preferred Stock
entitled to receive a quarterly dividend and before such Quarterly Dividend
Payment Date, in either of which events such dividends shall begin to accrue
and be cumulative from such Quarterly Dividend Payment Date. Accrued but
unpaid dividends shall not bear interest. Dividends paid on the shares of
Series A Preferred Stock in an amount less than the total amount of such
dividends at the time accrued and payable on such shares shall be allocated pro
rata on a share-by-share basis among all such shares at the time outstanding.
The Board of Directors may fix a record date for the determination of holders
of shares of Series A Preferred Stock entitled to receive payment of a dividend
or distribution declared thereon, which record date shall be no more than 60
days prior to the date fixed for the payment thereof.
- 20 -
<PAGE> 21
Section 3. Voting Rights. The holders of shares of Series A
Preferred Stock shall have the following voting rights:
(A) Subject to the provision for adjustment hereinafter set forth,
each share of Series A Preferred Stock shall entitle the holder thereof to 100
votes on all matters submitted to a vote of the stockholders of the
Corporation. In the event the Corporation shall at any time declare or pay any
dividend on Common Stock payable in shares of Common Stock, or effect a
subdivision or combination or consolidation of the outstanding shares of Common
Stock (by reclassification or otherwise than by payment of a dividend in shares
of Common Stock) into a greater or lesser number of shares of Common Stock,
then in each such case the number of votes per share to which holders of shares
of Series A Preferred Stock were entitled immediately prior to such event shall
be adjusted by multiplying such number by a fraction the numerator of which is
the number of shares of Common Stock outstanding immediately after such event
and the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
(B) Except as otherwise provided herein or by law, the holders of
shares of Series A Preferred Stock and the holders of shares of Common Stock
shall vote together as one class on all matters submitted to a vote of
stockholders of the Corporation.
(C) In the event that any four quarterly cumulative dividends,
whether consecutive or not, upon the Series A Preferred Stock shall be in
arrears, the holders of preferred stock of the Corporation of all series
(including the Series A Preferred Stock), other than series in respect of which
the right is expressly withheld by the authorizing resolutions, shall have the
right, at the next meeting of stockholders called for the election of
directors, to elect one-third of the members of the Board of Directors out of
the number fixed by the by-laws, and the holders of such preferred stock shall
continue to have such right until all unpaid dividends upon the Series A
Preferred Stock shall have been paid in full. In the event that any eight
quarterly cumulative dividends, whether consecutive or not, upon the Series A
Preferred Stock shall be in arrears, the holders of preferred stock of all
series (including the Series A Preferred Stock), other than series in respect
of which the right is expressly withheld by the authorizing resolutions, shall
have the right, at the next meeting of stockholders called for the election of
directors, to elect a majority of the members of the Board of Directors out of
the number fixed by the by-laws, and the holders of such preferred stock shall
continue to have such right until all unpaid dividends upon the Series A
Preferred Stock shall have been paid in full.
(D) Except as set forth herein, holders of Series A Preferred Stock
shall have no special voting rights and their consent shall not be required
(except to the extent they are entitled to vote with holders of Common Stock as
set forth herein) for taking any corporate action.
- 21 -
<PAGE> 22
Section 4. Certain Restrictions.
(A) Whenever quarterly dividends or other dividends or distributions
payable on the Series A Preferred Stock as provided in Section 2 are in
arrears, thereafter and until all accrued and unpaid dividends and
distributions, whether or not declared, on shares of Series A Preferred Stock
outstanding shall have been paid in full, the Corporation shall not
(i) declare or pay dividends on, make any other distributions
on, or redeem or purchase or otherwise acquire for consideration any shares of
stock ranking junior (either as to dividends or upon liquidation, dissolution
or winding up) to the Series A Preferred Stock;
(ii) declare or pay dividends on or make any other
distributions on any shares of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except dividends paid ratably on the Series A Preferred Stock
and all such parity stock on which dividends are payable or in arrears in
proportion to the total amounts to which the holders of all such shares are
then entitled;
(iii) redeem or purchase or otherwise acquire for
consideration shares of any stock ranking on a parity (either as to dividends
or upon liquidation, dissolution or winding up) with the Series A Preferred
Stock, provided that the Corporation may at any time redeem, purchase or
otherwise acquire shares of any such parity stock in exchange for shares of any
stock of the Corporation ranking junior (either as to dividends or upon
dissolution, liquidation or winding up) to the Series A Preferred Stock; or
(iv) purchase or otherwise acquire for consideration any
shares of Series A Preferred Stock, or any shares of stock ranking on a parity
with the Series A Preferred Stock, except in accordance with a purchase offer
made in writing or by publication (as determined by the Board of Directors) to
all holders of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other relative rights
and preferences of the respective series and classes, shall determine in good
faith will result in fair and equitable treatment among the respective series
or classes.
(B) The Corporation shall not permit any subsidiary of the
Corporation to purchase or otherwise acquire for consideration any shares of
stock of the Corporation unless the Corporation could, under paragraph (A) of
this Section 4, purchase or otherwise acquire such shares at such time and in
such manner.
Section 5. Reacquired Shares. Any shares of Series A Preferred Stock
purchased or otherwise acquired by the Corporation in any manner whatsoever
shall be retired and cancelled promptly after the acquisition thereof. All
such
- 22 -
<PAGE> 23
shares shall upon their cancellation become authorized but unissued shares of
preferred stock and may be reissued as part of a new series of preferred stock
to be created by resolution or resolutions of the Board of Directors, subject
to the conditions and restrictions on issuance set forth herein.
Section 6. Liquidation, Dissolution or Winding Up. Upon any
voluntary liquidation, dissolution or winding up of the Corporation, no
distribution shall be made (1) to the holders of shares of stock ranking junior
(either as to dividends or upon liquidation, dissolution or winding up) to the
Series A Preferred Stock unless, prior thereto, the holders of shares of Series
A Preferred Stock shall have received $100.00 per share, plus an amount equal
to accrued and unpaid dividends and distributions thereon, whether or not
declared, to the date of such payment, provided that the holders of shares of
Series A Preferred Stock shall be entitled to receive an aggregate amount per
share, subject to the provision for adjustment hereinafter set forth, equal to
100 times the aggregate amount to be distributed per share to holders of Common
Stock, or (2) to the holders of stock ranking on a parity (either as to
dividends or upon liquidation, dissolution or winding up) with the Series A
Preferred Stock, except distributions made ratably on the Series A Preferred
Stock and all other such parity stock in proportion to the total amounts to
which the holders of all such shares are entitled upon such liquidation,
dissolution or winding up. In the event the Corporation shall at any time
declare or pay any dividend on Common Stock payable in shares of Common Stock,
or effect a subdivision or combination or consolidation of the outstanding
shares of Common Stock (by reclassification or otherwise than by payment of a
dividend in shares of Common Stock) into a greater or lesser number of shares
of Common Stock, then in each such case the aggregate amount to which holders
of shares of Series A Preferred Stock were entitled immediately prior to such
event under the proviso in clause (1) of the preceding sentence shall be
adjusted by multiplying such amount by a fraction the numerator of which is the
number of shares of Common Stock outstanding immediately after such event and
the denominator of which is the number of shares of Common Stock that were
outstanding immediately prior to such event.
Section 7. Consolidation, Merger, etc. In case the Corporation shall
enter into any consolidation, merger, combination or other transaction in which
the shares of Common Stock are exchanged for or changed into other stock or
securities, cash and/or any other property, then in any such case the shares of
Series A Preferred Stock shall at the same time be similarly exchanged or
changed in an amount per share (subject to the provision for adjustment
hereinafter set forth) equal to 100 times the aggregate amount of stock,
securities, cash and/or any other property (payable in kind), as the case may
be, into which or for which each share of Common Stock is changed or exchanged.
In the event the Corporation shall at any time declare or pay any dividend on
Common Stock payable in shares of Common Stock, or effect a subdivision or
combination or consolidation of the
- 23 -
<PAGE> 24
outstanding shares of Common Stock (by reclassification or otherwise than by
payment of a dividend in shares of Common Stock) into a greater or lesser
number of shares of Common Stock, then in each such case the amount set forth
in the preceding sentence with respect to the exchange or change of shares of
Series A Preferred Stock shall be adjusted by multiplying such amount by a
fraction the numerator of which is the number of shares of Common Stock
outstanding immediately after such event and the denominator of which is the
number of shares of Common Stock that were outstanding immediately prior to
such event.
Section 8. No Redemption. The shares of Series A Preferred Stock
shall not be redeemable.
Section 9. Ranking. The Series A Preferred Stock shall rank junior
to all other series of the Corporation's preferred stock outstanding as of
August 14, 1984, as to the payment of dividends and the distribution of assets.
Section 10. Amendment. The Certificate of Incorporation of the
Corporation shall not be amended in any manner which would materially alter or
change the powers, preferences or special rights of the Series A Preferred
Stock so as to affect them adversely without the affirmative vote of the
holders of two-thirds or more of the outstanding shares of Series A Preferred
Stock, voting together as a single class.
IN WITNESS WHEREOF, we have executed and subscribed this Certificate
and do affirm the foregoing as true under the
- 24 -
<PAGE> 25
penalties of perjury this 17th day of August, 1984.
/s/ D. C. Clark
---------------------------------
D. C. Clark, Chairman of the
Board and Chief Executive Officer
/s/ J. D. Pinkerton
---------------------------------------
J. D. Pinkerton, Senior Vice President-
Administration and Secretary
- 25 -
<PAGE> 26
HOUSEHOLD INTERNATIONAL, INC.
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
Household International, Inc., a corporation organized and existing
under the General Corporation Law of the State of Delaware, does hereby
certify:
FIRST: That the Restated Certificate of Incorporation, as heretofore
amended, of said Corporation has been further amended by inserting the
following as Article VII:
ARTICLE VII
(1) Elimination of Certain Liability of Directors. A
director of the Corporation shall not be personally liable to the
Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director, except for liability (i) for any breach
of the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which
involve intentional misconduct or a knowing violation of law, (iii)
under Section 174 of the Delaware General Corporation Law or successor
provision, or (iv) for any transaction from which the director derived
an improper personal benefit. Any repeal or amendment to this Section
shall not adversely affect any right or protection of a director of
the Corporation for any act or occurrence taking place prior to such
repeal or amendment.
(2) Indemnification and Insurance.
(a) Each person who was or is made a party or is
threatened to be made a party to or is involved in any action, suit or
proceeding, whether civil, criminal, administrative, or investigative
(hereinafter a "proceeding"), by reason of the fact that he or she, or
a person of whom he or she is the legal representative, is or was a
director, officer, or employee of the Corporation or is or was serving
at the request of the Corporation as a director, officer, employee, or
agent of another corporation or of a partnership, joint venture,
trust, or other enterprise, including service with respect to employee
benefit plans, shall be indemnified and held harmless by the
Corporation to the fullest extent authorized by the Delaware General
Corporation Law, as the same exists or may hereafter be amended (but,
in the case of any such amendment, only to the extent that such
amendment permits the Corporation to provide broader indemnification
rights than said law permitted the Corporation to provide prior to
such amendment), against all expense, liability, and loss (including
attorneys' fees, judgments, fines, ERISA excise
- 26 -
<PAGE> 27
taxes, or penalties and amounts paid or to be paid in settlement)
reasonably incurred or suffered by such person in connection
therewith, and such indemnification shall continue as to a person who
has ceased to be a director, officer, employee, or agent and shall
inure to the benefit of his or her heirs, executors and
administrators; provided, however, that except as provided in
paragraph (b) hereof, the Corporation shall indemnify any such person
seeking indemnification in connection with a proceeding (or part
thereof) initiated by such person only if such proceeding (or part
thereof) was authorized by the Board of Directors of the Corporation.
The right to indemnification conferred in this Section shall be a
contract right and shall include the right to be paid by the
Corporation the expenses incurred in defending any such proceeding in
advance of its final disposition upon delivery to the Corporation of
an undertaking to repay all amounts so advanced if it shall ultimately
be determined that such person is not entitled to be indemnified under
this Section or otherwise. The Corporation may, by action of its
Board of Directors, provide indemnification to agents of the
Corporation with the same scope and effect as the foregoing
indemnification of directors, officers, and employees.
(b) If a claim under paragraph (a) of this Section
is not paid in full by the Corporation, the claimant may at any time
thereafter bring suit against the Corporation to recover the unpaid
amount of the claim and, if successful in whole or in part, the
claimant shall be entitled to be paid also the expense of prosecuting
such claim. It shall be a defense to any such action (other than an
action brought to enforce a claim for expenses incurred in defending
any proceeding in advance of its final disposition where the required
undertaking has been tendered to the Corporation) that the claimant
has not met the standards of conduct which make it permissible under
the Delaware General Corporation Law and paragraph (a) of this Section
for the Corporation to indemnify the claimant for the amount claimed,
but the burden of proving such defense shall be on the Corporation.
Neither the failure of the Corporation (including its Board of
Directors, independent legal counsel, or its stockholders) to have
made a determination prior to the commencement of such action that
indemnification of the claimant is proper in the circumstances because
he or she has met the applicable standard of conduct set forth in the
Delaware General Corporation Law, nor an actual determination by the
Corporation (including its Board of Directors, independent legal
counsel, or its stockholders) that the claimant has not met such
applicable standard of conduct, shall be a defense to the action or
create a presumption that the claimant has not met the applicable
standard of conduct.
(c) The right to indemnification and the payment of
expenses incurred in defending a proceeding in advance of
- 27 -
<PAGE> 28
its final disposition conferred in this Section shall not be exclusive
of any other right which any person may have or hereafter acquire
under any statute, provision of this Certificate of Incorporation,
bylaw, agreement, contract, vote of stockholders or disinterested
directors, or otherwise.
(d) The Corporation may purchase and maintain
insurance on behalf of any person who is or was a director, officer,
employee or agent of the Corporation, or is or was serving at the
request of the Corporation as a director, officer, employee or agent
of another corporation, partnership, joint venture, trust or other
enterprise against any liability asserted against him and incurred by
him in any such capacity, or arising out of his status as such,
whether or not the Corporation would have the power to indemnify him
against such liability under the provisions of this Section, the
Delaware General Corporation Law, or otherwise.
SECOND: That the aforesaid amendment of the Restated Certificate of
Incorporation of said Corporation, set forth in Paragraph FIRST hereinabove,
has been duly adopted in accordance with the provisions of Section 242 of the
General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused its corporate seal to
be hereunto affixed and this certificate to be signed by D. C. Clark, its
Chairman of the Board and Chief Executive Officer, and J. D. Pinkerton, its
Senior Vice President - Administration and Secretary, this 13th day of May,
1987.
HOUSEHOLD INTERNATIONAL, INC.
[SEAL]
By: /s/ D. C. Clark
-------------------------
Chairman of the Board and
Chief Executive Officer
Attest:
/s/ J. D. Pinkerton
- ----------------------------
Senior Vice President -
Administration and Secretary
- 28 -
<PAGE> 29
CERTIFICATE OF HOUSEHOLD INTERNATIONAL, INC.
UNDER SECTION 151 (g) OF THE GENERAL
CORPORATION LAW OF THE STATE OF DELAWARE
Household International, Inc., a Delaware corporation (hereinafter
referred to as the "Corporation"), does hereby certify that the following
resolutions were duly adopted by the Corporation's Board of Directors:
"WHEREAS, no shares of the Corporation's $2.375 Cumulative
Convertible Voting Preferred Stock (the '$2.375 Preferred Stock') and
$2.50 Cumulative Convertible Voting Preferred Stock (the '$2.50
Preferred Stock') are outstanding, it is hereby
"RESOLVED, that no shares of $2.375 Preferred Stock and $2.50
Preferred Stock will be issued pursuant to the terms of the
Certificate of Designation, Preferences, and Rights of each such
series of the Corporation's Preferred Stock.
"FURTHER RESOLVED, that the officers of the Corporation are
duly authorized to file a certificate with the Secretary of State of
Delaware eliminating from the Corporation's Certificate of
Incorporation all matters set forth in each Certificate of
Designation, Preferences, and Rights for the $2.375 and $2.50
Preferred Stock."
Upon the effective date of the filing of this Certificate, it shall
eliminate from the Corporation's Certificate of Incorporation all matters set
forth in the Certificates of Designation, Preferences, and Rights with respect
to the Corporation's $2.375 Cumulative Convertible Voting Preferred Stock and
$2.50 Cumulative Convertible Voting Preferred Stock, and all of such shares of
$2.375 Cumulative Convertible Preferred Stock and $2.50 Cumulative Convertible
Voting Preferred Stock shall resume the status of authorized and unissued
shares of the Corporation's Preferred Stock.
IN WITNESS WHEREOF, said Household International, Inc. has caused its
corporate seal to be hereunto affixed and this Certificate to be signed by J.
D. Pinkerton, its Senior Vice President-Administration and Secretary, and
attested by R. C. Roselli, its Assistant Secretary, this 11th day of July,
1989.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ J. D. Pinkerton
----------------------------
Senior Vice President-
Administration and Secretary
Attest:
By: /s/ R. C. Roselli
-------------------
Assistant Secretary
- 29 -
<PAGE> 30
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS OF
PREFERRED STOCK BY RESOLUTION OF THE BOARD OF DIRECTORS
PROVIDING FOR A SERIES OF 512,139 SHARES OF
PREFERRED STOCK DESIGNATED $2.375 CUMULATIVE
CONVERTIBLE VOTING PREFERRED STOCK
We, D.C. Clark, President, and J. D. Pinkerton, Secretary, of
Household International Inc., a corporation organized and existing under the
General Corporation Law of the State of Delaware, in accordance with the
provisions of Section 103 thereof, DO HEREBY CERTIFY:
That pursuant to authority conferred upon the Board of Directors by
the Restated Certificate of Incorporation of the said Corporation, the said
Board of Directors by unanimous written consent dated June 25, 1981, adopted
resolutions providing for the issuance of a series of 512,139 shares of
Preferred Stock, which resolutions are as follows:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of this Corporation in accordance with the provisions of its Restated
Certificate of Incorporation, a series of Preferred Stock of the Corporation be
and it hereby is created, such series of Preferred Stock to be designated
$2.375 Cumulative Convertible Voting Preferred Stock (the "$2.375 Preferred
Stock"), to consist of 512,139 shares;
FURTHER RESOLVED,
(a) $2.375 per share is fixed as the amount per annum at which the
holders of $2.375 Preferred Stock shall be entitled to receive dividends; and
such dividends shall be cumulative and shall accrue, whether or not earned or
declared, from April 1, 1981, as to all shares issued on or before June 30,
1981, and the first day of the quarterly dividend period during which such
shares were issued, as to all shares issued after June 30, 1981, and shall be
payable quarterly on the fifteenth days of January, April, July and October in
each year (and the quarterly dividend periods shall commence on the first days
of those months).
(b) The shares of $2.375 Preferred Stock shall be subject to
redemption in whole or in part at the redemption price of $50.00 per share.
(c) The amount to which shares of $2.375 Preferred Stock shall be
entitled upon voluntary liquidation, dissolution, or winding up of the
Corporation, shall be $50.00 per share plus the amount of accrued and unpaid
dividends, if any, thereon to the date fixed for payment, and no more.
The amount to which shares of $2.375 Preferred Stock shall be entitled
upon involuntary liquidation, dissolution, or winding up of the Corporation,
shall be $30 per share, plus the amount of accrued and unpaid dividends, if
any, thereon to the date fixed for payment, and no more.
- 30 -
<PAGE> 31
(d) The shares of $2.375 Preferred Stock shall be convertible at the
option of the record holder thereof, in the manner hereinafter provided, into
shares of Common Stock of the Corporation; provided, however, that as to any
shares of $2.375 Preferred Stock which shall have been called for redemption,
the right of conversion shall terminate at the close of business on the fifth
full business day prior to the date fixed for redemption. No payment or
adjustment shall be made for dividends accrued on any shares of $2.375
Preferred Stock that shall be converted or for dividends on any shares of
Common Stock that shall be issuable upon such conversion, but all dividends
accrued and unpaid on such shares of $2.375 Preferred Stock up to the dividend
payment date immediately preceding the date of conversion shall constitute a
debt of the Corporation payable to the converting shareholder, and no dividend
shall be paid upon the shares of Common Stock until such debt shall be paid or
sufficient funds set apart for the payment thereof.
Shares of $2.375 Preferred Stock may be converted at any time after
issue (subject to the above time limitation in the case of a call for
redemption), at the option of the record holder thereof, into shares of Common
Stock of the Corporation at the rate of two and one-quarter shares of Common
Stock for each share of $2.375 Preferred Stock.
The conversion rate provided for above shall be subject to the
following adjustments:
(i) In case the Corporation shall declare and pay to the holders of
the shares of Common Stock a dividend in shares of Common Stock, or in
securities convertible into shares of Common Stock, the conversion rate in
effect immediately prior to the time fixed for the determination of
shareholders entitled to such dividend shall be proportionately increased
(adjusted to the nearest, or if there shall be no nearest then to the next
lower, one-hundredth of a share of Common Stock), such adjustment to become
effective immediately after the time fixed for such determination.
(ii) In case the Corporation shall subdivide the outstanding shares
of Common Stock into a greater number of shares of Common Stock or combine the
outstanding shares of Common Stock into a smaller number of shares of Common
Stock, the conversion rate in effect immediately prior to such subdivision or
combination, as the case may be, shall be proportionately increased or
decreased (adjusted to the nearest, or if there shall be no nearest then to the
next lower, one-hundredth of a share of Common Stock), as the case may require,
such increase or decrease, as the case may be, to become effective when such
subdivision or combination becomes effective.
(iii) No adjustment of the conversion rate shall be made by reason of
the issuance of shares of Common Stock for cash, property, or services. In
order to protect the conversion rights of the holders of $2.375 Preferred Stock
from dilution, if stock
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<PAGE> 32
warrants, subscription, or other rights are offered to the holders of shares of
Common Stock, such rights shall also be offered to the holders of shares of
$2.375 Preferred Stock on the basis of the number of shares of Common Stock
into which the shares of $2.375 Preferred Stock are then convertible.
(iv) In case of any reclassification or change of outstanding shares
of Common Stock of the class issuable upon conversion of the shares of $2.375
Preferred Stock, or in the case of any consolidation or merger of the
Corporation with or into another corporation, or in case of any sale or
conveyance to another corporation of all or substantially all of the property
of the Corporation, the holder of each share of $2.375 Preferred Stock then
outstanding shall have the right thereafter, so long as his conversion right
hereunder shall exist, to convert such share into the kind and amount of shares
of stock and other securities and property receivable upon such
reclassification, change, consolidation, merger, sale or conveyance by a holder
of the number of shares of Common Stock, of the Corporation into which such
shares of $2.375 Preferred Stock might have been converted immediately prior to
such reclassification, change, consolidation, merger, sale or conveyance, and
shall have no other conversion rights under these provisions; provided, that
effective provision shall be made, in the Articles or Certificate of
Incorporation of the resulting, surviving, or successor corporation or
otherwise, so that the provisions set forth herein for the protection of the
conversion rights of the shares of $2.375 Preferred Stock shall thereafter be
applicable, as nearly as reasonably may be, to any such other shares of stock
and other securities and property deliverable upon conversion of the shares of
$2.375 Preferred Stock remaining outstanding or other convertible preferred
shares received by the holders in place thereof; and provided, further, that
any such resulting, surviving, or successor corporation shall expressly assume
the obligation to deliver, upon the exercise of the conversion privilege, such
shares, securities, or property as the holders of the shares of $2.375
Preferred Stock remaining outstanding, or other convertible preferred shares
received by the holders in place thereof, shall be entitled to receive pursuant
to the provisions hereof, and to make provision for the protection of the
conversion right as above provided. In case securities or property other than
shares of Common Stock shall be issuable or deliverable upon conversion as
aforesaid, then all references in this paragraph shall be deemed to apply, so
far as appropriate and as nearly as may be, to such other securities or
property. The subdivision or combination of shares of Common Stock at any time
outstanding into a greater or lesser number of shares of Common Stock (whether
with or without par value) shall not be deemed to be a reclassification of the
Common Stock of the Corporation for the purposes of this subparagraph (iv).
In order to convert shares of $2.375 Preferred Stock into shares of
Common Stock, the holder thereof shall surrender the certificate or
certificates for shares of $2.375 Preferred Stock, duly endorsed to the
Corporation or in blank, at the office of
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<PAGE> 33
any Transfer Agent for the shares of $2.375 Preferred Stock (or such other
place as may be designated by the Corporation), and shall give written notice
to the Corporation at said office that he elects to convert the same and shall
state in writing therein the name or names in which he wishes the certificate
or certificates for shares of Common Stock to be issued. The Corporation
shall, as soon as practicable thereafter, deliver at said office to such holder
of shares of $2.375 Preferred Stock, or to his nominee or nominees, a
certificate or certificates for the number of full shares of Common Stock to
which he shall be entitled as aforesaid and make appropriate payment in cash
for any fractional shares. Shares of $2.375 Preferred Stock shall be deemed to
have been converted as of the date of the surrender of such shares for
conversion as provided above, and the person or persons entitled to receive the
shares of Common Stock issuable upon such conversion shall be treated for all
purposes as the record holder or holders of such shares of Common Stock on such
date.
A number of authorized shares of Common Stock sufficient to provide
for the conversion of the shares of $2.375 Preferred Stock outstanding upon the
basis hereinbefore provided shall at all times be reserved for such conversion.
(e) Shares of $2.375 Preferred Stock redeemed shall not be reissued.
(f) The holders of $2.375 Preferred Stock shall be entitled to vote
at all meetings of the stockholders, and at each such meeting shall be entitled
to one vote for each share held.
(g) To the extent that the Board of Directors is authorized to fix
the designations, powers, preferences and relative, participating, optional or
other special rights, and qualifications, limitations or restrictions thereof,
in respect of additional series of Preferred Stock, none of the preferences or
rights of any such additional series as fixed by the Board of Directors shall
be prior or superior in any respect to those of the $2.375 Preferred Stock.
IN WITNESS WHEREOF, said Household International, Inc. has caused its
corporate seal to be hereunto affixed and this certificate to be signed by D.
C. Clark, its President, and
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<PAGE> 34
attested by J. D. Pinkerton, its Secretary, this 25th day of June, 1981.
Household International, Inc.
(SEAL) By: /s/ D. C. Clark
------------------------
President
ATTEST:
By: /s/ J. D. Pinkerton
-------------------
Secretary
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<PAGE> 35
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS OF
PREFERRED STOCK BY RESOLUTION OF THE BOARD OF DIRECTORS
PROVIDING FOR A SERIES OF 2,234,045 SHARES OF
PREFERRED STOCK DESIGNATED $2.50 CUMULATIVE
CONVERTIBLE VOTING PREFERRED STOCK
We, D. C. Clark, President, and J. D. Pinkerton, Secretary, of
Household International, Inc., a corporation organized and existing under the
General Corporation Law of the State of Delaware, in accordance with the
provisions of Section 103 thereof, DO HEREBY CERTIFY:
That pursuant to authority conferred upon the Board of Directors by
the Restated Certificate of Incorporation of the said Corporation, the said
Board of Directors by unanimous consent dated June 25, 1981, adopted
resolutions providing for the issuance of a series of two million two hundred
and thirty-four thousand forty-five (2,234,045) shares of Preferred Stock,
which resolutions are as follows:
RESOLVED, that pursuant to the authority vested in the Board of
Directors of this Corporation in accordance with the provisions of its Restated
Certificate of Incorporation, a series of Preferred Stock of the Corporation be
and it hereby is created, such series of Preferred Stock to be designated $2.50
Cumulative Convertible Voting Preferred Stock (the "$2.50 Preferred Stock") and
to consist of 2,234,045 shares; and
FURTHER RESOLVED,
(a) $2.50 per share is fixed as the amount per annum at which the
holders of $2.50 Preferred Stock shall be entitled to receive dividends; and
such dividends shall be cumulative and shall accrue, whether or not earned or
declared, from April 1, 1981, as to all shares issued on or before June 30,
1981, and the first day of the quarterly dividend period during which such
shares were issued, as to all shares issued after June 30, 1981, and shall be
payable quarterly on the fifteenth days of January, April, July and October in
each year (and the quarterly dividend periods shall commence on the first days
of those months.).
(b) The shares of $2.50 Preferred Stock shall be subject to
redemption in whole or in part at the redemption price of $50.00 per share.
(c) The amount to which shares of $2.50 Preferred Stock shall be
entitled upon voluntary liquidation, dissolution, or winding up of the
Corporation, shall be $50.00 per share, plus the amount of accrued and unpaid
dividends, if any, thereon to the date fixed for payment, and no more.
The amounts to which shares of $2.50 Preferred Stock shall be entitled
upon involuntary liquidation, dissolution, or winding up of the Corporation,
shall be $18.00 per share, plus the amount
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<PAGE> 36
of accrued and unpaid dividends, if any, thereon to the date fixed for payment,
and no more.
(d) The shares of $2.50 Preferred Stock shall be convertible at the
option of the record holder thereof, in the manner hereinafter provided, into
shares of Common Stock of the Corporation; provided, however, that as to any
shares of $2.50 Preferred Stock which shall have been called for redemption,
the right of conversion shall terminate at the close of business on the fifth
full business day prior to the date fixed for redemption. No payment or
adjustment shall be made for dividends accrued on any shares of $2.50 Preferred
Stock that shall be converted or for dividends on any shares of Common Stock
that shall be issuable upon such conversion, but all dividends accrued and
unpaid on such shares of $2.50 Preferred Stock up to the dividend payment date
immediately preceding the date of conversion shall constitute a debt of the
Corporation payable to the converting shareholder, and no dividend shall be
paid upon the shares of Common Stock until such debt shall be paid or
sufficient funds set apart for the payment thereof.
Shares of $2.50 Preferred Stock may be converted at any time after
issue (subject to the above time limitation in the case of a call for
redemption), at the option of the record holder thereof, into shares of Common
Stock of the Corporation at the rate of one and one-half shares of Common Stock
for each share of $2.50 Preferred Stock.
The conversion rate provided for above shall be subject to the
following adjustments:
(i) In case the Corporation shall declare and pay to the holders of
the shares of Common Stock a dividend in shares of Common Stock, or in
securities convertible into shares of Common Stock, the conversion rate in
effect immediately prior to the time fixed for the determination of
shareholders entitled to such dividend shall be proportionately increased
(adjusted to the nearest, or if there shall be no nearest then to the next
lower, one-hundredth of a share of Common Stock), such adjustment to become
effective immediately after the time fixed for such determination.
(ii) In case the Corporation shall subdivide the outstanding shares
of Common Stock into a greater number of shares of Common Stock or combine the
outstanding shares of Common Stock into a smaller number of shares of Common
Stock, the conversion rate in effect immediately prior to such subdivision or
combination, as the case may be, shall be proportionately increased or
decreased (adjusted to the nearest, or if there shall be no nearest then to the
next lower, one-hundredth of a share of Common Stock), as the case may require,
such increase or decrease, as the case may be, to become effective when such
subdivision or combination becomes effective.
(iii) No adjustment of the conversion rate shall be made by
- 36 -
<PAGE> 37
reason of the issuance of shares of Common Stock for cash, property, or
services. In order to protect the conversion rights of the holders of $2.50
Preferred Stock from dilution, if stock warrants, subscription, or other rights
are offered to the holders of shares of Common Stock, such rights shall also be
offered to the holders of shares of $2.50 Preferred Stock on the basis of the
number of shares of Common Stock into which the shares of $2.50 Preferred Stock
are then convertible.
(iv) In case of any reclassification or change of outstanding shares
of Common Stock of the class issuable upon conversion of the shares of $2.50
Preferred Stock, or in case of any consolidation or merger of the Corporation
with or into another corporation, or in case of any sale or conveyance to
another corporation of all or substantially all of the property of the
Corporation, the holder of each share of $2.50 Preferred Stock then outstanding
shall have the right thereafter, so long as his conversion right hereunder
shall exist, to convert such share into the kind and amount of shares of stock
and other securities and property receivable upon such reclassification,
change, consolidation, merger, sale or conveyance by a holder of the number of
shares of Common Stock, of the Corporation into which such shares of $2.50
Preferred Stock might have been converted immediately prior to such
reclassification, change, consolidation, merger, sale or conveyance, and shall
have no other conversion rights under these provisions; provided, that
effective provision shall be made, in the Articles or Certificate of
Incorporation of the resulting, surviving, or successor corporation or
otherwise, so that the provisions set forth herein for the protection of the
conversion rights of the shares of $2.50 Preferred Stock shall thereafter be
applicable, as nearly as reasonably may be, to any such other shares of stock
and other securities and property deliverable upon conversion of the shares of
$2.50 Preferred Stock remaining outstanding or other convertible preferred
shares received by the holders in place thereof; and provided, further, that
any such resulting, surviving, or successor corporation shall expressly assume
the obligation to deliver, upon the exercise of the conversion privilege, such
shares, securities, or property as the holders of the shares of $2.50 Preferred
Stock remaining outstanding, or other convertible preferred shares received by
the holders in place thereof, shall be entitled to receive pursuant to the
provisions hereof, and to make provision for the protection of the conversion
right as above provided. In case securities or property other than shares of
Common Stock shall be issuable or deliverable upon conversion as aforesaid,
then all references in this paragraph shall be deemed to apply, so far as
appropriate and as nearly as may be, to such other securities or property. The
subdivision or combination of shares of Common Stock at any time outstanding
into a greater or lesser number of shares of Common Stock (whether with or
without par value) shall not be deemed to be a reclassification of the Common
Stock of the Corporation for the purposes of this subparagraph (iv).
In order to convert shares of $2.50 Preferred Stock into
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<PAGE> 38
shares of Common Stock, the holder thereof shall surrender the certificate or
certificates for shares of $2.50 Preferred Stock, duly endorsed to the
Corporation or in blank, at the office of any Transfer Agent for the shares of
$2.50 Preferred Stock (or such other place as may be designated by the
Corporation), and shall give written notice to the Corporation as said office
that he elects to convert the same and shall state in writing therein the name
or names in which he wishes the certificate or certificates for shares of
Common Stock to be issued. The Corporation shall, as soon as practicable
thereafter, deliver at said office to such holder of shares of $2.50 Preferred
Stock, or to his nominee or nominees, a certificate or certificates for the
number of full shares of Common Stock to which he shall be entitled as
aforesaid and make appropriate payment in cash for any fractional shares.
Shares of $2.50 Preferred Stock shall be deemed to have been converted as of
the date of the surrender of such shares for conversion as provided above, and
the person or persons entitled to receive the shares of Common Stock issuable
upon such conversion shall be treated for all purposes as the record holder or
holders of such shares of Common Stock on such date.
A number of authorized shares of Common Stock sufficient to provide
for the conversion of the shares of $2.50 Preferred Stock outstanding upon the
basis hereinbefore provided shall at all times be reserved for such conversion.
(e) Shares of $2.50 Preferred Stock redeemed shall not be reissued.
(f) The holders of $2.50 Preferred Stock shall be entitled to vote at
all meetings of the stockholders, and at each such meeting shall be entitled to
one vote for each share held.
(g) To the extent that the Board of Directors is authorized to fix
the designation, powers, preferences and relative, participating, optional or
other special rights, and qualifications, limitations or restrictions thereof,
in respect of additional series of Preferred Stock, none of the preferences or
rights of any such additional series as fixed by the Board of Directors shall
be prior or superior in any respect to those of the $2.50 Preferred Stock.
IN WITNESS WHEREOF, said Household International, Inc. has caused its
corporate seal to be hereunto affixed and this certificate to be signed by D.C.
Clark, its President, and
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<PAGE> 39
attested by J.D. Pinkerton, its Secretary, this 25th day of June, 1981.
Household International, Inc.
(SEAL)
By: /s/ D. C. Clark
-------------------------
President
Attest:
By: /s/ J. D. Pinkerton
-------------------
Secretary
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<PAGE> 40
HOUSEHOLD INTERNATIONAL, INC.
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
9 1/2% CUMULATIVE PREFERRED STOCK, SERIES 1989-A
(Without Par Value)
HOUSEHOLD INTERNATIONAL, INC., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were duly adopted by the Board of Directors of
the Corporation and by the Preferred Stock Committee of the Board of Directors,
pursuant to authority conferred upon the Board of Directors by the provisions
of the Restated Certificate of Incorporation, as amended, of the Corporation,
and pursuant to authority conferred upon the Preferred Stock Committee by the
resolutions of the Board of Directors set forth herein and in accordance with
Section 141 (c) of the General Corporation Law of the State of Delaware.
1. The Board of Directors on September 12, 1989, adopted the
following resolutions designating a Preferred Stock Committee of the Board of
Directors and authorizing the Preferred Stock Committee to act on behalf of the
Board of Directors (within certain limitations) in connection with the
designation, issuance and sale of shares in one or more series of Preferred
Stock of the Corporation:
"RESOLVED, that a Preferred Stock Committee of the Board of
Directors is hereby designated which shall have and may exercise, to
the fullest extent permitted by law, the full power and authority of
the Board of Directors with respect to the issuance and sale of one or
more new series of the Corporation's Preferred Stock without par value
(each such series herein referred to as the "New Preferred Stock"),
including, without limitation, establishing the purchase price
therefor, and fixing the designations and any of the preferences,
powers, rights (other than voting powers or voting rights which shall
be fixed by the Board of Directors) and relative, participating,
optional or other special rights and qualifications, limitations or
restrictions thereof, of such shares of each series of New Preferred
Stock, and fixing the number of shares of each series of New Preferred
Stock.
"FURTHER RESOLVED, that the Committee is authorized to take
such additional actions and adopt such additional resolutions as it
deems necessary or appropriate for the purpose of authorizing and
implementing the issuance, offer, and sale for cash of New Preferred
Stock, including, without limiting the generality of the foregoing,
the authorization and execution of agreements (including underwriting
- 40 -
<PAGE> 41
agreements) relating to the offer and sale of New Preferred Stock,
authorization and approval of listing applications (including
amendments or supplements thereto) for the listing of such New
Preferred Stock on a stock exchange, approval of forms of stock
certificates and authorization of issuance of New Preferred Stock in
uncertificated form, any actions which may be necessary to qualify the
offering and sale of New Preferred Stock under Blue Sky Laws of the
various states, any necessary filings with the Secretary of the State
of Delaware and other jurisdictions, and the appointment of a transfer
agent.
"FURTHER RESOLVED, that notwithstanding the foregoing
resolutions, the Preferred Stock Committee may not authorize the sale
of New Preferred Stock for more than $250 million cash consideration
in the aggregate, and the power and authority of the Preferred Stock
Committee set forth in the preceding resolutions shall expire on
September 12, 1990.
"FURTHER RESOLVED, that the members of the Preferred Stock
Committee shall be D. C. Clark, E. P. Hoffman, and G. P. Osler. In
the absence of Mr. Osler, A. E. Rasmussen is designated as an
alternate member of the Preferred Stock Committee to serve in his
place."
2. The Board of Directors on October 17, 1989, adopted the following
resolution pertaining to the voting rights for series of Preferred Stock
authorized for issuance by the Preferred Stock Committee of the Board of
Directors:
"RESOLVED, that holders of each series of the Corporation's
Preferred Stock which is authorized by the Preferred Stock Committee
of the Board of Directors to be issued and sold pursuant to authority
granted to the Preferred Stock Committee by the Board of Directors
(each such series herein referred to as the "New Preferred Stock")
shall have no voting rights, and their consent shall not be required
for taking any corporate action, except as otherwise set forth herein,
except as otherwise required by law, and except as otherwise provided
by the Board of Directors with respect to any particular series of New
Preferred Stock.
The consent of the holders of the New Preferred Stock with
respect to the matters set forth in sub-sections (i) and (iii) of
paragraph (5) of Article IV of the Corporation's Restated Certificate
of Incorporation ("Paragraph (5)") shall not be required, except with
respect to the creation or issuance of any class of stock ranking
prior to or on a parity with the Preferred Stock, or any series
thereof, as to the payment of dividends or the distribution of assets;
but the other provisions of Paragraph (5) shall be applicable to the
New Preferred Stock. The holders of the New Preferred Stock shall
have no right to elect directors pursuant to paragraph (6) of
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<PAGE> 42
Article IV of the Corporation's Restated Certificate of Incorporation
("Paragraph (6)"), such right hereby being expressly withheld.
In the event that any six quarterly cumulative dividends,
whether consecutive or not, upon the New Preferred Stock shall be in
arrears, the holders of the New Preferred Stock shall have the right,
voting separately as a class with holders of shares of any one or more
other series of Preferred Stock ranking on a parity with the New
Preferred Stock either as to payment of dividends or the distribution
of assets upon liquidation, dissolution, or winding up, whether
voluntary or involuntary, and upon which like voting rights have been
conferred and are then exercisable, at the next meeting of
stockholders called for the election of directors, to elect two
members of the Board of Directors. The right of such holders of such
shares of the New Preferred Stock, voting separately as a class, to
elect (together with the holders of shares of any one or more other
series of Preferred Stock ranking on such a parity) members of the
Board of Directors of the Corporation as aforesaid shall continue
until such time as all dividends accumulated on such shares of the New
Preferred Stock shall have been paid in full, at which time such right
shall terminate, except as herein or by law expressly provided,
subject to revesting in the event of each and every subsequent failure
to pay dividends of the character above mentioned.
Upon any termination of the right of the holders of the New
Preferred Stock as a class to elect directors as herein provided, the
term of office of all directors so elected shall terminate
immediately. If the office of any director elected by such holders
voting as a class becomes vacant by reason of death, resignation,
retirement, disqualification, removal from office or otherwise, the
remaining director elected by such holders voting as a class may
choose a successor who shall hold office for the unexpired term in
respect of which such vacancy occurred. Whenever the term of office
of the directors elected by such holders voting as a class shall end
and the special voting powers vested in such holders as provided in
this resolution shall have expired, the number of directors shall
thereupon be such number as may be provided for in the Corporation's
Bylaws irrespective of any increase made pursuant to the provisions of
this resolution.
Until all unpaid dividends on the New Preferred Stock shall
have been paid in full, and in order to permit the holders of the
Corporation's $6.25 Cumulative Convertible Voting Preferred Stock, and
any other series of Preferred Stock issued by the Corporation having
the voting rights set forth in Paragraph (6) to exercise fully the
right to elect directors as granted by and provided in Paragraph (6),
the number of directors constituting the whole Board of
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<PAGE> 43
Directors of the Corporation shall not be less than seven. If, upon
any such arrearage in dividends, the number of directors constituting
the whole Board of Directors shall be less than seven, the size of the
Board of Directors shall, immediately prior to the next meeting of
stockholders called for the election of directors, automatically be
increased by such number as shall be necessary to cause the number of
directors constituting the whole Board of Directors to be no less than
seven.
To the extent that the Board of Directors is authorized to fix
the designations, powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof in respect of additional series of Preferred
Stock, none of the preferences or rights of any such additional series
as fixed by the Board of Directors shall rank prior to the New
Preferred Stock as to payment of dividends or the distribution of
assets upon liquidation, dissolution, or winding up, whether voluntary
or involuntary, without the consent of the holders of two-thirds of
the outstanding shares of such series of New Preferred Stock voting as
a class.
The foregoing voting provisions shall not apply to any series
of New Preferred Stock if, at or prior to the time when the act with
respect to which such vote would otherwise be required shall be
effected, all outstanding shares of such series of New Preferred Stock
shall have been redeemed or sufficient funds shall have been deposited
in trust to effect such redemption.
On any time in which the holders of New Preferred Stock are
entitled to vote, such holders shall be entitled to one vote for each
share held."
3. The Preferred Stock Committee of the Board of Directors on
November 2, 1989 adopted the following resolution pursuant to authority
conferred upon the Preferred Stock Committee of the Board of Directors by the
resolution of the Board of Directors set forth in paragraph 1 above of this
Certificate of Designation, Preferences and Rights:
"RESOLVED, that the issue of a series of Preferred Stock
without par value of the Corporation is hereby authorized and the
designation, preferences and privileges, relative, participating,
optional and other special rights, and qualifications, limitations and
restrictions thereof, in addition to those set forth in the Restated
Certificate of Incorporation, as amended, of the Corporation, are
hereby fixed as follows:
9 1/2% CUMULATIVE PREFERRED STOCK, SERIES 1989-A
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<PAGE> 44
(1) Number of Shares and Designation. 750,000 shares of Preferred
Stock without par value of the Corporation are hereby constituted as a series
of Preferred Stock without par value and designated as 9 1/2% Cumulative
Preferred Stock, Series 1989-A (hereinafter called the "Preferred Stock, Series
1989-A").
(2) Dividends. The holders of shares of the Preferred Stock, Series
1989-A, shall be entitled to receive cash dividends, when and as declared by
the Board of Directors of the Corporation, out of assets legally available for
the purpose, at the rate determined as provided below. Such dividends shall be
cumulative from the date of original issue of such shares and shall be payable
quarterly in arrears, when and as declared by the Board of Directors of the
Corporation, on the fifteenth day of January, April, July and October in each
year to holders of record on the respective business days next preceding the
first days of those months (and the quarterly dividend periods shall commence
on the first days of those months).
Dividends on the Preferred Stock, Series 1989-A, for all quarterly
dividend periods will be payable at the rate of 9 1/2% per annum applied to the
amount of $100 per share of Preferred Stock, Series 1989-A. The amount of
dividends payable on each share of Preferred Stock, Series 1989-A, for each
full quarterly dividend period shall be computed by dividing the dividend rate
by four and applying the dividend rate to the amount of $100 per share. The
amount of dividends payable for any dividend period shorter or longer than a
full quarterly dividend period shall be computed on the basis of 30-day months
and a 360-day year.
(3) Liquidation Preference. The amount to which shares of Preferred
Stock, Series 1989-A, shall be entitled upon liquidation, dissolution, or
winding up of the Corporation, whether voluntary or involuntary, shall be $100
per share, plus an amount equal to all accrued and unpaid dividends, if any,
thereon to the date fixed for payment, and no more.
(4) Redemption. The shares of Preferred Stock, Series 1989-A, shall
be subject to redemption in whole or in part at the option of the Corporation
on or after November 9, 1994, at the following redemption prices, plus an
amount equal to all accrued and unpaid dividends, if any, thereon to the date
fixed for redemption, and no more:
$104.75 per share if redeemed on or before November 8, 1995;
$103.80 per share if redeemed thereafter and on or before November 8,
1996;
$102.85 per share if redeemed thereafter and on or before November 8,
1997;
$101.90 per share if redeemed thereafter and on or before November 8,
1998;
$100.95 per share if redeemed thereafter and on or before November 8,
1999;
$100.00 per share if redeemed thereafter.
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<PAGE> 45
(5) Shares to be Retired. All shares of Preferred Stock, Series
1989-A, purchased or redeemed by the Corporation shall be retired and cancelled
and shall be restored to the status of authorized but unissued shares of the
class of Preferred Stock without par value, without designated as to series,
and may thereafter be issued, but not as shares of Preferred Stock, Series
1989-A.
(6) Conversion or Exchange. The holders of shares of Preferred
Stock, Series 1989-A, shall not have any rights herein to convert such shares
into or exchange such shares for shares of any other series of any class or
classes of capital stock (or any other security) of the Corporation.
(7) Ranking. The Preferred Stock, Series 1989-A, shall rank on a
parity with the Corporation's $6.25 Cumulative Convertible Voting Preferred
Stock as to payment of dividends and distribution of assets upon liquidation,
dissolution, or winding up, whether voluntary or involuntary, and shall rank
prior to the Corporation's Common Stock and Series A Junior Participating
Preferred Stock as to payment of dividends and distribution of assets upon
liquidation, dissolution, or winding up, whether voluntary or involuntary, and
prior to any other series of stock authorized to be issued by the Corporation
which ranks junior to the $6.25 Cumulative Convertible Voting Preferred Stock
as to payment of dividends and distribution of assets upon liquidation,
dissolution, or winding up, whether voluntary or involuntary."
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights to be signed by Donald C. Clark, Chairman
of the Board and Chief Executive officer of the Corporation, and attested by
James D. Pinkerton,
- 45 -
<PAGE> 46
the Corporation's Senior Vice President-Administration and Secretary, this 6th
day of November, 1989.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ D. C. Clark
------------------------
Chairman of the Board and
Chief Executive Officer
Attest:
/s/ J. D. Pinkerton
- ----------------------------
Senior Vice President-
Administration and Secretary
- 46 -
<PAGE> 47
HOUSEHOLD INTERNATIONAL, INC.
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
Pursuant to Section 141 of the
General Corporation Law of the State of Delaware
FLEXIBLE RATE AUCTION PREFERRED STOCK, SERIES A AND B
(Without Par Value)
HOUSEHOLD INTERNATIONAL, INC., a corporation organized and
existing under the laws of the State of Delaware (the "Corporation"), HEREBY
CERTIFIES that the following resolutions were duly adopted by the Board of
Directors of the Corporation and by the Preferred Stock Committee of the Board
of Directors, pursuant to authority conferred upon the Board of Directors by
the provisions of the Restated Certificate of Incorporation, as amended, of the
Corporation, and pursuant to authority conferred upon the Preferred Stock
Committee by the resolutions of the Board of Directors set forth herein and in
accordance with section 141(c) of the General Corporation Law of the State of
Delaware.
I. The Board of Directors on September 12, 1989, adopted
the following resolutions designating a Preferred Stock Committee of the Board
of Directors and authorizing the Preferred Stock Committee to act on behalf of
the Board of Directors (within certain limitations) in connection with the
designation, issuance and sale of shares in one or more series of Preferred
Stock of the Corporation:
"RESOLVED, that a Preferred Stock Committee of the Board of
Directors is hereby designated which shall have and may exercise, to
the fullest extent permitted by law, the full power and authority of
the Board of Directors with respect to the issuance and sale of one or
more new series of the Corporation's Preferred Stock without par value
(each such series herein referred to as the "New Preferred Stock"),
including, without limitation, establishing the purchase price
therefor, and fixing the designations and any of the preferences,
powers, rights (other than voting powers or voting rights which shall
be fixed by the Board of Directors) and relative, participating,
optional or other special rights and qualifications, limitations or
restrictions thereof, of such shares of each series of New Preferred
Stock, and fixing the number of shares of each series of New Preferred
Stock.
"FURTHER RESOLVED, that the Committee is authorized to take
such additional actions and adopt such additional resolutions as it
deems necessary or appropriate for the purpose of authorizing and
implementing the issuance, offer, and sale for cash of New Preferred
Stock, including, without limiting the generality of the foregoing,
the authorization and execution of agreements (including underwriting
- 47 -
<PAGE> 48
agreements) relating to the offer and sale of New Preferred Stock,
authorization and approval of listing applications (including
amendments or supplements thereto) for the listing of such New
Preferred Stock on a stock exchange, approval of forms of stock
certificates and authorization of issuance of New Preferred Stock in
uncertificated form, any actions which may be necessary to qualify the
offering and sale of New Preferred Stock under Blue Sky Laws of the
various states, any necessary filings with the Secretary of State of
Delaware and other jurisdictions, and the appointment of a transfer
agent.
"FURTHER RESOLVED, that notwithstanding the foregoing
resolutions, the Preferred Stock Committee may not authorize the sale
of New Preferred Stock for more than $250 million cash consideration
in the aggregate, and the power and authority of the Preferred Stock
Committee set forth in the preceding resolutions shall expire on
September 12, 1990.
"FURTHER RESOLVED, that the members of the Preferred Stock
Committee shall be D. C. Clark, E. P. Hoffman, and G. P. Osler. In
the absence of Mr. Osler, A. E. Rasmussen is designated as an
alternate member of the Preferred Stock Committee to serve in his
place."
II. The Board of Directors on July 10, 1990, adopted the following
resolution pertaining to the voting rights which will be applicable to the
Flexible Rate Auction Preferred Stock, Series A and B:
"RESOLVED, that notwithstanding the resolution of the Board of
Directors adopted on October 17, 1989, the holders of any series of
Preferred Stock which on or after July 10, 1990, is authorized by the
Corporation's Preferred Stock Committee of the Board of Directors to
be issued and sold pursuant to authority granted to the Preferred
Stock Committee by the Board of Directors (each such series herein
referred to as the "New Preferred Stock") shall have no voting rights,
and their consent shall not be required for taking any corporate
action, except as otherwise set forth herein, except as otherwise
required by law, and except as otherwise provided by the Board of
Directors with respect to any particular series of New Preferred
Stock.
The consent of the holders of the New Preferred Stock with
respect to the matters set forth in subsections (i) and (iii) of
paragraph (5) of Article IV of the Corporation's Restated Certificate
of Incorporation ("Paragraph (5)") shall not be required, except with
respect to the creation or issuance of any class of stock ranking
prior to or on a parity with the Preferred Stock, or any series
thereof, as to the payment of dividends or the distribution of assets;
but the other provisions of Paragraph (5) shall be applicable to the
New Preferred Stock. The holders of the New Preferred Stock shall
have no right to elect directors
- 48 -
<PAGE> 49
pursuant to paragraph (6) of Article IV of the Corporation's Restated
Certificate of Incorporation ("Paragraph (6)"), such right hereby
being expressly withheld.
In the event that any six quarterly cumulative dividends
(which shall be deemed to include dividends in respect of a number of
non-quarterly dividend periods containing not less than 540 days),
whether consecutive or not, upon the New Preferred Stock shall be in
arrears, the holders of the New Preferred Stock shall have the right,
voting separately as a class with holders of shares of any one or more
other series of Preferred Stock ranking on a parity with the New
Preferred Stock either as to payment of dividends or the distribution
of assets upon liquidation, dissolution, or winding up, whether
voluntary or involuntary, and upon which like voting rights have been
conferred (which shall include the Corporation's 9-1/2% Cumulative
Preferred Stock, Series 1989-A) and are then exercisable, at the next
meeting of stockholders called for the election of directors, to elect
two members of the Board of Directors. The right of such holders of
such shares of the New Preferred Stock, voting separately as a class,
to elect (together with the holders of shares of any one or more other
series of Preferred Stock ranking on such a parity) members of the
Board of Directors of the Corporation as aforesaid shall continue
until such time as all dividends accumulated on such shares of the New
Preferred Stock shall have been paid in full, at which time such right
shall terminate, except as herein or by law expressly provided,
subject to revesting in the event of each and every subsequent failure
to pay dividends of the character above mentioned.
Upon any termination of the right of the holders of the New
Preferred Stock as a class to elect directors as herein provided, the
term of office of all directors so elected shall terminate
immediately. If the office of any director elected by such holders
voting as a class becomes vacant by reason of death, resignation,
retirement, disqualification, removal from office or otherwise, the
remaining director elected by such holders voting as a class may
choose a successor who shall hold office for the unexpired term in
respect of which such vacancy occurred. Whenever the term of office
of the directors elected by such holders voting as a class shall end
and the special voting powers vested in such holders as provided in
this resolution shall have expired, the number of directors shall
thereupon be such number as may be provided for in the Corporation's
Bylaws irrespective of any increase made pursuant to the provisions of
this resolution.
Until all unpaid dividends on the New Preferred Stock shall
have been paid in full, and in order to permit the holders of the
Corporation's $6.25 Cumulative Convertible Voting Preferred Stock, and
any other series of Preferred
- 49 -
<PAGE> 50
Stock issued by the Corporation having the voting rights set forth in
Paragraph (6) to exercise fully the right to elect directors as
granted by and provided in paragraph (6), the number of directors
constituting the whole Board of Directors of the Corporation shall not
be less than seven. If, upon any such arrearage in dividends, the
number of directors constituting the whole Board of Directors shall be
less than seven, the size of the Board of Directors shall, immediately
prior to the next meeting of stockholders called for the election of
directors, automatically be increased by such number as shall be
necessary to cause the number of directors constituting the whole
Board of Directors to be no less than seven.
To the extent that the Board of Directors is authorized to fix
the designations, powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof in respect of additional series of Preferred
Stock, none of the preferences or rights of any such additional series
as fixed by the Board of Directors shall rank prior to the New
Preferred Stock as to payment of dividends or the distribution of
assets upon liquidation, dissolution, or winding up, whether voluntary
or involuntary, without the consent of the holders of two-thirds of
the outstanding shares of such series of New Preferred Stock voting as
a class.
The foregoing voting provisions shall not apply to any series
of New Preferred Stock if, at or prior to the time when the act with
respect to which such vote would otherwise be required shall be
effected, all outstanding shares of such series of New Preferred Stock
shall have been redeemed or sufficient funds shall have been deposited
in trust to effect such redemption.
On any item in which the holders of New Preferred Stock are
entitled to vote, such holders shall be entitled to one vote for each
share held."
III. The Preferred Stock Committee of the Board of Directors on
July 18, 1990 adopted the following resolution pursuant to authority conferred
upon the Preferred Stock Committee of the Board of Directors by the resolution
of the Board of Directors set forth in paragraph I above of this Certificate of
Designation, Preferences and Rights:
"RESOLVED, that the issue of two series of Preferred Stock
without par value of the Corporation is hereby authorized and the
designation, preferences and privileges, relative, participating,
optional and other special rights, and qualifications, limitations and
restrictions thereof, in addition to those set forth in the Restated
Certificate of Incorporation, as amended, of the Corporation, are
hereby fixed as follows:
- 50 -
<PAGE> 51
PART I
1. Designation; Amount and Series. The two Series of
Preferred Stock created hereby shall comprise 750,000 shares designated as
"Flexible Rate Auction Preferred Stock" (referred to as the "Flex APS"). The
750,000 shares of the Flex APS shall be issuable in the following Series:
350,000 shares designated "Flexible Rate Auction Preferred Stock, Series A"
(the "Series A Flex APS") and 400,000 shares designated "Flexible Rate Auction
Preferred Stock, Series B" (the "Series B Flex APS"). Each share of each
separate Series of Flex APS shall be identical and equal in all respects to
every other share of such Series, and the shares of all of the Series shall,
except as expressly provided herein, or as otherwise provided by law, be
identical and equal in all respects.
2. Definitions. Unless the context or use indicates
another or different meaning or intent, the following terms shall have the
following meanings, whether used in the singular or plural:
"60-day 'AA' Composite Commercial Paper Rate," on any date,
means (i) the interest equivalent of the 60-day rate on commercial
paper placed on behalf of issuers whose corporate bonds are rated "Aa"
by Moody's or AA by S&P or the equivalent of such rating by another
rating agency, as such 60-day rate is made available on a discount
basis or otherwise by the Federal Reserve Bank of New York for the
Business Day immediately preceding such date, or (ii) in the event
that the Federal Reserve Bank of New York does not make available such
a rate, then the arithmetic average of the interest equivalent of the
60-day rate on commercial paper placed on behalf of such issuers, as
quoted on a discount basis or otherwise by the Commercial Paper
Dealers to the Auction Agent for the close of business on the Business
Day immediately preceding such date. If any Commercial Paper Dealer
does not quote a rate required to determine the 60-day "AA" Composite
Commercial Paper Rate, the 60-day "AA" Composite Commercial Paper Rate
shall be determined on the basis of the quotation or quotations
furnished by the remaining Commercial Paper Dealer or Commercial Paper
Dealers and any Substitute Commercial Paper Dealer or Substitute
Commercial Paper Dealers selected by the Corporation to provide such
rate or rates not being supplied by any Commercial Paper Dealer or
Commercial Paper Dealers, as the case may be, or, if the Corporation
does not select any such Substitute Commercial Paper Dealer or
Substitute Commercial Paper Dealers, by the remaining Commercial Paper
Dealer or Commercial Paper Dealers. If the Board of Directors of the
Corporation, however, shall adjust the number of Dividend Period Days
pursuant to the second sentence of paragraph 3(b)(v) in the event of a
change in the dividends received deduction minimum holding period
contained in the Code, then (i) if the Dividend Period Days shall be
less than 70 days, such rate shall be the interest
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<PAGE> 52
equivalent of the 60-day rate on such commercial paper, (ii) if the
Dividend Period Days shall be 70 or more days but less than 85 days,
such rate shall be the arithmetic average of the interest equivalent
of the 60-day and 90-day rates on such commercial paper and (iii) if
the Dividend Period Days shall be 85 or more days but less than 99
days, such rate shall be the interest equivalent of the 90-day rate on
such commercial paper. For the purposes of such definition, "interest
equivalent" means the equivalent yield on a 360-day basis of a
discount basis security to an interest bearing security.
"Act" shall mean the Securities Act of 1933, as amended.
"Applicable 'AA' Composite Commercial Paper Rate" for any
Long-Term Dividend Period on any date, shall mean (A) in the case of
any Long-Term Dividend Period of less than 70 days, the interest
equivalent of the 60-day rate, (B) in the case of any Long-Term
Dividend Period of 70 days or more but less than 85 days, the
arithmetic average of the interest equivalent of the 60-day and 90-day
rates, (C) in the case of any Long-Term Dividend Period of 85 days or
more but less than 120 days, the interest equivalent of the 90-day
rate, (D) in the case of any Long-Term Dividend Period of 120 days or
more but less than 148 days, the arithmetic average of the interest
equivalent of the 90-day and 180-day rates, (E) in the case of any
Long-Term Dividend Period of 148 days or more but less than 210 days,
the interest equivalent of the 180-day rate, (F) in the case of any
Long-Term Dividend Period of 210 days or more but less than 238 days,
the arithmetic average of the interest equivalent of the 180-day and
270-day rates and (G) in the case of any Long-Term Dividend Period of
238 or more days, the interest equivalent of the 270-day rate on
commercial paper placed on behalf of issuers whose corporate bonds are
rated "Aa" by Moody's or AA by S&P, or the equivalent of such rating
by another rating agency, as made available on a discount basis or
otherwise by the Federal Reserve Bank of New York for the Business Day
immediately preceding such date or in the event that the Federal
Reserve Bank of New York does not make available any such rate, then
the arithmetic average of such rates, as quoted on a discount basis or
otherwise, by the Commercial Paper Dealers, to the Auction Agent for
the close of business on the Business Day next preceding such date.
If any Commercial Paper Dealer does not quote a rate required to
determine the "AA" Composite Commercial Paper Rate, the "AA" Composite
Commercial Paper Rate shall be determined on the basis of the
quotation or quotations furnished by the remaining Commercial Paper
Dealer or Commercial Paper Dealers and any Substitute Commercial Paper
Dealer or Substitute Commercial Paper Dealers selected by the
Corporation to provide such rate or rates not being supplied by any
Commercial Paper Dealer or Commercial Paper Dealers, as the case may
be, or, if the Corporation does not
- 52 -
<PAGE> 53
select any such Substitute Commercial Paper Dealer or Substitute
Commercial Paper Dealers, by the remaining Commercial Paper Dealer or
Commercial Paper Dealers. For purposes of this definition, the
"interest equivalent" means the equivalent yield on a 360-day basis of
a discount-basis security to an interest-bearing security.
"Applicable Rate" means the rate per annum established
pursuant to paragraph 3(c) hereof at which dividends are payable on a
Series for any Auction Dividend Period for such Series.
"Applicable Treasury Rate" on any date, with respect to any
Series of Flex APS with a Long-Term Dividend Period of one year or
more, means the interest equivalent of the rate for direct obligations
of the United States Treasury having an original maturity which is
equal to, or next lower than, the length of such Long-Term Dividend
Period, as published weekly by the Federal Reserve Board in "Federal
Reserve Statistical Release H.15 (519)--Selected Interest Rates," or
any successor publication by the Federal Reserve Board within five
Business Days preceding such date. In the event that the Federal
Reserve Board does not publish such weekly per annum interest rate, or
if such release is not yet available, the Applicable Treasury Rate
will be the arithmetic mean of the secondary market bid rates as of
approximately 3:30 p.m., New York City time, on the Business Day next
preceding such date of the U.S. Government Securities Dealers obtained
by the Auction Agent (in the case of a determination of the Applicable
Treasury Rate on any Auction Date) or the Corporation (in the case of
a determination of such rate on any other day) for the issue of direct
obligations of the United States Treasury, in an aggregate principal
amount of at least $1,000,000, with a remaining maturity equal to, or
next lower than, the length of such Long-Term Dividend Period. If any
U.S. Government Securities Dealer does not quote a rate required to
determine the Applicable Treasury Rate, the Applicable Treasury Rate
shall be determined on the basis of the quotation or quotations
furnished by the remaining U.S. Government Securities Dealer or
Dealers or any Substitute U.S. Government Securities Dealer or Dealers
selected by the Corporation to provide such rate or rates not being
supplied by any U.S. Government Securities Dealer or Dealers, as the
case may be, or, if the Corporation does not select any such
Substitute U.S. Government Securities Dealer or Dealers, by the
remaining U.S. Government Securities Dealer or Dealers; provided that,
in the event the Corporation is unable to cause such quotations to be
furnished to the Auction Agent (or, if applicable, to the Corporation)
by such sources, the Corporation may cause such rates to be furnished
to the Auction Agent (or, if applicable, to the Corporation) by such
alternative source as the Corporation in good faith deems to be
reliable. For purposes of this definition, the "interest equivalent"
of a rate stated on a discount basis
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<PAGE> 54
shall be equal to the quotient of (A) the discount rate divided by (B)
the difference between 1.00 and the discount rate.
"Auction" means each periodic operation of the Auction
Procedures.
"Auction Agent" means such bank or trust company or other
entity which has been appointed as such by a resolution of the Board
of Directors of the Corporation.
"Auction Date" has the meaning specified in Part II below.
"Auction Dividend Period" has the meaning set forth in
paragraph 3(b)(vii) below.
"Auction Procedures" means the procedures for conducting
Auctions set forth in Part II below.
"Bid" has the meaning set forth in Part II below.
"Board of Directors" means the Board of Directors of the
Corporation and any duly authorized committee of the Board of
Directors.
"Business Day" means a day on which the New York Stock
Exchange is open for trading and which is not a day on which banks in
New York City are authorized by law to close.
"Code" means the Internal Revenue Code of 1986, as amended.
"Commercial Paper Dealers" means Goldman, Sachs & Co., Morgan
Stanley & Co. Incorporated and Merrill Lynch, Pierce, Fenner & Smith
Incorporated or, in lieu of any thereof, their respective affiliates
or successors.
"Common Stock" means the Corporation's common stock, $1.00 par
value, and any other shares of stock into which such stock may
hereinafter be changed from time to time.
"Corporation" means Household International, Inc., a Delaware
corporation, or its successor.
"Date of Original Issue," with respect to any share of Flex
APS, means the date on which the Corporation originally issues such
share of Flex APS.
"Dividend Payment Date" has the meaning set forth in paragraph
3(b)(vi) below.
"Dividend Period Days" has the meaning set forth in paragraph
3(b)(v) below.
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<PAGE> 55
"Dividend Quarter" has the meaning set forth in paragraph
3(b)(vi) below.
"Existing Holder" has the meaning set forth in Part II below.
"Failure to Deposit" means, with respect to any Series of Flex
APS, the failure by the Corporation to irrevocably deposit with the
Paying Agent sufficient funds for either the payment of dividends or
the redemption price on such Series of Flex APS and to give the Paying
Agent irrevocable instructions to apply such funds and, if applicable,
the income and proceeds therefrom, to the payment of such dividends or
redemption price not later than noon New York City time on the
Business Day immediately preceding each Dividend Payment Date or date
fixed for redemption with respect to such shares of Flex APS.
"Fixed Dividend Period" has the meaning set forth in paragraph
3(b)(i) below.
"Flex APS" has the meaning set forth in paragraph 1 above.
"Holder" means the holder of shares of the Corporation's Flex
APS as the same appears on the Stock Books of the Corporation.
"Initial Auction", "Initial Auction Date", "Initial Auction
Holders" and "Initial Dividend Period" have the meanings set forth in
Part II below.
"LIBOR" means, on any date for any Auction Dividend Period,
the arithmetic average (rounded to the next higher 1/16 of 1%),
computed by the Auction Agent of the following rates per annum or
arithmetic averages thereof quoted by each of the principal London
offices of the Reference Banks, at which United States dollar deposits
in the amount of U.S. $10,000,000 are offered by such Reference Banks
(i) in the case of any Auction Dividend Period with Dividend Period
Days of less than 30 days, the one-month rate, (ii) in the case of any
Auction Dividend Period with Dividend Period Days of 30 days or more
but less than 70 days, the two-month rate, (iii) in the case of any
Auction Dividend Period with Dividend Period Days of 70 or more days
but less than 85 days, the two-month and three-month rates and (iv) in
the case of any Auction Dividend Period with Dividend Period Days of
85 or more but less than 98 days or in the case that a Failure to
Deposit occurs during a Long-Term Dividend Period, the three-month
rate, to leading banks in the London interbank market at approximately
11:00 a.m. (London time) on the first day of such Auction Dividend
Period (or Dividend Quarter), or if such day is not a day on which
dealings in United States dollars are transacted in the London
interbank market, then on the next preceding day on
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<PAGE> 56
which such dealings are transacted in such market. If any Reference
Bank does not quote a rate required to determine LIBOR, LIBOR shall be
determined on the basis of the quotations furnished by the remaining
Reference Bank or Reference Banks and any Substitute Reference Bank or
Substitute Reference Banks selected by the Corporation to provide such
quotation or quotations not being supplied by any Reference Bank or
Reference Banks, as the case may be, or, if the Corporation does not
select any Substitute Reference Bank or Substitute Reference Banks, by
the remaining Reference Bank or Reference Banks. For each Auction
Dividend Period or Dividend Quarter for which the rate is determined
with reference to 200% of LIBOR, the Auction Agent will obtain rates
from the Reference Banks and determine LIBOR and notify the
Corporation of such determination.
"Long-Term Dividend Period" has the meaning set forth in
paragraph 3(b)(vii) below.
"Maximum Applicable Rate," with respect to any Series with a
Short-Term Dividend Period, on any Auction Date will be the rate
obtained by multiplying the 60-day "AA" Composite Commercial Paper
Rate on such Auction Date, and with respect to any Series with a
Long-Term Dividend Period, the Maximum Applicable Rate on any Auction
Date will be the rate obtained by multiplying the Reference Rate on
such Auction Date, by a percentage determined as set forth below based
on the credit rating or ratings assigned to the Flex APS by Moody's
and S&P (or if Moody's or S&P or both shall not make such rating
available, the equivalent of either or both or such ratings by a
Substitute Rating Agency or two Substitute Rating Agencies or, in the
event that only one such rating shall be available, the percentage
will be based on such rating).
<TABLE>
<CAPTION>
Applicable Percentage of
Credit Rating 60-day "AA" Composite
-------------------------------- Commercial Paper Rate
Moody's S&P or Reference Rate
------- --- ------------------------
<S> <C> <C>
aa3 or Above AA- or Above 110%
a3 to a1 A- to A+ 125%
baa3 to baa1 BBB- to BBB+ 175%
ba3 to ba1 BB- to BB+ 200%
Below ba3 Below BB- 250%
</TABLE>
If the ratings for any Series of Flex APS are split between
two of the foregoing categories, the lower rating will determine the
prevailing rating.
The Corporation shall take all reasonable action necessary to
enable Moody's and S&P to provide a rating for each Series. If either
Moody's or S&P shall not make such rating available or neither Moody's
nor S&P shall make such
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<PAGE> 57
a rating available, Goldman, Sachs & Co. or its affiliates and
successors, after consultation with the Corporation, shall select a
Substitute Rating Agency or two Substitute Rating Agencies, as the
case may be.
"Minimum Holding Period" has the meaning set forth in
paragraph 3(b)(v) below.
"Moody's" means Moody's Investors Service, Inc., or its
successor, so long as such agency (or successor) is in the business of
rating securities of the type of the Flex APS and, if such agency is
not in such business, then a Substitute Rating Agency.
"Non-Auction Rate" has the meaning set forth in paragraph
3(c)(i) below.
"Normal Dividend Payment Date" has the meaning set forth in
paragraph 3(b)(ii) below.
"Notice of Long-Term Dividend Period" has the meaning set
forth in paragraph 3(b)(viii) below.
"Notice of Removal" has the meaning set forth in paragraph
3(b)(viii) below.
"Notice of Revocation" has the meaning set forth in paragraph
3(b)(viii) below.
"Paying Agent" means the Auction Agent unless another bank or
trust company has been appointed for such purpose by resolution of the
Board of Directors of the Corporation.
"Rating Agencies" means Moody's and S&P.
"Reference Banks" means Citibank, N.A., Bankers Trust Company
and Morgan Guaranty Trust Company of New York, or, in lieu thereof,
their respective successors.
"Reference Rate" means for Long-Term Dividend Periods (i)
from 50 days to less than 270 days, the Applicable "AA" Composite
Commercial Paper Rate, (ii) from 270 days to less than one year, the
higher of the 270-day Applicable "AA" Composite Commercial Paper Rate
and the one-year Applicable Treasury Rate and (iii) of one year or
more, the Applicable Treasury Rate.
"Securities Depository" means The Depository Trust Company and
its successors and assigns or any other securities depository selected
by the Corporation which agrees to follow the procedures required to
be followed by such securities depository in connection with the Flex
APS.
"Sell Order" has the meaning set forth in Part II below.
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<PAGE> 58
"Series" means the Series A Flex APS or the Series B Flex APS
authorized herein.
"Short-Term Dividend Period" has the meaning set forth in
paragraph 3(b)(vii) below.
"S&P" means Standard & Poor's Corporation, or its successor,
so long as such agency (or successor) is in the business of rating
securities of the type of the Flex APS and, if such agency is not in
such business, then a Substitute Rating Agency.
"Stock Books" means the stock transfer books of the
Corporation maintained by the Paying Agent.
"Substitute Commercial Paper Dealer" means The First Boston
Corporation or Shearson Lehman Hutton Inc. or, in lieu of each
thereof, their respective affiliates or successors.
"Substitute Rating Agency" means a nationally recognized
statistical rating organization (as that term is used in the rules and
regulations of the Securities Exchange Act of 1934) selected by the
Term Selection Agent after consultation with the Corporation, and may
include Fitch Investors Service, Inc. and Duff & Phelps, Inc.
"Substitute Reference Bank" means the principal London offices
of any of The Bank of Tokyo Ltd., The First National Bank of Chicago
or Commerebank A.G. or, in lieu thereof, their respective successors,
or, if none of such Substitute Reference Banks are engaged in dealings
in United States dollars in the London interbank market, then a bank
or banks selected by the Corporation, engaged in dealings in United
States dollars in the London interbank market.
"Substitute U.S. Government Securities Dealer" means Merrill
Lynch, Pierce, Fenner & Smith Incorporated or The First Boston
Corporation, or their respective affiliates or successors.
"Successful Initial Auction" shall have the meaning set forth
in Part II below.
"Term Selection Agent" means Goldman, Sachs & Co., unless or
until another investment banking firm has been appointed as such by a
resolution of the Board of Directors of the Corporation.
"Unit" with respect to each Series shall mean 1,000 shares of
Flex APS of such Series.
"U.S. Government Securities Dealer" means Goldman, Sachs &
Co., Salomon Brothers Inc. and Morgan Stanley & Co. Incorporated or,
in lieu of any thereof, their respective
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<PAGE> 59
affiliates or successors.
3. Dividends. (a) Holders of shares of each
Series of Flex APS shall be entitled to receive, when, as and if
declared by the Board of Directors of the Corporation, out of surplus
(as defined in the General Corporation Law of the State of Delaware),
or net profits of the Corporation for the fiscal year in which the
dividend is declared and/or for the preceding fiscal year, cumulative
cash dividends at the applicable dividend rate per annum established
or determined as set forth herein, payable on the respective dates set
forth below.
(b) (i) Dividends on the shares of each Series shall
accumulate at the respective rates for such Series (whether or
not declared) from the Date of Original Issue. From the Date
of Original Issue to but not including July 15, 1993 with
respect to the Series A Flex APS and July 15, 1995 with
respect to the Series B Flex APS (in each case the "Fixed
Dividend Period"), dividends on the Flex APS shall be payable
on the fifteenth day of October, January, April, and July in
each year commencing on October 15, 1990.
(ii) Following the respective Fixed Dividend
Period for any Series of Flex APS, dividends on the shares of
such Series with a Short-Term Dividend Period shall be
payable, except as provided below in this paragraph 3(b),
every 49 days on the day following the last day of such
Short-Term Dividend Period. Dividends on the shares of each
Series with a Long-Term Dividend Period shall be payable,
except as provided below in this paragraph 3(b), on the day
following the last day of such Long-Term Dividend Period and,
if occurring prior to the day following the last day of such
Long-Term Dividend Period, on the fifteenth day of the third
month after the commencement of such Long-Term Dividend Period
and quarterly thereafter on the fifteenth day of each
succeeding third month. Each day on which dividends on shares
of a Series would be payable as determined as set forth in
this clause (ii) but for the provisions set forth below in
this paragraph 3(b) is referred to herein as a "Normal
Dividend Payment Date."
(iii) In the case of dividends payable on the
shares of a Series with a Short-Term Dividend Period, if:
(A)(I) The Securities Depository shall
continue to make available to its members and
participants the amounts due as dividends on the
shares of such Series in next-day funds on the dates
on which such dividends are payable and (II) a Normal
Dividend Payment Date for such Series is not a
Business Day, or the day next succeeding
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<PAGE> 60
such Normal Dividend Payment Date is not a
Business Day, then dividends shall be payable on the
first Business Day preceding such Normal Dividend
Payment Date that is next succeeded by a Business
Day; or
(B)(I) The Securities Depository shall make
available to its members and participants the amounts
due as dividends on the shares of such Series in
immediately available funds on the dates on which
such dividends are payable (and the Securities
Depository shall have so advised the Auction Agent)
and (II) a Normal Dividend Payment Date for such
Series is not a Business Day, then dividends shall be
payable on the first Business Day following such
Normal Dividend Payment Date.
(iv) In the case of dividends payable on the
shares of a Series with a Long-Term Dividend Period, if:
(A)(I) The Securities Depository shall
continue to make available to its members and
participants the amounts due as dividends on the
shares of such Series in next-day funds on the dates
on which such dividends are payable and (II) a Normal
Dividend Payment Date for such Series is not a
Business Day, or the day next succeeding such Normal
Dividend Payment Date is not a Business Day, then
dividends shall be payable on the first Business Day
following such Normal Dividend Payment Date that is
next succeeded by a Business Day; or
(B)(I) The Securities Depository shall make
available to its members and participants the amounts
due as dividends on the shares of such Series in
immediately available funds on the dates on which
such dividends are payable (and the Securities
Depository shall have so advised the Auction Agent)
and (II) a Normal Dividend Payment Date for such
Series is not a Business Day, then dividends shall be
payable on the first Business Day following such
Normal Dividend Payment Date.
(v) Notwithstanding the foregoing, if the date on
which dividends on the shares of any Series would be payable
as determined as set forth in clauses (ii), (iii) or (iv)
above is a day that would result in the number of days between
successive Auction Dates for such Series (determined by
including the first Auction Date and excluding the second
Auction Date) not being at least equal to the then current
Minimum Holding Period, then dividends on such shares shall be
payable, if either clauses (iii)(A) or (iv)(A) above would be
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<PAGE> 61
applicable to such Series, on the first Business Day
following such date on which dividends would be so payable
that is next succeeded by a Business Day or, if either clauses
(iii)(B) or (iv)(B) above would be applicable to such Series,
on the first Business Day following such day on which
dividends would be so payable, that in either case results in
the number of days between such successive Auction Dates for
such Series (determined as set forth above) being at least
equal to the then current Minimum Holding Period.
In addition, notwithstanding the foregoing, in the
event of a change in law altering the minimum holding period
(the "Minimum Holding Period") required for corporate
taxpayers generally to be entitled to the dividends received
deduction for federal income tax purposes in respect of
dividends (other than extraordinary dividends) paid on
preferred stock held by non-affiliated corporations, the Board
of Directors of the Corporation may adjust the period of time
between Dividend Payment Dates for each Series so as to adjust
uniformly the number of days (such number of days without
giving effect to the provisions in paragraphs 3(b)(iii) and
(iv) being hereinafter referred to as "Dividend Period Days")
in Auction Dividend Periods for each Series commencing after
the date of such change in law to equal or exceed the then
current Minimum Holding Period, provided that the number of
Dividend Period Days shall not exceed by more than nine days
the length of such then current Minimum Holding Period and
shall be evenly divisible by seven, and the maximum number of
Dividend Period Days, as adjusted pursuant to this provision,
in no event shall exceed 98 days. Upon any such change in the
number of Dividend Period Days as a result of a change in law,
the Corporation shall mail notice of such change by
first-class mail, postage prepaid, to the Auction Agent and
the Paying Agent and to each Existing Holder.
(vi) Each date on which dividends on the shares of
a Series for an Auction Dividend Period shall be payable as
determined as set forth in paragraph 3(b)(ii) above shall be
referred to herein as a "Dividend Payment Date" for such
Series. If applicable, the period from the preceding Dividend
Payment Date to the next Dividend Payment Date for any Series
with a Long-Term Dividend Period is herein referred to as a
"Dividend Quarter." Although any particular Dividend Payment
Date for a Series may not occur on the originally scheduled
Normal Dividend Payment Date for such Series because of the
foregoing provisions, each succeeding Dividend Payment Date
for such Series shall be, subject to such provisions, the date
determined as set forth in clause (ii) above as if each
preceding Dividend Payment Date had occurred on
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<PAGE> 62
the respective originally scheduled Normal Dividend
Payment Date.
(vii) After the Fixed Dividend Period for each
Series, each subsequent Auction Dividend Period for such
Series (except for the adjustments for non-Business Days
provided in clauses (iii) and (iv) above) shall be 49 days
(each such 49-day period, subject to any adjustment as a
result of a change in law lengthening the Minimum Holding
Period as provided in clause (v) above, being referred to
herein as a "Short-Term Dividend Period"), unless as provided
in clause (viii) below, the Term Selection Agent specifies
that any such subsequent Auction Dividend Period shall be an
Auction Dividend Period of any specified number of days
greater than a Short-Term Dividend Period and, except as
otherwise designated by the Term Selection Agent in the case
of the Initial Auction Dividend Period, consisting of a whole
number of weeks (each such period being referred to herein as
a "Long-Term Dividend Period," and each such Short-Term
Dividend Period and Long-Term Dividend Period being referred
to herein as an "Auction Dividend Period"). The Initial
Auction Dividend Period will commence on July 15, 1993 with
respect to the Series A Flex APS, and on July 15, 1995 with
respect to the Series B Flex APS. Thereafter, each successive
Auction Dividend Period for such Series shall commence on the
Dividend Payment Date for the preceding Auction Dividend
Period and shall end (i) in the case of any Series with a
Short-Term Dividend Period, on the day preceding the next
Dividend Payment Date for such Series and (ii) in the case of
any Series with a Long-Term Dividend Period, on the day
preceding the last Dividend Payment Date for such Long-Term
Dividend Period specified by the Term Selection Agent in the
related notice of Long-Term Dividend Period.
(viii) Not less than 10 and not more than 20 days
prior to an Auction Date for any Series and based on the
criteria set forth below, the Term Selection Agent may give
telephonic and written notice to the Corporation, the Auction
Agent, the Paying Agent and the Securities Depository that the
next succeeding Auction Dividend Period for such Series will
be longer than a Short-Term Dividend Period (a "Notice of
Long-Term Dividend Period"). Such notice will specify the
next succeeding Auction Dividend Period for such Series as a
Long-Term Dividend Period, which may be any period designated
by the Term Selection Agent greater than the Short-Term
Dividend Period and, except as otherwise designated by the
Term Selection Agent in the case of the Initial Auction
Dividend Period, consisting of a whole number of weeks,
provided that for any Auction occurring after the Initial
Auction for any Series, the Term Selection Agent may not give
a Notice of Long-Term
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<PAGE> 63
Dividend Period for such Series (and any such notice
shall be null and void) unless Sufficient Clearing Bids were
made in the last occurring Auction for such Series and full
cumulative dividends for all Series payable prior to such date
have been paid in full. The Term Selection Agent shall state
in each Notice of Long-Term Dividend Period (i) that the next
succeeding Auction Dividend Period for such Series shall be a
Long-Term Dividend Period, (ii) the term thereof and (iii)
whether or not the shares of such Series for such Long-Term
Dividend Period will be redeemable at the option of the
Corporation and, if they are, the date or dates upon which
such shares will be so redeemable, the redemption price (which
shall not be less than $100 per share plus an amount equal to
accrued and unpaid dividends thereon (whether or not earned or
declared) to the date fixed for redemption), and such other
terms as may be necessary or appropriate to effect such
redemption. The Term Selection Agent may establish a Long-Term
Dividend Period for the shares of a Series of Flex APS and the
applicable redemption provisions therefor, if the Term
Selection Agent determines that such Long-Term Dividend Period
and such redemption provisions, in its sole opinion, provides
the Corporation with the most favorable financing alternative
based upon the following: (i) short-term and long-term market
rates and indices of such short-term and long-term rates, (ii)
the amounts, maturities and interest or dividend rates on the
then outstanding securities of the Corporation or its
subsidiaries, (iii) market supply and demand for short-term
and long-term securities, (iv) yield curves for short-term and
long-term securities comparable to the shares of Flex APS, (v)
industry and financial conditions which may affect the shares
of Flex APS including the Term Selection Agent's expectations
with respect thereto, (vi) current tax laws and administrative
interpretations with respect thereto, (vii) the number of
shares of Flex APS Outstanding on the next Auction Date and
(viii) the number of potential purchasers. Any Notice of
Long-Term Dividend Period may be revoked by the Term Selection
Agent on or prior to the second Business Day prior to the
related Auction by telephonic and written notice (a "Notice of
Revocation") to the Corporation, the Auction Agent, the Paying
Agent and the Securities Depository, specifying that the Term
Selection Agent has determined that because of subsequent
changes in any of the foregoing factors, such Long-Term
Dividend Period would not result in the most favorable
financing alternative for the Corporation, and shall be deemed
to have been revoked if on or prior to the second Business Day
prior to the related Auction, the Term Selection Agent shall
have been removed and the Corporation shall have given written
and telephonic notice of such removal ("Notice
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<PAGE> 64
of Removal") to the Auction Agent, the Paying Agent and
the Securities Depository. Except with respect to a Notice of
Long-Term Dividend Period that is deemed to be revoked, any
Long-Term Dividend Period specified by the Term Selection
Agent for a Series of Flex APS and any revocation thereof
shall be conclusive and binding on the Corporation and the
Holders.
The Corporation may remove the Term Selection Agent
for any Series of Flex APS upon 5 days' written notice. If
there is no Term Selection Agent with respect to any Auction
Dividend Period, then such Auction Dividend Period shall be a
Short-Term Dividend Period.
If the Term Selection Agent does not give a Notice of
Long-Term Dividend Period with respect to the next succeeding
Auction Dividend Period for any Series of Flex APS or gives a
Notice of Revocation with respect thereto or such Notice of
Long-Term Dividend Period shall be deemed to have been
revoked, such next succeeding Auction Dividend Period shall be
a Short-Term Dividend Period. In addition, in the event the
Term Selection Agent has given a Notice of Long-Term Dividend
Period with respect to the next succeeding Auction Dividend
Period for any Series of Flex APS and has not given a Notice
of Revocation with respect thereto and such Notice of
Long-Term Dividend Period shall not have been deemed revoked,
but Sufficient Clearing Bids are not made in the related
Auction for such Series or such Auction is not held for any
reason, such next succeeding Auction Dividend Period shall,
notwithstanding such Notice of Long-Term Dividend Period, be a
Short-Term Dividend Period and the Term Selection Agent may
not again give a Notice of Long-Term Dividend Period (and any
such notice shall be null and void) for such Series until
Sufficient Clearing Bids have been made in an Auction with
respect to a Short-Term Dividend Period for such Series.
(ix) Not later than noon New York City time on the
Business Day immediately preceding each Dividend Payment Date
with respect to which dividends on any shares of Flex APS have
been declared, the Corporation shall irrevocably deposit with
the Paying Agent sufficient funds for the payment of such
dividends and shall give the Paying Agent irrevocable
instructions to apply such funds and, if applicable, the
income and proceeds therefrom, to the payment of such
dividends.
(x) Each dividend on the shares of any Series
declared by the Board of Directors of the Corporation for an
Auction Dividend Period shall be paid to Holders of such
shares as such Holders' names appear on the Stock Books on the
related record date, which shall be
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<PAGE> 65
the opening of business on the Business Day immediately
preceding the Dividend Payment Date for such dividend.
Subject to Article IV of the Corporation's Restated
Certificate of Incorporation, as amended, dividends on the
shares of any Series of Flex APS in arrears may be declared by
the Board of Directors and paid on any date fixed by the Board
of Directors on such date as is established by the Board of
Directors, to Holders of such shares as such Holders' names
appear on the Stock Books on the related record date fixed by
the Board of Directors which shall not be more than 15 days
before the date fixed for the payment of such dividends.
(c)(i)(A) The Fixed Dividend Rate for the
Fixed Dividend Period for Series A Flex APS shall be
9.25% per annum and for Series B Flex APS shall be
9.50% per annum. The amount of dividends payable on
each share of Flex APS for each full quarterly
dividend period during the Fixed Dividend Period
shall be computed by dividing the Fixed Dividend Rate
by four and applying such rate to the amount of $100
per share. The amount of dividends payable for any
dividend period shorter or longer than a full
quarterly dividend period shall be computed on the
basis of 30-day months and a 360-day year. The
dividend rate on the shares of each Series for each
Auction Dividend Period shall be the rate per annum
determined for such Series pursuant to Part II below;
provided, however, that in the event that an Auction
for any Auction Dividend Period for any Series is not
held for any reason (other than as a result of the
existence of a Failure to Deposit on the Auction Date
for such Auction Dividend Period), the dividend rate
on the shares of such Series for such Auction
Dividend Period shall be the Non-Auction Rate on the
Auction Date with respect to such Auction Dividend
Period. The "Non-Auction Rate" for any Series on an
Auction Date for such Series shall be the greater of
(x) the Applicable Rate in effect for such Series
immediately prior to such Auction Date or (y) the
Maximum Applicable Rate in effect on such Auction
Date for a Short-Term Dividend Period, regardless of
whether an Auction is held. The dividend rate on the
shares of any Series for any Auction Dividend Period
or part thereof determined as set forth in this
clause (c) is referred to herein as the "Applicable
Rate" for such Series for such Auction Dividend
Period or part thereof.
(B) In the event a Failure to Deposit
occurs prior to the beginning of an Auction Dividend
Period and is not cured in accordance with the next
succeeding sentence, Auctions for such Series
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<PAGE> 66
will be suspended, until such time as set forth
below, and the Applicable Rate for shares of such
Series for each Auction Dividend Period (until
Auctions are resumed) commencing after such Failure
to Deposit shall be equal to 200% of LIBOR on the
first day of each such Auction Dividend Period and
each such Auction Dividend Period shall be a
Short-Term Dividend Period. Any such Failure to
Deposit with respect to the shares of any Series
shall be deemed cured if by 12:00 noon, New York City
time, on the third Business Day next succeeding any
such Failure to Deposit, the Corporation shall have
deposited with the Auction Agent all accumulated and
unpaid dividends on the shares of such Series and
shall have deposited any unpaid redemption payments
with the Paying Agent, including the full amount of
any dividends to be paid with respect to the Auction
Dividend Period with respect to which such Failure to
Deposit occurred, plus an amount computed by
multiplying (i) 200% of the 60-Day "AA" Composite
Commercial Paper Rate for the Auction Dividend Period
during which such Failure to Deposit occurred on the
Dividend Payment Date for such Auction Dividend
Period by (ii) a fraction, the numerator of which
shall be the number of days for which such Failure to
Deposit is not cured in accordance with this sentence
(including the day such Failure to Deposit occurs and
excluding the day such Failure to Deposit is cured)
and the denominator of which shall be 360, and
applying the rate obtained against the aggregate
liquidation preference of the shares of such Series
then Outstanding.
(C) In the event a Failure to Deposit
occurs during a Long-Term Dividend Period, the
Applicable Rate for such Auction Dividend Period
shall remain unchanged, and an additional amount
computed by multiplying (i) 200% of LIBOR on the date
on which such Failure to Deposit occurred by (ii) a
fraction, the numerator of which shall be the number
of days for which such Failure to Deposit is not
cured (including the day such Failure to Deposit
occurs and excluding the day such Failure to Deposit
is cured) and the denominator of which shall be 360,
and applying the rate obtained against accumulated
dividends not paid when due, shall accumulate as
additional dividends on the shares of such Series of
Flex APS. In the event that such Failure to Deposit
is not cured prior to the next succeeding Auction
Date for shares of such Series, Auctions for such
Series shall be suspended, the next succeeding
Auction Dividend Period shall be a Short-Term
Dividend Period and the Applicable Rate shall be
equal to 200% of
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<PAGE> 67
LIBOR on the first day of such Auction Dividend
Period. Thereafter until such Failure to Deposit
shall have been cured and full and cumulative
dividends on the shares of such Series shall have
been paid in full or the Board of Directors of the
Corporation shall have declared a dividend in such
amount and funds sufficient for the payment thereof
shall have been irrevocably deposited with the Paying
Agent, each subsequent Auction Dividend Period and
Applicable Rate for such Series will be determined
pursuant to the next preceding paragraph.
(D) If prior to an Auction Date for
shares of such Series, full and cumulative dividends
shall have been paid in full or the Board of
Directors of the Corporation shall have declared a
dividend in such amount and funds sufficient for the
payment thereof shall have been irrevocably deposited
with the Paying Agent, Auctions for such Series will
resume.
(ii) The amount of dividends per share of any
Series of the Flex APS payable for each Auction Dividend
Period (or for each Dividend Quarter during any Long-Term
Dividend Period) for any such Series shall be computed by
multiplying the Applicable Rate for each Auction Dividend
Period (or Dividend Quarter) by a fraction the numerator of
which shall be the number of days in the Auction Dividend
Period (or Dividend Quarter) such share was Outstanding and
the denominator of which shall be 360 and multiplying the
amount so obtained by $100.
(d) (i) Notwithstanding paragraph 1 of Article IV of
the Corporation's Restated Certificate of Incorporation,
dividends on other series of the Corporation's Preferred Stock
ranking on a parity with the Flex APS may from time to time be
declared or paid on different dates than dividends on the Flex
APS are declared or paid. Holders of Flex APS shall not be
entitled to any dividends, whether in cash, property or stock,
in excess of full cumulative dividends. No interest, or sum
if money in lieu of interest, shall be payable in respect of
any dividend payment or payments on the shares of Flex APS
which may be in arrears.
(ii) The Flex APS shall rank on a parity with the
Corporation's $6.25 Cumulative Convertible Voting Preferred
Stock and 9 1/2% Cumulative Preferred Stock, Series 1989-A, as
to payment of dividends and distribution of assets upon
liquidation, dissolution, or winding up, whether voluntary or
involuntary, and shall rank prior to the Corporation's Common
Stock and Series A Junior Participating Preferred Stock as to
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<PAGE> 68
payment of dividends and distribution of assets upon
liquidation, dissolution, or winding up, whether voluntary or
involuntary, and prior to any other series of stock authorized
to be issued by the Corporation which ranks junior to the
$6.25 Cumulative Convertible Voting Preferred Stock and 9 1/2%
Cumulative Preferred Stock, Series 1989-A, as to payment of
dividends and distribution of assets upon liquidation,
dissolution, or winding up, whether voluntary or involuntary.
(iii) Any dividend payment made on shares of Flex
APS shall first be credited against the dividends accumulated
with respect to the earliest period for which dividends have
not been paid.
(iv) Except in an Auction, the Corporation shall
have the right to purchase or otherwise acquire any shares of
Flex APS in the open market at any lawful price so long as the
Corporation is current in the payment of dividends on the
shares of all series of its Preferred Stock. Any shares of
Flex APS purchased or otherwise acquired by the Corporation
shall not be resold and shall be retired and canceled, and
shall be restored to the status of authorized but unissued
shares of the class of the Corporation's Preferred Stock
without designation as to series, and may thereafter be issued
as a new series of Preferred Stock.
4. Liquidation Rights. The amount to which shares of
Flex APS shall be entitled upon liquidation, dissolution, or winding up of the
Corporation, whether voluntary or involuntary, shall be $100 per share, plus an
amount equal to all accrued and unpaid dividends, if any, thereon to the date
fixed for payment, and no more.
5. Voting Rights. The Holders of the shares of each
Series of Flex APS shall have such voting rights as have been established by
the Board of Directors of the Corporation.
6. Redemption. During the Fixed Dividend Period for a
Series of Flex APS, the Corporation may not redeem the shares of such Series
except on the Business Day prior to the Initial Auction Date for such Series,
at which time the Corporation may redeem shares of such Series which in the
aggregate constitute one or more Units out of funds legally available therefor,
in whole or in part, at a redemption price of $100 per share plus an amount
equal to accrued and unpaid dividends (whether or not earned or declared) to
the date fixed for redemption. Following the Fixed Dividend Period for a
Series of Flex APS, the Corporation may redeem shares of Flex APS of such
Series, as a whole or in part, in an aggregate amount constituting one or more
Units, at $100 per share, plus an amount equal to accrued and unpaid dividends
thereon (whether or not earned or declared) to the date fixed for redemption,
(i) in the case of a Short-Term
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<PAGE> 69
Dividend Period, on the Dividend Payment Date for such period and (ii) in the
case of a Long-Term Dividend Period, on such dates and upon such terms as the
Term Selection Agent may specify in the applicable Notice of Long-Term Dividend
Period for such Series but in no case may the redemption price for such shares
be less than $100 per share.
Not later than noon New York City time on the Business Day
immediately preceding the date fixed for redemption of any shares of Flex APS,
the Corporation shall irrevocably deposit with the Paying Agent sufficient
funds for such purpose and shall give the Paying Agent irrevocable instructions
to apply such funds and, if applicable, the income and proceeds therefrom, to
the redemption of such shares.
7. Restrictions on Transfer. The Flex APS shall be
subject to the restrictions on transfer set forth herein, including the
Purchaser's Letter attached hereto. Prior to a Successful Initial Auction for
Series, shares of such Series will be represented by certificates which will be
freely transferable. Thereafter, shares of such Series may be transferred only
in Units and, except for deemed sales by the Initial Auction Holders in the
Initial Auction, only pursuant to a Bid or a Sell Order placed in an Auction or
to or through a Broker-Dealer or to a person that has delivered a signed
Purchaser's Letter to the Auction Agent.
8. Additional Agreements. (a) Term Selection Agent.
Following the Fixed Dividend Period, the Corporation shall use its
best efforts to maintain a Term Selection Agent with respect to the
Series A Flex APS and Series B Flex APS to act in accordance with the
provisions set forth herein with respect to each such Series.
(b) Auction Agent. Following the Fixed Dividend Period,
the Corporation shall use its best efforts to maintain an Auction
Agent with respect to the Series A Flex APS and Series B Flex APS to
act in accordance with the provisions set forth herein with respect to
each such Series.
PART II
AUCTION PROCEDURES
1. Certain Definitions.
(a) "Affiliate" shall mean any Person known to the
Auction Agent to be controlled by, in control of or under common
control with the Corporation.
(b) "Agent Member" shall mean the member of the
Securities Depository that will act on behalf of a Bidder and is
identified as such in such Bidder's Purchaser's Letter.
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<PAGE> 70
(c) "Available Flex APS" shall have the meaning specified
in paragraph (a) of Section 4 of this Part II.
(d) "Bid" and "Bids" shall have the respective meanings
specified in paragraph (a) of Section 2 of this Part II.
(e) "Bidder" and "Bidders" shall have the respective
meanings specified in paragraph (a) of Section 2 of this Part II.
(f) "Broker-Dealer" shall mean any broker-dealer, or
other entity permitted by law to perform the functions required of a
Broker-Dealer in this Part II, that is a member of, or a participant
in, the Securities Depository, and that has been selected by the
Corporation and has entered into a Broker-Dealer Agreement with the
Auction Agent that remains effective.
(g) "Broker-Dealer Agreement" shall mean an agreement
between the Auction Agent and a Broker-Dealer pursuant to which such
Broker-Dealer agrees to follow the procedures specified in this Part
II.
(h) "Existing Holder" shall mean a Person who signed a
Purchaser's Letter and is listed as the beneficial owner of Flex APS
in the records of the Auction Agent.
(i) "Hold Order" and "Hold Orders" shall have the
respective meanings specified in paragraph (a) of Section 2 of this
Part II.
(j) "Initial Auction" shall mean the Auction conducted on
the Business Day prior to the beginning of the Initial Auction
Dividend Period and, if on such date Sufficient Clearing Bids do not
exist, then each subsequent Auction up to and including the first
Auction at which Sufficient Clearing Bids exist.
(k) "Initial Auction Date" shall mean each date upon
which an Initial Auction is conducted.
(l) "Initial Auction Dividend Period" shall mean the
first Auction Dividend Period and each subsequent Auction Dividend
Period, if any, that occurs subsequent to an Initial Auction until
there shall be a Successful Initial Auction.
(m) "Initial Auction Holder" shall have the meaning
specified in Section 6 of this Part II.
(n) "Maximum Applicable Rate," with respect to a
Short-Term Dividend Period, on any Auction Date will be the rate
obtained by multiplying the 60-day "AA" Composite Commercial Paper
Rate on such Auction Date, and with respect
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to a Long-Term Dividend Period, the Maximum Applicable Rate on any
Auction Date will be the rate obtained by multiplying the Reference
Rate on such Auction Date, by a percentage determined as set forth
below based on the credit ratings assigned to the Flex APS by Moody's
and S&P (or if Moody's or S&P or both shall not make such rating
available, the equivalent of either or both of such ratings by a
Substitute Rating Agency or two Substitute Rating Agencies or, in the
event that only one such rating shall be available, the percentage
will be based on such rating).
<TABLE>
<CAPTION>
Applicable Percentage of
Credit Rating 60-day "AA" Composite
-------------------------------- Commercial Paper Rate
Moody's S&P or Reference Rate
------- --- ------------------------
<S> <C> <C>
aa3 or Above AA- or Above.... 110%
a3 to a1 A- to A+........ 125%
baa3 to baa1 BBB- to BBB+.... 175%
ba3 to ba1 BB- to BB+...... 200%
Below ba3 Below BB-....... 250%
</TABLE>
If the ratings are split between two of the foregoing
categories, the lower rating will determine the prevailing rating.
The Corporation shall take all reasonable action necessary to
enable Moody's and S&P to provide a rating for the Flex APS. If
either Moody's or S&P shall not make such rating available or neither
Moody's nor S&P shall make such a rating available, Goldman, Sachs &
Co. or its affiliates and successors, after consultation with the
Corporation, shall select a Substitute Rating Agency or two Substitute
Rating Agencies, as the case may be.
(o) "Order" and "Orders" shall have the respective
meanings specified in paragraph (a) of Section 2 of this Part II.
(p) "Person" shall mean and include an individual, a
partnership, a corporation, a trust, an unincorporated association, a
joint venture or other entity or a government or any agency or
political subdivision thereof.
(q) "Potential Holder" shall mean any Person, including
any Existing Holder, (i) who shall have executed a Purchaser's Letter
and (ii) who may be interested in acquiring Units of Flex APS (or, in
the case of an Existing Holder, additional Units of Flex APS).
(r) "Purchaser's Letter" shall mean a Purchaser's Letter,
the form of which is attached hereto, addressed to the Corporation,
the Auction Agent and an Agent Member in which a Person agrees, among
other things, to offer to purchase, to offer to sell and/or to sell
Units of Flex APS
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<PAGE> 72
as set forth in this Part II, or a similar letter containing
substantially the same information and representations, or such other
letter as the Board of Directors shall approve.
(s) "Sell Order" and "Sell Orders" shall have the
respective meanings specified in paragraph (a) of Section 2 of this
Part II.
(t) "Submission Deadline" shall mean 12:30 P.M., New York
City time, on any Auction Date or such other time on any Auction Date
by which Broker-Dealers are required to submit Orders to the Auction
Agent as specified by the Auction Agent from time to time.
(u) "Submitted Bid" and "Submitted Bids" shall have the
respective meanings specified in paragraph (a) of Section 4 of this
Part II.
(v) "Submitted Hold Order" and "Submitted Hold Orders"
shall have the respective meanings specified in paragraph (a) of
Section 4 of this Part II.
(w) "Submitted Order" and "Submitted Orders" shall have
the respective meanings specified in paragraph (a) of Section 4 of
this Part II.
(x) "Submitted Sell Order" and "Submitted Sell Orders"
shall have the respective meanings specified in paragraph (a) of
Section 4 of this Part II.
(y) "Successful Initial Auction" shall mean an Initial
Auction at which Sufficient Clearing Bids exist.
(z) "Sufficient Clearing Bids" shall have the meaning
specified in paragraph (a) of Section 4 of this Part II.
(aa) "Unit" shall mean 1,000 shares of Flex APS.
(bb) "Winning Bid Rate" shall have the meaning specified
in paragraph (a) of Section 4 of this Part II.
2. Orders by Existing Holders and Potential Holders.
(a) Prior to the Submission Deadline on each Auction Date:
(i) each Existing Holder may submit to a
Broker-Dealer information as to:
(A) the number of outstanding Units, if
any, of Flex APS held by such Existing Holder which
such Existing Holder desires to continue to hold
without regard to the Applicable Rate for the next
succeeding Auction Dividend Period;
(B) the number of outstanding Units,
if any, of Flex APS that such Existing Holder
desires to
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<PAGE> 73
continue to hold if the Applicable Rate for the
next succeeding Auction Dividend Period shall not be
less than the rate per annum specified by such
Existing Holder; and/or
(C) the number of outstanding Units, if
any, of Flex APS held by such Existing Holder which
such Existing Holder offers to sell without regard to
the Applicable Rate for the next succeeding Auction
Dividend Period; and
(ii) one or more Broker-Dealers, using lists of
Potential Holders, shall in good faith for the purpose of
conducting a competitive Auction in a commercially reasonable
manner, contact Potential Holders, including Persons that are
not Existing Holders, on such lists to determine the number of
Units, if any, of Flex APS which each such Potential Holder
offers to purchase, provided that the Applicable Rate for the
next succeeding Auction Dividend Period shall not be less than
the rate per annum specified by such Potential Holder.
For the purpose hereof, the communication to a Broker-Dealer
of information referred to above is hereinafter referred to as an
"Order" and collectively as "Orders" and each Existing Holder and each
Potential Holder placing an Order is hereinafter referred to as a
"Bidder" and collectively as "Bidders"; an Order containing the
information referred to in clause (i)(A) of this paragraph (a) is
hereinafter referred to as a "Hold Order" and collectively as "Hold
Orders"; an Order containing the information referred to in clause
(i)(B) or (ii) of this paragraph (a) is hereinafter referred to as a
"Bid" and collectively as "Bids"; and an Order containing the
information referred to in clause (i)(C) of this paragraph (a) is
hereinafter referred to as a "Sell Order" and collectively as "Sell
Orders."
(b) (i) A Bid by an Existing Holder shall constitute
an irrevocable offer to sell:
(A) the number of outstanding Units of
Flex APS specified in such Bid if the Applicable Rate
determined on such Auction Date shall be less than
such specified rate; or
(B) such number or a lesser number of
outstanding Units of Flex APS to be determined as set
forth in subparagraph (a) (iv) of Section 5 of this
Part II if the Applicable Rate determined on such
Auction Date shall be equal to such specified rate;
or
(C) a lesser number of outstanding Units
of
- 73 -
<PAGE> 74
Flex APS to be determined as set forth in
subparagraph (b) (iii) of Section 5 of this Part II
if such specified rate shall be higher than the
Maximum Applicable Rate and Sufficient Clearing Bids
do not exist.
(ii) A Sell Order by an Existing Holder shall
constitute an irrevocable offer to sell:
(A) the number of outstanding Units of
Flex APS specified in such Sell Order; or
(B) such number or a lesser number of
outstanding Units of Flex APS as set forth in
subparagraph (b) (iii) of Section 5 of this Part II
if Sufficient Clearing Bids do not exist.
(iii) A Bid by a Potential Holder shall constitute
an irrevocable offer to purchase.
(A) the number of outstanding Units of
Flex APS specified in such Bid if the Applicable Rate
determined on such Auction Date shall be higher than
such specified rate; or
(B) such number or a lesser number of
outstanding Units of Flex APS as set forth in
subparagraph (a) (v) of Section 5 of this Part II if
the Applicable Rate determined on Such Auction Date
shall be equal to such specified rate.
3. Submission of Orders by Broker-Dealers to Auction
Agent. (a) Each Broker-Dealer shall submit in writing to the
Auction Agent prior to the Submission Deadline on each Auction Date
all Orders obtained by such Broker-Dealer and specifying with respect
to each Order:
(i) the name of the Bidder placing such Order;
(ii) the aggregate number of Units of Flex APS
that are the subject of such Order;
(iii) to the extent that such Bidder is an Existing
Holder:
(A) the number of Units, if any, of Flex
APS subject to any Hold Order placed by such Existing
Holder;
(B) the number of Units, if any, of Flex
APS subject to any Bid placed by such Existing Holder
and the rate specified in such Bid; and
(C) the number of Units, if any, of Flex
APS subject to any Sell Order placed by such Existing
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<PAGE> 75
Holder; and
(iv) to the extent such Bidder is a Potential
Holder, the rate specified in such Potential Holder's Bid.
(b) If any rate specified in any Bid contains more than
three figures to the right of the decimal point, the Auction Agent
shall round such rate up to the next highest one thousandth (.001) of
1%.
(c) If an Order or Orders covering all of the outstanding
Units of Flex APS held by any Existing Holder is not submitted to the
Auction Agent prior to the Submission Deadline, the Auction Agent
shall deem a Hold Order to have been submitted on behalf of such
Existing Holder covering the number of outstanding Units of Flex APS
held by such Existing Holder and not subject to Orders submitted to
the Auction Agent.
(d) If one or more Orders covering in the aggregate more
than the number of outstanding Units of Flex APS held by any Existing
Holder are submitted to the Auction Agent, such Orders shall be
considered valid as follows and in the following order of priority:
(i) all Hold Orders shall be considered valid,
but only up to and including in the aggregate the number of
Units of Flex APS held by such Existing Holder, and, solely
for purposes of allocating compensation among the
Broker-Dealers submitting Hold Orders, if the number of Units
of Flex APS held by such Existing Holder is less than the
aggregate number of Units that are the subject of such
Existing Holder's Hold Orders, the number of Units subject to
each Hold Order shall be reduced pro rata to cover the number
of Units of Flex APS held by such Existing Holder;
(ii) (A) any Bid shall be considered valid up
to and including the excess of the number of
outstanding Units of Flex APS held by such Existing
Holder over the number of Units of Flex APS subject
to any Hold Orders referred to in subparagraph (i)
above;
(B) subject to clause (A), if more than
one Bid with the same rate is submitted on behalf of
such Existing Holder and the number of Units of Flex
APS subject to such Bids is greater than such excess,
such Bids shall be considered valid up to the amount
of such excess, and, solely for purposes of
allocating compensation among the Broker-Dealers
submitting Bids with the same rate, the number of
Units of Flex APS subject to each Bid with the same
rate shall be reduced pro rata
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<PAGE> 76
to cover the number of Units of Flex APS equal to
such excess;
(C) subject to clause (A), if more than
one Bid with different rates is submitted on behalf
of such Existing Holder, such Bid shall be considered
valid in the ascending order of their respective
rates up to the amount of such excess; and
(D) in any such event the number, if
any, of such Units subject to Bids not valid under
this subparagraph (ii) shall be treated as the
subject of a Bid a Potential Holder; and
(iii) all Sell Orders shall be considered valid but
only up to and including in the aggregate the excess of the
number of outstanding Units of Flex APS held by such Existing
Holder over the sum of the Units of Flex APS subject to Hold
Orders referred to in subparagraph (i) and valid Bids by such
Existing Holder referred to in subparagraph (ii) above,
provided that if more than one Sell Order is submitted on
behalf of any Existing Holder and the number of Units subject
to such Sell Orders is greater than such excess, the number of
Units subject to such Sell Orders shall be reduced pro rata so
that such Sell Orders shall cover the number of Units equal to
such excess.
(e) If more than one Bid is submitted on behalf of any
Potential Holder, each Bid submitted shall be a separate Bid with the
rate and number of Units specified therein.
(4) Determination of Sufficient Clearing Bids, Winning
Bid Rate and Applicable Rate. (a) Not earlier than the
Submission Deadline on each Auction Date, the Auction Agent shall
assemble all Orders submitted or deemed submitted to it by the
Broker-Dealers (each such Order as submitted or deemed submitted by a
Broker-Dealer being hereinafter referred to individually as a
"Submitted Hold Order," a "Submitted Bid" or a "Submitted Sell Order,"
as the case may be, or as a "Submitted Order" and collectively as
"Submitted Hold Orders," "Submitted Bids" or "Submitted Sell Orders,"
as the case may be, or as "Submitted Orders") and shall determine:
(i) the excess of the total number of outstanding
Units of Flex APS over the number of outstanding Units of Flex
APS that are the subject of Submitted Hold Orders (such excess
being hereinafter referred to as the "Available Flex APS");
(ii) from the Submitted Orders whether:
(A) the number of outstanding Units of
Flex APS that are the subject of Submitted Bids by
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<PAGE> 77
Potential Holders specifying one or more rates
equal to or lower than the Maximum Applicable Rate
exceeds or is equal to the sum of:
(I) the number of outstanding Units
of Flex APS that are the subject of Submitted
Bids by Existing Holders specifying one or
more rates higher than the Maximum Applicable
Rate; and
(II) the number of outstanding
Units of Flex APS that are the subject of
Submitted Sell Orders
(in the event of such excess or such equality (other
than because the sum of the number of Units of Flex
APS in clauses (I) and (II) above is zero because all
of the outstanding Units of Flex APS are the subject
of Submitted Hold Orders), such Submitted Bids in
clause (A) above being hereinafter referred to
collectively as "Sufficient Clearing Bids"); and
(iii) if Sufficient Clearing Bids exist, the lowest
rate specified in the Submitted Bids (the "Winning Bid Rate")
which if:
(A)(I) each Submitted Bid from Existing
Holders specifying such lowest rate and (II) all
other Submitted Bids from existing Holders specifying
lower rates were accepted, thus entitling such
Existing Holders to continue to hold the Units of
Flex APS that are the subject of such Submitted Bids;
and
(B)(I) each Submitted Bid from Potential
Holders specifying such lowest rate and (II) all
other Submitted Bids from Potential Holders
specifying lower rates were accepted, thus entitling
the Potential Holders to purchase the Units of Flex
APS that are the subject of those Submitted Bids,
would result in such Existing Holders described in clause (A)
continuing to hold an aggregate number of outstanding Units of
Flex APS which, when added to the number of outstanding Units
of Flex APS to be purchased by such Potential Holders
described in clause (B), would equal not less than the
Available Flex APS.
(b) Promptly after the Auction Agent has made the
determinations pursuant to paragraph (a) of this Section 4, the
Auction Agent shall advise the Corporation of the Maximum Applicable
Rate and, based on such determinations, the Applicable Rate for the
next succeeding Auction Dividend
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<PAGE> 78
Period as follows:
(i) if Sufficient Clearing Bids exist, that the
Applicable Rate for the next succeeding Auction Dividend
Period shall be equal to the Winning Bid Rate so determined;
(ii) if Sufficient Clearing Bids do not exist
(other than because all of the outstanding Units of Flex APS
are the subject of Submitted Hold Orders), then (a) if the
Term Selection Agent has not given a Notice of Long-Term
Dividend Period with respect to the next succeeding Auction
Dividend Period or has given a Notice of Revocation with
respect thereto or such Notice of Long-Term Dividend Period
shall be deemed to have been revoked, the Applicable Rate for
such next succeeding Auction Dividend Period shall be the
Maximum Applicable Rate on the Auction Date for a Short-Term
Dividend Period and (b) if the Term Selection Agent has given
a Notice of Long-Term Dividend Period with respect to the next
succeeding Auction Dividend Period and has not given a Notice
of Revocation with respect thereto and such Notice of
Long-Term Dividend Period shall not have been deemed revoked,
such next succeeding Auction Dividend Period shall,
notwithstanding such Notice of Long-Term Dividend Period, be a
Short-Term Dividend Period, and the Applicable Rate for such
next succeeding Auction Dividend Period shall be the greatest
of (i) the Applicable Rate in effect immediately prior to the
applicable Auction, (ii) the Maximum Applicable Rate on the
Auction Date for a Short-Term Dividend Period or (iii) the
Maximum Applicable Rate on the Auction Date for the specified
Long-Term Dividend Period; or
(iii) if all the outstanding Units of Flex APS are
the subject of Submitted Hold Orders, that the Applicable Rate
for the next succeeding Auction Dividend Period shall (1) in
the case of a Short-Term Dividend Period, be equal to 59% of
the 60-day "AA" Composite Commercial Paper Rate in effect on
the date of such Auction, and (2) in the case of a Long-Term
Dividend Period, be equal to 59% of the Reference Rate in
effect on the date of such Auction.
5. Acceptance and Rejection of Submitted Bids and
Submitted Sell Orders and Allocation of Units. Based on the determinations
made pursuant to paragraph (a) of Section 4 of this Part II, the Submitted Bids
and Submitted Sell Orders Shall be accepted or rejected and the Auction Agent
shall take such other action as set forth below:
(a) If Sufficient Clearing Bids have been made, subject
to the provisions of paragraphs (c), (d) and (e) of this Section 5,
Submitted Bids and Submitted Sell Orders
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<PAGE> 79
shall be accepted or rejected as follows in the following order of
priority and all other Submitted Bids shall be rejected:
(i) the Submitted Sell Orders of Existing Holders
shall be accepted and the Submitted Bid of each of the
Existing Holders specifying any rate that is higher than the
Winning Bid Rate shall be rejected, thus requiring each such
Existing Holder to sell the Units of Flex APS that are the
subject of such Submitted Bid;
(ii) the Submitted Bid of each of the Existing
Holders specifying any rate that is lower than the Winning Bid
rate shall be accepted, thus entitling such Existing Holder to
continue to hold the Units of Flex APS that are the subject of
each Submitted Bid;
(iii) the Submitted Bid of each of the Potential
Holders specifying any rate that is lower than the Winning Bid
Rate shall be accepted;
(iv) the Submitted Bid of each of the Existing
Holders specifying a rate that is equal to the Winning Bid
Rate shall be accepted, thus entitling each such Existing
Holder to continue to hold the Units of Flex APS that are the
subject of such Submitted Bid, unless the number of
outstanding Units of Flex APS subject to all such Submitted
Bids shall be greater than the number of Units of Flex APS
("remaining Units") equal to the excess of the Available Flex
APS over the number of Units of Flex APS subject to Submitted
Bids described in subparagraphs (ii) and (iii) of this
paragraph (a), in which event the Submitted Bids of each such
Existing Holder shall be rejected, and each such Existing
Holder shall be required to sell Units of Flex APS, but only
in an amount equal to the difference between (A) the number of
outstanding Units of Flex APS then held by such Existing
Holder subject to such Submitted Bid and (B) the number of
Units of Flex APS obtained by multiplying the number of
remaining Units by a fraction the numerator of which shall be
the number of outstanding Units of Flex APS held by such
Existing Holder subject to such Submitted Bid and the
denominator of which shall be the sum of the number of
outstanding Units of Flex APS subject to such Submitted Bids
made by all such Existing Holders that specified a rate equal
to the Winning Bid Rate; and
(v) the Submitted Bid of each of the Potential
Holders specifying a rate that is equal to the Winning Bid
Rate shall be accepted but only in an amount equal to the
number of Units of Flex APS obtained by multiplying the
difference between the Available Flex APS and the number of
Units of Flex APS subject to Submitted Bids described in
subparagraphs (ii), (iii)
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<PAGE> 80
and (iv) of this paragraph (a) by a fraction the
numerator of which shall be the number of outstanding Units of
Flex APS subject to such Submitted Bid and the denominator of
which shall be the sum of the number of outstanding Units of
Flex APS subject to such Submitted Bids made by all such
Potential Holders that specified a rate equal to the Winning
Bid Rate.
(b) If Sufficient Clearing Bids have not been made (other
than because all of the outstanding Units of Flex APS are subject to
Submitted Hold Orders), subject to the provisions of paragraph (c),
(d) and (e) of this Section 5, Submitted Orders shall be accepted or
rejected as follows in the following order of priority and all other
Submitted Bids shall be rejected:
(i) the Submitted Bid of each Existing Holder
specifying any rate that is equal to or lower than the Maximum
Applicable Rate shall be accepted, thus entitling such
Existing Holder to continue to hold the Units of Flex APS that
are the subject to such Submitted Bid;
(ii) the Submitted Bid of each Potential Holder
specifying any rate that is equal to or lower than the Maximum
Applicable Rate shall be accepted; and
(iii) the Submitted Bids of each Existing Holder
specifying any rate that is higher than the Maximum Applicable
Rate shall be rejected and the Submitted Sell Orders of each
Existing Holder shall be accepted, in both cases only in an
amount equal to the difference between (A) the number of
outstanding Units of Flex APS then held by such Existing
Holder subject to such Submitted Bid or Submitted Sell Order
and (B) the number of Units of Flex APS obtained by
multiplying the difference between the Available Flex APS and
the aggregate number of Units of Flex APS subject to Submitted
Bids described in subparagraphs (i) and (ii) of this paragraph
(b) by a fraction the numerator of which shall be the number
of outstanding Units of Flex APS held by such Existing Holder
subject to such Submitted Bid or Submitted Sell Order and the
denominator of which shall be the number of outstanding Units
of Flex APS subject to all such Submitted Bids and Submitted
Sell Orders.
(c) If all of the outstanding Units of Flex APS are the
subject of Submitted Hold Orders, all Submitted Bids shall be
rejected.
(d) If, as a result of the procedures described in
paragraph (a) or (b) of this Section 5, any Existing Holder would be
entitled or required to sell, or any Potential Holder would be
entitled or required to purchase, a fraction
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<PAGE> 81
of a Unit of Flex APS on any Auction Date, the Auction Agent, in such
manner as it shall determine in its sole discretion, shall round up or
down the number of Units of Flex APS to be purchased or sold by any
Existing Holder or Potential Holder on such Auction Date so that the
number of Units purchased or sold by each Existing Holder or Potential
Holder on such Auction Date shall be whole Units of Flex APS.
(e) If, as a result to the procedures described in
paragraph (a) of this Section 5, any Potential Holder would be
entitled or required to purchase less than a whole Unit of Flex APS on
any Auction Date, the Auction Agent, in such manner as it shall
determine in its sole discretion, shall allocate Units for purchase
among Potential Holders so that only whole Units of Flex APS are
purchased on such Auction Date by any Potential Holder, even if such
allocation results in one or more of such Potential Holders not
purchasing Units of Flex APS on such Auction Date.
(f) Based on the results of each Auction, the Auction
Agent shall determine the aggregate number of Units of Flex APS to be
purchased and the aggregate number of Units of Flex APS to be sold by
Potential Holders and Existing Holders on whose behalf each
Broker-Dealer submitted Bids or Sell Orders and, with respect to each
Broker-Dealer, to the extent that such aggregate number of Units to be
purchased and such aggregate number of Units to be sold differ,
determine to which other Broker-Dealer or Broker-Dealers acting for
one or more purchasers such Broker-Dealer shall deliver, or from which
other Broker-Dealer or Broker-Dealers acting for one or more sellers
such Broker-Dealer shall receive, as the case may be, Units of Flex
APS.
6. The Initial Auction Date. On the Initial Auction
Date, each holder of Flex APS ("Initial Auction Holder") will be deemed to have
submitted an order to the Auction Agent to sell all shares of Flex APS then
held, at a price of $100 per share, without regard to the Applicable Rate for
the Initial Auction Dividend Period.
7. Initial Auction Procedure. (a) In connection with a
Successful Initial Auction, the Auction Agent shall mail, within two
Business Days of such Initial Auction, a written notice of deemed sale
by first class mail, postage prepaid, to each Initial Auction Holder
(a "Notice of Deemed Sale"). The Corporation shall provide the
Auction Agent with written notice of the information to be contained
in the Notice of Deemed Sale at least one day prior to the date the
Notice of Deemed Sale is mailed to such Initial Auction Holders. For
purposes of the calculation of the date on which notice is given
pursuant to this Section 7(a), a Notice of Deemed Sale shall be deemed
to be given on the day such notice is first mailed by first class
mail, postage prepaid, to such Initial Auction Holders. Each Notice
of
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<PAGE> 82
Deemed Sale shall be addressed to the holder at the address of the
holder appearing on the stock transfer books maintained by the Auction
Agent. Each Notice of Deemed Sale shall include a statement setting
forth (i) the deemed sale date, (ii) the number of shares of Flex APS
deemed to have been sold, (iii) the deemed sales price (as specified
in Section 6), (iv) that the deemed seller shall not be entitled to
dividends on such shares after the Initial Auction Date and (v) the
place or places (which shall be in the City of New York) where holders
may surrender the certificates evidencing such shares of Flex APS and
obtain payment of the deemed sales price.
(b) In connection with an Initial Auction at which
Sufficient Clearing Bids do not exist, the Auction Agent shall mail,
within two Business Days of such Initial Auction, a written notice of
a failed Initial Auction by first class mail, postage prepaid, to each
Initial Auction Holder (a "Notice of Failed Initial Auction"). The
Corporation shall provide the Auction Agent with written notice of the
information to be contained in the Notice of Failed Initial Auction at
least one day prior to the date the Notice of Failed Initial Auction
is mailed to such Initial Auction Holders. For the purposes of the
calculation of the date on which notice is give pursuant to this
Section 7(b), a Notice of Failed Initial Auction shall be deemed to be
given on the day such notice is first mailed by first class mail,
postage prepaid, to such Initial Auction Holders. Each Notice of
Failed Initial Auction shall include a statement setting forth (i) the
date of Failed Initial Auction, (ii) that Sufficient Clearing Bids did
not exist, (iii) that all Submitted Bids were rejected, (iv) that all
shares of Flex APS deemed to have been the subject of Sell Orders
pursuant to Section 6 hereof were not sold and shall continue to be
held by such Initial Auction Holder of such shares, (v) that the
Applicable Rate for the next Auction Dividend Period shall be the
Maximum Applicable Rate and (vi) that for the purposes of these
Auction Procedures the next succeeding Auction Date shall also be
considered an Initial Auction Date, the next succeeding Auction shall
also be considered an Initial Auction and the next succeeding Auction
Dividend Period shall also be considered an Initial Auction Dividend
Period.
(c) On or after a Successful Initial Auction, each
Initial Auction Holder of shares of Flex APS that were deemed sold
shall surrender the certificate or certificates evidencing such shares
to the Corporation at any place designated for such surrender in the
Notice of Deemed Sale and shall then be entitled to receive payment of
the deemed sales price for such shares.
(d) Subsequent to a Successful Initial Auction the Paying
Agent shall pay the deemed sales price to the Initial Auction Holders
upon surrender of certificates representing
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<PAGE> 83
shares of Flex APS.
(e) Subsequent to a Successful Initial Auction all rights
of the Initial Auction Holders shall cease, except the right to
receive the deemed sales price against delivery of the certificates
evidencing such shares, but without interest, and the right to receive
any accrued and unpaid dividends to and including such Initial Auction
Date. The Corporation shall be entitled to receive, from time to
time, from the Auction Agent the interest, if any, earned on such
monies deposited with the Auction Agent by Bidders who have submitted
successful Bids at such Initial Auction, and the holders of such
shares shall have no claim to any such interest. With regard to any
such funds which are unclaimed by holders of such shares at the end of
two years from such deemed sales date, the Auction Agent shall, upon
demand, pay over to the Corporation such amount remaining on deposit,
and the Auction Agent shall thereupon be relieved of all
responsibility to the holders of such shares and the holders of shares
of Flex APS so sold shall thereafter be entitled to look only to the
Corporation for payment thereof.
8. Miscellaneous. (a) The Board of Directors of
the Corporation may interpret the provisions of this paragraph 8 to
resolve any inconsistency or ambiguity, remedy any formal defect or
make any other change or modification which does not adversely affect
the rights of Existing Holders of Flex APS and may in appropriate
cases authorize the filing of a Certificate of Correction.
(b) So long as the Applicable Rate is based on the
results of an Auction, an Existing Holder (i) may sell, transfer or
otherwise dispose of Units of Flex APS only pursuant to a Bid or Sell
Order in accordance with the procedures described in this Part II or
to or through a Broker-Dealer or to a Person that has delivered a
signed copy of a Purchaser's Letter to the Auction Agent, provided
that in the case of all transfers other than pursuant to Auctions such
Existing Holder or its Broker-Dealer advises the Auction Agent of such
transfer, and (ii) shall have the ownership of the Units of Flex APS
held by it maintained in book entry form by the Securities Depository
in the account of its Agent Member, which in turn will maintain
records of such Existing Holder's beneficial ownership.
(c) The Corporation and its Affiliates shall not submit
any Order in any Auction except as set forth in the next sentence. Any
Broker-Dealer that is an Affiliate of the Corporation may submit Orders
in Auctions but only if such Orders are not for its own account, except
that if such affiliated Broker-Dealer holds Units of Flex APS for its
own account, it must submit a Sell Order in the next Auction with
respect to such Units of Flex APS.
(d) Unless the context otherwise requires, all
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<PAGE> 84
references to the Flex APS in Part II hereof are deemed to refer to a
single series of the Flex APS.
* * * *
IN WITNESS WHEREOF, HOUSEHOLD INTERNATIONAL, INC. has caused
this Certificate to be made under the seal of the Corporation and signed by
David D. Wesselink, its Vice President and Treasurer, and attested by Ronald C.
Roselli, its Assistant Secretary, this 18th day of July, 1990.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ David D. Wesselink
----------------------
David D. Wesselink
Vice President and
Treasurer
(CORPORATE SEAL)
ATTEST:
By: /s/ Ronald C. Roselli
-----------------------
Ronald C. Roselli
Assistant Secretary
- 84 -
<PAGE> 85
FORM OF
PURCHASER'S LETTER
Relating to Securities Involving Rate
Settings Through Auctions
TO BE SUBMITTED TO YOUR BROKER-DEALER WHO WILL THEN DELIVER
COPIES ON YOUR BEHALF TO THE RESPECTIVE AUCTION AGENT
The Company
The Auction Agent
A Broker-Dealer
An Agent member
Other Persons
1. This letter is designed to apply to auctions for publicly or
privately offered debt or equity securities ("Securities") of any issuer
("Company") which are described in any final prospectus or other offering
materials relating to such Securities as the same may be amended or
supplemented (collectively, with respect to the particular Securities
concerned, the "Prospectus") and which involve periodic rate settings through
auctions ("Auctions"). This letter shall be for the benefit of any Company and
of any trust company or auction agent (collectively, "Auction Agent"),
broker-dealer, agent member, securities depository or other interested person
in connection with any Securities and related Auctions (it being understood
that such persons may be required to execute specified agreements and nothing
herein shall alter such requirements). The terminology used herein is intended
to be general in its application and not to exclude any Securities in respect
of which (in the Prospectus or otherwise) alternative terminology is used.
2. We may from time to time offer to purchase, purchase, offer to
sell and/or sell Securities of any Company as described in the Prospectus
relating thereto. We agree that this letter shall apply to all such purchases,
sales and offers and to Securities owned by us. We understand that the
dividend/interest rate on Securities may be based from time to time on the
results of Auctions as set forth in the Prospectus.
3. We agree that any bid or sell order placed by us shall
constitute an irrevocable offer by us to purchase or sell the Securities
subject to such bid or sell order, or such lesser amount of Securities as we
shall be required to sell or purchase as a result of such Auction, at the
applicable price, all as set forth in the Prospectus, and that if we fail to
place a bid or sell order with respect to Securities owned by us with a
broker-dealer on any auction date, or a broker-dealer to which we communicate a
bid or sell order fails to submit such bid or sell order to the Auction Agent
concerned, we shall be deemed to have placed a hold order with respect to such
Securities as described in the Prospectus. We authorize any broker-dealer that
submits a
- 85 -
<PAGE> 86
bid or sell order as our agent in Auctions to execute contracts for the sale of
Securities covered by such bid or sell order. We recognize that the payment by
such broker-dealer for Securities purchased on our behalf shall not relieve us
of any liability to such broker-dealer for payment for such Securities.
4. We agree that, during the applicable period as described in
the Prospectus, dispositions of Securities can be made only in the
denominations set forth in the Prospectus and we will sell, transfer or
otherwise dispose of any Securities held by us from time to time only pursuant
to a bid or sell order placed in an Auction to or through a broker-dealer or,
when permitted in the Prospectus, to a person that has signed and delivered or
caused to be delivered on its behalf, to the applicable Auction Agent a letter
substantially in the form of this letter (or other applicable purchaser's
letter), provided that in the case of all transfers other than pursuant to
Auctions we or our broker-dealer or our agent member shall advise such Auction
Agent of such transfer. We understand that a restrictive legend will be placed
on certificates representing the Securities and stop-transfer instructions will
be issued to the transfer agent and/or registrar, all as set forth in the
Prospectus. We agree to comply with any other transfer restrictions or other
related procedures as described in the Prospectus.
5. We agree that, during the applicable period as described in
the Prospectus, ownership of Securities shall be represented by a global
certificate registered in the name of the applicable securities depository or
its nominee, that we will not be entitled to receive any certificate
representing the Securities and that our ownership of any Securities will be
maintained in book entry form by the securities depository for the account of
our agent member, which in turn will maintain records of our beneficial
ownership. We authorize and instruct our agent member to disclose to the
applicable Auction Agent such information concerning our beneficial ownership
of Securities as such Auction Agent shall request.
6. We acknowledge that partial deliveries of Securities purchased
in Auctions may be made to us and such deliveries shall constitute good
delivery as set forth in the Prospectus.
7. This letter is not a commitment by us to purchase any
Securities.
8. This letter supersedes any prior-dated version of this
purchaser's letter, and supplements any prior-or post-dated purchaser's letter
specific to particular Securities; any recipient of this letter may rely upon
it until such recipient has received a signed writing amending or revoking this
letter.
9. The descriptions of Auction Procedures set forth in each
applicable Prospectus are incorporated by reference herein and, in case of any
conflict between this letter and any such description, such description shall
control.
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<PAGE> 87
10. Any photocopy or other reproduction of this letter shall be
deemed of equal effect as a signed original.
11. Our agent member of Securities depository currently is
_____________________________________________________________.
12. Our personnel authorized to place orders with broker-dealers
for the purposes set forth in the Prospectus in Auctions currently is/are
_____________________________________________, telephone number
_____________________________________________.
13. Our tax payer identification number is _____________.
14. In the case of each offer to purchase, purchase, offer to sell
or sale by us of Securities not registered under the Securities Act of 1933, as
amended (the "Act"), we represent and agree as follows:
A. We understand and expressly acknowledge that the
Securities have not been and will not be registered under the Act and,
accordingly, that the Securities may not be reoffered, resold or
otherwise pledged, hypothecated or transferred unless an applicable
exemption from the registration requirements of the Act is available.
B. We hereby confirm that any purchase of Securities
made by us will be for our own account, or for the account of one or
more parties for which we are acting as trustee or agent with complete
investment discretion and with authority to bind such parties, and not
with a view to any public resale or distribution thereof. We and each
other party for which we are acting which will acquire Securities will
be "accredited investors" within the meaning of Regulation D under the
Act with respect to the Securities to be purchased by us or such
party, as the case may be, will have previously invested in similar
types of instruments and will be able and prepared to bear the
economic risk of investing in and holding such Securities.
Dated:
--------------------- ------------------------------
Mailing Address of Purchaser (Name of Purchaser)
By:
--------------------------
Printed Name:
----------------
Title:
-----------------------
- 87 -
<PAGE> 88
CERTIFICATE OF HOUSEHOLD INTERNATIONAL, INC.
UNDER SECTION 151(g) OF THE GENERAL
CORPORATION LAW OF THE STATE OF DELAWARE
Household International, Inc., a Delaware corporation (hereinafter
referred to as the "Corporation"), does hereby certify that:
1) the Corporation's 11-1/4% Enhanced Rate Cumulative Preferred
Stock (the "Preferred Stock") has been redeemed in its entirety and that no
shares of the Preferred Stock are outstanding as of the date hereof.
2) the following resolution has been duly adopted by the
Corporation's Board of Directors:
"RESOLVED, that the officers of the Corporation are duly
authorized to file a certificate with the Secretary of State of
Delaware eliminating from the Corporation's Certificate of
Incorporation all matters set forth in each Certificate of
Designation, Preferences and Rights for the Preferred Stock and as
permitted by the Certificate of Designation, Preferences and Rights
for the Preferred Stock, such shares of Preferred Stock redeemed shall
resume the status of authorized and unissued shares of the
Corporation's preferred stock."
Upon the effective date of the filing of this Certificate, it shall
eliminate from the Corporation's Certificate of Incorporation all matters set
forth in the Certificate of Designation, Preferences and Rights with respect to
the Corporation's 11-1/4% Enhanced Rate Cumulative Preferred Stock, and all of
such shares of 11-1/4% Enhanced Rate Cumulative Preferred Stock shall resume
the status of authorized and unissued shares of the Corporation's class of
Preferred Stock.
IN WITNESS WHEREOF, said Household International, Inc., has caused its
corporate seal to be hereunto affixed and this Certificate to be signed by John
W. Blenke, its Secretary, and attested by Susan E. Casey, its Assistant
Secretary, this 14th day of November, 1994.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ J. W. Blenke
------------------------
Secretary
Attest:
By: /s/ S. E. Casey
-------------------
Assistant Secretary
- 88 -
<PAGE> 89
HOUSEHOLD INTERNATIONAL, INC.
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
11-1/4% ENHANCED RATE CUMULATIVE PREFERRED STOCK
(Without Par Value)
HOUSEHOLD INTERNATIONAL, INC., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were duly adopted by the Board of Directors of
the Corporation and by the Preferred Stock Committee of the Board of Directors,
pursuant to authority conferred upon the Board of Directors by the provisions
of the Restated Certificate of Incorporation, as amended, of the Corporation,
and pursuant to authority conferred upon the Preferred Stock Committee by the
resolutions of the Board of Directors set forth herein and in accordance with
Section 141(c) of the General Corporation Law of the State of Delaware.
1. The Board of Directors has adopted the following resolutions
designating a Preferred Stock Committee of the Board of Directors and
authorizing the Preferred Stock Committee to act on behalf of the Board of
Directors (within certain limitations) in connection with the designation,
issuance and sale of shares in one or more series of Preferred Stock of the
Corporation:
"RESOLVED, that a Preferred Stock Committee of the Board of
Directors is hereby designated which shall have and may exercise, to
the fullest extent permitted by law, the full power and authority of
the Board of Directors with respect to the issuance and sale of one or
more new series of the Corporation's Preferred Stock without par value
(each such series herein referred to as the "New Preferred Stock"),
including, without limitation, establishing the purchase price
therefor, and fixing the designations and any of the preferences,
powers, rights (other than voting powers or voting rights which shall
be fixed by the Board of Directors) and relative, participating,
optional or other special rights and qualifications, limitations or
restrictions thereof, of such shares of each series of New Preferred
Stock, and fixing the number of shares of each series of New Preferred
Stock.
"FURTHER RESOLVED, that the Committee is authorized to take
such additional actions and adopt such additional resolutions as it
deems necessary or appropriate for the purpose of authorizing and
implementing the issuance, offer, and sale for cash of New Preferred
Stock, including, without limiting the generality of the foregoing,
the authorization and execution of agreements (including underwriting
- 89 -
<PAGE> 90
agreements) relating to the offer and sale of New Preferred Stock,
authorization and approval of listing applications (including
amendments or supplements thereto) for the listing of such New
Preferred Stock on a stock exchange, approval of forms of stock
certificates and authorization of issuance of New Preferred Stock in
uncertificated form, any actions which may be necessary to qualify the
offering and sale of New Preferred Stock under Blue Sky Laws of the
various states, any necessary filings with the Secretary of State of
Delaware and other jurisdictions, and the appointment of a transfer
agent.
"FURTHER RESOLVED, that notwithstanding the foregoing
resolutions, the Preferred Stock Committee may not authorize the sale
of New Preferred Stock for more than $250 million cash consideration
in the aggregate, and the power and authority of the Preferred Stock
Committee set forth in the preceding resolutions shall expire on
September 12, 1991.
"FURTHER RESOLVED, that the members of the Preferred Stock
Committee shall be D. C. Clark, E. P. Hoffman, and G. P. Osler. In
the absence of Mr. Osler, A. E. Rasmussen is designated as an
alternate member of the Preferred Stock Committee to serve in his
place."
2. The Board of Directors has adopted the following resolution
pertaining to the voting rights for series of Preferred Stock authorized for
issuance by the Preferred Stock Committee of the Board of Directors:
"RESOLVED, that notwithstanding the resolution of the Board of
Directors adopted on October 17, 1989, the holders of the
Corporation's Flexible Rate Auction Preferred Stock, Series A, and
Flexible Rate Auction Preferred Stock, Series B, and any other series
of Preferred Stock which on or after July 10, 1990, is authorized by
the Preferred Stock Committee of the Board of Directors to be issued
and sold pursuant to authority granted to the Preferred Stock
Committee by the Board of Directors (each such series herein referred
to as the "New Preferred Stock") shall have no voting rights, and
their consent shall not be required for taking any corporate action,
except as otherwise set forth herein, except as otherwise required by
law, and except as otherwise provided by the Board of Directors with
respect to any particular series of New Preferred Stock.
The consent of the holders of the New Preferred Stock with
respect to the matters set forth in sub-sections (i) and (iii) of
paragraph (5) of Article IV of the Corporation's Restated Certificate
of Incorporation ("Paragraph (5)") shall not be required, except with
respect to the creation or issuance of any class of stock ranking
prior to or on a parity with the Preferred Stock, or any series
thereof, as to the payment of dividends or the distribution of assets;
but the other provisions of
- 90 -
<PAGE> 91
Paragraph (5) shall be applicable to the New Preferred Stock. The
holders of the New Preferred Stock shall have no right to elect
directors pursuant to paragraph (6) of Article IV of the Corporation's
Restated Certificate of Incorporation ("Paragraph (6)"), such right
hereby being expressly withheld.
In the event that any six quarterly cumulative dividends
(which shall be deemed to include dividends in respect of a number of
non-quarterly dividend periods containing not less than 540 days),
whether consecutive or not, upon the New Preferred Stock shall be in
arrears, the holders of the New Preferred Stock shall have the right,
voting separately as a class with holders of shares of any one or more
other series of Preferred Stock ranking on a parity with the New
Preferred Stock either as to payment of dividends or the distribution
of assets upon liquidation, dissolution, or winding up, whether
voluntary or involuntary, and upon which like voting rights have been
conferred (which shall include the Corporation's 9-1/2% Cumulative
Preferred Stock, Series 1989-A) and are then exercisable, at the next
meeting of stockholders called for the election of directors, to elect
two members of the Board of Directors. The right of such holders of
such shares of the New Preferred Stock, voting separately as a class,
to elect (together with the holders of shares of any one or more other
series of Preferred Stock ranking on such a parity) members of the
Board of Directors of the Corporation as aforesaid shall continue
until such time as all dividends accumulated on such shares of the New
Preferred Stock shall have been paid in full, at which time such right
shall terminate, except as herein or by law expressly provided,
subject to revesting in the event of each and every subsequent failure
to pay dividends of the character above mentioned.
Upon any termination of the right of the holders of the New
Preferred Stock as a class to elect directors as herein provided, the
term of office of all directors so elected shall terminate
immediately. If the office of any director elected by such holders
voting as a class becomes vacant by reason of death, resignation,
retirement, disqualification, removal from office or otherwise, the
remaining director elected by such holders voting as a class may
choose a successor who shall hold office for the unexpired term in
respect of which such vacancy occurred. Whenever the term of office
of the directors elected by such holders voting as a class shall end
and the special voting powers vested in such holders as provided in
this resolution shall have expired, the number of directors shall
thereupon be such number as may be provided for in the Corporation's
Bylaws irrespective of any increase made pursuant to the provisions
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<PAGE> 92
of this resolution.
Until all unpaid dividends on the New Preferred Stock shall
have been paid in full, and in order to permit the holders of the
Corporation's $6.25 Cumulative Convertible Voting Preferred Stock, and
any other series of Preferred Stock issued by the Corporation having
the voting rights set forth in Paragraph (6) to exercise fully the
right to elect directors as granted by and provided in paragraph (6),
the number of directors constituting the whole Board of Directors of
the Corporation shall not be less than seven. If, upon any such
arrearage in dividends, the number of directors constituting the whole
Board of Directors shall be less than seven, the size of the Board of
Directors shall, immediately prior to the next meeting of stockholders
called for the election of directors, automatically be increased by
such number as shall be necessary to cause the number of directors
constituting the whole Board of Directors to be no less than seven.
To the extent that the Board of Directors is authorized to fix
the designations, powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof in respect of additional series of Preferred
Stock, none of the preferences or rights of any such additional series
as fixed by the Board of Directors shall rank prior to the New
Preferred Stock as to payment of dividends or the distribution of
assets upon liquidation, dissolution, or winding up, whether voluntary
or involuntary, without the consent of the holders of two-thirds of
the outstanding shares of such series of New Preferred Stock voting as
a class.
The foregoing voting provisions shall not apply to any series
of New Preferred Stock if, at or prior to the time when the act with
respect to which such vote would otherwise be required shall be
effected, all outstanding shares of such series of New Preferred Stock
shall have been redeemed or sufficient funds shall have been deposited
in trust to effect such redemption.
On any item in which the holders of New Preferred Stock are
entitled to vote, such holders shall be entitled to one vote for each
share held."
3. The Preferred Stock Committee of the Board of Directors has
adopted the following resolution pursuant to authority conferred upon the
Preferred Stock Committee of the Board of Directors by the resolution of the
Board of Directors set forth in paragraph 1 above of this Certificate of
Designation, Preferences and Rights:
- 92 -
<PAGE> 93
"RESOLVED, that the issue of a series of Preferred Stock
without par value of the Corporation is hereby authorized and the
designation, preferences and privileges, relative, participating,
optional and other special rights, and qualifications, limitations and
restrictions thereof, in addition to those set forth in the Restated
Certificate of Incorporation, as amended, of the Corporation, are
hereby fixed as follows:
11-1/4% ENHANCED RATE CUMULATIVE PREFERRED STOCK
(1) Number of Shares and Designation. 450,000 shares of
Preferred Stock without par value of the Corporation are hereby
constituted as a series of Preferred Stock without par value and
designated as 11-1/4% Enhanced Rate Cumulative Preferred Stock
(hereinafter called the "Enhanced Rate Preferred Stock").
(2) Dividends. The holders of shares of the Enhanced Rate
Preferred Stock shall be entitled to receive cash dividends, when and
as declared by the Board of Directors of the Corporation, out of
assets legally available for such purpose, at the rate determined as
provided below. Such dividends shall be cumulative from the date of
original issue of such shares and shall be payable quarterly in
arrears, when and as declared by the Board of Directors of the
Corporation, on the fifteenth day of January, April, July and October
in each year to holders of record on the respective business days next
preceding the first days of those months (and the quarterly dividend
periods shall commence on the first days of those months).
Dividends on the Enhanced Rate Preferred Stock for quarterly
dividend periods will be payable at the rate of 11-1/4% per annum
from the date of original issue through September 30, 1994, 11-1/2%
per annum from October 1, 1994 through September 30, 1995, 11-3/4% per
annum from October 1, 1995 through September 30, 1996, 12% per annum
from October 1, 1996 through September 30, 1997, and 12-1/8% per annum
on or after October 1, 1997, in each case applied to the amount of
$100 per share of Enhanced Rate Preferred Stock. The amount of
dividends payable on each share of Enhanced Rate Preferred Stock for
each full quarterly dividend period shall be computed by dividing the
dividend rate by four and applying the dividend rate to the amount of
$100 per share. The amount of dividends payable for any dividend
period shorter or longer than a full quarterly dividend period shall
be computed on the basis of 30-day months and a 360-day year.
(3) Liquidation Preference. The amount to which shares of
Enhanced Rate Preferred Stock shall be entitled upon
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<PAGE> 94
liquidation, dissolution, or winding up of the Corporation, whether
voluntary or involuntary, shall be $100 per share, plus an amount
equal to all accrued and unpaid dividends, if any, thereon to the date
fixed for payment, and no more.
(4) Redemption. The shares of Enhanced Rate Preferred Stock
shall be subject to redemption in whole or in part at the option of
the Corporation on or after October 1, 1993, at the following
redemption prices, plus an amount equal to all accrued and unpaid
dividends, if any, thereon to the date fixed for redemption, and no
more:
$102.50 per share if redeemed on or before September 30, 1994;
$101.25 per share if redeemed thereafter and on or before
September 30, 1995;
$100.00 per share if redeemed thereafter.
(5) Shares to be Retired. All shares of Enhanced Rate
Preferred Stock purchased or redeemed by the Corporation shall be
retired and cancelled and shall be restored to the status of
authorized but unissued shares of the class of Preferred Stock without
par value, without designation as to series, and may thereafter be
issued, but not as shares of Enhanced Rate Preferred Stock.
(6) Conversion or Exchange. The holders of shares of Enhanced
Rate Preferred Stock shall not have any rights herein to convert such
shares into or exchange such shares for shares of any other series of
any class or classes of capital stock (or any other security) of the
Corporation.
(7) Ranking. The Enhanced Rate Preferred Stock shall rank on
a parity with the Corporation's $6.25 Cumulative Convertible Voting
Preferred Stock, 9-1/2% Cumulative Preferred Stock, Series 1989-A,
Flexible Rate Auction Preferred Stock, Series A, and Flexible Rate
Auction Preferred Stock, Series B as to payment of dividends and
distribution of assets upon liquidation, dissolution, or winding up,
whether voluntary or involuntary, and shall rank prior to the
Corporation's Common Stock and Series A Junior Participating Preferred
Stock as to payment of dividends and distribution of assets upon
liquidation, dissolution, or winding up, whether voluntary or
involuntary, and prior to any other series of stock authorized to be
issued by the Corporation which ranks junior to the $6.25 Cumulative
Convertible Voting Preferred Stock, 9-1/2% Cumulative Preferred Stock,
Series 1989-A, Flexible Rate Auction Preferred Stock, Series A, and
Flexible Rate Auction Preferred Stock, Series B as to payment of
dividends and distribution of assets upon liquidation, dissolution, or
winding up, whether voluntary or involuntary."
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<PAGE> 95
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights to be signed by David D. Wesselink, Vice
President and Treasurer of the Corporation, and attested by Ronald C. Roselli,
Assistant Secretary, this 9th day of November, 1990.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ D. D. Wesselink
------------------------
Vice President and Treasurer
Attest:
/s/ R. C. Roselli
- -----------------
Assistant Secretary
- 95 -
<PAGE> 96
HOUSEHOLD INTERNATIONAL, INC.
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
9-1/2% Cumulative Preferred Stock, Series 1991-A
(Without Par Value)
HOUSEHOLD INTERNATIONAL, INC., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were duly adopted by the Board of Directors of
the Corporation and by the Preferred Stock Committee of the Board of Directors,
pursuant to authority conferred upon the Board of Directors by the provisions
of the Restated Certificate of Incorporation, as amended, of the Corporation,
and pursuant to authority conferred upon the Preferred Stock Committee by the
resolutions of the Board of Directors set forth herein and in accordance with
Section 141(c) of the General Corporation Law of the State of Delaware.
1. The Board of Directors has adopted the following resolutions
designating a Preferred Stock Committee of the Board of Directors and
authorizing the Preferred Stock Committee to act on behalf of the Board of
Directors (within certain limitations) in connection with the designation,
issuance and sale of shares in one or more series of Preferred Stock of the
Corporation:
"RESOLVED, that a Preferred Stock Committee of the Board of
Directors is hereby designated which shall have and may exercise, to
the fullest extent permitted by law, the full power and authority of
the Board of Directors with respect to the issuance and sale of one or
more new series of the Corporation's Preferred Stock without par value
(each such series herein referred to as the "New Preferred Stock"),
including, without limitation, establishing the purchase price
therefor, and fixing the designations and any of the preferences,
powers, rights (other than voting powers or voting rights which shall
be fixed by the Board of Directors) and relative, participating,
optional or other special rights and qualifications, limitations or
restrictions thereof, of such shares of each series of New Preferred
Stock, and fixing the number of shares of each series of New Preferred
Stock.
"FURTHER RESOLVED, that the Committee is authorized to take
such additional actions and adopt such additional resolutions as it
deems necessary or appropriate for the purpose of authorizing and
implementing the issuance, offer,
- 96 -
<PAGE> 97
and sale for cash of New Preferred Stock, including, without limiting
the generality of the foregoing, the authorization and execution of
agreements (including underwriting agreements) relating to the offer
and sale of New Preferred Stock, authorization and approval of listing
applications (including amendments or supplements thereto) for the
listing of such New Preferred Stock on a stock exchange, approval of
forms of stock certificates and authorization of issuance of New
Preferred Stock in uncertificated form, any actions which may be
necessary to qualify the offering and sale of New Preferred Stock
under Blue Sky Laws of the various states, any necessary filings with
the Secretary of State of Delaware and other jurisdictions, and the
appointment of a transfer agent.
"FURTHER RESOLVED, that notwithstanding the foregoing
resolutions, the Preferred Stock Committee may not authorize the sale
of New Preferred Stock for more than $250 million cash consideration
in the aggregate, and the power and authority of the Preferred Stock
Committee set forth in the preceding resolutions shall expire on
September 12, 1991.
"FURTHER RESOLVED, that the members of the Preferred Stock
Committee shall be D. C. Clark, E. P. Hoffman, and G. P. Osler. In
the absence of Mr. Osler, A. E. Rasmussen is designated as an
alternate member of the Preferred Stock Committee to serve in his
place."
2. The Board of Directors has adopted the following resolution
pertaining to the voting rights for series of Preferred Stock authorized for
issuance by the Preferred Stock Committee of the Board of Directors:
"RESOLVED, that notwithstanding the resolution of the Board of
Directors adopted on October 17, 1989, the holders of the
Corporation's Flexible Rate Auction Preferred Stock, Series A, and
Flexible Rate Auction Preferred Stock, Series B, and any other series
of Preferred Stock which on or after July 10, 1990, is authorized by
the Preferred Stock Committee of the Board of Directors to be issued
and sold pursuant to authority granted to the Preferred Stock
Committee by the Board of Directors (each such series herein referred
to as the "New Preferred Stock") shall have no voting rights, and
their consent shall not be required for taking any corporate action,
except as otherwise set forth herein, except as otherwise required by
law, and except as otherwise provided by the Board of Directors with
respect to any particular series of New Preferred Stock.
The consent of the holders of the New Preferred Stock with
respect to the matters set forth in sub-sections (i) and (iii) of
paragraph (5) of Article IV of the
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<PAGE> 98
Corporation's Restated Certificate of Incorporation ("Paragraph (5)")
shall not be required, except with respect to the creation or issuance
of any class of stock ranking prior to or on a parity with the
Preferred Stock, or any series thereof, as to the payment of dividends
or the distribution of assets; but the other provisions of Paragraph
(5) shall be applicable to the New Preferred Stock. The holders of
the New Preferred Stock shall have no right to elect directors
pursuant to paragraph (6) of Article IV of the Corporation's Restated
Certificate of Incorporation ("Paragraph (6)"), such right hereby
being expressly withheld.
In the event that any six quarterly cumulative dividends
(which shall be deemed to include dividends in respect of a number of
non-quarterly dividend periods containing not less than 540 days),
whether consecutive or not, upon the New Preferred Stock shall be in
arrears, the holders of the New Preferred Stock shall have the right,
voting separately as a class with holders of shares of any one or more
other series of Preferred Stock ranking on a parity with the New
Preferred Stock either as to payment of dividends or the distribution
of assets upon liquidation, dissolution, or winding up, whether
voluntary or involuntary, and upon which like voting rights have been
conferred (which shall include the Corporation's 9-1/2% Cumulative
Preferred Stock, Series 1989-A) and are then exercisable, at the next
meeting of stockholders called for the election of directors, to elect
two members of the Board of Directors. The right of such holders of
such shares of the New Preferred Stock, voting separately as a class,
to elect (together with the holders of shares of any one or more other
series of Preferred Stock ranking on such a parity) members of the
Board of Directors of the Corporation as aforesaid shall continue
until such time as all dividends accumulated on such shares of the New
Preferred Stock shall have been paid in full, at which time such right
shall terminate, except as herein or by law expressly provided,
subject to revesting in the event of each and every subsequent failure
to pay dividends of the character above mentioned.
Upon any termination of the right of the holders of the New
Preferred Stock as a class to elect directors as herein provided, the
term of office of all directors so elected shall terminate
immediately. If the office of any director elected by such holders
voting as a class becomes vacant by reason of death, resignation,
retirement, disqualification, removal from office or otherwise, the
remaining director elected by such holders voting as a class may
choose a successor who shall hold office for the unexpired term in
respect of which such vacancy occurred. Whenever the term
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<PAGE> 99
of office of the directors elected by such holders voting as a class
shall end and the special voting powers vested in such holders as
provided in this resolution shall have expired, the number of
directors shall thereupon be such number as may be provided for in the
Corporation's Bylaws irrespective of any increase made pursuant to the
provisions of this resolution.
Until all unpaid dividends on the New Preferred Stock shall
have been paid in full, and in order to permit the holders of the
Corporation's $6.25 Cumulative Convertible Voting Preferred Stock, and
any other series of Preferred Stock issued by the Corporation having
the voting rights set forth in Paragraph (6) to exercise fully the
right to elect directors as granted by and provided in paragraph (6),
the number of directors constituting the whole Board of Directors of
the Corporation shall not be less than seven. If, upon any such
arrearage in dividends, the number of directors constituting the whole
Board of Directors shall be less than seven, the size of the Board of
Directors shall, immediately prior to the next meeting of stockholders
called for the election of directors, automatically be increased by
such number as shall be necessary to cause the number of directors
constituting the whole Board of Directors to be no less than seven.
To the extent that the Board of Directors is authorized to fix
the designations, powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof in respect of additional series of Preferred
Stock, none of the preferences or rights of any such additional series
as fixed by the Board of Directors shall rank prior to the New
Preferred Stock as to payment of dividends or the distribution of
assets upon liquidation, dissolution, or winding up, whether voluntary
or involuntary, without the consent of the holders of two-thirds of
the outstanding shares of such series of New Preferred Stock voting as
a class.
The foregoing voting provisions shall not apply to any series
of New Preferred Stock if, at or prior to the time when the act with
respect to which such vote would otherwise be required shall be
effected, all outstanding shares of such series of New Preferred Stock
shall have been redeemed or sufficient funds shall have been deposited
in trust to effect such redemption.
On any item in which the holders of New Preferred Stock are
entitled to vote, such holders shall be entitled to one vote for each
share held."
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<PAGE> 100
3. The Preferred Stock Committee of the Board of Directors has
adopted the following resolution pursuant to authority conferred upon the
Preferred Stock Committee of the Board of Directors by the resolution of the
Board of Directors set forth in paragraph 1 above of this Certificate of
Designation, Preferences and Rights:
"RESOLVED, that the issue of a series of Preferred Stock
without par value of the Corporation is hereby authorized and the
designation, preferences and privileges, relative, participating,
optional and other special rights, and qualifications, limitations and
restrictions thereof, in addition to those set forth in the Restated
Certificate of Incorporation, as amended, of the Corporation, are
hereby fixed as follows:
9-1/2% Cumulative Preferred Stock, Series 1991-A
(1) Number of Shares and Designation. 550,000 shares of
Preferred Stock without par value of the Corporation are hereby
constituted as a series of Preferred Stock without par value and
designated as 9-1/2% Cumulative Preferred Stock, Series 1991-A
(hereinafter called the "9-1/2% Preferred Stock").
(2) Dividends. The holders of shares of the 9-1/2% Preferred
Stock shall be entitled to receive cash dividends, when and as
declared by the Board of Directors of the Corporation, out of assets
legally available for such purpose, at the rate determined as provided
below. Such dividends shall be cumulative from the date of original
issue of such shares and shall be payable quarterly in arrears, when
and as declared by the Board of Directors of the Corporation, on the
fifteenth day of January, April, July and October in each year to
holders of record on the respective business days next preceding the
first days of those months (and the quarterly dividend periods shall
commence on the first days of those months).
Dividends on the 9-1/2% Preferred Stock for quarterly dividend
periods will be payable at the rate of 9-1/2% per annum from the date
of original issue applied to the amount of $100 per share of 9-1/2%
Preferred Stock. The amount of dividends payable on each share of
9-1/2% Preferred Stock for each full quarterly dividend period shall
be computed by dividing the dividend rate by four and applying the
dividend rate to the amount of $100 per share. The amount of
dividends payable for any dividend period shorter or longer than a
full quarterly dividend period shall be computed on the basis of
30-day months, a 360-day year and the actual number of days elapsed in
the period.
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<PAGE> 101
(3) Liquidation Preference. The amount to which shares of
9-1/2% Preferred Stock shall be entitled upon liquidation,
dissolution, or winding up of the Corporation, whether voluntary or
involuntary, shall be $100 per share, plus an amount equal to all
accrued and unpaid dividends, if any, thereon to the date fixed for
payment, and no more.
(4) Redemption. The shares of 9-1/2% Preferred Stock shall be
subject to redemption in whole or in part at the option of the
Corporation on or after August 13, 1996, at $100 per share, plus an
amount equal to all accrued and unpaid dividends, if any, thereon to
the date fixed for redemption, and no more.
(5) Shares to be Retired. All shares of 9-1/2% Preferred
Stock purchased or redeemed by the Corporation shall be retired and
cancelled and shall be restored to the status of authorized but
unissued shares of the class of Preferred Stock without par value,
without designation as to series, and may thereafter be issued, but
not as shares of 9-1/2% Preferred Stock.
(6) Conversion or Exchange. The holders of shares of 9-1/2%
Preferred Stock shall not have any rights herein to convert such
shares into or exchange such shares for shares of any other series of
any class or classes of capital stock (or any other security) of the
Corporation.
(7) Ranking. The 9-1/2% Preferred Stock shall rank on a
parity with the Corporation's $6.25 Cumulative Convertible Voting
Preferred Stock, 9-1/2% Cumulative Preferred Stock, Series 1989-A,
Flexible Rate Auction Preferred Stock, Series A, Flexible Rate Auction
Preferred Stock, Series B, and 11-1/4% Enhanced Rate Cumulative
Preferred Stock as to payment of dividends and distribution of assets
upon liquidation, dissolution, or winding up, whether voluntary or
involuntary, and shall rank prior to the Corporation's Common Stock
and Series A Junior Participating Preferred Stock as to payment of
dividends and distribution of assets upon liquidation, dissolution, or
winding up, whether voluntary or involuntary, and prior to any other
series of stock authorized to be issued by the Corporation which ranks
junior to the $6.25 Cumulative Convertible Voting Preferred Stock,
9-1/2% Cumulative Preferred Stock, Series 1989-A, Flexible Rate
Auction Preferred Stock, Series A, Flexible Rate Auction Preferred
Stock, Series B and 11-1/4% Enhanced Rate Cumulative Preferred Stock
as to payment of dividends and distribution of assets upon
liquidation, dissolution, or winding up, whether voluntary or
involuntary."
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights to be signed
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<PAGE> 102
by David D. Wesselink, Vice President and Treasurer of the Corporation, and
attested by Susan Casey, Assistant Secretary, this 5th day of August, 1991.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ D. D. Wesselink
----------------------------
Vice President and Treasurer
Attest:
/s/ S. E. Casey
- -------------------
Assistant Secretary
- 102 -
<PAGE> 103
HOUSEHOLD INTERNATIONAL, INC.
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
8-1/4% Cumulative Preferred Stock, Series 1992-A
(Without Par Value)
HOUSEHOLD INTERNATIONAL, INC., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were duly adopted by the Board of Directors of
the Corporation and by the Preferred Stock Committee of the Board of Directors,
pursuant to authority conferred upon the Board of Directors by the provisions
of the Restated Certificate of Incorporation, as amended, of the Corporation,
and pursuant to authority conferred upon the Preferred Stock Committee by the
resolutions of the Board of Directors set forth herein and in accordance with
Section 141(c) of the General Corporation Law of the State of Delaware.
1. The Board of Directors has adopted the following resolutions
designating a Preferred Stock Committee of the Board of Directors and
authorizing the Preferred Stock Committee to act on behalf of the Board of
Directors (within certain limitations) in connection with the designation,
issuance and sale of shares in one or more series of Preferred Stock of the
Corporation:
"RESOLVED, that a Preferred Stock Committee of the Board of
Directors is hereby designated which shall have and may exercise, to
the fullest extent permitted by law, the full power and authority of
the Board of Directors with respect to the issuance and sale of one or
more new series of the Corporation's Preferred Stock without par value
(each such series herein referred to as the "New Preferred Stock"),
including, without limitation, establishing the purchase price
therefor, and fixing the designations and any of the preferences,
powers, rights (other than voting powers or voting rights which shall
be fixed by the Board of Directors) and relative, participating,
optional or other special rights and qualifications, limitations or
restrictions thereof, of such shares of each series of New Preferred
Stock, and fixing the number of shares of each series of New Preferred
Stock.
"FURTHER RESOLVED, that the Preferred Stock Committee is
authorized to take such additional actions and adopt such additional
resolutions as it deems necessary or appropriate for the purpose of
authorizing and implementing the issuance, offer, and sale for cash of
New Preferred Stock, including, without limiting the generality of the
foregoing, the authorization and execution of agreements (including
- 103 -
<PAGE> 104
underwriting agreements) relating to the offer and sale of New
Preferred Stock, authorization and approval of listing applications
(including amendments or supplements thereto) for the listing of such
New Preferred Stock on a stock exchange, approval of forms of stock
certificates and authorization of issuance of New Preferred Stock in
uncertificated form, any actions which may be necessary to qualify the
offering and sale of New Preferred Stock under Blue Sky Laws of the
various states, any necessary filings with the Secretary of State of
Delaware and other jurisdictions, and the appointment of a transfer
agent.
"FURTHER RESOLVED, that notwithstanding the foregoing
resolutions, the Preferred Stock Committee may not authorize the sale
of New Preferred Stock for more than $150 million cash consideration
in the aggregate, and the power and authority of the Preferred Stock
Committee set forth in the preceding resolutions shall expire on
December 31, 1994, unless extended by further action of the Board of
Directors of the Corporation.
"FURTHER RESOLVED, that the members of the Preferred Stock
Committee shall be D. C. Clark, E. P. Hoffman, and G. P. Osler. In
the absence of Mr. Osler, A. E. Rasmussen is designated as an
alternate member of the Preferred Stock Committee to serve in his
place."
2. The Board of Directors has adopted the following resolution
pertaining to the voting rights for series of Preferred Stock authorized for
issuance by the Preferred Stock Committee of the Board of Directors:
"RESOLVED, that holders of each series of the Corporation's
New Preferred Stock which is authorized by the Preferred Stock
Committee of the Board of Directors shall have no voting rights, and
their consent shall not be required for taking any corporate action,
except as otherwise set forth herein, or as otherwise required by law,
and except as otherwise provided by the Board of Directors with
respect to any particular series of New Preferred Stock.
The consent of the holders of the New Preferred Stock with
respect to the matters set forth in sub-sections (i) and (iii) of
paragraph (5) of Article IV of the Corporation's Restated Certificate
of Incorporation ("Paragraph (5)") shall not be required, except with
respect to the creation or issuance of any class of stock ranking
prior to or on a parity with the New Preferred Stock, or any series
thereof, as to the payment of dividends or the distribution of assets;
but the other provisions of Paragraph (5) shall be applicable to the
New Preferred Stock. The holders of the New Preferred Stock shall
have no right to elect directors pursuant to paragraph (6) of Article
IV of the Corporation's Restated Certificate of
- 104 -
<PAGE> 105
Incorporation ("Paragraph (6)"), such right hereby being expressly
withheld.
In the event that any six quarterly cumulative dividends,
whether consecutive or not, upon the New Preferred Stock shall be in
arrears, the holders of the New Preferred Stock shall have the right,
voting separately as a class with holders of shares of any one or more
other series of Preferred Stock of the Corporation ranking on a parity
with the New Preferred Stock either as to payment of dividends or the
distribution of assets upon liquidation, dissolution, or winding up,
whether voluntary or involuntary, and upon which like voting rights
have been conferred and are then exercisable, at the next meeting of
stockholders called for the election of directors, to elect two
members of the Board of Directors. The right of such holders of such
shares of the New Preferred Stock, voting separately as a class, to
elect (together with the holders of shares of any one or more other
series of Preferred Stock of the Corporation ranking on such a parity)
members of the Board of Directors of the Corporation as aforesaid
shall continue until such time as all dividends accumulated on such
shares of the New Preferred Stock shall have been paid in full, at
which time such right shall terminate, except as herein or by law
expressly provided, subject to revesting in the event of each and
every subsequent failure to pay dividends of the character above
mentioned.
Upon any termination of the right of the holders of the New
Preferred Stock as a class to elect directors as herein provided, the
term of office of all directors so elected shall terminate
immediately. If the office of any director elected by such holders
voting as a class becomes vacant by reason of death, resignation,
retirement, disqualification, removal from office or otherwise, the
remaining director elected by such holders voting as a class may
choose a successor who shall hold office for the unexpired term in
respect of which such vacancy occurred. Whenever the term of office
of the directors elected by such holders voting as a class shall end
and the special voting powers vested in such holders as provided in
this resolution shall have expired, the number of directors shall
thereupon be such number as may be provided for in the Corporation's
Bylaws irrespective of any increase made pursuant to the provisions of
this resolution.
Until all unpaid dividends on the New Preferred Stock shall
have been paid in full, and in order to permit the holders of the
Corporation's $6.25 Cumulative Convertible Voting Preferred Stock, and
any other series of Preferred Stock issued by the Corporation having
the voting rights set forth in Paragraph (6) to exercise fully the
right to elect
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<PAGE> 106
directors as granted by and provided in Paragraph (6), the number of
directors constituting the whole Board of Directors of the Corporation
shall not be less than seven. If, upon any such arrearage in
dividends, the number of directors constituting the whole Board of
Directors shall be less than seven, the size of the Board of Directors
shall, immediately prior to the next meeting of stockholders called
for the election of directors, automatically be increased by such
number as shall be necessary to cause the number of directors
constituting the whole Board of Directors to be no less than seven.
To the extent that the Board of Directors is authorized to fix
the designations, powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof in respect of additional series of Preferred
Stock, none of the preferences or rights of any such additional series
as fixed by the Board of Directors shall rank prior to the New
Preferred Stock as to payment of dividends or the distribution of
assets upon liquidation, dissolution, or winding up, whether voluntary
or involuntary, without the consent of the holders of two-thirds of
the outstanding shares of such series of New Preferred Stock voting as
a class.
The foregoing voting provisions shall not apply to any series
of New Preferred Stock if, at or prior to the time when the act with
respect to which such vote would otherwise be required shall be
effected, all outstanding shares of such series of New Preferred Stock
shall have been redeemed or sufficient funds shall have been deposited
in trust to effect such redemption.
On any item in which the holders of New Preferred Stock are
entitled to vote, such holders shall be entitled to one vote for each
share held."
3. The Preferred Stock Committee of the Board of Directors has
adopted the following resolution pursuant to authority conferred upon the
Preferred Stock Committee of the Board of Directors by the resolution of the
Board of Directors set forth in paragraph 1 above of this Certificate of
Designation, Preferences and Rights:
"RESOLVED, that the issue of a series of Preferred Stock
without par value of the Corporation is hereby authorized and the
designation, preferences and privileges, relative, participating,
optional and other special rights, and qualifications, limitations and
restrictions thereof, in addition to those set forth in the Restated
Certificate of Incorporation, as amended, of the Corporation, are
hereby
- 106 -
<PAGE> 107
fixed as follows:
8-1/4% Cumulative Preferred Stock, Series 1992-A
(1) Number of Shares and Designation. 50,000 shares of
Preferred Stock without par value of the Corporation are hereby
constituted as a series of Preferred Stock without par value and
designated as 8-1/4% Cumulative Preferred Stock, Series 1992-A
(hereinafter called the "8-1/4% Preferred Stock").
(2) Dividends. The holders of shares of the 8-1/4% Preferred
Stock shall be entitled to receive cash dividends, when and as
declared by the Board of Directors of the Corporation, out of assets
legally available for such purpose, at the rate determined as provided
below. Such dividends shall be cumulative from the date of original
issue of such shares and shall be payable quarterly in arrears, when
and as declared by the Board of Directors of the Corporation, on the
fifteenth day of January, April, July and October in each year to
holders of record on the respective business days next preceding the
first days of those months (and the quarterly dividend periods shall
commence on the first days of those months).
Dividends on the 8-1/4% Preferred Stock for quarterly dividend
periods will be payable at the rate of 8-1/4% per annum from the date
of original issue applied to the amount of $1,000 per share of 8-1/4%
Preferred Stock. The amount of dividends payable on each share of
8-1/4% Preferred Stock for each full quarterly dividend period shall
be computed by dividing the dividend rate by four and applying the
dividend rate to the amount of $1,000 per share. The amount of
dividends payable for any dividend period shorter or longer than a
full quarterly dividend period shall be computed on the basis of
30-day months, a 360-day year and the actual number of days elapsed in
the period.
(3) Liquidation Preference. The amount to which shares of
8-1/4% Preferred Stock shall be entitled upon liquidation,
dissolution, or winding up of the Corporation, whether voluntary or
involuntary, shall be $1,000 per share, plus an amount equal to all
accrued and unpaid dividends, if any, thereon to the date fixed for
payment, and no more.
(4) Redemption. The shares of 8-1/4% Preferred Stock shall be
subject to redemption in whole or in part at the option of the
Corporation on or after October 15, 2002, at $1,000 per share, plus an
amount equal to all accrued and unpaid dividends, if any, thereon to
the date fixed for redemption, and no more.
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<PAGE> 108
(5) Shares to be Retired. All shares of 8-1/4% Preferred
Stock purchased or redeemed by the Corporation shall be retired and
cancelled and shall be restored to the status of authorized but
unissued shares of the class of Preferred Stock without par value,
without designation as to series, and may thereafter be issued, but
not as shares of 8-1/4% Preferred Stock.
(6) Conversion or Exchange. The holders of shares of 8-1/4%
Preferred Stock shall not have any rights herein to convert such
shares into or exchange such shares for shares of any other series of
any class or classes of capital stock (or any other security) of the
Corporation.
(7) Ranking. The 8-1/4% Preferred Stock shall rank on a
parity with the Corporation's $6.25 Cumulative Convertible Voting
Preferred Stock, 9-1/2% Cumulative Preferred Stock, Series 1989-A,
Flexible Rate Auction Preferred Stock, Series A, Flexible Rate Auction
Preferred Stock, Series B, 11-1/4% Enhanced Rate Cumulative Preferred
Stock and 9-1/2% Cumulative Preferred Stock, Series 1991-A as to
payment of dividends and distribution of assets upon liquidation,
dissolution, or winding up, whether voluntary or involuntary, and
shall rank prior to the Corporation's Common Stock and Series A Junior
Participating Preferred Stock as to payment of dividends and
distribution of assets upon liquidation, dissolution, or winding up,
whether voluntary or involuntary, and prior to any other series of
stock authorized to be issued by the Corporation which ranks junior to
the $6.25 Cumulative Convertible Voting Preferred Stock, 9-1/2%
Cumulative Preferred Stock, Series 1989-A, Flexible Rate Auction
Preferred Stock, Series A, Flexible Rate Auction Preferred Stock,
Series B, 11-1/4% Enhanced Rate Cumulative Preferred Stock and 9-1/2%
Cumulative Preferred Stock, Series 1991-A as to payment of dividends
and distribution of assets upon liquidation, dissolution, or winding
up, whether voluntary or involuntary."
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights to be signed by J. Richard Hull, Senior
Vice President-Secretary of the
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<PAGE> 109
Corporation, and attested by John W. Blenke, Assistant Secretary, this 14th day
of October, 1992.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ J. Richard Hull
----------------------
Senior Vice President-
Secretary
Attest:
/s/ John W. Blenke
- -------------------
Assistant Secretary
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<PAGE> 110
HOUSEHOLD INTERNATIONAL, INC.
CERTIFICATE OF AMENDMENT
OF
CERTIFICATE OF INCORPORATION
Household International, Inc., a corporation organized and existing
under the General Corporation Law of the State of Delaware, does hereby
certify:
FIRST: That the Restated Certificate of Incorporation, as heretofore
amended, of said Corporation has been further amended by deleting, in its
entirety, the first paragraph of Article IV thereof and inserting the following
as the new first paragraph of Article IV:
The total number of shares that may be issued by the
Corporation is 158,155,004 of which 8,155,004 shares shall be
Preferred Stock without par value and 150,000,000 shares shall be
Common Stock of the par value of $1 per share.
SECOND: That the aforesaid amendment of the Restated Certificate of
Incorporation of said Corporation, set forth in Paragraph FIRST hereinabove,
has been duly adopted in accordance with the provisions of Section 242 of the
General Corporation Law of the State of Delaware.
IN WITNESS WHEREOF, the Corporation has caused its corporate seal to
be hereunto affixed and this certificate to be signed by D. C. Clark, its
Chairman of the Board and Chief Executive Officer and J. W. Blenke, Assistant
General Counsel and Assistant Secretary, this 12th day of May, 1993.
HOUSEHOLD INTERNATIONAL, INC.
[SEAL]
By: /s/ D. C. Clark
-----------------------
Chairman of the Board and
Chief Executive Officer
Attest:
/s/ J. W. Blenke
- -----------------------------
Assistant General Counsel and
Assistant Secretary
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<PAGE> 111
CERTIFICATE OF HOUSEHOLD INTERNATIONAL, INC.
UNDER SECTION 151(g) OF THE GENERAL
CORPORATION LAW OF THE STATE OF DELAWARE
Household International, Inc., a Delaware corporation (hereinafter
referred to as the "Corporation"), does hereby certify that the following
resolution was duly adopted by the Corporation's Board of Directors:
"WHEREAS, no shares of the Corporation's Flexible Rate Auction
Preferred Stock, Series A (the "Preferred Stock"), are outstanding as
of the July 13, 1993, redemption date, it is hereby
"RESOLVED, that the officers of the Corporation are duly
authorized to file a certificate with the Secretary of State of
Delaware eliminating from the Corporation's Certificate of
Incorporation all matters set forth in each Certificate of
Designation, Preferences and Rights for the Preferred Stock and as
permitted by the Certificate of Designation, Preferences and Rights
for the Preferred Stock, such shares of Preferred Stock redeemed shall
resume the status of authorized and unissued shares of the
Corporation's preferred stock."
Upon the effective date of the filing of this Certificate, it shall
eliminate from the Corporation's Certificate of Incorporation all matters set
forth in the Certificate of Designation, Preferences, and Rights with respect
to the Corporation's Flexible Rate Auction Preferred Stock, Series A, and all
of such shares of Flexible Rate Auction Preferred Stock, Series A, shall resume
the status of authorized and unissued shares of the Corporation's Preferred
Stock.
IN WITNESS WHEREOF, said Household International, Inc., has caused its
corporate seal to be hereunto affixed and this Certificate to be signed by J.
R. Hull, its Senior Vice President-Secretary and General Counsel, and attested
by J. W. Blenke, its Assistant General Counsel and Assistant Secretary, this
13th day of July, 1993.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ J. R. Hull
-----------------------------
Senior Vice President-
Secretary and General Counsel
Attest:
By: /s/ J. W. Blenke
-------------------------
Assistant General Counsel
and Assistant Secretary
- 111 -
<PAGE> 112
HOUSEHOLD INTERNATIONAL, INC.
CERTIFICATE OF DESIGNATION, PREFERENCES AND RIGHTS
Pursuant to Section 151 of the
General Corporation Law of the State of Delaware
7.35% Cumulative Preferred Stock, Series 1993-A
(Without Par Value)
HOUSEHOLD INTERNATIONAL, INC., a corporation organized and existing
under the laws of the State of Delaware (the "Corporation"), HEREBY CERTIFIES
that the following resolutions were duly adopted by the Board of Directors of
the Corporation and by the Offering Committee of the Board of Directors,
pursuant to authority conferred upon the Board of Directors by the provisions
of the Restated Certificate of Incorporation, as amended, of the Corporation,
and pursuant to authority conferred upon the Offering Committee by the
resolutions of the Board of Directors set forth herein and in accordance with
Section 141(c) of the General Corporation Law of the State of Delaware.
1. The Board of Directors on May 12, 1993 has adopted the
following resolutions designating an Offering Committee of the Board of
Directors and authorizing the Offering Committee to act on behalf of the Board
of Directors (within certain limitations) in connection with the designation,
issuance and sale of shares in one or more series of Preferred Stock, without
par value, of the Corporation:
"FURTHER RESOLVED, that an Offering Committee of the Board of
Directors is hereby designated which shall have and may exercise, to
the fullest extent permitted by law, the full power and authority of
the Board of Directors with respect to the issuance and sale of (i)
the Common Stock, (ii) the Debt Securities or (iii) one or more new
series of the Corporation's Preferred Stock, including, without
limitation, establishing the purchase price therefore, and fixing the
designations and any of the preferences, powers, rights (other than
voting powers or voting rights which shall be fixed by the Board of
Directors) and relative, participating, optional or other special
rights and qualifications, limitations or restrictions thereof, of
such shares of each series of Preferred Stock; and
"FURTHER RESOLVED, that notwithstanding the foregoing
resolutions, the power and authority of the Offering Committee set
forth in the preceding resolution shall expire on June 30, 1995,
unless extended by further action of the Board of Directors of the
Corporation; and
"FURTHER RESOLVED, that the members of the Offering Committee
shall be D. C. Clark, A. E. Rasmussen and G. P. Osler. In the
absence of any of the named directors, any
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<PAGE> 113
current director of the Corporation is designated as an alternate
member of the Offering Committee to serve in such named director's
place; and
"FURTHER RESOLVED, that the Offering Committee is authorized
to take such additional actions and adopt such additional resolutions
as it deems necessary or appropriate for the purpose of authorizing
and implementing the issuance, offer, and sale for cash of Preferred
Stock, including, without limiting the generality of the foregoing,
the authorization and execution of agreements (including underwriting
agreements) relating to the offer and sale of Preferred Stock,
approval of forms of stock certificates and authorization of issuance
of Preferred Stock in uncertificated form, any actions which may be
necessary to qualify the offering and sale of Preferred Stock under
Blue Sky Laws of the various states, any necessary filings with the
Secretary of State of Delaware and other jurisdictions, and the
appointment of a transfer agent; and
"FURTHER RESOLVED, that the Offering Committee is hereby
empowered, in connection with the issuance and sale of any new series
of the Corporation's Preferred Stock, to authorize the issuance and
sale of depositary shares and depositary receipts for such depositary
shares with respect to any such series of Preferred Stock, and to
authorize the appointment of a depositary, registrar, and transfer
agent for such depositary shares and depositary receipts, the
execution of a depositary agreement, and any additional agreements or
actions in connection therewith as the Offering Committee deems
necessary or appropriate."
2. The Board of Directors, on May 12, 1993, has adopted the
following resolution pertaining to the voting rights for series of Preferred
Stock, without par value, authorized for issuance by the Offering Committee of
the Board of Directors:
"FURTHER RESOLVED, that holders of each series of the
Corporation's Preferred Stock which is authorized by the Offering
Committee of the Board of Directors shall have no voting rights, and
their consent shall not be required for taking any corporate action,
except as otherwise set forth herein or as otherwise required by law,
and except as otherwise provided by the Board of Directors with
respect to any particular series of Preferred Stock:
The consent of the holders of the Preferred Stock with respect
to the matters set forth in sub-sections (i) and (iii) of paragraph
(5) of Article IV of the Corporation's Restated Certificate of
Incorporation ("Paragraph (5)") shall not be required, except with
respect to the creation or issuance of any class of stock ranking
prior to or on a parity with the Preferred Stock, or any series
thereof, as to the payment of dividends or the distribution of assets;
but the other provisions of Paragraph (5) shall be
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<PAGE> 114
applicable to the Preferred Stock. The holders of the Preferred Stock
shall have no right to elect directors pursuant to paragraph (6) of
Article IV of the Corporation's Restated Certificate of Incorporation
("Paragraph (6)"), such right hereby being expressly withheld.
In the event that any six quarterly cumulative dividends,
whether consecutive or not, upon the Preferred Stock shall be in
arrears, the holders of the Preferred Stock shall have the right,
voting separately as a class with holders of shares of any one or more
other series of preferred stock of the Corporation ranking on a parity
with the Preferred Stock either as to payment of dividends or the
distribution of assets upon liquidation, dissolution, or winding up,
whether voluntary or involuntary, and upon which like voting rights
have been conferred and are then exercisable, at the next meeting of
stockholders called for the election of directors, to elect two
members of the Board of Directors. The right of such holders of such
shares of the Preferred Stock, voting separately as a class, to elect
(together with the holders of shares of any one or more other series
of preferred stock of the Corporation ranking on such a parity)
members of the Board of Directors of the Corporation as aforesaid
shall continue until such time as all dividends accumulated on such
shares of the Preferred Stock shall have been paid in full, at which
time such right shall terminate, except as herein or by law expressly
provided, subject to revesting in the event of each and every
subsequent failure to pay dividends of the character above mentioned.
Upon any termination of the right of the holders of the
Preferred Stock as a class to elect directors as herein provided, the
term of office of all directors so elected shall terminate
immediately. If the office of any director elected by such holders
voting as a class becomes vacant by reason of death, resignation,
retirement, disqualification, removal from office or otherwise, the
remaining director elected by such holders voting as a class may
choose a successor who shall hold office for the unexpired term in
respect of which such vacancy occurred. Whenever the term of office
of the directors elected by such holders voting as a class shall end
and the special voting powers vested in such holders as provided in
this resolution shall have expired, the number of directors shall
thereupon be such number as may be provided for in the Corporation's
Bylaws irrespective of any increase made pursuant to the provisions of
this resolution.
Until all unpaid dividends on the Preferred Stock shall have
been paid in full, and in order to permit the holders of the
Corporation's $6.25 Cumulative Convertible Voting
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<PAGE> 115
Preferred Stock, and any other series of preferred stock issued by the
Corporation having the voting rights set forth in Paragraph (6) to
exercise fully the right to elect directors as granted by and provided
in Paragraph (6), the number of directors constituting the whole Board
of Directors of the Corporation shall not be less than seven. If,
upon any such arrearage in dividends the number of directors
constituting the whole Board of Directors shall be less than seven,
the size of the Board of Directors shall, immediately prior to the
next meeting of stockholders called for the election of directors,
automatically be increased by such number as shall be necessary to
cause the number of directors constituting the whole Board of
Directors to be no less than seven.
To the extent that the Board of Directors is authorized to fix
the designations, powers, preferences and relative, participating,
optional or other special rights, and qualifications, limitations or
restrictions thereof in respect of additional series of preferred
stock, none of the preferences or rights of any such additional series
as fixed by the Board of Directors shall rank prior to the Preferred
Stock as to payment of dividends or the distribution of assets upon
liquidation, dissolution, or winding up, whether voluntary or
involuntary, without the consent of the holders of two-thirds of the
outstanding shares of such series of Preferred Stock voting as a
class.
The foregoing voting provisions shall not apply to any series
of Preferred Stock, if at or prior to the time when the act with
respect to which such vote would otherwise be required shall be
effected, all outstanding shares of such series of Preferred Stock
shall have been redeemed or sufficient funds shall have been deposited
in trust to effect such redemption.
On any item in which the holders of Preferred Stock are
entitled to vote, such holders shall be entitled to one vote for each
share held."
3. The Offering Committee of the Board of Directors has on August
30, 1993 adopted the following resolution pursuant to authority conferred upon
the Offering Committee of the Board of Directors by the resolutions of the
Board of Directors set forth in paragraph 1 above of this Certificate of
Designation, Preferences and Rights:
"RESOLVED, that the issue of a series of Preferred Stock
without par value of the Corporation is hereby authorized and the
designation, preferences and privileges, relative, participating,
optional and other special rights, and qualifications, limitations and
restrictions thereof, in
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addition to those set forth in the Restated Certificate of
Incorporation, as amended, of the Corporation, are hereby fixed as
follows:
7.35% Cumulative Preferred Stock, Series 1993-A
(1) Number of Shares and Designation. 100,000 shares of
Preferred Stock without par value of the Corporation are hereby
constituted as a series of Preferred Stock without par value and
designated as 7.35% Cumulative Preferred Stock, Series 1993-A
(hereinafter called the "7.35% Preferred Stock").
(2) Dividends. The holders of shares of the 7.35% Preferred
Stock shall be entitled to receive cash dividends, when and as
declared by the Board of Directors of the Corporation, out of assets
legally available for such purpose, at the rate determined as provided
below. Such dividends shall be cumulative from the date of original
issue of such shares and shall be payable quarterly in arrears, when
and as declared by the Board of Directors of the Corporation, on the
fifteenth day of January, April, July and October in each year to
holders of record on the respective business days next preceding the
first days of those months (and the quarterly dividend periods shall
commence on the first days of those months).
Dividends on the 7.35% Preferred Stock for quarterly dividend
periods will be payable at the rate of 7.35% per annum from the date
of original issue applied to the amount of $1,000 per share of 7.35%
Preferred Stock. The amount of dividends payable on each share of
7.35% Preferred Stock for each full quarterly dividend period shall be
computed by dividing the dividend rate by four and applying the
dividend rate to the amount of $1,000 per share. The amount of
dividends payable for any dividend period shorter or longer than a
full quarterly dividend period shall be computed on the basis of
30-day months, a 360-day year and the actual number of days elapsed in
the period.
(3) Liquidation Preference. The amount to which shares of
7.35% Preferred Stock shall be entitled upon liquidation, dissolution,
or winding up of the Corporation, whether voluntary or involuntary,
shall be $1,000 per share, plus an amount equal to all accrued and
unpaid dividends, if any, thereon to the date fixed for payment, and
no more.
(4) Redemption. The shares of 7.35% Preferred Stock shall be
subject to redemption in whole or in part at the option of the
Corporation on or after October 15, 1998 at $1,000 per share, plus an
amount equal to all accrued and unpaid dividends, if any, thereon to
the date fixed for
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<PAGE> 117
redemption, and no more.
(5) Shares to be Retired. All shares of 7.35% Preferred Stock
purchased or redeemed by the Corporation shall be retired and
cancelled and shall be restored to the status of authorized but
unissued shares of the class of Preferred Stock without par value,
without designation as to series, and may thereafter be issued, but
not as shares of 7.35% Preferred Stock.
(6) Conversion or Exchange. The holders of shares of 7.35%
Preferred Stock shall not have any rights herein to convert such
shares into or exchange such shares for shares of any other series of
any class or classes of capital stock (or any other security) of the
Corporation.
(7) Ranking. The 7.35% Preferred Stock shall rank on a parity
with the Corporation's $6.25 Cumulative Convertible Voting Preferred
Stock, 9-1/2% Cumulative Preferred Stock, Series 1989-A, Flexible Rate
Auction Preferred Stock, Series B, 11-1/4% Enhanced Rate Cumulative
Preferred Stock, 9-1/2% Cumulative Preferred Stock, Series 1991-A and
8-1/4% Cumulative Preferred Stock, Series 1992-A as to payment of
dividends and distribution of assets upon liquidation, dissolution, or
winding up, whether voluntary or involuntary, and shall rank prior to
the Corporation's Common Stock and Series A Junior Participating
Preferred Stock as to payment of dividends and distribution of assets
upon liquidation, dissolution, or winding up, whether voluntary or
involuntary, and prior to any other series of stock authorized to be
issued by the Corporation which ranks junior to the $6.25 Cumulative
Convertible Voting Preferred Stock, 9-1/2% Cumulative Preferred Stock,
Series 1989-A, Flexible Rate Auction Preferred Stock, Series B,
11-1/4% Enhanced Rate Cumulative Preferred Stock, 9-1/2% Cumulative
Preferred Stock, Series 1991-A and 8-1/4% Cumulative Preferred Stock,
Series 1992-A as to payment of dividends and distribution of assets
upon liquidation, dissolution, or winding up, whether voluntary or
involuntary."
IN WITNESS WHEREOF, the Corporation has caused this Certificate of
Designation, Preferences and Rights to be signed by J. Richard Hull, Senior
Vice President-Secretary and General Counsel of the Corporation, and attested
by John W. Blenke,
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<PAGE> 118
Assistant General Counsel and Assistant Secretary, this 1st day of September,
1993.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ J. Richard Hull
----------------------
Senior Vice President-
Secretary and General
Counsel
Attest:
/s/ John W. Blenke
- -----------------------------
Assistant General Counsel and
Assistant Secretary
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<PAGE> 1
Exhibit 3(b)
HOUSEHOLD INTERNATIONAL, INC.
Bylaws
______________
(As in effect January 10, 1995)
<PAGE> 2
______________________________________________________________________________
BYLAWS OF
HOUSEHOLD INTERNATIONAL, INC.
______________________________________________________________________________
ARTICLE I.
DEFINITIONS, PLACES OF MEETINGS.
SECTION l. Definitions. When used herein, "Board" shall mean the
Board of Directors of this Corporation, and "Chairman" shall mean Chairman of
the Board of Directors.
SECTION 2. Places of Meetings of Stockholders and Directors. Unless
the Board shall fix another place for the holding of the meeting, meetings of
stockholders and of the Board shall be held at the Corporation's International
Headquarters, Prospect Heights, Cook County, Illinois, or at such other place
in Cook County specified by the person or persons calling the meeting.
ARTICLE II.
STOCKHOLDERS MEETINGS.
SECTION 1. Annual Meeting of Stockholders. The annual meeting of
stockholders shall be held on such date and at such time as is fixed by the
Board. Any previously scheduled annual meeting of stockholders may be
postponed by resolution of the Board of Directors upon public announcement
given prior to the date previously scheduled for such annual meeting of
stockholders.
SECTION 2. Special Meetings.
CALL. Special meetings of the stockholders may be called at
any time by the Chairman of the Board, the President, or a majority of the
Board of Directors. Any previously scheduled special meeting of stockholders
may be postponed by resolution of the Board of Directors upon public
announcement given prior to the date previously scheduled for such special
meeting of stockholders.
REQUISITES OF CALL. A call for a special meeting of
stockholders shall be in writing, filed with the Secretary, and
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<PAGE> 3
shall specify the time and place of holding such meeting and the purpose or
purposes for which it is called.
SECTION 3. Notice of Meetings. Written notice of a meeting of
stockholders setting forth the place, date, and hour of the meeting and the
purpose or purposes for which the meeting is called shall be mailed not less
than ten nor more than sixty days before the date of the meeting to each
stockholder entitled to vote at the meeting.
SECTION 4. Quorum and Adjournments. At any meeting of stockholders,
the holders of a majority of all the outstanding shares entitled to vote,
present in person or by proxy, shall constitute a quorum for the transaction of
business, and a majority of such quorum shall prevail except as otherwise
required by law, the Certificate of Incorporation, or the bylaws.
If the stockholders necessary for a quorum shall fail to be present at
the time and place fixed for any meeting, the holders of a majority of the
shares entitled to vote who are present in person or by proxy may adjourn the
meeting from time to time, until a quorum is present, provided, however, that
any stockholders' meeting, annual or special, whether or not a quorum is
present, may be adjourned from time to time by the Chairman of the meeting. At
any adjourned meeting, any business may be transacted which might have been
transacted at the original meeting.
SECTION 5. Inspectors of Election. The Corporation shall, in advance
of any meeting of stockholders, appoint one or more inspectors to act at the
meeting and make a written report thereof. The Corporation may designate one
or more persons as alternate inspectors to replace any inspector who fails to
act. If no inspector or alternate is able to act at a meeting of stockholders,
the person presiding at the meeting shall appoint one or more inspectors to act
at the meeting. Each inspector, before entering upon the discharge of his
duties, shall take and sign an oath faithfully to execute the duties of
inspector with strict impartiality and according to the best of his ability.
The inspectors shall (i) ascertain the number of shares outstanding
and the voting power of each, (ii) determine the shares represented at a
meeting and the validity of proxies and ballots, (iii) count all votes and
ballots, (iv) determine and retain for a reasonable period a record of the
disposition of any challenges made to any determination by the inspectors, and
(v) certify their determination of the number of shares represented at the
meeting, and their count of all votes and ballots. The inspectors may appoint
or retain other persons or entities to assist the inspectors in the performance
of the duties of the inspectors.
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<PAGE> 4
SECTION 6. List of Stockholders. The Secretary shall prepare, at
least ten days before every meeting of stockholders, a complete list of the
stockholders entitled to vote at the meeting, arranged in alphabetical order,
and showing the address of each stockholder and the number of shares registered
in the name of each stockholder. Such list shall be open to the examination of
any stockholder, for any purpose germane to the meeting, during ordinary
business hours, for a period of at least ten days prior to the meeting, either
at a place within the city where the meeting is to be held, which place shall
be specified in the notice of the meeting, or, if not so specified, at the
place where the meeting is to be held. The list shall be produced and kept at
the time and place of the meeting during the whole time thereof and may be
inspected by any stockholder present.
SECTION 7. Polls. The date and time of the opening and the closing of
the polls for each matter upon which the stockholders will vote at a meeting
shall be announced at the meeting. No ballot, proxies or votes, nor any
revocations thereof or changes thereto, shall be accepted by the inspectors
after the closing of the polls unless the Court of Chancery of the State of
Delaware upon application by a stockholder shall determine otherwise.
SECTION 8. Nomination and Stockholder Business.
(A) Annual Meetings of Stockholders. (1) Nominations of persons
for election to the Board of Directors of the Corporation and the proposal of
business to be considered by the stockholders may be made (a) by or at the
direction of the Board of Directors pursuant to the Corporation's proxy
statement or notice of meeting or at the annual meeting of stockholders, or (b)
other than as permitted by Rule 14a-8 of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), by any stockholder of the Corporation at the
annual meeting of stockholders, provided such stockholder is entitled to vote
at the meeting, has complied with the notice and the other procedures set forth
in this Section 8, and was a stockholder of record at the time of giving of
notice provided for in this Section 8.
(2) For proposed nominees or other business to be
properly brought before an annual meeting by a stockholder pursuant to clause
(b) of paragraph (A)(1) of this Section 8, the stockholder must have given
timely notice thereof in writing to the Secretary of the Corporation. To be
timely, a stockholder's notice shall be delivered to the Secretary at the
principal executive offices of the Corporation not less than 60 days nor more
than 90 days prior to the first anniversary of the preceding year's annual
meeting; provided, however, that in the event that the date of the annual
meeting is advanced by more than 30 days or delayed by more than 60 days from
such anniversary date, notice by the stockholder to be timely must be so
delivered not earlier than the 90th day prior to such annual meeting and not
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later than the close of business on the later of the 60th day prior to such
annual meeting or the 10th day following the day on which public announcement
of the date of such meeting is first made. Such stockholder's notice shall set
forth (a) as to each person whom the stockholder proposes to nominate at the
annual meeting for election or reelection as a director all information
relating to such person that is required to be disclosed in solicitations of
proxies for election of directors, or is otherwise required, in each case
pursuant to Regulation 14A under the Exchange Act (including such person's
written consent to serving as a director if elected). Any individual proposed
to be nominated to the Board of Directors by a stockholder pursuant to this
procedure shall only become a nominee for election to the Board of Directors if
the stockholder who has provided the notice, or his proxy, presents such
individual as a nominee at the annual meeting; (b) as to any other business
that the stockholder proposes to bring before the meeting, a brief description
of the business desired to be brought before the meeting, the reasons for
conducting such business at the meeting and any material interest in such
business of such stockholder and the beneficial owner, if any, on whose behalf
the proposal is made; and (c) as to the stockholder giving the notice and the
beneficial owner, if any, on whose behalf the nomination or proposal is made
(i) the name and address of such stockholder, as it appears on the
Corporation's books, and of such beneficial owner and (ii) the class and number
of shares of the Corporation which are owned beneficially and of record by such
stockholder and such beneficial owner.
(3) Notwithstanding anything in the second sentence of
paragraph (A)(2) of this Section 8 to the contrary, in the event that the
number of directors to be elected to the Board of Directors of the Corporation
is increased and there is no public announcement naming all of the nominees for
Director or specifying the size of the increased Board of Directors made by the
Corporation at least 70 days prior to the first anniversary of the preceding
year's annual meeting, a stockholder's notice required by this Section 8 shall
also be considered timely, but only with respect to proposed nominees for any
new positions created by such increase, if it shall be delivered to the
Secretary at the principal executive offices of the Corporation not later than
the close of business on the 10th day following the day on which such public
announcement is first made by the Corporation.
(B) Special Meetings of Stockholders. Only such business shall be
conducted at a special meeting of stockholders as shall have been brought
before the meeting pursuant to the Corporation's proxy statement or notice of
meeting. Nominations of persons for election to the Board of Directors at a
special meeting of stockholders at which directors are to be elected may be
made (a) by or at the direction of the Board of Directors pursuant to the
Corporation's proxy statement or notice of
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<PAGE> 6
meeting or at the meeting, or (b) at the meeting by any stockholder of the
Corporation who is a stockholder of record at the time of giving of notice
provided for in this paragraph (B) of Section 8, who shall be entitled to vote
at the meeting and who complies with the procedures set forth in clause (a) of
paragraph (A)(2) of this Section 8. Stockholder's notice required by this
paragraph (B) of this Section 8 shall be delivered to the Secretary at the
principal executive offices of the Corporation not earlier than the 90th day
prior to such special meeting and not later than the close of business on the
later of the 60th day prior to such special meeting or the 10th day following
the day on which public announcement is first made of the date of the special
meeting and of the nominees proposed by the Board of Directors to be elected at
such meeting.
(C) General. (1) Only such persons who are nominated in
accordance with the procedures set forth in this Section 8 shall be eligible to
serve as directors and only such business shall be conducted at a meeting of
stockholders as shall have been brought before the meeting in accordance with
the procedures set forth in this Section 8. The Chairman of the meeting shall
have the power and duty to determine whether a nomination or any business
proposed to be brought before the meeting was made in accordance with the
procedures set forth in this Section 8 and, if any proposed nomination or
business is not in compliance with this Section 8, to declare that such
defective nomination or proposal shall be disregarded.
(2) For purposes of this Article II, "public
announcement" shall mean disclosure in a press release reported by the Dow
Jones News Service, Associated Press or comparable national news service or in
a document publicly filed by the Corporation with the Securities and Exchange
Commission pursuant to Sections 13, 14 or 15(d) of the Exchange Act.
(3) Notwithstanding anything set forth herein to the
contrary, any stockholder may submit a notice delivered to the Secretary at the
principal executive offices of the Corporation containing names of individuals
for the Board of Directors to consider as potential nominees to the Board of
Directors at the next meeting of stockholders called for the purpose of
electing directors. In connection with such notice, the stockholder shall
provide the information required in clause (a) of paragraph (A)(2) of this
Section 8, including, the written consent of each individual to be named in the
Corporation's proxy statement or notice of meeting if the Board of Directors,
in its sole discretion, determines to nominate such individual. Any such
notice provided by a stockholder must be timely received by the Corporation to
enable the Board of Directors to review the qualifications of any person to be
considered for a nomination. For purposes hereof, the notice shall be deemed
timely if it is delivered to the Secretary of the Corporation within the time
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periods required for notices of stockholder proposals as set forth in Rule
14a-8 of the Exchange Act.
(4) Nothing in this Section 8 shall be deemed to affect
any rights of stockholders to request inclusion of proposals in the
Corporation's proxy statement or notice of meeting pursuant to Rule 14a-8 of
the Exchange Act.
(5) Notwithstanding the foregoing provisions of this
Section 8, a stockholder shall also comply with all applicable requirements of
the Exchange Act and the rules and regulations thereunder with respect to the
matters set forth in this Section 8.
ARTICLE III.
BOARD OF DIRECTORS.
SECTION l. General Powers. The business and affairs of this
Corporation shall be managed under the direction of the Board.
NUMBER. The number of directors shall be fixed from time to
time by resolution of the Board.
TENURE. The directors shall be elected at the annual meeting
of stockholders. Each director shall hold office until his successor is
elected and qualified or until his earlier resignation or removal.
VACANCIES. Vacancies and newly created directorships
resulting from any increase in the authorized number of directors may be filled
by a majority of the directors then in office though less than a quorum.
SECTION 2. Annual Meetings of the Board. The annual meeting of the
Board shall be held following the annual meeting of stockholders and shall be a
meeting of the directors elected at such meeting of stockholders. No notice
shall be required.
SECTION 3. Regular Meetings of the Board. Regular meetings of the
Board shall be held at such times and places as the Board may fix. No notice
shall be required.
SECTION 4. Special Meetings of the Board. Special meetings of the Board
shall be held whenever called by the Chairman, the President, or any four or
more directors. At least twenty-four hours' written or oral notice of each
special meeting shall be given to each director. If mailed, notice must be
deposited in the United States mail at least seventy-two hours before the
meeting.
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SECTION 5. Quorum. A majority of the members of the Board if the total
number is odd or one-half thereof if the total number is even shall constitute
a quorum for the transaction of business, but if at any meeting of the Board
there is less than a quorum the majority of those present may adjourn the
meeting from time to time until a quorum is present. At any such adjourned
meeting, a quorum being present, any business may be transacted which might
have been transacted at the original meeting.
Except as otherwise provided by law, the Certificate of Incorporation,
or the bylaws, all actions of the Board shall be decided by vote of a majority
of those present.
SECTION 6. Committees. The Board may, by resolution passed by a
majority of the entire Board, designate one or more committees of directors
which to the extent provided in the resolution shall have and may exercise
powers and authority of the Board in the management of the business and affairs
of the Corporation.
SECTION 7. Action Without a Meeting. Any action required or permitted
to be taken at any meeting of the Board or of any committee thereof may be
taken without a meeting if all the members of the Board or committee, as the
case may be, consent thereto in writing, and the writing or writings are filed
with the minutes of proceedings of the Board or committee.
ARTICLE IV.
OFFICERS.
SECTION l. Officers. The General Officers of the Corporation shall be
a Chairman of the Board, a Chief Executive Officer, a President, such number of
Executive Vice Presidents, Group Executives or Senior Vice Presidents as may be
determined by the Board, a Secretary and a Treasurer. The Chairman and
President shall be directors.
The Board may from time to time designate, employ, or appoint such
other officers and assistant officers, agents, employees, counsel, and
attorneys at law or in fact as it shall deem desirable for such periods and on
such terms as it may deem advisable, and such persons shall have such titles,
only such power and authority, and perform such duties as the Board may
determine.
SECTION 2. Duties of Chairman of the Board. The Chairman shall sign
and issue, jointly with the President, all reports to the stockholders and
shall preside at all meetings of stockholders and of the Board. He shall, in
general, perform all duties incident to the office of Chairman, and such other
duties
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as may be prescribed by the Board and perform the duties of the President in
his absence or inability to act.
SECTION 3. Duties of Chief Executive Officer. At each annual meeting
of the Board, or other meeting at which General Officers are or may be elected,
the Board shall designate the Chairman or the President as the Chief Executive
Officer of the Corporation. The Chief Executive Officer shall have general
authority over all matters relating to the business and affairs of the
Corporation subject to the control and direction of the Board.
SECTION 4. Duties of President. The President shall, in general,
perform all duties incident to the office of President and shall perform such
other duties as may be prescribed by the Board. In the absence or inability of
the Chairman to act, the President shall perform the duties of the Chairman
pertaining to management of the Corporation, and the Chairman of the Executive
Committee of the Board shall perform those duties of the Chairman pertaining to
Board functions.
SECTION 5. Duties of Executive Vice President, Group Executives and
Senior Vice Presidents. Each Executive Vice President, Group Executive and
Senior Vice President shall have such powers and perform such duties as may be
prescribed by the Chief Executive Officer of the Corporation or the Board. The
order of seniority, if any, among the Executive Vice Presidents, Group
Executives and Senior Vice Presidents shall be as designated from time to time
by the Chief Executive Officer of the Corporation. In the absence or inability
of the Chairman and the President to act, the senior of the Executive Vice
Presidents, Group Executives and Senior Vice Presidents, if one has been so
designated, shall perform the duties of the President. In the absence of any
such designation, the director who is the acting Chairman of the Executive
Committee of the Board of Directors shall assume the duties of the President
for such time period as required.
SECTION 6. Duties of Secretary. The Secretary shall record the
proceedings of meetings of the stockholders and directors, give notices of
meetings, and shall, in general, perform all duties incident to the office of
Secretary and such other duties as may be prescribed by the Board.
SECTION 7. Duties of Treasurer. The Treasurer shall have custody of
all funds, securities, evidences of indebtedness, and other similar property of
the Corporation, and shall, in general, perform all duties incident to the
office of Treasurer and such other duties as may be prescribed by the Board."
ARTICLE V.
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MISCELLANEOUS PROVISIONS.
SECTION l. Waiver of Notice. Whenever notice is required to be given,
a written waiver thereof signed by the person entitled to notice, whether
before or after the time stated therein, shall be deemed equivalent to notice.
Attendance of a person at a meeting shall constitute a waiver of notice of such
meeting, except when the person attends a meeting for the express purpose of
objecting, at the beginning of the meeting, to the transaction of any business
because the meeting is not lawfully called or convened.
SECTION 2. Record Date. In order that the Corporation may determine
the stockholders entitled to notice of or to vote at any meeting of
stockholders or any adjournment thereof, or entitled to receive payment of any
dividend or other distribution or allotment of any rights, or entitled to
exercise any rights in respect of any change, conversion or exchange of stock
or for the purpose of any other lawful action, the Board may fix, in advance, a
record date, which shall not be more than sixty nor less than ten days before
the date of such meeting, nor more than sixty days prior to any other action;
except that the establishment of a record date for determination of
stockholders entitled to express consent to corporate action in writing without
a meeting shall be established pursuant to Article VII of the bylaws.
ARTICLE VI.
EMERGENCY BYLAWS.
SECTION l. When Operative. Notwithstanding any different provision in
the preceding Articles of the bylaws or in the Certificate of Incorporation,
the emergency bylaws provided in this Article VI shall be operative during any
emergency resulting from an attack on the United States or on a locality in
which the Corporation conducts its business or customarily holds meetings of
its Board or its stockholders, or during any nuclear or atomic disaster, or
during the existence of any catastrophe, or other similar emergency condition,
as a result of which a quorum of the Board or a standing committee thereof
cannot readily be convened for action.
SECTION 2. Board Meetings. During any such emergency, a meeting of
the Board may be called by any director or, if necessary, by any officer who is
not a director. The meeting shall be held at such time and place, within or
without Cook County, Illinois, specified by the person calling the meeting and
in the notice of the meeting which shall be given to such of the directors as
it may be feasible to reach at the time and by such means as may be feasible at
the time, including publication or radio. Such advance notice shall be given
as, in the judgment of
-10-
<PAGE> 11
the person calling the meeting, circumstances permit. Two directors shall
constitute a quorum for the transaction of business. To the extent required to
constitute a quorum at the meeting, the officers present shall be deemed, in
order of rank and within the same rank in order of seniority, directors for the
meeting.
SECTION 3. Amendments to Emergency Bylaws. These emergency bylaws may
be amended, either before or during any emergency, to make any further or
different provision that may be practical and necessary for the circumstances
of the emergency.
ARTICLE VII.
CONSENTS TO CORPORATE ACTION.
SECTION 1. Action by Written Consent. Unless otherwise provided in
the Certificate of Incorporation, any action which is required to be or may be
taken at any annual or special meeting of stockholders of the Corporation,
subject to the provisions of Sections (2) and (3) of this Article VII, may be
taken without a meeting, without prior notice and without a vote if a consent
in writing, setting forth the action so taken, shall have been signed by the
holders of outstanding stock having not less than the minimum number of votes
that would be necessary to authorize or to take such action at a meeting at
which all shares entitled to vote thereon were present and voted; provided,
however, that prompt notice of the taking of the corporate action without a
meeting and by less than unanimous written consent shall be given to those
stockholders who have not consented in writing.
SECTION 2. Determination of Record Date for Action by Written Consent.
The record date for determining stockholders entitled to express consent to
corporate action in writing without a meeting shall be fixed by the Board of
Directors of the Corporation. Any stockholder seeking to have the stockholders
authorize or take corporate action by written consent without a meeting shall,
by written notice to the Secretary, request the Board of Directors to fix a
record date. Upon receipt of such a request, the Secretary shall, as promptly
as practicable, call a special meeting of the Board of Directors to be held as
promptly as practicable. At such meeting, the Board of Directors shall fix a
record date as provided in Section 213(b) (or its successor provision) of the
Delaware General Corporation Law; that record date, however, shall not be more
than 10 days after the date upon which the resolution fixing the record date is
adopted by the Board nor more than 15 days from the date of the receipt of the
stockholder's request. Notice of the record date shall be published in
accordance with the rules and policies of any stock exchange on which
securities of the Corporation are then listed. Should the Board fail to fix a
record date as provided for in this Section 2, then the record date shall be
the day on which
-11-
<PAGE> 12
the first written consent is duly delivered pursuant to Section 213(b) (or its
successor provision) of the Delaware General Corporation Law, or, if prior
action is required by the Board with respect to such matter, the record date
shall be at the close of business on the day on which the Board adopts the
resolution taking such action.
SECTION 3. Procedures for Written Consent. In the event of the
delivery to the Corporation of a written consent or consents purporting to
represent the requisite voting power to authorize or take corporate action
and/or related revocations, the Secretary of the Corporation shall provide for
the safekeeping of such consents and revocations and shall promptly engage
nationally recognized independent inspectors of elections for the purpose of
promptly performing a ministerial review of the validity of the consents and
revocations. No action by written consent without a meeting shall be effective
until such inspectors have completed their review, determined that the
requisite number of valid and unrevoked consents has been obtained to authorize
or take the action specified in the consents, and certified such determination
for entry in the records of the Corporation kept for the purpose of recording
the proceedings of meetings of stockholders.
-12-
<PAGE> 1
Exhibit 4(a)
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
HOUSEHOLD INTERNATIONAL, INC.
AND
THE FIRST NATIONAL BANK
OF MARYLAND,
AS TRUSTEE.
---------------
INDENTURE
DATED AS OF OCTOBER 1, 1993
---------------
PROVIDING FOR ISSUANCE OF NOTES IN SERIES
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 2
HOUSEHOLD INTERNATIONAL, INC.
Indenture dated as of October 1, 1993
------------------------------------
TABLE OF CONTENTS*
------------------------------------
<TABLE>
<CAPTION>
PAGE
<S> <C>
PARTIES.............................................................. 1
RECITALS:
General Form of Face of Note......................................... 1
General Form of Reverse of Note...................................... 3
Form of Trustee's Certificate of Authentication for Notes............ 9
General Form of 'Option to Elect Repayment', if applicable, for
Notes.............................................................. 10
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
SECTION 1.01 Definitions
Act.................................................. 11
Affiliate; Control................................... 11
Authorized Newspaper................................. 11
Board of Directors................................... 11
Board Resolution..................................... 12
Business Day......................................... 12
Commission; SEC...................................... 12
Company.............................................. 12
Company Request; Company Order; Company Consent...... 12
Depository........................................... 12
Depository Note...................................... 12
Dollar............................................... 13
ECU.................................................. 13
European Communities................................. 13
Event of Default..................................... 13
Foreign Currency..................................... 13
Holder............................................... 13
Indenture............................................ 13
Independent.......................................... 13
Interest............................................. 13
Interest Payment Date................................ 14
</TABLE>
* This Table of Contents does not constitute a part of the Indenture and is for
convenience of reference only.
<PAGE> 3
ii
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
Maturity............................................. 14
Notes................................................ 14
Note Register; Note Registrar........................ 14
Officers' Certificate................................ 14
Opinion of Counsel................................... 14
Original Issue Discount Note......................... 14
Outstanding.......................................... 14
Paying Agent......................................... 15
Person............................................... 16
Predecessor Notes.................................... 16
Redemption Date...................................... 16
Redemption Price..................................... 16
Regular Record Date.................................. 16
Responsible Officer.................................. 16
Special Record Date.................................. 16
Stated Maturity...................................... 16
Subsidiary........................................... 17
Trustee.............................................. 17
Trust Indenture Act, TIA............................. 17
Voting Stock......................................... 17
SECTION 1.02 Compliance Certificates and Opinions................. 17
SECTION 1.03 Form of Documents Delivered to Trustee............... 18
SECTION 1.04 Acts of Holders...................................... 18
SECTION 1.05 Notices, etc., to Trustee and Company................ 20
SECTION 1.06 Notices to Holders; Waiver........................... 20
SECTION 1.07 Conflict with Trust Indenture Act.................... 21
SECTION 1.08 Effect of Headings and Table of Contents............. 21
SECTION 1.09 Successors and Assigns............................... 21
SECTION 1.10 Separability Clause.................................. 21
SECTION 1.11 Benefits of Indenture................................ 21
SECTION 1.12 Governing Law........................................ 22
SECTION 1.13 Payment on Business Day.............................. 22
SECTION 1.14 Incorporation by Reference of Trust Indenture Act.... 22
ARTICLE II
ISSUE, EXECUTION AND REGISTRATION OF NOTES
SECTION 2.01 Issuance of Notes in Series.......................... 22
SECTION 2.02 Authentication and Delivery of Notes................. 23
SECTION 2.03 Execution of Notes................................... 24
SECTION 2.04 Temporary Notes...................................... 24
</TABLE>
<PAGE> 4
iii
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
SECTION 2.05 Exchanges and Transfers of Notes..................... 24
SECTION 2.06 Mutilated, Destroyed, Lost or Stolen Notes........... 27
SECTION 2.07 Payment of Interest; Interest Rights Preserved....... 28
SECTION 2.08 Persons Deemed Owners................................ 29
SECTION 2.09 Cancellation of Notes................................ 29
SECTION 2.10 Appointment of Authenticating Agent.................. 30
SECTION 2.11 Securities Issuable in the Form of a Depository
Note................................................. 31
ARTICLE III
COVENANTS
SECTION 3.01 Payment of Principal, Premium and Interest........... 32
SECTION 3.02 Maintenance of Office or Agency...................... 33
SECTION 3.03 Money for Note Payments to be Held in Trust.......... 33
SECTION 3.04 Payment of Taxes and Other Claims.................... 34
SECTION 3.05 Statement as to Compliance........................... 35
SECTION 3.06 Corporate Existence.................................. 35
SECTION 3.07 Filing of Reports.................................... 35
SECTION 3.08 Not to Subject Property to Lien Without Securing
Notes Ratably; Waiver of Covenant.................... 35
ARTICLE IV
REPAYMENT AT OPTION OF HOLDERS
SECTION 4.01 Optional Repayment of Notes.......................... 38
SECTION 4.02 Repayment Procedure for Notes........................ 38
ARTICLE V
REDEMPTION OF NOTES; SINKING FUNDS
SECTION 5.01 Applicability of Redemption Provisions............... 39
SECTION 5.02 Election to Redeem; Notice to Trustee................ 39
SECTION 5.03 Selection by Trustee of Notes to be Redeemed......... 39
SECTION 5.04 Notice of Redemption................................. 40
SECTION 5.05 Deposit of Redemption Price.......................... 41
SECTION 5.06 Notes Payable on Redemption Date..................... 41
SECTION 5.07 Notes Redeemed in Part............................... 41
SECTION 5.08 Sinking Funds........................................ 41
SECTION 5.09 Satisfaction of Sinking Fund Payments with Notes..... 42
SECTION 5.10 Redemption of Notes for Sinking Fund................. 42
</TABLE>
<PAGE> 5
iv
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
ARTICLE VI
SATISFACTION AND DISCHARGE
SECTION 6.01 Satisfaction and Discharge of Indenture.............. 43
SECTION 6.02 Application Of Trust Money........................... 44
SECTION 6.03 Satisfaction, Discharge, and Defeasance of Notes of
any Series........................................... 44
ARTICLE VII
REMEDIES
SECTION 7.01 Events of Default.................................... 46
SECTION 7.02 Acceleration of Maturity; Rescission and Annulment... 48
SECTION 7.03 Collection of Indebtedness and Suits for Enforcement
by Trustee........................................... 49
SECTION 7.04 Trustee May File Proofs of Claim..................... 50
SECTION 7.05 Trustee May Enforce Claims Without Possession of
Notes................................................ 51
SECTION 7.06 Application of Money Collected....................... 51
SECTION 7.07 Limitation on Suits.................................. 52
SECTION 7.08 Unconditional Right of Holders to Receive Principal,
Premium and Interest................................. 52
SECTION 7.09 Restoration of Rights and Remedies................... 53
SECTION 7.10 Rights and Remedies Cumulative....................... 53
SECTION 7.11 Delay or Omission Not Waiver......................... 53
SECTION 7.12 Control by Holders................................... 53
SECTION 7.13 Waiver of Past Defaults.............................. 53
SECTION 7.14 Undertaking for Costs................................ 54
SECTION 7.15 Waiver of Stay or Extension Laws..................... 54
ARTICLE VIII
THE TRUSTEE
SECTION 8.01 Certain Duties and Responsibilities.................. 55
SECTION 8.02 Notice of Defaults................................... 56
SECTION 8.03 Certain Rights of Trustee............................ 56
SECTION 8.04 Not Responsible for Recitals or Issuance of Notes.... 57
SECTION 8.05 May Hold Notes....................................... 58
SECTION 8.06 Money Held in Trust.................................. 58
SECTION 8.07 Compensation and Reimbursement....................... 58
SECTION 8.08 Corporate Trustee Required; Eligibility;
Disqualification; Conflicting Interests.............. 59
SECTION 8.09 Preferential Collection of Claims Against Company.... 59
</TABLE>
<PAGE> 6
v
<TABLE>
<CAPTION>
PAGE
<S> <C> <C>
SECTION 8.10 Resignation and Removal; Appointment of Successor.... 59
SECTION 8.11 Acceptance of Appointment by Successor............... 61
SECTION 8.12 Merger, Conversion, Consolidation or Succession to
Business............................................. 61
ARTICLE IX
HOLDERS' LIST AND REPORTS BY TRUSTEE AND COMPANY
PAGE
SECTION 9.01 Company to Furnish Trustee Names and Addresses of
Holders.............................................. 62
SECTION 9.02 Preservation of Information; Communications to
Holders.............................................. 62
SECTION 9.03 Reports by Trustee................................... 62
ARTICLE X
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 10.01 Company May Consolidate, etc. only on Certain
Terms................................................ 63
SECTION 10.02 Successor Corporation Substituted.................... 64
ARTICLE XI
SUPPLEMENTAL INDENTURES
SECTION 11.01 Supplemental Indentures Without Consent of Holders... 64
SECTION 11.02 Supplemental Indentures With Consent of Holders...... 65
SECTION 11.03 Execution of Supplemental Indentures................. 66
SECTION 11.04 Effect of Supplemental Indentures.................... 67
SECTION 11.05 Conformity with Trust Indenture Act.................. 67
SECTION 11.06 Reference in Notes to Supplemental Indentures........ 67
</TABLE>
<PAGE> 7
vi
Tie of certain provisions of Trust Indenture Act of 1939, as amended, with
Indenture, dated as of October 1, 1993, between Household International, Inc.
and The First National Bank of Maryland, as Trustee*
<TABLE>
<CAPTION>
SECTION OF
SECTION OF ACT INDENTURE
- ------------------------------------------------------------- -----------
<S> <C> <C>
310 (a)(1).................................................. 8.08
(a)(2).................................................. 8.08
Not
(a)(3).................................................. Applicable
Not
(a)(4).................................................. Applicable
(b)..................................................... 8.08, 8.10
311 (a)..................................................... 8.09
(b)..................................................... 8.09
312 (a)..................................................... 9.01
9.02(a)
(b)..................................................... 9.02(b)
(c)..................................................... 9.02(b)
313 (a)..................................................... 9.03(a)
(b)..................................................... 9.03(a)
(c)..................................................... 9.03(a)
9.03(b)
(d)..................................................... 9.03(c)
314 (a)..................................................... 3.07
Not
(b)..................................................... Applicable
(c)(1).................................................. 1.02
(c)(2).................................................. 1.02
Not
(c)(3).................................................. Applicable
Not
(d)..................................................... Applicable
(e)..................................................... 1.02
315 (a)..................................................... 8.01(a)
8.01(c)
(b)..................................................... 8.02
........................................................ 9.03(a)
(c)..................................................... 8.01(b)
</TABLE>
* This tie of provisions does not constitute a part of the Indenture and is for
convenience of reference only.
<PAGE> 8
vii
<TABLE>
<CAPTION>
SECTION OF
SECTION OF ACT INDENTURE
- ------------------------------------------------------------- -----------
<S> <C> <C>
315 (d)..................................................... 8.01(c)
(d)(1).................................................. 8.01(c)(1)
(d)(2).................................................. 8.01(c)(2)
(d)(3).................................................. 8.01(c)(3)
(e)..................................................... 7.14
316 (a)..................................................... 1.01
(a)(1)(A)............................................... 7.02
7.12
(a)(1)(B)............................................... 7.13
(a)(2).................................................. Not
Applicable
(b)..................................................... 7.08
317 (a)(1).................................................. 7.03
(a)(2).................................................. 7.04
(b)..................................................... 3.03
318 (a)..................................................... 1.07
</TABLE>
<PAGE> 9
THIS INDENTURE, dated as of the 1st day of October, 1993, between Household
International, Inc. a corporation duly organized and validly existing under the
laws of the State of Delaware (hereinafter sometimes called the 'Company'),
having principal office at 2700 Sanders Road, Prospect Heights, Illinois 60070,
and The First National Bank of Maryland, a banking association organized and
existing under the laws of the United States (hereinafter called the 'Trustee').
WITNESSETH:
WHEREAS, the Company deems it necessary from time to time to borrow money for
its corporate purposes and to issue its debt securities therefor, and to that
end has duly authorized and directed the execution and delivery of this
Indenture to provide for one or more series of its unsecured debentures, notes,
or other evidences of indebtedness (hereinafter called 'Notes'), issuable as in
this Indenture provided; and
WHEREAS, the general forms of the Notes, the Trustee's certificate of
authentication to be borne by the Notes, and the general form of the 'Option to
Elect Repayment' (if applicable) may be as follows, with any insertions,
omissions and variations as the Board of Directors of the Company may determine
in accordance with the provisions of this Indenture, or in such other form as
shall be established by or pursuant to a Board Resolution or in one or more
indentures supplemental hereto:
[GENERAL FORM OF FACE OF NOTE]
[If the Note is an Original Issue Discount Note, insert--For purposes of
Sections 1271-1273 of the United States Internal Revenue Code of 1986, as
amended, the issue price of this Note is % of its principal amount and the
issue date is , 19 .]
No.
HOUSEHOLD INTERNATIONAL, INC.
.... Note
HOUSEHOLD INTERNATIONAL, INC., a Delaware corporation (hereinafter called the
'Company', which term includes any successor corporation under the Indenture
hereinafter referred to), for value received, hereby promises to pay to
, or registered assigns, the principal sum of on
. [If the Note is to bear interest prior to Maturity,
<PAGE> 10
2
insert--, and to pay interest thereon at the rate per annum [of %] [set forth
on the reverse of this Note]. The Company will pay interest from ,
or from the most recent Interest Payment Date to which interest has been paid or
duly provided for, [Insert frequency of interest periods.] (beginning
) on , until the principal hereof is paid or duly
provided for. The interest so payable, and punctually paid or duly provided for,
on any Interest Payment Date will, as provided in the Indenture, be paid to the
Holder of this Note (or one or more Predecessor Notes) of record at the close of
business on the Regular Record Date for such interest, which shall be
[If applicable, insert--except that interest payable at Maturity
shall be paid to the same Person to whom the principal of this Note is payable.]
Interest will be computed on the basis of [Insert method of computing interest].
Any such interest not so punctually paid or duly provided for shall forthwith
cease to be payable to the Holder on such Regular Record Date, and may be paid
to the Holder of this Note (or one or more Predecessor Notes) of record at the
close of business on a Special Record Date fixed by the Trustee for the payment
of such defaulted interest, notice whereof shall be given to Holders not less
than 10 days prior to such Special Record Date, or may be paid at any time in
any other lawful manner not inconsistent with the requirements of any securities
exchange on which the Notes may be listed, and upon such notice as may be
required by such exchange, all as more fully provided in the Indenture.]
[If the Security is not to bear interest prior to Maturity, insert--The
principal of this Note shall not bear interest except in the case of a default
in payment of principal upon acceleration, upon redemption or at Stated Maturity
and in such case the overdue principal of this Note shall bear interest at the
rate of % per annum (to the extent that the payment of such interest shall be
legally enforceable), which shall accrue from the date of such default in
payment to the date payment of such principal has been made or duly provided
for. Interest on any overdue principal shall be payable on demand. Any such
interest on any overdue principal that is not so paid on demand shall bear
interest at the rate of % per annum (to the extent that the payment of such
interest shall be legally enforceable), which shall accrue from the date of such
demand for payment to the date payment of such interest has been made or duly
provided for, and such interest shall also be payable on demand.]
<PAGE> 11
3
Payment of the principal of (and premium, if any) on this Note and, unless
otherwise paid as hereinafter provided, the interest (if any) thereon will be
made at the office or agency of the Company in the
, in such coin or currency of the [United States of
America as at the time of payment is legal tender for payment of public and
private debts,] provided, however, that payment of interest may be made at the
option of the Company by check or draft mailed to the Person entitled thereto at
his address appearing in the Note Register. Additional provisions of this Note
are set forth on the reverse hereof.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee by manual signature, this Note shall not be entitled to
any benefit under the Indenture, or be valid or obligatory for any purpose.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed
under its facsimile corporate seal.
<TABLE>
<S> <C>
Dated: HOUSEHOLD INTERNATIONAL, INC.
ATTEST: By
</TABLE>
[GENERAL FORM OF REVERSE OF NOTE]
HOUSEHOLD INTERNATIONAL, INC.
.... Note
This Note is one of a duly authorized issue of Notes of the Company (herein
called the 'Notes'), issuable in series, unlimited in aggregate principal amount
except as may be otherwise provided in respect of the Notes of a particular
series, issued and to be issued under and pursuant to an Indenture dated as of
October 1, 1993 (herein called the 'Indenture'), duly executed and delivered by
the Company to The First National Bank of Maryland, as Trustee, and is one of a
series designated as Notes due (herein called the '
Notes'), [Insert, as applicable-- unlimited in aggregate principal amount--or
- --limited in aggregate principal amount to $ .] Reference is hereby made to
the Indenture and all indentures supplemental thereto for a
<PAGE> 12
4
description of the rights, limitations of rights, obligations, duties and
immunities thereunder of the Trustee, the Company and the Holders.
[AT THE COMPANY'S OPTION, ADDITIONAL PROVISIONS APPLICABLE TO
INTEREST RATE MAY BE INSERTED HERE]
[If applicable, insert--The Notes of this series are subject to redemption
upon not less than 30 days' notice by mail, [if applicable, insert-- (1) on
in any year commencing with the year and ending with the year
through operation of the sinking fund for this series at a Redemption Price
equal to 100% of the principal amount, and (2)] at any time [on or after
, 19 ], as a whole or in part, at the election of the Company, at the
following Redemption Prices (expressed as percentages of the principal amount):
If redeemed [on or before , %, and if redeemed] during the
12-month period beginning of the years indicated,
<TABLE>
<CAPTION>
<S> <C> <C> <C>
REDEMPTION REDEMPTION
YEAR PRICE YEAR PRICE
- ----- ----------- ----- ----------
</TABLE>
<PAGE> 13
5
and thereafter at a Redemption Price equal to % of the principal amount,
together in the case of any such redemption [if applicable, insert--(whether
through operation of the sinking fund or otherwise)] with accrued interest to
the Redemption Date, but interest instalments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Notes, or
one or more Predecessor Notes, of record at the close of business on the
relevant Record Dates referred to on the face hereof, all as provided in the
Indenture.]
[If applicable, insert--The Notes of this series are subject to redemption
upon not less than 30 days' notice by mail, (1) on in any year
commencing with the year and ending with the year through operation of
the sinking fund for this series at the Redemption Prices for redemption through
operation of the sinking fund (expressed as percentages of the principal amount)
set forth in the table below, and (2) at any time [on or after ], as a
whole or in part, at the election of the Company, at the Redemption Prices for
redemption otherwise than through operation of the sinking fund (expressed as
percentages of the principal amount) set forth in the table below: If redeemed
during a 12-month period beginning of the years indicated,
<TABLE>
<CAPTION>
REDEMPTION PRICE
FOR REDEMPTION REDEMPTION PRICE FOR
THROUGH OPERATION REDEMPTION OTHERWISE
OF THE THAN THROUGH OPERATION
YEAR SINKING FUND OF THE SINKING FUND
- ------------------------ ------------------ -----------------------
<S> <C> <C>
</TABLE>
and thereafter at a Redemption Price equal to % of the principal amount,
together in the case of any such redemption (whether through operation of the
sinking fund or otherwise) with accrued interest to the Redemption Date, but
interest instalments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Notes, or one or more Predecessor
Notes, of record at the close of
<PAGE> 14
6
business on the relevant Regular Record Dates referred to on the face hereof,
all as provided in the Indenture].
[The sinking fund for this series provides for the redemption on
in each year beginning with the year and ending with the year of [not
less than] $ [('mandatory sinking fund') and not more than $ ]
aggregate principal amount of Notes of this series. [Notes of this series
acquired or redeemed by the Company otherwise than through [mandatory] sinking
fund payments may be credited against subsequent [mandatory] sinking fund
payments otherwise required to be made-in the inverse order in which they become
due.]
[In the event of redemption of this Note in part only, a new Note or Notes of
this series for the unredeemed portion hereof will be issued in the name of the
Holder hereof upon the cancellation hereof.]
[If applicable, insert--The Notes of this series will be repayable on
, , at the option of the holders of the Notes of this series, at
100% of their principal amount together with interest (if any) payable to the
date of repayment, except that interest, the Stated Maturity of which is on or
prior to such repayment date, shall be payable to the Holders of Notes of this
series, [or one or more Predecessor Notes,] of record on the relevant Record
Dates referred to on the face hereof, all as provided in the Indenture. In order
for a Note of this series to be repaid, the Trustee must receive at its office
in (or at such other address of which the Company may from
time to time notify Holders), during the period from and including ,
to and including , (or, if such , is not a Business
Day, the next succeeding Business Day) (i) this Note with the form entitled
'Option to Elect Repayment' on the reverse of this Note duly completed, or (ii)
a telegram, telex, facsimile transmission or letter from a member of a national
securities exchange or the National Association of Securities Dealers, Inc. or a
commercial bank or a trust company in the United States of America setting forth
the name of the Holder of this Note, the principal amount of this Note, the
amount of this Note to be repaid, a statement that the option to elect repayment
is being exercised thereby and a guarantee that this Note to be repaid with the
form entitled 'Option to Elect Repayment' on the reverse of this Note duly
completed will be received by the [Trustee] [Company] not later than five
Business Days after the date of such telegram, telex, facsimile transmission or
letter and such Note and form duly completed are received by the
<PAGE> 15
7
[Trustee] [Company] by such fifth Business Day. Any such notice received by the
[Trustee] [Company] during the period from and including , to and
including , shall be irrevocable. The repayment option may be
exercised by the Holder of this Note for less than the entire principal amount
of this Note provided the principal amount which is to be repaid is equal to
$ or an integral multiple of $ . All questions as to the
validity, eligibility (including time of receipt) and acceptance of any Note of
this series for repayment will be determined by the Company, whose determination
will be final and binding.]
[If the Note is not an Original Issue Discount Note,--If any Event of Default
with respect to Notes of this series shall occur and be continuing, the
principal of the Notes of this series may be declared due and payable in the
manner and with the effect provided in the Indenture.]
[If the Note is an Original Issue Discount Note,--If an Event of Default with
respect to Notes of this series shall occur and be continuing, an amount of
principal of the Notes of this series may be declared due and payable in the
manner and with the effect provided in the Indenture. Such amount shall be equal
to--Insert formula for determining the amount. Upon payment (i) of the amount of
principal so declared due and payable and (ii) of interest on any overdue
principal and overdue interest (in each case to the extent that the payment of
such interest shall be legally enforceable), all of the Company's obligations in
respect of the payment of the principal of and interest, if any, on the Notes of
this series shall terminate.]
[The Indenture contains provisions for defeasance at any time of the entire
indebtedness of the Company on this Note upon compliance by the Company with
certain conditions set forth therein, which provisions apply to this Note.]
The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders under the Indenture at any time by the
Company with the consent of the Holders of at least a majority in aggregate
principal amount of the Notes at the time Outstanding of each series which is
affected by such amendment or modification, except that certain amendments
specified in the Indenture may be made without approval of Holders of the Notes.
The Indenture also contains provisions permitting the Holders of a majority in
aggregate
<PAGE> 16
8
principal amount of the Outstanding Notes of any series to waive on behalf of
the Holders of such series of Notes compliance by the Company with certain
provisions of the Indenture and certain past defaults under the Indenture and
their consequences. Any such consent or waiver by the Holder of this Note shall
be binding upon such Holder and upon all future Holders of this Note and any
Note issued upon the registration of transfer hereof or in exchange herefor or
in lieu hereof whether or not notation of such consent or waiver is made upon
this Note.
No reference herein to the Indenture and no provision of this Note or of the
Indenture shall alter or impair the obligation of the Company,which is absolute
and unconditional, to pay the principal of (and premium, if any) and interest on
this Note at the times, place, and rate, and in the coin or currency, herein
prescribed.
As provided in the Indenture and subject to certain limitations therein set
forth, transfer of this Note is registrable on the Note Register, upon surrender
of this Note for registration of transfer at the office or agency of the Company
in the , duly endorsed by,
or accompanied by a written instrument of transfer in form satisfactory to the
Company and the Note Registrar duly executed by, the Holder hereof or his
attorney duly authorized in writing, and thereupon one or more new Notes of the
same series containing identical terms and provisions, of authorized
denominations and for a like aggregate principal amount, will be issued to the
designated transferee or transferees.
The Notes are issuable only as registered Notes without coupons in
denominations of . As provided in the Indenture and
subject to certain limitations therein set forth, Notes are exchangeable for a
like aggregate principal amount of Notes of the same series containing identical
terms and provisions and of different authorized denominations, as requested by
the Holder surrendering the same.
No service charge will be made for any such registration of transfer or
exchange, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith.
The Company, the Trustee and any agent of the Company or the Trustee may treat
the person in whose name this Note is registered as the owner hereof for the
purpose of receiving payment as herein
<PAGE> 17
9
provided and for all other purposes whether or not this Note be overdue, and
neither the Company, the Trustee nor any such agent shall be affected by notice
to the contrary.
All terms used in this Note which are defined in the Indenture have the
meanings assigned to them in the Indenture.
[FORM OF TRUSTEE'S CERTIFICATE OF
AUTHENTICATION FOR NOTES]
This is one of the Notes designated herein referred to in the within-mentioned
Indenture.
The First National Bank of Maryland,
as Trustee
By
Authorized Signature
<PAGE> 18
10
[GENERAL FORM OF 'OPTION TO ELECT REPAYMENT',
IF APPLICABLE, FOR NOTES]
OPTION TO ELECT REPAYMENT
The undersigned hereby requests and irrevocably instructs the Company to repay
the within Note on the first occurring not less than nor more than
days after the date of receipt of the within Note by the Trustee at
Attention:
(or at such other place of which the Company shall from time to
time notify the Holder of the within Note), at a price equal to the principal
amount thereof, [together with interest to the date of repayment], to the
undersigned at
---------------------------------------------------------------------------
---------------------------------------------------------------------------
Please Print or Typewrite Name and Address of the Undersigned
Dated
-----------------------------------
NOTICE: THE SIGNATURE TO THIS
REQUEST AND INSTRUCTION MUST
CORRESPOND WITH THE NAME AS IT
APPEARS UPON THE FACE OF THE NOTE
IN EVERY PARTICULAR WITHOUT
ALTERATION OR ENLARGEMENT OR ANY
CHANGE WHATEVER.
------------------------------
WHEREAS, all things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
Now, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of Notes to be
issued hereunder by Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders, as follows:
<PAGE> 19
11
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.01. For all purposes of this Indenture, except as otherwise
expressly provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to them
in this Article, and include the plural as well as the singular;
(2) all other terms used herein which are defined in the TIA, either
directly or by reference therein, have the meanings assigned to them
therein; and
(3) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with generally accepted accounting
principles.
'Act' when used with respect to any Holder has the meaning specified in
Section 1.04.
'Affiliate' of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purposes of this definition,
'control' when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms 'controlling' and 'controlled' have meanings correlative to the
foregoing.
'Authorized Newspaper' when used in connection with the name of a particular
city, means a newspaper, printed in an official language of the country of
publication, of general circulation and customarily published in such city on
each Business Day, whether or not published on Saturdays, Sundays or holidays.
Whenever successive weekly publications in an Authorized Newspaper are required
hereunder they may be made (unless otherwise expressly provided herein) on the
same or different days of the week and in the same or in different Authorized
Newspapers.
'Board of Directors' means either the board of directors of the Company, any
duly authorized committee of that board, or any officer of the Company duly
authorized by the board of directors of the Company or a duly authorized
committee of that board.
<PAGE> 20
12
'Board Resolution' means a copy of a resolution certified by the Secretary or
an Assistant Secretary of the Company to have been duly adopted by the Board of
Directors and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
'Business Day' means each Monday, Tuesday, Wednesday, Thursday or Friday which
is not a legal holiday for banking institutions in the particular city with
reference to which the determination as to Business Day is being made.
'Commission' or 'SEC' means the Securities and Exchange Commission, as from
time to time constituted, created under the Securities Exchange Act of 1934, or
if at any time after the execution of this instrument such Commission is not
existing and performing the duties now assigned to it under the Trust Indenture
Act, then the body performing such duties on such date.
'Company' means the Person named as the Company in the first paragraph of this
Indenture until a successor corporation shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter Company shall mean such
successor corporation.
'Company Request', 'Company Order' and 'Company Consent' mean, respectively, a
written request, order or consent signed in the name of the Company by its
President or a Vice President, and by its Treasurer, an Assistant Treasurer,
Controller, an Assistant Controller, Secretary or an Assistant Secretary, and
delivered to the Trustee.
'Depository' shall mean, with respect to Notes of any series for which the
Company shall determine that such Notes will be issued as a Depository Note, The
Depository Trust Company, New York, New York, another clearing agency or any
successor registered under the Securities Exchange Act of 1934, or other
applicable statute or regulation, which, in each case, shall be designated by
the Company pursuant to either Section 2.01 or 2.11.
'Depository Note' shall mean, with respect to any series of Notes, a Note
executed by the Company and authenticated and delivered by the Trustee to the
Depository or pursuant to the Depository's instruction, all in accordance with
this Indenture and pursuant to a Company Order, which (i) shall be registered as
to principal and interest in the name of the Depository or its nominee and (ii)
shall represent, and shall be denominated in an amount equal to the aggregate
principal amount of, all of the Outstanding Notes of such series.
<PAGE> 21
13
'Dollar' means the coin or currency of the United States of America which at
the time of payment is legal tender for the payment of public and private debts.
'ECU' means the European Currency Unit as defined and revised from time to
time by the Council of the European Communities.
'European Communities' means the European Economic Community, the European
Coal and Steel Community and the European Atomic Energy Community.
'Event of Default' has the meaning specified in Section 7.01.
'Foreign Currency' means such coin or currency issued by the government of a
country other than the United States which at the time of payment is legal
tender in the country of issuance for the payment of public and private debts or
a composite coin or currency the value of which is determined by reference to
the values of the currencies of any specific group of countries.
'Holder' means a Person in whose name a Note is registered in the Note
Register.
'Indenture' means this Indenture dated as of October 1, 1993, and, unless the
context otherwise indicates, all indentures supplemental hereto from time to
time in effect.
'Independent' when used with respect to any specified Person means such a
Person who (1) is in fact independent, (2) does not have any material direct or
indirect financial interest in the Company or in any other obligor upon the
Notes or in any Affiliate of the Company or of such other obligor, and (3) is
not connected with the Company or such other obligor or any Affiliate of the
Company or of such other obligor, as an officer, employee, promoter,
underwriter, trustee, partner, director or person performing similar functions.
Whenever it is herein provided that any Independent Person's opinion or
certificate shall be furnished to the Trustee, such Person shall be appointed by
a Company Order, and such opinion or certificate shall state that the signer has
read this definition and that the signer is Independent within the meaning
hereof.
'Interest' when used with respect to an Original Issue Discount Note which by
its terms bears interest only after Maturity, means interest payable after
Maturity.
<PAGE> 22
14
'Interest Payment Date' means the Stated Maturity of interest on Notes of a
particular series.
'Maturity' when used with respect to Notes of a particular series means the
date on which the principal or any instalment of principal of such Notes becomes
due and payable as therein or herein provided, whether at the Stated Maturity or
by declaration of acceleration, call for redemption or otherwise.
'Notes' means all debt securities issued under this Indenture, regardless of
series.
'Note Register' and 'Note Registrar' have the respective meanings specified in
Section 2.05.
'Officers' Certificate' means a certificate signed by the Chairman of the
Board, the President or a Vice President, and by the Treasurer, an Assistant
Treasurer, the Controller, an Assistant Controller, the Secretary or an
Assistant Secretary of the Company, and delivered to the Trustee. Wherever this
Indenture requires that an Officers' Certificate be signed also by an accountant
or other expert, such accountant or other expert (except as otherwise expressly
provided in this Indenture) may be in the employ of the Company.
'Opinion of Counsel' means a written opinion of counsel, who may be counsel
for the Company or other counsel reasonably satisfactory to the Trustee.
'Original Issue Discount Note' means any Note which provides for an amount
less than the principal amount thereof to be due and payable upon a declaration
of acceleration of the Maturity thereof pursuant to Section 7.02.
'Outstanding' when used with respect to Notes means, as of the date of
determination, all Notes theretofore authenticated and delivered under this
Indenture, except:
(i) Notes theretofore cancelled by the Trustee or any authenticating
agent, or delivered to the Trustee or any authenticating agent for
cancellation;
(ii) Notes or portions thereof for whose payment or redemption money in
the necessary amount has been theretofore deposited with the Trustee or any
Paying Agent, other than the Company, in trust or set aside and segregated
in trust by the Company (if the Com-
<PAGE> 23
15
pany shall act as its own Paying Agent) for the Holders of such Notes,
provided that, if such Notes or any portions thereof are to be redeemed,
notice of such redemption has been duly given pursuant to this Indenture or
provision therefor satisfactory to the Trustee has been made;
(iii) Notes which have been paid pursuant to Section 2.06 or in exchange
for or in lieu of which other Notes have been authenticated and delivered
pursuant to this Indenture other than any such Notes in respect of which
there shall have been presented to the Trustee proof satisfactory to it
that such Notes are held by a bona fide purchaser in whose hands such Notes
are valid obligations of the Company; and
(iv) any such Notes which have been defeased pursuant to Section 6.03.
provided, however, that in determining whether the Holders of the requisite
principal amount of Notes Outstanding have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, or for any other
purpose, (i) Notes owned by the Company or any other obligor upon the Notes or
any Affiliate of the Company or such other obligor shall be disregarded and
deemed not to be Outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Notes which the Trustee knows to be
so owned shall be so disregarded, and Notes so owned which have been pledged in
good faith may be regarded as Outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Notes and that the pledge is not the Company or any other obligor upon the Notes
or any Affiliate of the Company or such other obligor, and (ii) the principal
amount of an Original Issue Discount Note or a Note denominated in a Foreign
Currency, as the case may be, that is deemed to be Outstanding for such purposes
shall be the amount of the principal thereof that, for an Original Issue
Discount Note, would be due and payable as of the date of such determination
upon a declaration of acceleration pursuant to Section 7.02 or, for a Note
denominated in a Foreign Currency, as calculated pursuant to Section 1.04(f).
'Paying Agent' means any Person authorized by the Company to pay the principal
of (and premium, if any) or interest on any Notes on behalf of the Company.
<PAGE> 24
16
'Person' means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
'Predecessor Notes' of any particular Note means every previous Note
evidencing all or a portion of the same debt as that evidenced by such
particular Note; and, for purposes of this definition, any Note authenticated
and delivered under Section 2.06 in exchange for or in lieu of a mutilated,
destroyed, lost, or stolen Note shall be deemed to evidence the same debt as the
mutilated, destroyed, lost, or stolen Note.
'Redemption Date' when used with respect to any Note to be redeemed means the
date fixed for such redemption by or pursuant to this Indenture, any indenture
supplemental hereto, or resolution of the Board of Directors as provided in
Section 2.01 of this Indenture.
'Redemption Price' when used with respect to any Note to be redeemed means the
price at which it is to be redeemed pursuant to this Indenture, any indenture
supplemental hereto, or resolution of the Board of Directors as provided in
Section 2.01 of this Indenture.
'Regular Record Date' for the interest payable on any Interest Payment Date
means, with respect to Notes of any series, the date specified as the Regular
Record Date therefor in the relevant supplemental indenture or resolution of the
Board of Directors authorizing such series of Notes.
'Responsible Officer' when used with respect to the Trustee means an officer
of the Trustee assigned to the corporate trust office, including any vice
president or assistant vice president, any trust officer or assistant trust
officer, or any other officer of the Trustee customarily performing functions
similar to those performed by any of the above designated officers and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his knowledge of and familiarity with
the particular subject.
'Special Record Date' for the payment of any Defaulted Interest (as defined in
Section 2.07) means a date fixed by the Trustee pursuant to Section 2.07.
'Stated Maturity' when used with respect to any Note or any instalment of
principal thereof or any instalment of interest thereon means the date specified
in such Note as the fixed date on which the principal
<PAGE> 25
17
of such Note or such instalment of principal or interest is due and payable.
'Subsidiary' of the Company means any corporation at least a majority of the
shares of the Voting Stock (or the equivalent thereof, in the case of
corporations organized outside the United States of America) of which shall at
the time be owned, directly or indirectly, by the Company or by one or more
Subsidiaries or by the Company and one or more Subsidiaries.
'Trustee' means the Person named as the Trustee in the first paragraph of this
instrument until a successor Trustee shall have become such pursuant to the
applicable provisions of this Indenture, and thereafter Trustee shall mean such
successor Trustee.
'Trust Indenture Act' or 'TIA' means the Trust Indenture Act of 1939, as it
may be amended from time to time.
'Voting Stock', as applied to the stock of any corporation, means stock of any
class or classes (however designated) having ordinary voting power for the
election of a majority of the directors of such corporation, other than stock
having such power only by reason of the happening of a contingency.
SECTION 1.02. Upon any application or request by the Company to the Trustee to
take any action under any provision of this Indenture, the Company shall furnish
to the Trustee an Officers' Certificate stating that all conditions precedent,
if any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture shall include
(1) a statement that each individual signing such certificate or opinion
has read such covenant or condition and the definitions herein relating
thereto;
<PAGE> 26
18
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, he has made
such examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition has
been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 1.03. In any case where several matters are required to be certified
by, or covered by an opinion of, any specified Person, it is not necessary that
all such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Person as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based, insofar
as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, in so far as
it relates to factual matters, upon a certificate or opinion of, or
representations by, any officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 1.04. (a) Any request, demand, authorization, direction, notice,
consent, waiver or other action provided by this Indenture to be given or taken
by Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders
<PAGE> 27
19
in person or by an agent duly appointed in writing; and, except as herein
otherwise expressly provided, such action shall become effective when such
instrument or instruments are delivered to the Trustee, and, where it is hereby
expressly required, to the Company. Such instrument or instruments (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the 'Act' of the Holders signing such instrument or instruments. Proof of
execution of any such instrument or of a writing appointing any such agent shall
be sufficient for any purpose of this Indenture and (subject to Section. 8.01)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Section 1.04.
(b) The fact and date of the execution by any Person of any such instrument or
writing may be proved by the affidavit of a witness of such execution or by the
certificate of any notary public or other officer authorized by law to take
acknowledgements of deeds, certifying that the individual signing such
instrument or writing acknowledged to him the execution thereof. Where such
execution is by an officer of a corporation or a member of a partnership, on
behalf of such corporation or partnership, such certificate or affidavit shall
also constitute sufficient proof of his authority. The fact and date of the
execution of any such instrument or writing, or the authority of the person
executing the same, may also be proved in any other manner which the Trustee
deems sufficient, and the Trustee may in any instance require proof with respect
to any of the matters referred to in this Section 1.04.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver or
other action by the Holder of any Note shall bind the Holder of every Note
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof, in respect of anything done or suffered to be done by the Trustee
or the Company in reliance thereon, whether or not notation of such action is
made upon such Note.
(e) In determining whether the Holders of the requisite principal amount of
Outstanding Notes of any series have given any request, demand, authorization,
direction, notice, consent or waiver under this indenture, the principal amount
of an Original Issue Discount Note that may be counted in making such
determination and that shall be deemed to be Outstanding for such purposes shall
be equal to the amount of the principal thereof that would be due and payable
pursuant to the terms
<PAGE> 28
20
of such Original Issue Discount Note upon a declaration of acceleration pursuant
to Section 7.02 at the time the taking of such action by the Holders of such
requisite principal amount of Outstanding Notes is evidenced to the Trustee, as
provided in Subsection (a) of this Section.
(f) For the purposes of calculating the principal amount of Notes of any
series denominated in ECUs or a currency issued by the government of any country
other than the United States for any purpose under this Indenture, the principal
amount of such Notes at any time outstanding shall be deemed to be that amount
of Dollars that could be obtained for such principal amount on the basis of a
spot rate of exchange specified to the Trustee in an Officers' Certificate for
ECUs or such currency into Dollars as of the date of any such calculation.
SECTION 1.05. Any request, demand, authorization, direction, notice, consent,
waiver or Act of Holders or other document provided or permitted by this
Indenture to be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient for
every purpose hereunder if made, given, furnished or filed in writing to or
with the Trustee at its principal corporate trust office, or
(2) the Company by the Trustee or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to the Company addressed
to it at the address of its principal office specified in the first
paragraph of this instrument or at any other address previously furnished
in writing to the Trustee by the Company.
SECTION 1.06. Where this Indenture provides for notice to Holders of any
event, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each Holder affected by such event, at his address as it appears in the Note
Register, not later than the latest date, and not earlier than the earliest
date, prescribed for the giving of such notice. In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders and any notice which is
mailed in the manner herein provided shall be conclusively presumed to have been
duly given. Where
<PAGE> 29
21
this Indenture provides for notice in any manner, such notice may be waived in
writing by the Person entitled to receive such notice, either before or after
the event, and such waiver shall be the equivalent of such notice. Waivers of
notice by Holders shall be filed with the Trustee, but such filing shall not be
a condition precedent to the validity of any action taken in reliance upon such
waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then such
notification as shall be made that is satisfactory to the Trustee shall
constitute a sufficient notification for every purpose hereunder.
In case, by reason of the suspension of publication of any Authorized
Newspaper, or by reason of any other cause, it shall be impossible to make
publication of any notice in an Authorized Newspaper or Authorized Newspapers as
required by this Indenture, then such method of publication or notification as
shall be made with the approval of the Trustee shall constitute a sufficient
publication of such notice.
SECTION 1.07. If any provision hereof limits, qualifies or conflicts with
another provision hereof which is required to be included in this Indenture by
any of the provisions of TIA, such required provision shall control.
SECTION 1.08. The Article headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof.
SECTION 1.09. All covenants and agreements in this Indenture by the Company
shall bind its successors and assigns, whether so expressed or not.
SECTION 1.10. In case any provision in this Indenture or in the Notes shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
SECTION 1.11. Nothing in this Indenture or in the Notes, expressed or implied,
shall give to any Person, other than the parties hereto and their successors
hereunder and the Holders, any benefit or any legal or equitable right, remedy
or claim under this Indenture.
<PAGE> 30
22
SECTION 1.12. This Indenture and each Note issued hereunder shall be construed
in accordance with and governed by the laws of the State of Illinois.
SECTION 1.13. In any case where any Interest Payment Date, Redemption Date or
Stated Maturity of any Note shall not be a Business Day, then (notwithstanding
any other provision of this Indenture) payment of interest or principal (and
premium, if any), as the case may be, need not be made on such date but may be
made on the next succeeding Business Day with the same force and effect as if
made on the Interest Payment Date or Redemption Date, or at the Stated Maturity,
provided that no interest shall accrue for the period from and after such
Interest Payment Date, Redemption Date, or Stated Maturity, as the case may be.
SECTION 1.14. Whenever this Indenture refers to a section of the TIA, that
section, as in effect on any particular date, is incorporated by reference in
and made a part of this Indenture. If the numerical designation of a section of
the TIA is changed subsequent to the date of this Indenture as a result of an
amendment to the TIA, then the reference in this Indenture to such section shall
be deemed to refer to the numerical designation of such section as amended.
The following TIA terms used in this Indenture have the following meanings:
'indenture securities' means the Notes.
'indenture security holder' means a Holder.
'indenture to be qualified' means this Indenture.
'indenture trustee' or 'institutional trustee' means the Trustee.
'obligor' on the indenture securities means the Company or any other
obligor on the Notes.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule have the
meanings assigned to them by the TIA or such statute or rule.
ARTICLE II
ISSUE, EXECUTION AND REGISTRATION OF NOTES
SECTION 2.01. At the option of the Company, the Notes issued hereunder, which
are unlimited in aggregate principal amount except as may be
<PAGE> 31
23
otherwise provided in respect of the Notes of a particular series, may be issued
in one or more series. The Notes of each series may be generally in the form
provided in this Indenture (with any such insertions, omissions and variations
as determined by the Board of Directors), to bear such series designation, to
mature on such date, to bear interest at such rate and payable on such dates,
and to have such other terms and provisions (including the currency of
denomination, which may be Dollars, Foreign Currency, ECU or other currency or
unit specified therein, specification as to whether Depository Note or an
Original Issue Discount Note, and including any addition to, or modification or
deletion of, any Event of Default or any covenant of the Company specified
herein with respect to Notes of the series), all as shall, prior to the
authentication thereof, be established, consistently with the other provisions
of this Indenture, by resolution or approval of the Board of Directors and set
forth in an Officers' Certificate, or in one or more supplemental indentures
approved by the Board of Directors. The Notes of any series may be issued as a
Depository Note.
All Notes of any one series shall be substantially identical except as to
denomination and except as may otherwise be provided in or pursuant to (i) a
Board Resolution and (subject to Section 2.02) set forth in such Officers'
Certificate or (ii) in any indenture supplemental hereto.
If any of the terms of the series are established by action taken pursuant to
a Board Resolution, a copy of an appropriate record of such action shall be
certified by the Secretary or an Assistant Secretary of the Company and
delivered to the Trustee at or prior to the delivery of the Officers'
Certificate setting forth the terms of the series.
SECTION 2.02. From time to time the Company may execute and deliver to the
Trustee, and the Trustee shall thereupon authenticate and deliver to or upon a
Company Order, Notes of any series duly established pursuant to Section 2.01,
upon receipt by the Trustee of:
(a)(i) the Board Resolution authorizing the execution and requesting the
authentication and delivery of the Notes applied for in the principal amount
therein specified, designating the series of such Notes and specifying the
officer or officers of the Company to whom or upon whose order such Notes shall
be delivered; and which, as permitted by Section 2.01, establishes the terms of
such series of Notes and which, if applicable, authorizes the execution of an
indenture supplemental hereto creating such series of Notes or, (ii) if an
officer of the Company
<PAGE> 32
24
has been duly authorized with respect to the foregoing, a certificate from such
officer to the Trustee authorizing the above actions and a Board Resolution
evidencing such officer's authority;
(b) an Officers' Certificate pursuant to Section 2.01 or, if the Notes of such
series are to be issued pursuant to a supplemental indenture, a supplemental
indenture duly executed on behalf of the Company, in form satisfactory to the
Trustee, creating such series of Notes;
(c) an Officers' Certificate pursuant to Section 1.02; and
(d) an Opinion of Counsel pursuant to Section 1.02 to the effect that:
(i) the form and terms of such Notes have been established in conformity
with the provisions of this Indenture;
(ii) all conditions precedent to the authentication and delivery of such
Notes have been complied with and that such Notes, when authenticated and
delivered by the Trustee and issued by the Company in the manner and subject
to any conditions specified in such Opinion of Counsel, will constitute valid
and legally binding obligations of the Company, enforceable in accordance with
their terms, subject to bankruptcy, insolvency, reorganization and other laws
of general applicability relating to or affecting the enforcement of
creditors' rights and to general equity principles;
(iii) all laws and requirements in respect of the execution and delivery by
the Company of such Notes have been complied with; and
(iv) the Company is not in default in any of its obligations under this
Indenture, and the issuance of such Notes will not result in any such default.
If all Notes of a series are not to be originally issued at one time, it shall
not be necessary to deliver the documents described in this Section 2.02 at or
prior to the time of authentication of each Note of such series if such
documents are delivered at or prior to the authentication upon original issuance
of the first Note of such series to be issued.
SECTION 2.03. The Notes shall be executed on behalf of the Company by its
Chairman of the Board, President or one of its Vice Presidents under its
corporate seal reproduced thereon and attested by its Secretary or one of its
Assistant Secretaries. The signature of any of such officers on the Notes may be
manual or facsimile.
<PAGE> 33
25
Notes bearing the manual or facsimile signatures of individuals who were at
any time the proper officers of the Company shall bind the Company,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Notes or did not hold
such offices at the date of such Notes.
All Notes shall be dated the date of their authentication.
No Note shall be entitled to any benefit under this Indenture or be valid or
obligatory for any purpose, unless there appears on such Note a certificate of
authentication substantially in the form provided for herein executed by manual
signature, and such certificate upon any Note shall be conclusive evidence, and
the only evidence, that such Note has been duly authenticated and delivered
hereunder.
SECTION 2.04. Pending the preparation of definitive Notes of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, or cause to be delivered, temporary Notes of such series which are
printed, lithographed, typewritten, mimeographed or otherwise produced, in any
denomination, substantially of the tenor of the definitive Notes in lieu of
which they are issued and with such appropriate insertions, omissions,
substitutions and other variations as the officers executing such Notes may
determine, as evidenced by their signing of such Notes.
If temporary Notes of any series are issued, the Company will cause definitive
Notes of such series to be prepared without unreasonable delay. After the
preparation of definitive Notes, the temporary Notes shall be exchangeable for
definitive Notes upon surrender of the temporary Notes at the office or agency
of the Company without charge to the Holder. Upon surrender for cancellation of
any one or more temporary Notes of any series the Company shall execute and the
Trustee shall authenticate and deliver, or cause to be delivered, in exchange
therefor a like principal amount of definitive Notes of such series, of
authorized denominations. Until so exchanged the temporary Notes shall in all
respects be entitled to the same benefits under this Indenture as the definitive
Notes.
SECTION 2.05. The Company shall cause to be kept at the principal corporate
trust office of the Trustee a Note Register in which, subject to such reasonable
regulations as the Company may prescribe, the Company shall, subject to Section
2.11, provide for the registration of Notes and for registrations of transfer of
Notes. The Trustee is hereby ap-
<PAGE> 34
26
pointed Note Registrar for the purpose of registering Notes and registering
transfers of Notes as herein provided.
Subject to the provisions of Section 2.11, upon surrender for registration of
transfer of any Note at any office or agency of the Company maintained for that
purpose, the Company shall execute, and the Trustee shall authenticate and
deliver, in the name of the designated transferee or transferees, one or more
new Notes of the same series containing identical terms and provisions, of any
authorized denominations and for a like aggregate principal amount.
Subject to the provisions of Section 2.11, at the option of the Holder, Notes
may be exchanged for other Notes of the same series containing identical terms
and provisions, of any authorized denominations and for a like aggregate
principal amount, upon surrender of the Notes to be exchanged at any such office
or agency. Whenever any Notes are so surrendered for exchange, the Company shall
execute, and the Trustee shall authenticate and deliver, the Notes which the
Holder making the exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange of Notes shall
be the valid obligations of the Company, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Notes surrendered upon such
registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or exchange
shall (if so required by the Company or the Trustee) be duly endorsed, or be
accompanied by a written instrument of transfer in form satisfactory to the
Company and the Note Registrar duly executed by the Holder thereof or his
attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or exchange
of Notes, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Notes, other than exchanges pursuant to
Section 2.04, Section 5.07 or Section 11.06 not involving any registration of
transfer.
The Company shall not be required (i) to issue, register the transfer of or
exchange any Note of any series during a period beginning at the opening of
business 15 days before the day of the mailing of a notice of redemption of
Notes of such series selected for redemption under Section 5.04 and ending at
the close of business on the day of such
<PAGE> 35
27
mailing, or (ii) to register the transfer of or exchange any Note so selected
for redemption in whole or in part.
SECTION 2.06. A mutilated Note may be surrendered to the Company and thereupon
the Company shall execute and the Trustee shall authenticate and deliver in
exchange therefor a new Note of the same series and of like tenor and principal
amount, bearing a number not contemporaneously outstanding.
If there be delivered to the Company and to the Trustee
(i) evidence to their satisfaction of the destruction, loss or theft of any
Note of any series, and
(ii) such security or indemnity as may be required by them to save each of
them harmless,
then, in the absence of notice to the Company or the Trustee that such Note has
been acquired by a bona fide purchaser, the Company shall execute and upon its
request the Trustee shall authenticate and deliver, in lieu of any such
destroyed, lost or stolen Note, a new Note of such series and of like tenor and
principal amount, bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Note has become or is
about to become due and payable, the Company in its discretion may, instead of
issuing a new Note, pay such Note.
Upon the issuance of any new Note under this Section 2.06, the Company may
require the payment of a sum sufficient to cover any tax or other governmental
charge that may be imposed in relation thereto and any other expenses (including
the fees and expenses of the Trustee) connected therewith.
Every new Note issued pursuant to this Section 2.06 in lieu of any destroyed,
lost or stolen Note shall constitute an original additional contractual
obligation of the Company, whether or not the destroyed, lost or stolen Note
shall be at any time enforceable by anyone, and shall be entitled to all the
benefits of this Indenture equally and proportionately with any and all other
Notes of the same series containing identical terms and provisions duly issued
hereunder.
The provisions of this Section 2.06 are exclusive and shall preclude (to the
extent lawful) all other rights and remedies with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Notes.
<PAGE> 36
28
SECTION 2.07. Interest on any Note which is payable, and is punctually paid or
duly provided for, on any Interest Payment Date shall be paid to the Person in
whose name such Note (or one or more Predecessor Notes) is registered at the
close of business on the Regular Record Date for such interest; provided,
however, interest payable at Maturity may be paid to the same Person to whom
principal of the Notes is payable if so stated in the Note. Notwithstanding the
foregoing, however, interest that is payable on Notes registered in the name of
the Company at the close of business on any Regular Record Date may be withheld
at the option of the Company; provided, however, the Notes are continuously held
by the Company through the relevent Interest Payment Date.
Any interest on any Note which is payable, but is not punctually paid or duly
provided for, on any Interest Payment Date (herein called 'Defaulted Interest')
shall forthwith cease to be payable to the Holder on the relevant Regular Record
Date by virtue of having been such Holder; and such Defaulted Interest may be
paid by the Company, at its election in each case, as provided in Clause (1) or
Clause (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the Notes (or their respective Predecessor
Notes) are registered at the close of business on a Special Record Date for
the payment of such Defaulted Interest, which shall be fixed in the
following manner. The Company shall notify the Trustee in writing of the
amount of Defaulted Interest proposed to be paid on each Note and the date
of the proposed payment, and at the same time the Company shall deposit
with the Trustee an amount of money equal to the aggregate amount proposed
to be paid in respect of such Defaulted Interest or shall make arrangements
satisfactory to the Trustee for such deposit prior to the date of the
proposed payment, such money when deposited to be held in trust for the
benefit of the Persons entitled to such Defaulted Interest as in this
Clause (1) provided. Thereupon the Trustee shall fix a Special Record Date
for the payment of such Defaulted Interest which shall be not more than 15
nor less than 10 days prior to the date of the proposed payment and not
less than 10 days after the receipt by the Trustee of the notice of the
proposed payment. The Trustee shall promptly notify the Company of such
Special Record Date and, in the name and at the expense of the Company,
shall cause notice of the proposed payment of such Defaulted Interest and
the Special Record Date therefor to be mailed first class postage
<PAGE> 37
29
prepaid, to each Holder at his address as it appears in the Note Register,
not less than 10 days prior to such Special Record Date. The Trustee shall,
upon a Company Request and in the name and at the expense of the Company,
cause a similar notice to be published at least once in an Authorized
Newspaper in New York City but such publication shall not be a condition
precedent to the establishment of such Special Record Date. Notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor having been mailed as aforesaid, such Defaulted Interest shall be
paid to the Persons in whose names the Notes (or their respective
Predecessor Notes) are registered on such Special Record Date and shall no
longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest in any other
lawful manner not inconsistent with the requirements of any securities
exchange on which the Notes may be listed, and upon such notice as may be
required by such exchange, if, after notice given by the Company to the
Trustee of the proposed payment pursuant to this Clause (2), such payment
shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section 2.07, each Note delivered
under this Indenture upon registration of transfer of or in exchange for or in
lieu of any other Note shall carry the rights to interest accrued and unpaid,
and to accrue, which were carried by such other Note.
SECTION 2.08. The Company, the Trustee and any agent of the Company or the
Trustee may treat the Person in whose name any Note is registered as the owner
of such Note for the purpose of receiving payment of principal of (and premium,
if any) and (subject to Section 2.07) interest on such Note and for all other
purposes whatsoever, whether or not such Note be overdue, and neither the
Company, the Trustee nor any such agent shall be affected by notice to the
contrary.
SECTION 2.09. All Notes surrendered for payment, redemption, registration of
transfer or exchange or for credit against any sinking fund payment provided in
respect of any series of Notes shall, if surrendered to any Person other than
the Trustee, be delivered to the Trustee and shall be promptly cancelled by it.
The Company may at any time deliver to the Trustee for cancellation any Notes
previously authenticated and delivered hereunder which the Company may have
acquired in any
<PAGE> 38
30
manner whatsoever, and all Notes so delivered shall be promptly cancelled by the
Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes
cancelled as provided in this Section 2.09, except as expressly permitted by
this Indenture. All cancelled Notes held by the Trustee shall be destroyed by
the Trustee and the Trustee shall deliver to the Company a certificate of such
destruction.
SECTION 2.10. The Trustee shall, if requested in writing so to do by the
Company, promptly appoint an agent or agents of the Trustee who shall have
authority to authenticate Notes of any series in the name and on behalf of the
Trustee. If the Company does direct the Trustee to appoint an authenticating
agent, the Company shall pay the reasonable compensation of such authenticating
agent. Such appointment by the Trustee shall be evidenced by a certificate
executed by a Responsible Officer of the Trustee delivered to the Company prior
to the effectiveness of such appointment designating such agent or agents and
stating that all appropriate corporate action has been taken by the Trustee in
connection with such appointment.
Any such authenticating agent shall be an agent acceptable to the Company and
shall at all times be a corporation which is organized and doing business under
the laws of the United States or of any State, is authorized under such laws to
act as authenticating agent, has a combined capital and surplus of at least
$5,000,000, and is subject to supervision or examination by Federal or State
authority.
Any authenticating agent may at any time resign by giving written notice of
resignation to the Trustee and to the Company. The Trustee may at any time, and
upon written request of the Company to the Trustee shall, terminate the agency
of any authenticating agent by giving written notice of termination to such
authenticating agent and to the Company.
Any such authenticating agent shall have the rights and immunities of the
Trustee set forth in Sections 2.08, 8.03, 8.04 and 8.05 to the same extent and
as fully to all intents and purposes as though such authenticating agent had
been expressly named in place of the Trustee.
If an appointment is made pursuant to this Section 2.10 with respect to any
series of Notes, such Notes shall have endorsed thereon, in
<PAGE> 39
31
addition to the Trustee's Certificate of Authentication, an alternate Trustee's
Certificate of Authentication in the following form:
(ALTERNATE FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION)
This is one of the Notes of the series designated herein referred to in the
within-mentioned Indenture.
THE FIRST NATIONAL
BANK OF MARYLAND,
as Trustee
By
Authenticating Agent
By
Authorized Signature
SECTION 2.11.(a) If the Company shall establish pursuant to Section 2.01 that
the Notes of a particular series are to be issued as a Depository Note, then the
Company shall execute and the Trustee shall, in accordance with Sections 2.02
and 2.03 and the Company Order delivered to the Trustee thereunder, authenticate
and deliver, a Depository Note which (i) shall represent, and shall be
denominated in an amount equal to the aggregate principal amount of, all of the
Outstanding Notes of such series, (ii) shall be registered in the name of the
Depository or its nominee, (iii) shall be delivered by the Trustee to the
Depository or pursuant to the Depository's instruction and (iv) shall bear a
legend substantially to the following effect: 'Except as otherwise provided in
Section 2.11 of the Indenture, this Note may be transferred, in whole but not in
part, only to another nominee of the Depository or to a successor Depository or
to a nominee of such successor Depository.'
(b) Notwithstanding any other provision of this Section 2.11 or of Section
2.05, the Depository Note of a series may be transferred, in whole but not in
part and in the manner provided in Section 2.05, only to another nominee of the
Depository for such series, or to a successor Depository for such series
selected or approved by the Company or to a nominee of such successor
Depository.
<PAGE> 40
32
(c) If at any time the Depository for a series of Notes notifies the Company
that it is unwilling or unable to continue as Depository for such series or if
at any time the Depository for such series shall no longer be registered or in
good standing as a clearing agency registered under the Securities Exchange Act
of 1934, as amended, or other applicable statute or regulation and a successor
Depository for such series is not appointed by the Company within 90 days after
the Company receives such notice or becomes aware of such condition, as the case
may be, this Section 2.11 shall no longer be applicable to the Notes of such
series and the Company will execute, and the Trustee will authenticate and
deliver, Notes of such series in definitive registered form without coupons, in
authorized denominations, and in an aggregate principal amount equal to the
principal amount of the Depository Note of such series then Outstanding in
exchange for such Depository Note. In addition, the Company may at any time
determine that the Notes of any series shall no longer be represented by a
Depository Note and that the provisions of this Section 2.11 shall no longer
apply to the Notes of such series. In such event the Company will execute and
the Trustee, upon receipt of an Officers' Certificate evidencing such
determination by the Company, will authenticate and deliver Notes of such series
in definitive registered form without coupons, in authorized denominations, and
in an aggregate principal amount equal to the principal amount of the Depository
Note of such series in exchange for such Depository Note. Upon the exchange of
the Depository Note for such Notes in definitive registered form without
coupons, in authorized denominations, the Depository Note shall be cancelled by
the Trustee. Such Notes in definitive registered form issued in exchange for the
Depository Note pursuant to this Section 2.11(c) shall be registered in such
names and in such authorized denominations as the Depository, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee.
ARTICLE III
COVENANTS
SECTION 3.01. The Company will duly and punctually pay the principal of (and
premium, if any) and interest on the Notes in accordance with the terms of the
Notes and this Indenture.
<PAGE> 41
33
SECTION 3.02. The Company will maintain an office or agency at each place at
which the principal of (and premium, if any) or interest on any of the Notes is
payable, where Notes may be presented or surrendered for payment, where Notes
may be surrendered for registration of transfer or exchange and where notices
and demands to or upon the Company in respect of the Notes and this Indenture
may be served. The Company will give prompt written notice to the Trustee of the
location, and of any change in the location, of each such office or agency. If
at any time the Company shall fail to maintain any such office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the principal corporate
trust office of the Trustee, and the Company hereby appoints the Trustee its
agent to receive all such presentations, surrenders, notices and demands.
SECTION 3.03. If the Company shall at any time act as its own Paying Agent, it
will, on or before each due date of the principal of (and premium, if any) or
interest on, any of the Notes, segregate and hold in trust for the benefit of
the Persons entitled thereto a sum sufficient to pay the principal (and premium,
if any) or interest so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided and will promptly notify the
Trustee of its action or failure so to act.
If the Company shall have one or more Paying Agents, it will, on or before
each due date of the principal of (and premium, if any) or interest on, any of
the Notes, deposit with a Paying Agent a sum sufficient to pay the principal
(and premium, if any) or interest so becoming due, such sum to be held in trust
for the benefit of the Persons entitled to such principal, premium or interest,
and (unless such Paying Agent is the Trustee) the Company will promptly notify
the Trustee of its action or failure so to act.
The Company will cause each Paying Agent other than the Trustee to execute and
deliver to the Trustee an instrument in which such Paying Agent shall agree with
the Trustee, subject to the provisions of this Section 3.03, that such Paying
Agent will:
(1) hold all sums held by it for the payment of principal of (and premium,
if any) or interest on Notes in trust for the benefit of the Persons entitled
thereto until such sums shall be paid to such Persons or otherwise disposed of
as herein provided;
<PAGE> 42
34
(2) give the Trustee notice of any default by the Company (or any other
obligor upon the Notes) in the making of any such payment of principal (and
premium, if any) or interest; and
(3) at any time during the continuance of any such default, upon the written
request of the Trustee, forthwith pay to the Trustee all sums so held in trust
by such Paying Agent.
The Company may at any time, for the purpose of obtaining the satisfaction and
discharge of this Indenture or for any other purpose, pay, or by Company Order
direct any Paying Agent to pay, to the Trustee all sums held in trust by the
Company or such Paying Agent, such sums to be held by the Trustee upon the same
trusts as those upon which such sums were held by the Company or such Paying
Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying
Agent shall be released from all further liability with respect to such money.
Any money deposited with the Trustee or any Paying Agent, or then held by the
Company, in trust for the payment of the principal of (and premium, if any) or
interest on any Note and remaining unclaimed for three years after such
principal (and premium, if any) or interest has become due and payable shall be
paid to the Company on Company Request, or (if then held by the Company) shall
be discharged from such trust; and the Holder of such Note shall thereafter, as
an unsecured creditor, look only to the Company for payment thereof, and all
liability of the Trustee or such Paying Agent with respect to such trust money,
and all liability of the Company as trustee thereof, shall thereupon cease;
provided, however, that the Trustee or such Paying Agent, before being required
to make any such repayment, may at the expense of the Company cause to be
published once, in an Authorized Newspaper in New York City, notice that such
money remains unclaimed and that, after a date specified therein, which shall
not be less than 30 days from the date of such publication, any unclaimed
balance of such money then remaining will be repaid to the Company.
SECTION 3.04. The Company will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, (1) all taxes, assessments
and governmental charges levied or imposed upon it or upon its income, profits
or property, and (2) all lawful claims for labor, materials and supplies which,
if unpaid, might by law become a lien upon its property; provided, however, that
the Company shall not be
<PAGE> 43
35
required to pay or discharge or cause to be paid or discharged any such tax,
assessment, charge or claim whose amount, applicability or validity is being
contested in good faith by appropriate proceedings.
SECTION 3.05. The Company will deliver to the Trustee, within 120 days after
the end of each fiscal year, a written statement (which need not comply with
Section 1.02) signed by the Chairman of the Board, President or a Vice President
and by the Treasurer, an Assistant Treasurer, the Controller or an Assistant
Controller, or the Secretary or an Assistant Secretary of the Company, stating,
as to each signer thereof, whether or not to the best of his knowledge, the
Company is in default in the performance of any of its obligations under this
Indenture, and, if there is a default in the fulfillment of any such obligation,
specifying each such default known to him and the nature and status thereof.
SECTION 3.06. Subject to Article X, the Company will do or cause to be done
all things necessary to preserve and keep in full force and effect its corporate
existence, rights (charter and statutory) and franchises; provided, however,
that the Company shall not be required to preserve or cause to be preserved any
right or franchise if the Company shall determine that the preservation thereof
is no longer desirable in the conduct of the business of the Company and that
the loss thereof is not disadvantageous in any material respect to the Holders.
SECTION 3.07. The Company shall file with the Trustee within 15 days after it
files them with the SEC copies of the annual reports and of the information,
documents, and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and regulations prescribe) which the Company is required
to file with the SEC pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934. The Company also shall comply with the other provisions of TIA
sec.314(a).
SECTION 3.08. (a) The Company will not issue, assume or guarantee any
indebtedness for borrowed money (referred to in this Section as 'indebtedness,'
which term shall not include any guarantee or other recourse obligation in
connection with the sale or discount by the Company of finance or accounts
receivables, trade acceptances or other paper arising in the ordinary course of
its business) secured by a mortgage, security interest, pledge or lien (referred
to in this Section as 'mortgage' or 'mortgages') of or upon any property of the
Company whether such property is owned at the date of this Indenture or
<PAGE> 44
36
thereafter acquired, without making effective provision whereby the Notes
(together with, if the Company shall so determine, any other indebtedness
issued, assumed or guaranteed by the Company and then existing or thereafter
created) shall be secured by such mortgage equally and ratably with (or, at the
option of the Company, prior to) such indebtedness, so long as such indebtedness
shall be so secured; provided that the foregoing shall not apply to any of the
following:
(1) mortgages of or upon any property acquired, constructed or improved
by, or of or upon any shares of capital stock or indebtedness acquired by,
the Company after the date of this Indenture (A) to secure the payment of
all or any part of the purchase price of such property, shares of capital
stock or indebtedness upon the acquisition thereof by the Company, or (B)
to secure any indebtedness issued, assumed or guaranteed by the Company
prior to, at the time of, or within 360 days after (i) in the case of
property, the later of the acquisition, completion of construction
(including any improvements on existing property) or commencement of
commercial operation of such property or (ii) in the case of shares of
capital stock or indebtedness, the acquisition of such shares of capital
stock or indebtedness, which indebtedness is issued, assumed or guaranteed
for the purpose of financing or refinancing all or any part of the purchase
price of such property, shares of capital stock or indebtedness and, in the
case of property, the cost of construction thereof or improvements thereon,
provided that in the case of any such acquisition, construction or
improvement of property, the mortgage shall not apply to any property,
shares of capital stock or indebtedness theretofore owned by the Company
other than, in the case of any such construction or improvement, any
theretofore unimproved or substantially unimproved real property on which
the property so constructed or the improvement is located;
(2) mortgages of or upon any property, shares of capital stock or
indebtedness, which mortgages exist at the time of acquisition of such
property, shares or indebtedness by the Company;
(3) mortgages of or upon any property of a corporation, which mortgages
exist at the time such corporation is merged with or into or consolidated
with the Company or which mortgages exist at the time of a sale or transfer
of the properties of a corporation as an entirety or substantially as an
entirety to the Company;
<PAGE> 45
37
(4) mortgages to secure indebtedness of the Company to any Subsidiary;
(5) mortgages in favor of the United States of America or any State
thereof, or any department, agency or instrumentality or political
subdivision of the United States of America or any State thereof, or in
favor of any other country or political subdivision, to secure partial,
progress, advance or other payments pursuant to any contract or statute or
to secure any indebtedness incurred or guaranteed for the purpose of
financing or refinancing all or any part of the purchase price of the
property, shares of capital stock or indebtedness subject to such
mortgages, or the cost of constructing or improving the property subject to
such mortgages (including, without limitation, mortgages incurred in
connection with pollution control, industrial revenue or similar
financings);
(6) mortgages on properties financed through tax-exempt municipal
obligations; provided that such mortgages are limited to the property so
financed;
(7) mortgages existing on the date of execution of this Indenture; and
(8) any extension, renewal, refunding or replacement (or successive
extensions, renewals or replacements) in whole or in part of any mortgage
existing at the date of this Indenture or any mortgage referred to in the
foregoing Clauses (1) through (7), inclusive, provided, however, that the
principal amount of indebtedness secured thereby shall not exceed the
principal amount of indebtedness so secured at the time of such extension,
renewal, refunding or replacement, and that such extension, renewal,
refunding or replacement shall be limited to all or a part of the property
(plus improvements and construction on such property), shares of capital
stock or indebtedness which was subject to the mortgage so extended,
renewed, refunded or replaced.
(b) Notwithstanding the provisions of subsection (a) of this Section, the
Company may, without equally and ratably securing the Notes, issue, assume or
guarantee indebtedness secured by a mortgage not excepted by Clauses (1) through
(8) of such subsection (a), if the aggregate amount of such indebtedness,
together with all other indebtedness of, or indebtedness guaranteed by, the
Company existing at such time and secured by mortgages not so excepted, does not
at the time
<PAGE> 46
38
exceed 10% of the Company's Consolidated Net Worth. 'Consolidated Net Worth'
shall be the difference between the Company's consolidated assets and
consolidated liabilities as shown on the Company's most recent audited
consolidated financial statements prepared in accordance with generally accepted
accounting principles.
(c) An arrangement with any Person providing for the leasing by the Company of
any property, which property has been or is to be sold or transferred by the
Company to such Person with the intention that such property be leased back to
the Company, shall not be deemed to create any indebtedness secured by a
mortgage if the obligations in respect of such lease would not be included as
liabilities on a consolidated balance sheet of the Company.
The Company may fail or omit in any particular instance to comply with the
covenant set forth in this Section 3.08 if the Company shall have obtained and
filed with the Trustee prior to the time for such compliance the consent in
writing of the Holders of at least a majority in aggregate principal amount of
all of the Notes at the time Outstanding either waiving such compliance in such
instance or generally waiving compliance with such covenant, but no such waiver
shall extend to or affect any obligation not expressly waived or impair any
right consequent thereon.
ARTICLE IV
REPAYMENT AT OPTION OF HOLDERS
SECTION 4.01. If the Board Resolution or supplemental indenture, as the case
may be, with respect to the Notes of any particular series so provides, such
Notes shall be subject to repayment at the option of the Holder prior to their
Stated Maturity, on such terms as set forth in the Board Resolution or
supplemental indenture pertaining to such Notes, upon the receipt by the Company
of the form entitled 'Option to Elect Repayment' as specified in Section 4.02 or
such optional notification procedure as may be specified in such Notes.
SECTION 4.02. To be repaid at the option of the Holder, unless additional or
substitute procedures are set forth in the Notes, Notes must be received, with
the form entitled 'Option to Elect Repayment' on the reverse of the Notes duly
completed, by the Trustee at its designated office (or at such other place of
which the Company shall from time to
<PAGE> 47
39
time notify the Holders of the Notes) within the periods specified by the terms
of the Notes. Effective exercise of the repayment option by the Holder shall be
irrevocable. Upon such completion and receipt of the applicable form, Notes for
which the option has been exercised become due and payable on the repayment date
at the repayment price plus accrued interest (if any), except that interest, the
Stated Maturity of which is on or prior to such repayment date, shall be payable
to the Holders of such Notes of record on the relevant Record Dates according to
their terms and the provisions of Section 2.07. From and after such repayment
date (unless the Company shall default in the payment of the repayment price)
such Notes shall cease to bear interest.
ARTICLE V
REDEMPTION OF NOTES; SINKING FUNDS
SECTION 5.01. Notes of any series which are redeemable before their Stated
Maturity at the option of the Company or otherwise shall be redeemable in
accordance with their terms and in accordance with the following provisions of
this Article V.
SECTION 5.02. The election of the Company to redeem Notes of any series shall
be evidenced by a Board Resolution or, if an officer of the Company has been
duly authorized with respect to the redemption of Notes, a certificate from such
officer to the Trustee authorizing such actions as are necessary or appropriate
to effect the redemption and a Board Resolution evidencing such officer's
authority. In case of any redemption at the option of the Company of less than
all of the Notes of any series the Company shall, at least 45 days prior to the
Redemption Date fixed by the Company (unless a shorter notice shall be
satisfactory to the Trustee), notify the Trustee by Company Order of such
Redemption Date and of the principal amount of Notes to be redeemed.
SECTION 5.03. If less than all the Notes of any series are to be redeemed, and
unless otherwise provided with respect to the Notes of any particular series,
the particular Notes to be redeemed shall be selected by the Trustee from the
Outstanding Notes of such series not previously called for redemption, by lot or
by such other method as the Trustee shall deem fair and appropriate and which
may provide for the selection for redemption of portions of the principal of
Notes, provided, however, that except with respect to Notes being redeemed
pursuant to the operation of a sinking fund, no such partial redemption shall
reduce
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40
the portion of the principal amount of a Note of such series not redeemed to
less than the minimum denomination for a Note of that series. The portions of
the principal of Notes so selected for partial redemption shall be equal to the
smallest authorized denomination of the Notes of such series or an integral
multiple thereof.
The Trustee shall promptly notify the Company in writing of the Notes selected
for redemption and, in the case of any Note selected for partial redemption, the
principal amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise requires, all
provisions relating to the redemption of Notes shall relate, in the case of any
Note redeemed or to be redeemed only in part, to the portion of the principal of
such Note which has been or is to be redeemed.
SECTION 5.04. Notice of redemption shall be given not less than 30 nor more
than 60 days prior to the Redemption Date, to each Holder of Notes to be
redeemed, at his address appearing in the Note Register.
All notices of redemption shall state:
(1) the series designation of the Notes to be redeemed,
(2) the Redemption Date,
(3) the Redemption Price,
(4) if less than all Outstanding Notes of such series are to be redeemed,
the identification (and, in the case of partial redemption, the respective
principal amounts) of the Notes of such Holder to be redeemed,
(5) that on the Redemption Date the Redemption Price will become due and
payable upon each such Note, and that, if applicable, interest thereon shall
cease to accrue from and after said date,
(6) the place where such Notes are to be surrendered for payment of the
Redemption Price, which shall be the office or agency of the Company at any
place at which the principal of such Notes is payable, and
(7) if Notes are to be redeemed pursuant to any sinking or purchase fund
established for any series of Notes, that the redemption is being made for the
purposes of such sinking or purchase fund.
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41
Notice of redemption of Notes to be redeemed at the option of the Company
shall be given by the Company or, at the Company's request, by the Trustee in
the name and at the expense of the Company.
SECTION 5.05. On or prior to any Redemption Date, the Company shall deposit
with the Trustee or with a Paying Agent (or, if the Company is acting as its own
Paying Agent, segregate and hold in trust as provided in Section 3.03) an amount
of money sufficient to pay the Redemption Price plus accrued interest of all the
Notes which are to be redeemed on that date.
SECTION 5.06. Notice of redemption having been given as aforesaid, the Notes
so to be redeemed shall, on the Redemption Date, become due and payable at the
Redemption Price therein specified and from and after such date (unless the
Company shall default in the payment of the Redemption Price) such Notes shall
cease to bear interest. Upon surrender of such Notes for redemption in
accordance with such notice, such Notes shall be paid by the Company at the
Redemption Price. Interest, the Stated Maturity of which is on or prior to the
Redemption Date, shall be payable to the Holders of such Notes of record on the
relevant Record Dates according to their terms and the provisions of Section
2.07.
If any Note called for redemption shall not be so paid upon surrender thereof
for redemption, the principal (and premium, if any) shall, until paid, bear
interest from the Redemption Date at the rate borne by the Note.
SECTION 5.07. Any Note which is to be redeemed only in part shall be
surrendered to the Trustee or Paying Agent (with, if the Company or the Trustee
so requires, due endorsement by, or a written instrument of transfer in form
satisfactory to the Company and the Trustee duly executed by, the Holder thereof
or his attorney duly authorized in writing) and the Company shall execute and
the Trustee shall authenticate and deliver to such Holder, without service
charge, a new Note or Notes of the same series, of any authorized denominations
as requested by such Holder in aggregate principal amount equal to and in
exchange for the unredeemed portion of the principal of the Note so surrendered.
SECTION 5.08. The provisions of this Article V shall be applicable to any
sinking fund for the retirement of Notes of any series except as otherwise
specified as contemplated in such Notes.
<PAGE> 50
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The minimum amount of any sinking fund payment provided for by the terms of
Notes of any series is herein referred to as a 'mandatory sinking fund payment',
and any payment in excess of such minimum amount provided for by the terms of
Notes of any series is herein referred to as an 'optional sinking fund payment'.
If provided for by the terms of Notes of any series, the cash amount of any
sinking fund payment may be subject to reduction as provided in Section 5.09.
Each sinking fund payment shall be applied to the redemption of Notes of any
series as provided for by the terms of Notes of such series.
SECTION 5.09. The Company (1) may deliver to the Trustee for cancellation
Outstanding Notes of a series (other than any previously called for redemption)
and (2) may apply as a credit Notes of a series containing identical terms and
provisions which have been redeemed either at the election of the Company
pursuant to the terms of such Notes or through the application of permitted
optional sinking fund payments pursuant to the terms of such Notes, in each case
in satisfaction of all or any part of any mandatory sinking fund payment with
respect to the Notes of such series required to be made pursuant to the terms of
such Notes as provided for by the terms of such Notes; provided that such Notes
shall not have been previously so credited. Such Notes shall be received and
credited for such purpose by the Trustee at the Redemption Price specified in
such Notes for redemption through operation of the mandatory sinking fund and
the amount of such mandatory sinking fund payment shall be reduced accordingly.
SECTION 5.10. Not less than 45 days prior to each sinking fund payment date
for Notes of any series, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing mandatory sinking fund
payment and optional sinking fund payment, if any, for that series of Notes
pursuant to the terms thereof, the portion thereof, if any, which is to be
satisfied by payment of cash and the portion thereof, if any, which is to be
satisfied by delivering and crediting Notes of that series pursuant to Section
5.09 and will also deliver with the said Officers' Certificate to the Trustee
any Notes to be so delivered if not theretofore delivered. Not less than 30 days
before each such sinking fund payment date the Company shall cause to be
selected the Notes to be redeemed upon such sinking fund payment in the manner
specified in Section 5.03 and shall cause notice of the redemption thereof to be
given in the name of and at the expense of the Company in the manner provided in
Section 5.04. The Company shall
<PAGE> 51
43
deposit the amount of cash, if any, required for such sinking fund payment with
the Trustee in the manner provided in Section 5.05. Such notice having been duly
given, the redemption of such Notes shall be made upon the terms and in the
manner stated in Sections 5.06 and 5.07.
ARTICLE VI
SATISFACTION AND DISCHARGE
SECTION 6.01. This Indenture shall cease to be of further effect (except as to
any surviving rights of registration of transfer or exchange of Notes if herein
or in any supplemental indenture expressly provided for), and the Trustee, on
demand of and at the expense of the Company, shall execute proper instruments
acknowledging satisfaction and discharge of this Indenture, when
(1) either
(A) all Notes theretofore authenticated and delivered (other than (i)
Notes which have been destroyed, lost or stolen and which have been
replaced or paid as provided in Section 2.06, and (ii) Notes for whose
payment money has theretofore been deposited in trust or segregated and
held in trust by the Company and thereafter repaid to the Company or
discharged from such trust, as provided in Section 3.03) have been
delivered to the Trustee for cancellation; or
(B) all such Notes not theretofore delivered to the Trustee for
cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within one
year, or
(iii) are to be called for redemption within one year under
arrangements satisfactory to the Trustee for the giving of notice of
redemption by the Trustee in the name, and at the expense, of the
Company,
and the Company, in the case of (B) (i), (ii) or (iii) above, has
deposited or caused to be deposited with the Trustee as trust funds in
trust for the purpose an amount sufficient to pay and discharge the entire
indebtedness on such Notes not theretofore
<PAGE> 52
44
delivered to the Trustee for cancellation, for principal (and premium, if
any) and interest to the date of such deposit (in the case of Notes which
have become due and payable), or to their Stated Maturity or Redemption
Date, as the case may be;
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture
have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Section 8.07, the obligations of
the Trustee to any authenticating agent under Section 2.10 and, if money shall
have been deposited with the Trustee pursuant to subclause (B) of clause (i) of
this Section, the obligations of the Trustee under Section 6.02 and the last
paragraph of Section 3.03 shall survive.
SECTION 6.02. Subject to the provisions of the last paragraph of Section 3.03,
all money deposited with the Trustee pursuant to Section 6.01 shall be held in
trust and applied by it, in accordance with the provisions of the Notes and this
Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest for whose payment such money has been deposited with the
Trustee; but such money need not be segregated from other funds except to the
extent required by law.
SECTION 6.03. Unless this Section 6.03 shall be deemed inapplicable to a
series of Notes pursuant to the Board Resolution or supplemental indenture
creating such series, the Company shall be deemed to have paid and discharged
the entire indebtedness on all the Outstanding Notes of any such series and the
Trustee, at the demand of and at the expense of the Company, shall execute
proper instruments acknowledging satisfaction and discharge of such
indebtedness, when
(1) either
(A) with respect to all Outstanding Notes of such series,
<PAGE> 53
45
(i) the Company has deposited or caused to be deposited with the
Trustee as trust funds in trust for the purpose of discharging such
indebtedness an amount sufficient to pay and discharge the entire
indebtedness on all Outstanding Notes of such series for principal (and
premium, if any) and interest to the Stated Maturity or any Redemption
Date as contemplated by the penultimate paragraph of this Section 6.03,
as the case may be; or
(ii) the Company has deposited or caused to be deposited with the
Trustee as obligations in trust for the purpose of discharging such
indebtedness such amount of direct obligations of, or obligations the
principal of and interest on which are fully guaranteed by, the United
States of America and which are not callable at the option of the issuer
thereof as will, together with the income to accrue thereon without
consideration of any reinvestment thereof, be sufficient to pay and
discharge the entire indebtedness on all Outstanding Notes of such
series for principal (and premium, if any) and interest to the Stated
Maturity or any Redemption Date as contemplated by the penultimate
paragraph of this Section 6.03, as the case may be; or
(B) the Company has properly fulfilled such other means of satisfaction
and discharge as is specified in the Board Resolution or supplemental
indenture applicable to the Notes of such series; and
(2) the Company has paid or caused to be paid all other sums payable with
respect to the Outstanding Notes of such series; and
(3) the Company has delivered to the Trustee a certificate of a firm of
independent public accountants certifying as to the sufficiency of the
amounts deposited pursuant to subsections (A)(i) or (ii) of this Section
for payment of the principal (and premium, if any) and interest on the
dates such payments are due, an Officers' Certificate and an Opinion of
Counsel, each such Certificate and Opinion stating that all conditions
precedent herein provided for relating to the satisfaction and discharge of
the entire indebtedness on all Outstanding Notes of any such series have
been complied with.
<PAGE> 54
46
Any deposits with the Trustee referred to in Section 6.03(1)(A) above shall be
irrevocable and shall be made under the terms of an escrow trust agreement in
form and substance satisfactory to the Trustee. If any Outstanding Notes of such
series are to be redeemed prior to their Stated Maturity, whether pursuant to
any optional redemption provisions or in accordance with any mandatory sinking
fund requirement, the Company shall make such arrangements as are satisfactory
to the Trustee for the giving of notice of redemption by the Trustee in the
name, and at the expense, of the Company.
Upon the satisfaction of the conditions set forth in this Section 6.03 with
respect to all the Outstanding Notes of any series, the terms and conditions of
such series, including the terms and conditions with respect thereto set forth
in this Indenture, shall no longer be binding upon, or applicable to, the
Company, other than the provisions of Sections 2.06, 2.07 and 3.02 and other
than the right of Holders of Notes of such series to receive, from the trust
fund described in this Section, payment of the principal of and the interest on
such Notes when such payments are due and other than the rights, powers, duties
and immunities of the Trustee hereunder (including the obligations of the
Company to the Trustee under Section 8.07).
ARTICLE VII
REMEDIES
SECTION 7.01. 'Event of Default ', wherever used herein with respect to Notes
of any series, means any one of the following events (whatever the reason for
such Event of Default and whether it shall be voluntary or involuntary or be
effected by operation of law pursuant to any judgment, decree or order of any
court or any order, rule or regulation of any administrative or governmental
body):
(1) default in the payment of any instalment of interest upon any Note of
that series when such instalment of interest shall become due and payable,
and continuance of such default for a period of 30 days; or
(2) default in the payment of the principal of (or premium, if any, on)
any Note of that series at its Maturity; or
(3) default in the deposit under Section 5.10 of any instalment of any
sinking fund or similar payment with respect to Notes of that
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47
series when and as payable by the terms of the Board Resolution or
supplemental indenture establishing such series, and continuance of such
default for a period of 30 days; or
(4) default in the performance, or breach, of any covenant or warranty of
the Company in this Indenture (other than a covenant or warranty a default
in whose performance or whose breach is elsewhere in this Section 7.01
specifically dealt with or which has expressly been included in the
Indenture solely for the benefit of Notes of a series other than that
series), and continuance of such default or breach for the period of time
and after the notice specified below;
(5) the entry of a decree or order by a court having jurisdiction in the
premises adjudging the Company a bankrupt or insolvent, or approving as
properly filed a petition seeking reorganization, arrangement, adjustment
or composition of or in respect of the Company under the Federal Bankruptcy
Code or any other applicable Federal or State law, or appointing a
receiver, liquidator, assignee, trustee, sequestrator (or other similar
official) of the Company or of any substantial part of its property, or
ordering the winding up or liquidation of its affairs, and the continuance
of any such decree or order unstayed and in effect for a period of 60
consecutive days; or
(6) the institution by the Company of proceedings to be adjudicated a
bankrupt or insolvent, or the consent by it to the institution of
bankruptcy or insolvency proceedings against it, or the filing by it of a
petition or answer or consent seeking reorganization or relief under the
Federal Bankruptcy Code or any other applicable Federal or State law, or
the consent by it to the filing of any such petition or to the appointment
of a receiver, liquidator, assignee, trustee, sequestrator (or other
similar official) of the Company or of any substantial part of its
property, or the making by it of an assignment for the benefit of
creditors, or the admission by it in writing of its inability to pay its
debts generally as they become due, or the taking of corporate action by
the Company in furtherance of any such action; or
(7) default by the Company beyond any period of grace provided for with
respect thereto in any payment of principal or interest on any obligation
for borrowed money, other than any of the Notes, under an indenture in
which the Trustee is acting as the trustee for
<PAGE> 56
48
security holders, or in the performance of any other term, condition or
covenant contained in any such indenture, which results in the principal
amount of such indebtedness becoming or being declared due and payable
prior to the date on which it would otherwise be due and payable, without
such acceleration being rescinded or annulled within the period and after
the notice specified below, and such principal amount exceeds $150,000,000.
A default with respect to any series of Notes under clause (4) or clause (7)
is not an Event of Default until the Trustee notifies the Company, or the
Holders of at least 25% in principal amount of the outstanding Notes of that
series notify the Company and the Trustee, of the default and the Company does
not cure the default within 60 days in the case of clause (4) and 30 days in the
case of clause (7) after receipt of the notice. The notice must specify the
default, demand that it be remedied and state that the notice is a 'Notice of
Default.'
SECTION 7.02. If an Event of Default occurs with respect to Notes of any
series at the time Outstanding and is continuing, then and in every such case
the Trustee or the Holders of not less than 25% in principal amount of the
Outstanding Notes of that series may declare the principal of all the Notes of
that series (or, if the Notes of that series are Original Issue Discount Notes,
such portion of the principal amount thereof as may be specified in the terms of
such Notes) and all accrued but unpaid interest to be due and payable
immediately, by a notice in writing to the Company (and to the Trustee if given
by Holders), and upon any such declaration such principal and all accrued but
unpaid interest shall become immediately due and payable.
At any time after such a declaration of acceleration has been made and before
a judgment or decree for payment of the money due has been obtained by the
Trustee as hereinafter in this Article VII provided, the Holders of a majority
in principal amount of the Notes then Outstanding of that series, by written
notice to the Company and the Trustee, may rescind and annul such declaration
and its consequences if
(1) the Company has paid or deposited with the Trustee a sum sufficient
to pay
(A) all overdue instalments of interest, if any, on all Notes of that
series,
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(B) the principal of (and premium, if any, on) any Notes of that series
which have become due otherwise than by such declaration of acceleration
and interest thereon at the rate or the respective rates borne by the
Notes of that series,
(C) to the extent that payment of such interest is lawful, interest upon
overdue instalments of interest, if any, at the rate or the respective
rates borne by the Notes of that series or at a rate otherwise specified
therein, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel;
and
(2) all Events of Default, other than the non-payment of the principal of
Notes of that series which have become due solely by such acceleration,
have been cured or waived as provided in Section 7.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 7.03. The Company covenants that if
(1) default is made in the payment of any installment of interest on any
Notes when such interest becomes due and payable and such default continues
for a period of 30 days, or
(2) default is made in the payment of (i) the principal of (or premium, if
any) or, (ii) any sinking fund instalment when due and payable on any Notes at
the Maturity thereof,
the Company will, upon demand of the Trustee or the Holders of not less than 25%
in principal amount of such Outstanding Notes, pay to the Trustee, for the
benefit of the Holders of such Notes, the whole amount then due and payable on
such Notes for principal (and premium, if any) and interest, with interest upon
the overdue principal (and premium, if any) and, to the extent that payment of
such interest shall be legally enforceable, upon overdue instalments of
interest, at the rate or respective rates borne by such Notes or at the rate or
respective rates specified therein; and, in addition thereto, such further
amount as shall be sufficient to cover the costs and expenses of collection,
including the
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reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel.
If the Company fails to pay such amount forthwith upon such demand, the
Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon the Notes and collect the moneys
adjudged or decreed to be payable in the manner provided by law out of the
property of the Company or any other obligor upon the Notes, wherever situated.
If an Event of Default occurs and is continuing, the Trustee may in its
discretion proceed to protect and enforce its rights and the rights of the
Holders by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific
enforcement of any covenant or agreement in this Indenture or in aid of the
exercise of any power granted herein, or to enforce any other proper remedy.
SECTION 7.04. In case of the pendency of any receivership, insolvency,
liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or
other judicial proceeding relative to the Company or any other obligor upon the
Notes or the property of the Company or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Notes shall
then be due and payable as therein expressed or by declaration or otherwise and
irrespective of whether the Trustee shall have made any demand on the Company
for the payment of overdue principal or interest) shall be entitled and
empowered, by intervention in such proceeding or otherwise,
(i) to file and prove a claim for the whole amount of principal (and
premium, if any) and interest owing and unpaid in respect of the Notes and to
file such other papers or documents as may be necessary or advisable in order
to have the claims of the Trustee (including any claim for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel) and of the Holders allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same; and any receiver,
assignee, trustee, liquidator, sequestrator (or other similar official) in any
such judicial proceeding is hereby authorized by each
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Holder to make such payments to the Trustee, and in the event that the Trustee
shall consent to the making of such payments directly to the Holders, to pay
to the Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any
other amounts due the Trustee under Section 8.07.
Nothing herein contained shall be deemed to authorize the Trustee to authorize
or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder, or to authorize the Trustee to vote in respect of the
claim of any Holder in any such proceeding.
SECTION 7.05. All rights of action and claims under this Indenture or the
Notes may be prosecuted and enforced by the Trustee without the possession of
any of the Notes or the production thereof in any proceeding relating thereto,
and any such proceeding instituted by the Trustee shall be brought in its own
name as trustee of an express trust, and any recovery of judgment shall, after
provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Holders of the Notes in respect of which such judgment
has been recovered.
SECTION 7.06. Any money collected by the Trustee pursuant to this Article VII
shall be applied in the following order, at the date or dates fixed by the
Trustee and, in case of the distribution of such money on account of principal
(or premium, if any) or interest, upon presentation of the Notes, and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section 8.07;
SECOND: To the payment of the amounts then due and unpaid upon the Notes for
principal (and premium, if any) and interest, in respect of which or for the
benefit of which such money has been collected, ratably, without preference or
priority of any kind, according to the amounts due and payable on such Notes
for principal (and premium, if any) and interest, respectively; and
THIRD: To the payment of the remainder, if any, to the Company or any other
Person lawfully entitled thereto.
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For all purposes of this Section 7.06, the Holders of any Notes denominated in
ECU, or any other composite currency or a Foreign Currency shall be entitled to
receive a ratable portion of the payment determined pursuant to Section 1.04(f)
hereof.
SECTION 7.07. No Holder of any Note of any series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless
(1) such Holder has previously given written notice to the Trustee of a
continuing Event of Default with respect to the Notes of that series;
(2) the Holders of not less than 25% in principal amount of the Outstanding
Notes of that series shall have made written request to the Trustee to
institute proceedings in respect of such Event of Default in its own name as
Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable indemnity
against the costs, expenses and liabilities to be incurred in compliance with
such request;
(4) the Trustee for 60 days after its receipt of such notice, request and
offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given to
the Trustee during such 60 day period by the Holders of a majority in
principal amount of the Outstanding Notes of such series;
it being understood and intended that no one or more Holders shall have any
right in any manner whatever by virtue of, or by availing of, any provision of
this Indenture to affect, disturb or prejudice the rights of any other Holders,
or to obtain or to seek to obtain priority or preference over any other Holders
or to enforce any right under this Indenture, except in the manner herein
provided and for the equal and ratable benefit of all the Holders.
SECTION 7.08. Notwithstanding any other provision in this Indenture, the
Holder of any Note shall have the right which is absolute and unconditional to
receive payment of the principal of (and premium, if any) and (subject to
Section 2.07) interest on such Note on the respective Stated Maturities
expressed in such Note (or, in the case of redemption, on the Redemption Date)
and to institute suit for the
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53
enforcement of any such payment, and such right shall not be impaired without
the consent of such Holder.
SECTION 7.09. If the Trustee or any Holder has instituted any proceeding to
enforce any right or remedy under this Indenture and such proceeding has been
discontinued or abandoned for any reason, or has been determined adversely to
the Trustee or to such Holder, then and in every such case the Company, the
Trustee and the Holders shall, subject to any determination in such proceeding,
be restored severally and respectively to their former positions hereunder, and
thereafter all rights and remedies of the Trustee and the Holders shall continue
as though no such proceeding had been instituted.
SECTION 7.10. No right or remedy herein conferred upon or reserved to the
Trustee or to the Holders is intended to be exclusive of any other right or
remedy, and every right and remedy shall, to the extent permitted by law, be
cumulative and in addition to every other right and remedy given hereunder or
now or hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
SECTION 7.11. No delay or omission of the Trustee or of any Holder to exercise
any right or remedy accruing upon any Event of Default shall impair any such
right or remedy or constitute a waiver of any such Event of Default or an
acquiescence therein. Every right and remedy given by this Article VII or by law
to the Trustee or to the Holders may be exercised from time to time, and as
often as may be deemed expedient, by the Trustee or by the Holders, as the case
may be.
SECTION 7.12. The Holders of a majority in principal amount of the Outstanding
Notes shall have the right to direct the time, method and place of conducting
any proceeding for any remedy available to the Trustee or exercising any trust
or power conferred on the Trustee, provided that
(1) such direction shall not be in conflict with any rule of law or with
this Indenture, and
(2) the Trustee may take any other action deemed proper by the Trustee which
is not inconsistent with such direction.
SECTION 7.13. The Holders of a majority in principal amount of the Outstanding
Notes of any series affected by an Event of Default may on
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54
behalf of the Holders of such series of Notes waive any past default hereunder
and its consequences, except a default
(1) in the payment of the principal of (or premium, if any) or interest on
any Note of such series, or
(2) in respect of a covenant or provision hereof which under Section 11.02
cannot be modified or amended without the consent of the Holder of each
Outstanding Note affected.
Upon any such waiver, such default shall cease to exist, and any Event of
Default arising therefrom shall be deemed to have been cured, for every purpose
of this Indenture; but no such waiver shall extend to any subsequent or other
default or impair any right consequent thereon.
SECTION 7.14. All parties to this Indenture agree, and each Holder of any Note
by his acceptance thereof shall be deemed to have agreed, that any court may in
its discretion require, in any suit for the enforcement of any right or remedy
under this Indenture, or in any suit against the Trustee for any action taken,
suffered, or omitted by it as Trustee, the filing by any party litigant in such
suit of an undertaking to pay the costs of such suit, and that such court may in
its discretion assess reasonable costs, including reasonable attorneys' fees,
against any party litigant in such suit, having due regard to the merits and
good faith of the claims or defenses made by such party litigant; but the
provisions of this Section 7.14 shall not apply to any suit instituted by the
Trustee, to any suit instituted by any Holder, or group of Holders, holding in
the aggregate more than 10% in principal amount of any series of the Outstanding
Notes, or to any suit instituted by any Holder for the enforcement of the
payment of the principal of (or premium, if any) or interest on any Note on or
after the respective Stated Maturities expressed in such Note for such interest
(or, in the case of redemption, on or after the Redemption Date).
SECTION 7.15. The Company covenants (to the extent that it may lawfully do so)
that it will not at any time insist upon, or plead, or in any manner whatsoever
claim or take the benefit or advantage of, any stay or extension law wherever
enacted, now or at any time hereafter in force, which may affect the covenants
or the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it will not hinder, delay or impede the execution of any
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55
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
ARTICLE VIII
THE TRUSTEE
SECTION 8.01. (a) Except during the continuance of an Event of Default:
(1) the Trustee undertakes to perform such duties and only such duties as
are specifically set forth in this Indenture, and no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may conclusively
rely, as to the truth of the statements and the correctness of the opinions
expressed therein, upon certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of any such
certificates or opinions which by any provision hereof are specifically
required to be furnished to the Trustee, the Trustee shall be under a duty to
examine the same to determine whether or not they conform to the requirements
of this Indenture.
(b) In case an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in their exercise, as a prudent man would
exercise or use under the circumstances in the conduct of his own affairs.
(c) No provision of this Indenture shall be construed to relieve the Trustee
from liability for its own negligent action, its own negligent failure to act,
or its own wilful misconduct, except that
(1) this Subsection (c) shall not be construed to limit the effect of
Subsection (a) of this Section 8.01;
(2) the Trustee shall not be liable for any error of judgment made in good
faith by a Responsible Officer, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the
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56
direction of the Holders of a majority in principal amount of the Outstanding
Notes relating to the time, method and place of conducting any proceeding for
any remedy available to the Trustee, or exercising any trust or power
conferred upon the Trustee, under this Indenture; and
(4) no provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of its
rights or powers.
SECTION 8.02. Within 90 days after the occurrence of any default hereunder,
the Trustee shall transmit by mail to all Holders, as their names and addresses
appear in the Note Register, notice of such default hereunder known to the
Trustee, unless such default shall have been cured or waived; provided, however,
that, except in the case of a default in the payment of the principal of (or
premium, if any) or interest on any Note or in the payment of any sinking or
purchase fund instalment, the Trustee shall be protected in withholding such
notice if and so long as the board of directors, the executive committee or a
trust committee of directors and/or Responsible Officers of the Trustee in good
faith determine that the withholding of such notice is in the interests of the
Holders; and provided, further, that in the case of any default of the character
specified in Section 7.01(4) no such notice to Holders shall be given until at
least 60 days after the occurrence thereof. For the purpose of this Section 8.02
the term 'default' means any event which is, or after notice or lapse of time or
both would become, an Event of Default.
SECTION 8.03. Except as otherwise provided in Section 8.01:
(a) the Trustee may rely and shall be protected in acting or refraining from
acting upon any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture or other
paper or document believed by it to be genuine and to have been signed or
presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors may be sufficiently evidenced by a Board
Resolution;
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57
(c) whenever in the administration of this Indenture the Trustee shall deem
it desirable that a matter be proved or established prior to taking, suffering
or omitting any action hereunder, the Trustee (unless other evidence be herein
specifically prescribed) may, in the absence of bad faith on its part, rely
upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted by it hereunder
in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders pursuant to this Indenture, unless such Holders shall have offered
to the Trustee reasonable security or indemnity against the costs, expenses
and liabilities which might be incurred by it in compliance with such request
or direction;
(f) the Trustee shall not be bound to make any investigation into the facts
or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture
or other paper or document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or perform
any duties hereunder either directly or by or through agents or attorneys and
the Trustee shall not be responsible for any misconduct or negligence on the
part of any agent or attorney appointed with due care by it hereunder; and
(h) the Trustee shall not be liable for any action taken by it in good faith
and believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Indenture.
SECTION 8.04. The recitals contained herein and in the Notes, except the
certificate of authentication, shall be taken as the statements of the Company,
and the Trustee assumes no responsibility for their correctness. The Trustee
makes no representations as to the validity or sufficiency of this Indenture or
of the Notes. The Trustee shall not be
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58
accountable for the use or application by the Company of Notes or the proceeds
thereof.
SECTION 8.05. The Trustee, any Paying Agent Note Registrar or any other agent
of the Company, in its individual or any other capacity, may become the owner or
pledgee of Notes and, subject to Sections 8.08 and 8.09 may otherwise deal with
the Company with the same rights it would have if it were not Trustee, Paying
Agent, Note Registrar or such other agent.
SECTION 8.06. Money held by the Trustee in trust hereunder need not be
segregated from other funds except to the extent required by law. The Trustee
shall be under no liability for interest on any money received by it hereunder
except as otherwise agreed with the Company.
SECTION 8.07. The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation for
all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee
of an express trust);
(2) except as otherwise expressly provided herein, to reimburse the
Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision
of this Indenture (including the reasonable compensation and the expenses
and disbursements of its agents and counsel), except any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify the Trustee for, and to hold it harmless against, any
loss, liability or expense incurred without negligence or bad faith on its
part, arising out of or in connection with the acceptance or administration
of this trust, including the costs and expenses of defending itself against
any claim or liability in connection with the exercise or performance of
any of its powers or duties hereunder.
As security for the performance of the obligations of the Company under this
Section 8.07 the Trustee shall have a lien prior to the Notes upon all property
and funds held or collected by the Trustee as such, except funds held in trust
for the payment of principal of (and premium, if any) or interest on particular
Notes.
<PAGE> 67
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SECTION 8.08. (a) This Indenture shall always have a Trustee with respect to
the Notes of each series which satisfies the requirements of TIA sec. 310(a)(1).
The Trustee shall always have a combined capital and surplus of at least
$5,000,000 as set forth in its most recent annual report of condition.
(b) The Trustee is subject to TIA sec. 310(b), it being understood that for
the purposes of this Indenture, with respect to Notes of any series, the
provisions of TIA sec. 310(b) with respect to conflicting interests relating to
'other securities' shall be interpreted to include Notes of each other series
and with respect to 'other indentures' shall include the provisions of this
Indenture relating to the Notes of such other series.
SECTION 8.09. The Trustee is subject to TIA sec. 311(a), excluding any
creditor relationship listed in TIA sec. 311(b). A Trustee who has resigned or
been removed shall be subject to TIA sec. 311(a) to the extent indicated.
SECTION 8.10. (a) No resignation or removal of the Trustee and no appointment
of a successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 8.11.
(b) The Trustee may resign at any time by giving written notice thereof to the
Company. If an instrument of acceptance by a successor Trustee shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee.
(c) The Trustee may be removed at any time by Act of the Holders of a majority
in principal amount of the Outstanding Notes, delivered to the Trustee and to
the Company.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 8.08(b) after written
request therefor by the Company or by any Holder who has been a bona fide
Holder for at least six months, or
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(2) the Trustee shall cease to be eligible under Section 8.08(a) and
shall fail to resign after written request therefor by the Company or by
any such Holder, or
(3) the Trustee shall become incapable of acting or shall be adjudged a
bankrupt or insolvent or a receiver of the Trustee or of its property shall
be appointed or any public officer shall take charge or control of the
Trustee or of its property or affairs for the purpose of rehabilitation,
conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee, or (ii) subject to Section 7.14, any Holder who has been a bona fide
Holder for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the removal
of the Trustee and the appointment of a successor Trustee.
(e) If the Trustee shall resign, be removed or become incapable of acting, or
if a vacancy shall occur in the office of Trustee for any cause, the Company, by
a Board Resolution, shall promptly appoint a successor Trustee. If, within one
year after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee shall be appointed by Act of the Holders of a
majority in principal amount of the Outstanding Notes delivered to the Company
and the retiring Trustee, the successor Trustee so appointed shall, forthwith
upon its acceptance of such appointment, become the successor Trustee and
supersede the successor Trustee appointed by the Company. If no successor
Trustee shall have been so appointed by the Company or the Holders and accepted
appointment in the manner hereinafter provided, any Holder who has been a bona
fide Holder for at least six months may, on behalf of himself and all others
similarly situated, petition any court of competent jurisdiction for the
appointment of a successor Trustee.
(f) The Company shall give notice of each resignation and each removal of the
Trustee and each appointment of a successor Trustee to the Holders as their
names and addresses appear in the Note Register. Each notice shall include the
name of the successor Trustee and the address of its principal corporate trust
office.
SECTION 8.11. Every successor Trustee appointed hereunder shall execute,
acknowledge and deliver to the Company and to the retiring Trustee an instrument
accepting such appointment, and thereupon the resignation or removal of the
retiring Trustee shall become effective and
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such successor Trustee, without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Trustee; but, on request of the Company or the successor Trustee, such retiring
Trustee shall, upon payment of its charges, execute and deliver an instrument
transferring to such successor Trustee all the rights, powers and trusts of the
retiring Trustee, and shall duly assign, transfer and deliver to such successor
Trustee all property and money held by such retiring Trustee hereunder, subject
nevertheless to its lien, if any, provided for in Section 8.07. Upon request of
any such successor Trustee, the Company shall execute any and all instruments
for more fully and certainly vesting in and confirming to such successor Trustee
all such rights, powers and trusts.
No successor Trustee shall accept its appointment unless at the time of such
acceptance such successor Trustee shall be qualified and eligible under this
Article VIII.
SECTION 8.12. Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which the Trustee shall be a
party, or any corporation succeeding to all or substantially all of the
corporate trust business of the Trustee, shall be the successor of the Trustee
hereunder, provided such corporation shall be otherwise qualified and eligible
under this Article VIII, without the execution or filing of any paper or any
further act on the part of any of the parties hereto. In case any Notes shall
have been authenticated, but not delivered, by the Trustee then in office, any
successor by merger, conversion or consolidation to such authenticating Trustee
may adopt such authentication and deliver the Notes so authenticated with the
same effect as if such successor Trustee had itself authenticated such Notes.
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ARTICLE IX
HOLDER'S LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 9.01. The Company covenants and agrees that it will furnish or cause
to be furnished to the Trustee, between May 1 and May 15 and between November 1
and November 15 in each 12 months' period beginning with May 1, 1994, and at
such other times as the Trustee may request in writing, within 30 days after
receipt by the Company of any such request, a list in such form as the Trustee
may reasonably require of the names and addresses of the Holders as of a date
not more than 15 days prior to the time such information is furnished. So long
as the Trustee is the Note Registrar no such list need be furnished.
SECTION 9.02. (a) The Trustee shall preserve, in as current a form as is
reasonably practicable, the names and addresses of Holders contained in the most
recent list furnished to the Trustee as provided in Section 9.01 and the names
and addresses of Holders received by the Trustee in its capacity as Note
Registrar. The Trustee may destroy any list furnished to it as provided in
Section 9.01 upon receipt of a new list so furnished.
(b) Holders of Notes may communicate pursuant to TIA sec. 312(b) with other
Holders with respect to their rights under this Indenture or the Notes. The
Company, the Trustee, the Note Registrar, and anyone else shall have the
protection of TIA sec. 312(c).
SECTION 9.03. (a) The term 'reporting date', as used in this Section 9.03,
means May 15. Within 60 days after the reporting date in each year, the Trustee
shall transmit by mail to all Holders, as their names and addresses appear in
the Note Register, a brief report dated as of such reporting date that complies
with TIA sec. 313(a). The Trustee shall also comply with TIA sec. 313(b).
(b) Reports pursuant to this Section 9.03 shall be transmitted by mail:
(1) to all Holders of Notes, as the names and addresses of such Holders
appear in the Note Register;
(2) to such Holders of Notes as have, within the 2 years preceding such
transmission, filed their names and addresses with the Trustee for that
purpose; and except in the case of reports pursuant
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to TIA sec. 313(b), to all Holders of Notes whose names and addresses have
been furnished to or received by the Trustee pursuant to Section 9.01.
(c) A copy of each such report shall, at the time of such transmission to
Holders, be filed by the Trustee with each stock exchange upon which the Notes
are listed, and also with the Commission. The Company will notify the Trustee
when the Notes are listed on any stock exchange.
ARTICLE X
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 10.01. The Company shall not consolidate with or merge into any other
corporation or convey, transfer, sell or lease its properties and assets as, or
substantially as, an entirety to any Person, unless:
(1) the corporation formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance, transfer,
sale or lease the properties and assets of the Company as, or substantially
as, an entirety shall be a corporation organized and existing under the
laws of the United States of America or any State or the District of
Columbia, and shall expressly assume, by an indenture supplemental hereto,
executed and delivered to the Trustee, in form satisfactory to the Trustee,
the due and punctual payment of the principal of (and premium, if any) and
interest on all the Notes and the performance of every covenant of this
Indenture on the part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have happened and be continuing; and
(3) the Company has delivered to the Trustee an Officers' Certificate and
an Opinion of Counsel each stating that such consolidation, merger,
conveyance or transfer and such supplemental indenture comply with this
Section 10.01 and that all conditions precedent herein provided for
relating to such transaction have been complied with.
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SECTION 10.02. Upon any consolidation or merger, or any conveyance, transfer,
sale or lease of the properties and assets of the Company as, or substantially
as, an entirety in accordance with Section 10.01, the successor corporation
formed by such consolidation or into which the Company is merged or to which
such conveyance, transfer, sale or lease is made shall succeed to, and be
substituted for, and may exercise every right and power of, the Company under
this Indenture with the same effect as if such successor corporation had been
named as the Company herein, and thereafter, except in the case of a lease, the
predecessor corporation shall be relieved of all obligations and covenants under
this Indenture and the Notes.
ARTICLE XI
SUPPLEMENTAL INDENTURES
SECTION 11.01. Without the consent of any Holder, the Company and the Trustee,
at any time and from time to time, may enter into one or more indentures
supplemental hereto, in form satisfactory to the Trustee, for any of the
following purposes:
(1) to create a new series of Notes;
(2) to evidence the succession of another corporation to the Company, and
the assumption by any such successor of the covenants of the Company herein
and in the Notes contained;
(3) to add to the covenants of the Company for the benefit of the Holders
of all or any series of Notes (and if such covenants are to be for the
benefit of less than all series of Notes, stating that such covenants are
expressly being included solely for the benefit of such series) or to
surrender any right or power herein conferred upon the Company;
(4) to mortgage, pledge, convey, assign and transfer to the Trustee any
property or assets as security for the Notes and to specify the terms and
conditions upon which such property or assets are to be held and dealt with
by the Trustee and to set forth such other provisions in respect thereof as
may be required by this Indenture or as may, consistent with the provisions
of this Indenture, be deemed appropriate by the Company and the Trustee, or
to correct or amplify the description of any such property or assets at any
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time so mortgaged, pledged, conveyed and transferred to the Trustee;
(5) to add any additional Events of Default with respect to all or any
series of Notes;
(6) to cure any ambiguity, defect, or inconsistency or to correct or
supplement any provision contained herein or in any supplemental indenture
or in any Notes issued hereunder;
(7) to provide for uncertificated Notes in addition to certificated
Notes;
(8) to add to or change any of the provisions of this Indenture to such
extent as shall be necessary to permit or facilitate the issuance of Notes
in bearer form, registrable or not registrable as to principal, and with or
without interest coupons;
(9) to evidence and provide for the acceptance of appointment hereunder by a
successor Trustee with respect to the Notes of one or more series and to add
to or change any of the provisions of this Indenture as shall be necessary to
provide for or facilitate the administration of the trusts hereunder by more
than one Trustee, pursuant to the requirements of Section 8.11; or
(10) to make any change that does not adversely affect the rights of any
Holder of Notes which are Outstanding.
SECTION 11.02. Subject to the provisions of Section 7.12 and Section 7.13,
with the consent of the Holders of not less than a majority in principal amount
of the Outstanding Notes of each series which are affected, evidenced by Act of
said Holders delivered to the Company and the Trustee, the Company, when
authorized by a Board Resolution, and the Trustee may enter into an indenture or
indentures supplemental hereto for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Indenture or
of any supplemental indenture or of modifying in any manner the rights of the
Holders of the Notes of such series thereof under this Indenture; provided,
however, that no such supplemental indenture shall, without the consent of the
Holder of each Outstanding Note affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment of
interest on, any Note, or reduce the principal amount thereof or the interest
thereon or any premium payable upon the redemption
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thereof, or reduce the principal amount of an Original Issue Discount Note
that would be due and payable upon a declaration of acceleration of the
Maturity thereof, or change the coin or currency in which any Note or the
interest thereon is payable, or impair the right to institute suit for the
enforcement of any such payment on or after the Stated Maturity thereof (or,
in the case of redemption, on or after the Redemption Date), or
(2) reduce the percentage in principal amount of the Outstanding Notes of
any series, the consent of whose Holders is required for any such supplemental
indenture, or the consent of whose Holders is required for any waiver (of
compliance with certain provisions of this Indenture or certain defaults
hereunder and their consequences) provided for in this Indenture, or
(3) modify any of the provisions of this Section 11.02 or Section 7.13,
except to increase any such percentage or to provide that certain other
provisions of this Indenture cannot be modified or waived without the consent
of the Holder of each Note affected thereby provided, however, that this
clause shall not be deemed to require the consent of any Holder with respect
to changes in the references to 'the Trustee' and concomitant changes in this
Section and Section 3.08, or the deletion of this proviso, in accordance with
the requirements of Sections 8.11 and 11.01(9).
It shall not be necessary for any Act of Holders under this Section 11.02 to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 11.03. In executing, or accepting the additional trusts created by,
any supplemental indenture permitted by this Article XI or the modification
thereby of the trusts created by this Indenture, the Trustee shall be entitled
to receive, and (subject to Section 8.01) shall be fully protected in relying
upon, an Opinion of Counsel, stating that the execution of such supplemental
indenture is authorized or permitted by this Indenture and that such
supplemental indenture is a valid and binding obligation of the Company in
accordance with its terms. The Trustee may, but shall not be obligated to, enter
into any such supplemental indenture which affects the Trustee's own rights,
duties or immunities under this Indenture or otherwise.
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SECTION 11.04. Upon the execution of any supplemental indenture under this
Article XI, this Indenture shall be modified in accordance therewith, and such
supplemental indenture shall form a part of this Indenture for all purposes; and
every Holder of Notes theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby.
SECTION 11.05. Every supplemental indenture executed pursuant to this Article
XI shall conform to the requirements of TIA as then in effect.
SECTION 11.06. Notes authenticated and delivered after the execution of any
applicable supplemental indenture pursuant to this Article XI may, and shall if
required by the Trustee, bear a notation in form approved by the Trustee as to
any matter provided for in such supplemental indenture. If the Company shall so
determine, new Notes so modified as to conform, in the opinion of the Trustee
and the Board of Directors, to any such supplemental indenture may be prepared
and executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Notes.
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TESTIMONIUM
This Indenture may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all such counterparts shall
together constitute but one and the same instrument.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly
executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
HOUSEHOLD INTERNATIONAL, INC.
BY /S/ JOSEPH W. HOFF
-----------------------------------
Assistant Treasurer
Attest:
/s/ SUSAN E. CASEY
- -------------------------------------
Assistant Secretary
(CORPORATE SEAL)
THE FIRST NATIONAL BANK OF
MARYLAND, AS TRUSTEE
BY /S/ JAY SMITH
-----------------------------------
Assistant Vice President
Attest:
/s/ MARY E. WEXLER
- -------------------------------------
Vice President
(CORPORATE SEAL)
<PAGE> 1
Exhibit 4(d)
HOUSEHOLD INTERNATIONAL, INC.
Form of Warrant Agreement
(for warrants sold alone)
THIS WARRANT AGREEMENT dated as of
between Household International, Inc. a corporation organized
under the laws of the State of Delaware (the "Company", which
term includes any successor corporation under the Indenture
hereinafter referred to) and
as Warrant Agent (the "Warrant Agent").
WHEREAS, the Company has entered into an Indenture
dated as of (the "Indenture"), with
, as Trustee (the "Trustee"), providing for the
issuance from time to time of its unsecured debt securities (the
"Debt Securities"), to be issued in one or more series as
provided in the Indenture; and
WHEREAS, the Company proposes to sell warrant
certificates evidencing one or more warrants (the "Warrants" or,
individually a "Warrant) representing the right to purchase
[title of debt securities purchasable through exercise of
Warrants] (the "Warrant Debt Securities"), such warrant
certificates and other warrant certificates issued pursuant to
this Agreement hereinafter referred to as the "Warrant
Certificates"; and
WHEREAS, the Company desires the Warrant Agent to act
on behalf of the Company in connection with the issuance,
exchange, exercise and replacement of the Warrant Certificates,
and in this Agreement wishes to set forth, among other things,
the form and provisions of the Warrant Certificates and the terms
and conditions on which they may be issued, exchanged, exercised
and replaced;
NOW THEREFORE, in consideration of the premises and of
the mutual agreements herein contained, the parties hereto agree
as follows:
ARTICLE I
Issuance of Warrants and Execution
and Delivery of Warrant Certificates
Section 1.01. Issuance of Warrants. Each Warrant
Certificate shall evidence one or more Warrants. Each Warrant
evidenced thereby shall represent the right, subject to the
provisions contained herein and therein, to purchase a Warrant
Debt Security in the principal amount of $ .
<PAGE> 2
Section 1.02. Execution and Delivery of Warrant
Certificates. Each Warrant Certificate, whenever issued, shall
be in [bearer] [registered] form substantially in the form set
forth in Exhibit A hereto, shall be dated and may have such
letters, numbers or other marks of identification or designation
and such legends or endorsements printed, lithographed or
engraved thereon as the officers of the Company executing the
same may approve (execution thereof to be conclusive evidence of
such approval) and as are not inconsistent with the provisions of
this Agreement, or as may be required to comply with any law or
with any rule or regulation made pursuant thereto or with any
rule or regulation of any stock exchange on which the Warrant
Certificates may be listed, or to conform to usage. The Warrant
Certificates shall be signed on behalf of the Company by either
its President, one of its Vice Presidents or one of its Assistant
Treasurers under its corporate seal and attested by its Secretary
or any of its Assistant Secretaries. Such signatures may be
manual or facsimile signatures of such authorized officers and
may be imprinted or otherwise reproduced on the Warrant
Certificates. The seal of the Company may be in the form of a
facsimile thereof and may be impressed, affixed, imprinted or
otherwise reproduced on the Warrant Certificates.
No Warrant Certificate shall be valid for any purpose,
and no Warrant evidenced thereby shall be exercisable, until such
Warrant Certificate has been countersigned by the manual
signature of the Warrant Agent. Such signature by the Warrant
Agent upon any Warrant Certificate executed by the Company shall
be conclusive evidence that the Warrant Certificate so
countersigned has been duly issued hereunder.
In case any officer of the Company who shall have
signed any of the Warrant Certificates either manually or by
facsimile signature shall cease to be such officer before the
Warrant Certificates so signed shall have been countersigned and
delivered by the Warrant Agent, such Warrant Certificates may be
countersigned and delivered notwithstanding that the person who
signed such Warrant Certificates has ceased to be such officer of
the Company; and any Warrant Certificate may be signed on behalf
of the Company by such persons as, at the actual date of the
execution of such Warrant Certificate, shall be the proper
officers of the Company, although at the date of the execution of
this Agreement any such person was not such officer.
[If bearer Warrants -- The term "holder" or "holder of
a Warrant Certificate" as used herein shall mean the bearer of
such Warrant Certificate.]
[If registered Warrants -- The term "holder" or "holder
of a Warrant Certificate" as used herein shall mean any person in
whose name at the time any Warrant Certificate shall be
registered
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<PAGE> 3
upon the books to be maintained by the Warrant Agent for that
purpose.]
Section 1.03. Issuance of Warrant Certificates.
Warrant Certificates evidencing the right to purchase an
aggregate principal amount not exceeding $ = aggregate
principal amount of Warrant Debt Securities (except as provided
in Sections 2.03(c), 3.02 and 4.01) may be executed by the
Company and delivered to the Warrant Agent upon the execution of
this Warrant Agreement or from time to time thereafter. The
Warrant Agent shall, upon receipt of Warrant Certificates duly
executed on behalf of the Company, countersign Warrant
Certificates evidencing Warrants representing the right to
purchase up to $ aggregate principal amount of Warrant
Debt Securities and shall deliver such Warrant Certificates to or
upon the order of the Company. Subsequent to such original
issuance of the Warrant Certificates, the Warrant Agent shall
countersign a Warrant Certificate only if the Warrant Certificate
is issued in exchange or substitution for one or more previously
countersigned Warrant Certificates, [If registered Warrants -- or
in connection with their transfer], as hereinafter provided or as
provided in Section 2.03(c).
ARTICLE II
Warrant Price, Duration and Exercise of Warrants
Section 2.01. Warrant Price*. [On , 19 the
exercise price of each Warrant is $ . During the period
from , 19 through and including , 19
the exercise price of each Warrant will be $ plus
[accrued amortization of the original issue discount] [accrued
interest] from , 19 . On , 19 the
exercise price of each Warrant will be $ . During the
period from , 19 , through and including
, 19 , the exercise price of each Warrant will be $ plus
[accrued amortization of the original issue discount] [accrued
interest] from , 19 , [in each case, the original issue
discount will be amortized at a % annual rate, computed on an
annual basis using a 360-day year consisting of twelve 30-day
months]. Such purchase price of Warrant Debt Securities is
referred to in this Agreement as the "Warrant Price". [The
original issue discount for each $1,000 principal amount of
Warrant Debt Securities is $ ].
Section 2.02. Duration of Warrants. Each Warrant evidenced
by a Warrant Certificate may be exercised in whole at any time,
as
* Complete and modify the provisions of this Section as
appropriate to reflect the exact terms of the Offered
Warrants and the Warrant Debt Securities.
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<PAGE> 4
specified herein, on or after [the date thereof] [ ,
19 ] and at or before 5 p.m. time on ,
19 (the "Expiration Date"). Each Warrant not exercised at or
before 5 p.m. time on the Expiration Date shall
become void, and all rights of the holder of the Warrant
Certificate evidencing such Warrant under this Agreement shall
cease.
Section 2.03. Exercise of Warrants. (a) During the period
specified in Section 2.02 any whole number of Warrants may be
exercised by providing certain information set forth on the
reverse side of the Warrant Certificate and by paying in full, in
lawful money of the United States of America, [in cash or by
certified check or official bank check or by bank wire transfer,
in each case] [by bank wire transfer] in immediately available
funds, the Warrant Price for each Warrant exercised, to the
Warrant Agent at its corporate trust office [or at ],
provided that such exercise is subject to receipt within five
business days of such [payment] [wire transfer] by the Warrant
Agent of the Warrant Certificate with the form of election to
purchase Warrant Debt Securities set forth on the reverse side of
the Warrant Certificate properly completed and duly executed.
The date on which payment in full of the Warrant Price is
received by the Warrant Agent shall, subject to receipt of the
Warrant Certificate as aforesaid, be deemed to be the date on
which the Warrant is exercised. The Warrant Agent shall deposit
all funds received by it in payment of the Warrant Price in an
account of the Company maintained with it and shall advise the
Company by telephone at the end of each day on which a [payment]
[wire transfer] for the exercise of Warrants is received of the
amount so deposited to its account. The Warrant Agent shall
promptly confirm such telephone advice to the Company in writing.
(b) The Warrant Agent shall, from time to time, as
promptly as practicable, advise the Company and the Trustee under
the Indenture of (i) the number of Warrants exercised in
accordance with the terms and conditions of this Agreement and
the Warrant Certificates; (ii) the instructions of each holder of
the Warrant Certificates evidencing such Warrants with respect to
delivery of the Warrant Debt Securities to which such holder is
entitled upon such exercise; (iii) delivery of Warrant
Certificates evidencing the balance, if any, of the Warrants
remaining after such exercise; and (iv) such other information as
the Company or the Trustee shall reasonably require.
(c) As soon as practicable after the exercise of any
Warrant, the Company shall issue, pursuant to the Indenture, in
authorized denominations to or upon the order of the holder of
the Warrant Certificate evidencing such Warrant, the Warrant Debt
Securities to which such holder is entitled [in fully registered
form, registered in such name or names] [in bearer form] as may
be
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<PAGE> 5
directed by such holder*; [provided, however, the Company
shall not be required to deliver any unregistered Warrant Debt
Securities in the United States]. If fewer than all of the
Warrants evidenced by such Warrant Certificate were exercised,
the Company shall execute, and an authorized officer of the
Warrant Agent shall manually countersign and deliver, a new
Warrant Certificate evidencing the number of such Warrants
remaining unexercised.
(d) The Company shall not be required to pay any stamp
or other tax or other governmental charge required to be paid in
connection with any transfer involved in the issue of the Warrant
Debt Securities; and in the event that any such transfer is
involved, the Company shall not be required to issue or deliver
any Warrant Debt Securities until such tax or other charge shall
have been paid or it has been established to the Company's
satisfaction that no such tax or other charge is due.
[(e) Issuance of unregistered Warrant Debt Securities
upon exercise of Warrants shall be subject to such arrangements
and procedures as shall be provided pursuant to Section
of the Indenture.]
ARTICLE III
Other Provisions Relating to Rights
of Holders of Warrant Certificates
Section 3.01. No Rights as Warrant Debt Security
Holder Conferred by Warrants or Warrant Certificates. No Warrant
Certificate or Warrant evidenced thereby shall entitle the holder
thereof to any of the rights of a holder of Warrant Debt
Securities, including, without limitation, the right to receive
the payment of principal of, premium (if any) or interest on
Warrant Debt Securities or to enforce any of the covenants in the
Indenture.
Section 3.02. Lost, Stolen, Mutilated or Destroyed
Warrant Certificates. Upon receipt by the Company and the
Warrant Agent of evidence reasonably satisfactory to them of the
ownership of and the loss, theft, destruction or mutilation of
any Warrant Certificate and of indemnity reasonably satisfactory
to them and, in the case of mutilation, upon surrender thereof to
the Warrant Agent for cancellation, then, in the absence of
notice to the Company or the Warrant Agent that such Warrant
Certificate has been acquired by a bona fide purchaser, the
Company shall execute, and an authorized officer of the Warrant
Agent shall manually countersign and deliver, in exchange for or
in lieu of the lost,
* Subject to change in accordance with changes in tax laws and
regulations.
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<PAGE> 6
stolen, destroyed or mutilated Warrant Certificate, a new Warrant
Certificate of the same tenor and evidencing the same number of
Warrants. Upon the issuance of any new Warrant Certificate under
this Section, the Company may require the payment of a sum
sufficient to cover any tax or other governmental charge that may
be imposed in relation thereto and any other expenses (including
the fees and expenses of the Warrant Agent) in connection
therewith. Every substitute Warrant Certificate executed and
delivered pursuant to this Section in lieu of any lost, stolen or
destroyed Warrant Certificate shall represent an additional
contractual obligation of the Company, whether or not the lost,
stolen or destroyed Warrant Certificate shall be at any time
enforceable by anyone, and shall be entitled to the benefits of
this Agreement equally and proportionately with any and all other
Warrant Certificates duly executed and delivered hereunder. The
provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to
the replacement of mutilated, lost, stolen or destroyed Warrant
Certificates.
Section 3.03. Holder of Warrant Certificate May
Enforce Rights. Notwithstanding any of the provisions of this
Agreement, any holder of a Warrant Certificate, without the
consent of the Warrant Agent, the Trustee, the holder of any
Warrant Debt Securities or the holder of any other Warrant
Certificate, may, in his own behalf and for his own benefit,
enforce, and may institute and maintain any suit, action or
proceeding against the Company suitable to enforce or otherwise
in respect of, his right to exercise the Warrants evidenced by
his Warrant Certificate in the manner provided in his Warrant
Certificate and in this Agreement.
ARTICLE IV
Exchange and Transfer of Warrant Certificates
Section 4.01. Exchange and Transfer of Warrant
Certificates. Upon surrender at the corporate trust office of
the Warrant Agent [or ], Warrant Certificates
evidencing Warrants may be exchanged for Warrant Certificates in
other denominations evidencing such Warrants [If registered
Warrants -- or may be transferred in whole or in part]; provided
that such other Warrant Certificates evidence the same aggregate
number of Warrants as the Warrant Certificates so surrendered.
[If registered Warrants -- The Warrant Agent shall keep, at its
corporate trust office [and at ], books in which,
subject to such reasonable regulations as it may prescribe, it
shall register Warrant Certificates and exchanges and transfers
of outstanding Warrant Certificates, upon surrender of the
Warrant Certificates to the Warrant Agent at its corporate trust
office [or ] for exchange [or transfer], properly
endorsed or accompanied by appropriate instruments of transfer
and written instructions for transfer, all in form satisfactory
to the Company
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<PAGE> 7
and the Warrant Agent.] No service charge shall be made for any
exchange [or transfer] of Warrant Certificates, but the Company
may require payment of a sum sufficient to cover any stamp or
other tax or other governmental charge that may be imposed in
connection with any such exchange [or transfer]. Whenever any
Warrant Certificates are so surrendered for exchange [or
transfer] an authorized officer of the Warrant Agent shall
manually countersign and deliver to the person or persons
entitled thereto a Warrant Certificate or Warrant Certificates
duly authorized and executed by the Company, as so requested.
The Warrant Agent shall not be required to effect any exchange
[or transfer] which will result in the issuance of a Warrant
Certificate evidencing a fraction of a Warrant or a number of
full Warrants and a fraction of a Warrant. All Warrant
Certificates issued upon any exchange [or transfer] of Warrant
Certificates shall be the valid obligations of the Company,
evidencing the same obligations, and entitled to the same
benefits under this Agreement, as the Warrant Certificates
surrendered for such exchange [or transfer].
Section 4.02. Treatment of Holders of Warrant
Certificates. [Bearer warrants -- Each Warrant Certificate shall
be transferable by delivery and shall be deemed negotiable and
the bearer of each Warrant Certificate may be treated by the
Company, the Warrant Agent and all other persons dealing with
such bearer as the absolute owner thereof for any purpose and as
the person entitled to exercise the rights represented by the
Warrants evidenced thereby, any notice to the contrary
notwithstanding.] [Registered Warrants -- The Company and the
Warrant Agent may treat the registered holder as the absolute
owner thereof for any purpose and as the person entitled to
exercise the rights represented by the Warrants evidenced
thereby, any notice to the contrary notwithstanding.]
Section 4.03. Cancellation of Warrant Certificates.
Any Warrant Certificate surrendered for exchange [transfer] or
exercise of the Warrants evidenced thereby shall, if surrendered
to the Company, be delivered to the Warrant Agent and all Warrant
Certificates surrendered or so delivered to the Warrant Agent
shall be promptly cancelled by the Warrant Agent and shall not be
reissued and, except as expressly permitted by this Agreement, no
Warrant Certificate shall be issued hereunder in exchange or in
lieu thereof. The Warrant Agent shall deliver to the Company
from time to time or otherwise dispose of cancelled Warrant
Certificates in a manner satisfactory to the Company.
ARTICLE V
Concerning the Warrant Agent
Section 5.01. Warrant Agent. The Company hereby
appoints as Warrant Agent of the Company in
respect of the Warrants and the Warrant Certificates, upon the
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<PAGE> 8
terms and subject to the conditions herein set forth; and
hereby accepts such appointment. The Warrant Agent
shall have the powers and authority granted to and conferred upon
it in the Warrant Certificates and hereby and such further powers
and authority to act on behalf of the Company as the Company may
hereafter grant to or confer upon it. All of the terms and
provisions with respect to such powers and authority contained in
the Warrant Certificates are subject to and governed by the terms
and provisions hereof.
Section 5.02. Conditions of Warrant Agent's
Obligations. The Warrant Agent accepts its obligations herein
set forth upon the terms and conditions hereof, including the
following, to all of which the Company agrees and to all of which
the rights hereunder of the holders from time to time of the
Warrant Certificates shall be subject:
(a) Compensation and Indemnification. The Company
agrees promptly to pay the Warrant Agent the compensation to be
agreed upon with the Company for all services rendered by the
Warrant Agent and to reimburse the Warrant Agent for reasonable
out-of-pocket expenses (including counsel fees) incurred by the
Warrant Agent in connection with the services rendered hereunder
by the Warrant Agent. The Company also agrees to indemnify the
Warrant Agent for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on
the part of the Warrant Agent, arising out of or in connection
with its acting as Warrant Agent hereunder, as well as the costs
and expenses of defending against any claim of such liability.
(b) Agent for the Company. In acting under this
Warrant Agreement and in connection with the Warrant
Certificates, the Warrant Agent is acting solely as agent of the
Company and does not assume any obligation or relationship of
agency or trust for or with any of the holders of Warrant
Certificates or beneficial owners of Warrants.
(c) Counsel. The Warrant Agent may consult with
counsel satisfactory to it, and the advise of such counsel shall
be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good
faith and in accordance with the advice of such counsel.
(d) Documents. The Warrant Agent shall be protected
and shall incur no liability for or in respect of any action
taken or thing suffered by it in reliance upon any Warrant
Certificate, notice, direction, consent, certificate, affidavit,
statement or other paper or document reasonably believed by it to
be genuine and to have been presented or signed by the proper
parties.
(e) Certain Transactions. The Warrant Agent, and its
officers, directors and employees, may become the owner of, or
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<PAGE> 9
acquire any interest in, Warrants, with the same rights that it
or they would have if it were not the Warrant Agent hereunder,
and, to the extent permitted by applicable law, it or they may
engage or be interested in any financial or other transaction
with the Company and may act on, or as depositary, trustee or
agent for, any committee or body of holders of Warrant Debt
Securities or other obligations of the Company as freely as if it
were not the Warrant Agent hereunder. Nothing in this Warrant
Agreement shall be deemed to prevent the Warrant Agent from
acting as Trustee under the Indenture.
(f) No Liability for Interest. The Warrant Agent
shall have no liability for interest on any monies at any time
received by it pursuant to any of the provisions of this
Agreement or of the Warrant Certificates.
(g) No Liability for Invalidity. The Warrant Agent
shall have no liability with respect to any invalidity of this
Agreement or any of the Warrant Certificates.
(h) No Responsibility for Representations. The
Warrant Agent shall not be responsible for any of the recitals or
representations herein or in the Warrant Certificates (except as
to the Warrant Agent's countersignature thereon), all of which
are made solely by the Company.
(i) No Implied Obligations. The Warrant Agent shall
be obligated to perform only such duties as are herein and in the
Warrant Certificates specifically set forth, and no implied
duties or obligations shall be read into this Agreement or the
Warrant Certificates against the Warrant Agent. The Warrant
Agent shall not be under any obligations to take any action
hereunder which may tend to subject it to any expense or
liability, reimbursement for which within a reasonable time is
not, in its reasonable opinion, assured to it. The Warrant Agent
shall not be accountable or responsible for the use by the
Company of any of the Warrant Certificates authenticated by the
Warrant Agent and delivered by it to the Company pursuant to this
Agreement or for the application by the Company of the proceeds
of the Warrant Certificates. The Warrant Agent shall have no
duty or responsibility in case of any default by the Company in
the performance of its covenants or agreements contained herein
or in the Warrant Certificates or in the case of the receipt of
any written demand from a holder of a Warrant Certificate with
respect to such default, including, without limiting the
generality of the foregoing, any duty or responsibility to
initiate or attempt to initiate any proceedings at law or
otherwise or, except as provided in Section 6.02 hereof, to make
any demand upon the Company.
Section 5.03. Resignation and Appointment of
Successor. (a) The Company agrees, for the benefit of the
holders from time to time of the Warrant Certificates, that there
shall at all times be
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<PAGE> 10
a Warrant Agent hereunder until all the Warrant Certificates are
no longer exercisable.
(b) The Warrant Agent may at any time resign as such
agent by giving written notice to the Company of such intention
on its part, specifying the date on which its desired resignation
shall become effective; provided that such date shall be not less
than three months after the date on which such notice is given,
unless the Company otherwise agrees. The Warrant Agent hereunder
may be removed at any time by the filing with it of an instrument
in writing signed by or on behalf of the Company and specifying
such removal and the date when it shall become effective. Such
resignation or removal shall take effect upon the appointment by
the Company, as hereinafter provided, of a successor Warrant
Agent (which shall be a bank or trust company authorized under
the laws of the jurisdiction of its organization to exercise
corporate trust powers) and the acceptance of such appointment by
such successor Warrant Agent. The obligation of the Company
under Section 5.02(a) shall continue to the extent set forth
therein, notwithstanding the resignation or removal of the
Warrant Agent.
(c) In case at any time the Warrant Agent shall resign,
or shall be removed, or shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or shall file a
petition seeking relief under Title II of the United States Code,
as now constituted or hereafter amended, or under any other
applicable Federal or State bankruptcy law or similar law or make
an assignment for the benefit of its creditors or consent to the
appointment of a receiver or custodian of all or any substantial
part of its property, or shall admit in writing its inability to
pay or meet its debts as they mature, or if a receiver or
custodian of it or of all or any substantial part of its property
shall be appointed, or if an order of any court shall be entered
for relief against it under the provisions of Title II of the
United States Code, as now constituted or hereafter amended, or
under any other applicable Federal or State bankruptcy or similar
law, or if any public officer shall have taken charge or control
of the Warrant Agent or of its property or affairs, for the
purpose of rehabilitation, conservation or liquidation, a
successor Warrant Agent, qualified as set forth in subsection (b)
above, shall be appointed by the Company by an instrument in
writing, filed with the successor Warrant Agent. Upon the
appointment as aforesaid of a successor Warrant Agent and
acceptance by the successor Warrant Agent of such appointment,
the Warrant Agent shall cease to be Warrant Agent hereunder.
(d) Any successor Warrant Agent appointed hereunder
shall execute, acknowledge and deliver to its predecessor and to
the Company an instrument accepting such appointment hereunder,
and thereupon such successor Warrant Agent, without any further
act, deed or conveyance, shall become vested with all the
authority, rights, powers, trusts, immunities, duties and
obligations of such
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<PAGE> 11
predecessor with like effect as if originally named as Warrant
Agent hereunder, and such predecessor upon payment of its charges
and disbursements then unpaid, shall thereupon become obligated
to transfer, deliver and pay over, and such successor Warrant
Agent shall be entitled to receive, all monies, securities and
other property on deposit w ith or held by such predecessor, as
Warrant Agent hereunder.
(e) Any corporation into which the Warrant Agent
hereunder may be merged or converted or any corporation with
which the Warrant Agent may be consolidated, or any corporation
resulting from any merger, conversion or consolidation to which
the Warrant Agent shall be a party, or any corporation to which
the Warrant Agent shall sell or otherwise transfer all or
substantially all the assets and business of the Warrant Agent
shall be the successor Warrant Agent under this Agreement without
the execution or filing of any paper or any further act on the
part of any of the parties hereto, provided that it shall be
qualified as set forth above in subsection (b).
ARTICLE VI
Miscellaneous
Section 6.01 Amendment. This Agreement may be amended
by the parties hereto, without the consent of the holder of any
Warrant Certificate, for the purpose of curing any ambiguity, or
of curing, correcting or supplementing any defective provision
contained herein, or making any other provisions with respect to
matters or questions arising under this Agreement as the Company
and the Warrant Agent may deem necessary or desirable; provided
that such action shall not adversely affect the interests of the
holders of the Warrant Certificates.
Section 6.02. Notices and Demands to the Company and
Warrant Agent. If the Warrant Agent shall receive any notice or
demand addressed to the Company by the holder of a Warrant
Certificate pursuant to the provisions of the Warrant
Certificates, the Warrant Agent shall promptly forward such
notice or demand to the Company.
Section 6.03. Addresses. Any communications from the
Company to the Warrant Agent with respect to this Agreement shall
be addressed to , attention:
, and any communications from the Warrant Agent
to the Company with respect to this Agreement shall be addressed
to Household International, Inc., 2700 Sanders Road, Prospect
Heights, Illinois 60070, attention: Treasurer (or such other
address as shall be specified in writing by the Warrant Agent or
by the Company).
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Section 6.04. Applicable Law. The validity,
interpretation and performance of this Agreement and each Warrant
Certificate issued hereunder and of the respective terms and
provisions thereof shall be governed by, and construed in
accordance with, the laws of the State of .
Section 6.05. Delivery of Prospectus. The Company
will furnish to the Warrant Agent sufficient copies of a
prospectus relating to the Warrant Debt Securities deliverable
upon exercise of Warrants (the "Prospectus"), and the Warrant
Agent agrees that upon the exercise of any Warrant, the Warrant
Agent will deliver to the holder of the Warrant Certificate
evidencing such Warrant, prior to or concurrently with the
delivery of the Warrant Debt Securities issued upon such
exercise, a Prospectus.
Section 6.06. Obtaining of Governmental Approvals.
The Company will from time to time take all action which may be
necessary to obtain and keep effective any and all permits,
consents and approvals of governmental agencies and authorities
and securities acts filings under United States Federal and State
laws (including without limitation a registration statement in
respect of the Warrants and Warrant Debt Securities under the
Securities Act of 1933), which may be or become requisite in
connection with the issuance, sale, transfer, and delivery of the
Warrant Certificates, the exercise of the Warrants, the issuance,
sale, transfer and delivery of the Warrant Debt Securities issued
upon exercise of the Warrants or upon the expiration of the
period during which the Warrants are exercisable.
Section 6.07. Persons Having Rights under Warrant
Agreement. Nothing in this Agreement expressed or implied and
nothing that may be inferred from any of the provisions hereof is
intended, or shall be construed, to confer upon, or give to, any
person or corporation other than the Company, the Warrant Agent
and the holders of the Warrant Certificates any right, remedy or
claim under or by reason of this Agreement or of any covenant,
condition, stipulation, promise or agreement hereof; and all
covenants, conditions, stipulations, promises and agreements in
this Agreement contained shall be for the sole and exclusive
benefit of the Company and the Warrant Agent and their successors
and of the holders of the Warrant Certificates.
Section 6.08. Headings. The descriptive headings of
the several Articles and Sections of this Agreement are inserted
for convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
Section 6.09. Counterparts. This Agreement may be
executed in any number of counterparts, each of which as so
executed shall be deemed to be an original, but such counterparts
shall together constitute but one and the same instrument.
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Section 6.10. Inspection of Agreement. A copy of this
Agreement shall be available at all reasonable times at the
principal corporate trust office of the Warrant Agent for
inspection by the holder of any Warrant Certificate. The Warrant
Agent may require such holder to submit his Warrant Certificate
for inspection by it.
IN WITNESS WHEREOF, Household International, Inc. has
caused this Agreement to be signed by one of its duly authorized
officers, and its corporate seal to be affixed hereunto, and the
same to be attested by its Secretary or one of its Assistant
Secretaries; and has caused this
Agreement to be signed by one of its duly authorized officers,
and its corporate seal to be affixed hereunto, and the same to be
attested by its Secretary or one of its Assistant Secretaries,
all as of the day and year first above written.
HOUSEHOLD INTERNATIONAL, INC.
By________________________________________
Attest:
____________________
By________________________________________
as Warrant Agent
Attest:
_____________________
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EXHIBIT A
(FORM OF WARRANT CERTIFICATE)
[Face of Warrant Certificate]
EXERCISABLE ONLY IF COUNTERSIGNED BY THE WARRANT
AGENT AS PROVIDED HEREIN
Warrant Certificates representing
Warrants to purchase
[Title of Warrant Debt Securities]
as described herein.
HOUSEHOLD INTERNATIONAL, INC.
WARRANTS TO PURCHASE
[Title of Warrant Debt Securities]
VOID AFTER 5 P.M. TIME ON , 19
[No.] Warrants
This certifies that [the bearer is the] [ or
registered assigns is the registered] owner of the above
indicated number of Warrants, each Warrant entitling such
[bearer] [owner] to purchase, at any time [after 5 p.m.
time on , 19 and] on or before 5 p.m.
time on , 19 , $ principal amount of [Title
of Warrant Debt Securities] (the "Warrant Debt Securities"), of
HOUSEHOLD INTERNATIONAL, INC. (the "Company"), issued and to be
issued under the Indenture (as hereinafter defined), on the
following basis:* [on , 19 the exercise price of
each Warrant is $ ; during the period from , 19
through and including , 19 , the exercise price of each
Warrant will be $ plus [accrued amortization of the
original issue discount] [accrued interest] from , 19
; on , 19 the exercise price of each Warrant will be
$ ; during the period from , 19 , through and
including , 19 , the exercise price of each
Warrant will be $ plus [accrued amortization of the
original issue discount] [accrued interest]
* Complete and modify the following provisions as appropriate
to reflect the exact terms of the Offered Warrants and the
Warrant Debt Securities.
<PAGE> 15
from , 19
; [in each case, the original issue discount will be amortized at
a % annual rate, computed on an annual basis, using a 360-day
year consisting of twelve 30-day months] (the "Warrant Price").
[The original issue discount for each $1,000 principal amount of
Warrant Debt Securities is $ .] The holder may exercise
the Warrants evidenced hereby by providing certain information
set forth on the back hereof and by paying in full in lawful
money of the United States of America, [in cash or by certified
check or official bank check or by bank wire transfer, in each
case,] [by bank wire transfer] in immediately available funds,
the Warrant Price for each Warrant exercised to the Warrant Agent
[as hereinafter defined] and by surrendering this Warrant
Certificate, with the purchase form on the back hereof duly
executed at the corporate trust office of [name of Warrant
Agent], or its successor as warrant agent (the "Warrant Agent"),
[or ] at the address specified on the reverse hereof
and upon compliance with and subject to the conditions set forth
herein and in the Warrant Agreement [as hereinafter defined].
Any whole number of Warrants evidenced by this Warrant
Certificate may be exercised to purchase Warrant Debt Securities
in registered form in denominations of $ and any integral
multiples thereof. Upon any exercise of fewer than all of the
Warrants evidenced by this Warrant Certificate, there shall be
issued to the holder hereof a new Warrant Certificate evidencing
the number of Warrants remaining unexercised.
This Warrant Certificate is issued under and in
accordance with the Warrant Agreement, dated as of ,
19 (the "Warrant Agreement"), between the Company and the
Warrant Agent and is subject to the terms and provisions
contained in the Warrant Agreement, to all of which terms and
provisions the holder of this Warrant Certificate consents by
acceptance hereof. Copies of the Warrant Agreement are on file
at the above-mentioned office of the Warrant Agent [and at
].
The Warrant Debt Securities to be issued and delivered
upon the exercise of the Warrants evidenced by this Warrant
Certificate will be issued under and in accordance with an
Indenture dated as of (the "Indenture"), between the
Company and , a organized and
existing under the laws of ,
as Trustee, ( and any successor to
such Trustee being hereinafter referred to as the "Trustee") and
will be subject to the terms and provisions contained in the
Indenture. [In particular, issuance of unregistered Warrant Debt
Securities upon exercise of Warrants shall be subject to such
arrangements and procedures as shall be provided pursuant to
Section of the Indenture.] Copies of the Indenture and the
form of the Warrant Debt Securities are on file at the corporate
trust office of the Trustee [and at ].
2
<PAGE> 16
[If Bearer Warrants -- This Warrant Certificate, and
all rights hereunder, may be transferred by delivery and the
Company and the Warrant Agent may treat the bearer hereof as the
owner for all purposes.]
[If Registered Warrants -- This Warrant Certificate may
be transferred when surrendered at the corporate trust office of
the Warrant Agent [or ] by the registered owner or his
assigns, in person or by an attorney duly authorized in writing,
in the manner and subject to the limitations provided in the
Warrant Agreement.]
After countersignature by the Warrant Agent and prior
to the expiration of this Warrant Certificate, this Warrant
Certificate may be exchanged at the corporate trust office of the
Warrant Agent for Warrant Certificates representing the same
aggregate number of Warrants.
This Warrant Certificate shall not entitle the holder
hereof to any of the rights of a holder of the Warrant Debt
Securities, including, without limitation, the right to receive
payments of principal of (premium, if any) or interest, if any,
on the Warrant Debt Securities or to enforce any of the covenants
of the Indenture.
This Warrant Certificate shall not be valid or
obligatory for any purpose until countersigned by the Warrant
Agent.
Dated as of , 19 .
HOUSEHOLD INTERNATIONAL, INC.
By______________________________________
Attest:
________________________
Countersigned:
________________________
As Warrant Agent
By______________________
Authorized Signature
3
<PAGE> 17
[Reverse of Warrant Certificate]
(Instructions for Exercise of Warrant)
To exercise the Warrants evidenced hereby, the holder
must pay [in cash or by certified check or official bank check or
by bank wire transfer] [by bank wire transfer] in immediately
available funds the Warrant Price in full for Warrants exercised
to [insert name of Warrant Agent] Corporate Trust Department,
[insert address of Warrant Agent], Attn: [or
], which [payment] [wire transfer] must specify the
name of the holder and the number of Warrants exercised by such
holder. In addition, the holder must complete the information
required below and present this Warrant Certificate in person or
by mail (registered mail is recommended) to the Warrant Agent at
the addresses set forth below. This Warrant Certificate,
completed and duly executed, must be received by the Warrant
Agent within five business days of the [payment] [wire transfer].
[FORM OF ELECTION TO PURCHASE]
(To be executed upon exercise of Warrant.)
The undersigned hereby irrevocably elects to exercise
Warrants, evidenced by this Warrant Certificate, to
purchase $ principal amount of the [Title of Debt
Securities] (the "Warrant Debt Securities") of Household
International, Inc. and represents that he has tendered payment
for such Warrant Debt Securities [in cash or by certified check
or official bank check or by bank wire transfer, in each case]
[by bank wire transfer] in immediately available funds to the
order of Household International, Inc. c/o [insert name and
address of Warrant Agent], in the amount of $ in
accordance with the terms hereof. The undersigned requests that
said principal amount of Warrant Debt Securities be in [bearer
form in the authorized denominations] [fully registered form in
the authorized denominations, registered in such names and
delivered] all as specified in accordance with the instructions
set forth below.
If the number of Warrants exercised is less than all of
the Warrants evidenced hereby, the undersigned requests that a
new Warrant Certificate representing the remaining Warrants
evidenced hereby be issued and delivered to the undersigned
unless otherwise specified in the instructions below.
<TABLE>
<S> <C>
Dated:
- ------------------------
___________________________
Name_________________________________
(Insert Social Security (Please Print)
or Other Identifying Number
of Holder) Address______________________________
______________________________
Signature____________________________
</TABLE>
<PAGE> 18
The Warrants evidenced hereby may be exercised at the
following addresses:
By hand at ____________________________________________
______________________________________________
______________________________________________
______________________________________________
$________________
By mail at ____________________________________________
______________________________________________
______________________________________________
______________________________________________
(Instructions as to form and delivery of Warrant Debt
Securities and, if applicable, Warrant Certificates evidencing
unexercised Warrants.)
2
<PAGE> 19
Reverse of Warrant Certificate
*[CERTIFICATE FOR DELIVERY OF BEARER BONDS]
HOUSEHOLD INTERNATIONAL, INC.
Warrant Debt Securities
TO: HOUSEHOLD INTERNATIONAL, INC.
[Name of Trustee],
as Trustee
This certificate is submitted in connection with our
request that you deliver to us $ principal amount of
Warrant Debt Securities in bearer form upon exercise of Warrants.
We hereby certify that either (a) none of such Warrant Debt
Securities will be held by or on behalf of a United States
Person, or (b) if a United States Person will have a beneficial
interest in such Warrant Debt Securities, such person is
described in Section 165(j)(3)(A), (B) or (C) of the United
States Internal Revenue Code of 1954, as amended, and the
regulations thereunder. As used herein, "United States Person"
means a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in or under the
laws of the United States or any political subdivision thereof or
an estate or trust whose income from sources without the United
States is includible in gross income for United States Federal
income tax purposes regardless of its connection with the conduct
of a trade or business within the United States.
We understand that this certificate is required in
connection with certain tax legislation in the United States. If
administrative or legal proceedings are commenced or threatened
in connection with which this certificate is or would be
relevant, we irrevocably authorize you to produce this
certificate or a copy thereof to any interested party in such
proceedings.
Dated:
_____________________________________
(Please print name)
* Subject to changes in accordance with changes in tax laws
and regulations.
<PAGE> 20
[If registered Warrant]
ASSIGNMENT
[FORM OF ASSIGNMENT TO BE EXECUTED IF HOLDER DESIRES
TO TRANSFER WARRANTS EVIDENCED HEREBY]
FOR VALUE RECEIVED hereby
sells, assigns and transfers unto
Please insert social security
or other identifying number
________________________________
______________________________
(Please print name and address
including zip code)
__
the Warrants represented by the within Warrant Certificate and
does hereby irrevocably constitute and appoint
Attorney, to transfer said Warrant Certificate on
the books of the Warrant Agent with full power of substitution in
the premises.
<TABLE>
<S> <C>
Dated:
--------------------------------
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this
Warrant Certificate and must
bear a signature guarantee by
a bank, trust company or
member broker of the New York
or Midwest Stock Exchange.)
Signature Guaranteed:
______________________________
</TABLE>
<PAGE> 21
HOUSEHOLD INTERNATIONAL, INC.
Form of Warrant Agreement
(for warrants sold attached to debt securities)
THIS WARRANT AGREEMENT dated as of
between Household International, Inc. a Delaware corporation (the
"Company", which term includes any successor corporation under
the Indenture hereinafter referred to) and
as Warrant Agent (the "Warrant Agent").
WHEREAS, the Company has entered into an Indenture
dated as of (the "Indenture"), with
, as Trustee (the "Trustee"), providing for the
issuance from time to time of its unsecured debt securities
("Debt Securities"), to be issued in one or more series as
provided in the Indenture; and
WHEREAS, the Company proposes to sell [title of Debt
Securities being offered] (the "Offered Debt Securities"), with
warrant certificates evidencing one or more warrants (the
"Warrants" or, individually a "Warrant") representing the right
to purchase [title of Debt Securities purchasable through
exercise of Warrants] (the "Warrant Debt Securities"), such
warrant certificates and other warrant certificates issued
pursuant to this Agreement hereinafter referred to as the
"Warrant Certificates"; and
WHEREAS, the Company desires the Warrant Agent to act
on behalf of the Company in connection with the issuance,
exchange, exercise and replacement of the Warrant Certificates,
and in this Agreement wishes to set forth, among other things,
the form and provisions of the Warrant Certificates and the terms
and conditions on which they may be issued, exchanged, exercised
and replaced;
NOW THEREFORE, in consideration of the premises and of
the mutual agreements herein contained, the parties hereto agree
as follows:
ARTICLE I
Issuance of Warrants and Execution
and Delivery of Warrant Certificates
SECTION 1.01. Issuance of Warrants. Warrants shall be
initially issued in connection with the issuance of the Offered
Debt Securities [but shall be separately transferable on and
after , 19 (the "Detachable Date")] [shall not be
separately transferable] and each Warrant Certificate shall
evidence one or more Warrants. Each Warrant evidenced thereby
shall represent the right, subject to the provisions contained
herein and therein, to purchase a Warrant Debt Security in the
principal amount of $ . Warrant Certificates shall be
initially issued in units with
<PAGE> 22
the Offered Debt Securities and each Warrant Certificate included
in such unit shall evidence Warrants for each $
principal amount of Offered Debt Securities included in such unit.
SECTION 1.02. Execution and Delivery of Warrant
Certificates. Each Warrant Certificate, whenever issued, shall
be in [bearer] [registered] form substantially in the form set
forth in Exhibit A hereto, shall be dated and may have
such letters, numbers or other marks of identification or
designation and such legends or endorsements printed,
lithographed or engraved thereon as the officers of the Company
executing the same may approve (execution thereof to be
conclusive evidence of such approval) and as are not inconsistent
with the provisions of this Agreement, or as may be required to
comply with any law or with any rule or regulation made pursuant
thereto or with any rule or regulation of any stock exchange on
which the Warrant Certificates may be listed, or to conform to
usage. The Warrant Certificates shall be signed on behalf of the
Company by either its President, one of its Vice Presidents or
one of its Assistant Treasurers under its corporate seal and
attested by its Secretary or any of its Assistant Secretaries.
Such signatures may be manual or facsimile signatures of such
authorized officers and may be imprinted or otherwise reproduced
on the Warrant Certificates. The seal of the Company may be in
the form of a facsimile thereof and may be impressed, affixed,
imprinted or otherwise reproduced on the Warrant Certificates.
No Warrant Certificate shall be valid for any purpose,
and no Warrant evidenced thereby shall be exercisable, until such
Warrant Certificate has been countersigned by the manual
signature of the Warrant Agent. Such signature by the Warrant
Agent upon any Warrant Certificate executed by the Company shall
be conclusive evidence that the Warrant Certificate so
countersigned has been duly issued hereunder.
In case any officer of the Company who shall have
signed any of the Warrant Certificates either manually or by
facsimile signature shall cease to be such officer before the
Warrant Certificates so signed shall have been countersigned and
delivered by the Warrant Agent, such Warrant Certificates may be
countersigned and delivered notwithstanding that the person who
signed such Warrant Certificates has ceased to be such officer of
the Company; and any Warrant Certificate may be signed on behalf
of the Company by such persons as, at the actual date of the
execution of such Warrant Certificate, shall be the proper
officers of the Company, although at the date of the execution of
this Agreement any such person was not such officer.
[If bearer Warrants -- The term "holder" or "holder of
a Warrant Certificate" as used herein shall mean [If Offered Debt
Securities with Warrants which are not immediately detachable,
prior to the Detachable Date, the registered owner of the Offered
2
<PAGE> 23
Debt Security to which such Warrant Certificate was initially
attached (or the bearer if the Offered Debt Security is a bearer
Debt Security), and after such Detachable Date] the bearer of
such Warrant Certificate.]
[If registered Warrants -- The term "holder" or "holder
of a Warrant Certificate" as used herein shall mean any person in
whose name at the time any Warrant Certificate shall be
registered upon the books to be maintained by the Warrant Agent
for that purpose. [If Offered Debt Securities with Warrants
which are not immediately detachable, or upon the register of the
Offered Debt Securities prior to the Detachable Date. The
Company will, or will cause the registrar of the Offered Debt
Securities to make available at all times to the Warrant Agent
such information as to holders of the Offered Debt Securities
with Warrants as may be necessary to keep the Warrant Agent's
records up to date.]]
SECTION 1.03. Issuance of Warrant Certificates.
Warrant Certificates evidencing the right to purchase an
aggregate principal amount not exceeding $ aggregate
principal amount of Warrant Debt Securities (except as provided
in Sections 2.03(c), 3.02 and 4.01) may be executed by the
Company and delivered to the Warrant Agent upon the execution of
this Warrant Agreement or from time to time thereafter. The
Warrant Agent shall, upon receipt of Warrant Certificates duly
executed on behalf of the Company, countersign Warrant
Certificates evidencing Warrants representing the right to
purchase up to $ aggregate principal amount of Warrant
Debt Securities and shall deliver such Warrant Certificates to or
upon the order of the Company. Subsequent to such original
issuance of the Warrant Certificates, the Warrant Agent shall
countersign a Warrant Certificate only if the Warrant Certificate
is issued in exchange or substitution for one or more previously
countersigned Warrant Certificates, [If registered Warrants -- or
in connection with their transfer], as hereinafter provided or as
provided in Section 2.03(c).
ARTICLE II
Warrant Price, Duration and Exercise of Warrants
SECTION 2.01. Warrant Price.* [On , 19 the
exercise price of each Warrant is $ . During the period
from , 19 through and including , 19
the exercise price of each Warrant will be $ plus
[accrued amortization of the original issue discount] [accrued
interest] from , 19 . On , 19 the
exercise price of
* Complete and modify the provisions of this Section as
appropriate to reflect the exact terms of the Offered Warrants
and the Warrant Debt Securities.
3
<PAGE> 24
each Warrant will be $ . During the
period from , 19 , through and including
, 19 , the exercise price of each Warrant will be $ plus
[accrued amortization of the original issue discount] [accrued
interest] from , 19 , [in each case, the original issue
discount will be amortized at a % annual rate, computed on an
annual basis using a 360-day year consisting of twelve 30-day
months]. Such purchase price of Warrant Debt Securities is
referred to in this Agreement as the "Warrant Price." [The
original issue discount for each $1,000 principal amount of
Warrant Debt Securities is $ ].
SECTION 2.02. Duration of Warrants. Each Warrant evidenced
by a Warrant Certificate may be exercised in whole at any time,
as specified herein, on or after [the date thereof] [ ,
19 ] and at or before 5 p.m. time on ,
19 (the "Expiration Date"). Each Warrant not exercised at or
before the close of business on the Expiration Date shall become
void, and all rights of the holder of the Warrant Certificate
evidencing such Warrant under this Agreement shall cease.
SECTION 2.03. Exercise of Warrants. (a) During the period
specified in Section 2.02 any whole number of Warrants may be
exercised by providing certain information set forth on the
reverse side of the Warrant Certificate and by paying in full, in
lawful money of the United States of America, [in cash or by
certified check or official bank check or by bank wire transfer,
in each case,] [by bank wire transfer] in immediately available
funds the Warrant Price for each Warrant exercised to the Warrant
Agent at its corporate trust office [or at ],
provided that such exercise is subject to receipt within five
business days of such [payment] [wire transfer] by the Warrant
Agent of the Warrant Certificate with the form of election to
purchase Warrant Debt Securities set forth on the reverse side of
the Warrant Certificate properly completed and duly executed.
The date on which payment in full of the Warrant Price is
received by the Warrant Agent shall, subject to receipt of the
Warrant Certificate as aforesaid, be deemed to be the date on
which the Warrant is exercised. The Warrant Agent shall deposit
all funds received by it in payment of the Warrant Price in an
account of the Company maintained with it and shall advise the
Company by telephone at the end of each day on which a [payment]
[wire transfer] for the exercise of Warrants is received of the
amount so deposited to its account. The Warrant Agent shall
promptly confirm such telephone advice to the Company in writing.
(b) The Warrant Agent shall, from time to time, as
promptly as practicable, advise the Company and the Trustee under
the Indenture of (i) the number of Warrants exercised in
accordance with the terms and conditions of this Agreement and
the Warrant Certificates, (ii) the instructions of each holder of
the Warrant Certificates evidencing such Warrants with respect to
delivery of the Warrant Debt Securities to which such holder is
entitled upon
4
<PAGE> 25
such exercise, (iii) delivery of Warrant
Certificates evidencing the balance, if any, of the Warrants
remaining after such exercise, and (iv) such other information as
the Company or the Trustee shall reasonably require.
(c) As soon as practicable after the exercise of any
Warrant, the Company shall issue, pursuant to the Indenture, in
authorized denominations to or upon the order of the holder of
the Warrant Certificate evidencing such Warrant, the Warrant Debt
Securities to which such holder is entitled, [in fully registered
form, registered in such name or names] [in bearer form] as may
be directed by such holder* [; provided, however, the Company
shall not be required to deliver any unregistered Warrant Debt
Securities in the United States]. If fewer than all of the
Warrants evidenced by such Warrant Certificate were exercised,
the Company shall execute, and an authorized officer of the
Warrant Agent shall manually countersign and deliver, a new
Warrant Certificate evidencing the number of such Warrants
remaining unexecuted.
(d) The Company shall not be required to pay any stamp
or other tax or other governmental charge required to be paid in
connection with any transfer involved in the issue of the Warrant
Debt Securities; and in the event that any such transfer is
involved, the Company shall not be required to issue or deliver
any Warrant Debt Security until such tax or other charge shall
have been paid or it has been established to the Company's
satisfaction that no such tax or other charge is due.
[(e) Issuance of unregistered Warrant Debt Securities
upon exercise of Warrants shall be subject to such arrangements
and procedures as shall be provided pursuant to Section
of the Indenture.]
ARTICLE III
Other Provisions Relating to Rights
of Holders of Warrant Certificates
SECTION 3.01. No Rights as Warrant Debt Security
Holder Conferred by Warrants or Warrant Certificates. No Warrant
Certificate or Warrant evidenced thereby shall entitle the holder
thereof to any of the rights of a holder of Warrant Debt
Securities, including, without limitation, the right to receive
the payment of principal of, premium (if any) or interest on
Warrant Debt Securities or to enforce any of the covenants in the
Indenture.
* Subject to change in accordance with changes in tax laws and
regulations.
5
<PAGE> 26
SECTION 3.02. Lost, Stolen, Mutilated or Destroyed
Warrant Certificates. Upon receipt by the Company and the
Warrant Agent of evidence reasonably satisfactory to them of the
ownership of and the loss, theft, destruction or mutilation of
any Warrant Certificate and of indemnity reasonably satisfactory
to them and, in the case of mutilation, upon surrender thereof to
the Warrant Agent for cancellation, then, in the absence of
notice to the Company or the Warrant Agent that such Warrant
Certificate has been acquired by a bona fide purchaser, the
Company shall execute, and an authorized officer of the Warrant
Agent shall manually countersign and deliver, in exchange for or
in lieu of the lost, stolen, destroyed or mutilated Warrant
Certificate, a new Warrant Certificate of the same tenor and
evidencing the same number of Warrants. Upon the issuance of any
new Warrant Certificate under this Section, the Company may
require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the
Warrant Agent) in connection therewith. Every substitute Warrant
Certificate executed and delivered pursuant to this Section in
lieu of any lost, stolen or destroyed Warrant Certificate shall
represent an additional contractual obligation of the Company,
whether or not the lost, stolen or destroyed Warrant Certificate
shall be at any time enforceable by anyone, and shall be entitled
to the benefits of this Agreement equally and proportionately
with any and all other Warrant Certificates duly executed and
delivered hereunder. The provisions of this Section are
exclusive and shall preclude (to the extent lawful) all other
rights and remedies with respect to the replacement of mutilated,
lost, stolen or destroyed Warrant Certificates.
SECTION 3.03. Holder of Warrant Certificate May
Enforce Rights. Notwithstanding any of the provisions of this
Agreement, any holder of a Warrant Certificate, without the
consent of the Warrant Agent, the Trustee, the holder of any
Warrant Debt Securities or the holder of any other Warrant
Certificate, may, in his own behalf and for his own benefit,
enforce, and may institute and maintain any suit, action or
proceeding against the Company suitable to enforce or otherwise
in respect of, his right to exercise the Warrants evidenced by
his Warrant Certificate in the manner provided in his Warrant
Certificate and in this Agreement.
ARTICLE IV
Exchange and Transfer of Warrant Certificates
SECTION 4.01. Exchange and Transfer of Warrant
Certificates. [If Offered Debt Securities with Warrants which
are immediately detachable -- Upon] [If Offered Debt Securities
with Warrants which are not immediately detachable -- Prior to
the Detachable Date a Warrant Certificate may be exchanged or
transferred only together with the Offered Debt Security to which
6
<PAGE> 27
the Warrant Certificate was initially attached, and only for the
purpose of effecting or in conjunction with an exchange or
transfer of such Offered Debt Security. Prior to the Detachable
Date, each transfer of the Offered Debt Security [on the register
of the Offered Debt Securities] shall operate also to transfer
the related Warrant Certificates. After the Detachable Date
upon] surrender at the corporate trust office of the Warrant
Agent [or ], Warrant Certificates evidencing
Warrants may be exchanged for Warrant Certificates in other
denominations evidencing such Warrants [If registered Warrants --
or may be transferred in whole or in part], provided that such
other Warrant Certificates evidence the same aggregate number of
Warrants as the Warrant Certificates so surrendered. [If
registered Warrants -- The Warrant Agent shall keep, at its
corporate trust office [and at ], books in which,
subject to such reasonable regulations as it may prescribe, it
shall register Warrant Certificates and exchanges and transfers
of outstanding Warrant Certificates, upon the surrender of the
Warrant Certificates to the Warrant Agent at its corporate trust
office [or ] for exchange [or transfer], properly
endorsed or accompanied by appropriate instruments of transfer
and written instructions for transfer, all in form satisfactory
to the Company and the Warrant Agent]. No service charge shall
be made for any exchange [or transfer] of Warrant Certificates,
but the Company may require payment of a sum sufficient to cover
any stamp or other tax or other governmental charge that may be
imposed in connection with any such exchange [or transfer].
Whenever any Warrant Certificates are so surrendered for exchange
[or transfer] an authorized officer of the Warrant Agent shall
manually countersign and deliver to the person or persons
entitled thereto a Warrant Certificate or Warrant Certificates
duly authorized and executed by the Company, as so requested.
The Warrant Agent shall not be required to effect any exchange
[or transfer] which will result in the issuance of a Warrant
Certificate evidencing a fraction of a Warrant or a number of
full Warrants and a fraction of a Warrant. All Warrant
Certificates issued upon any exchange [or transfer] of Warrant
Certificates shall be the valid obligations of the Company,
evidencing the same obligations, and entitled to the same
benefits under this Agreement, as the Warrant Certificates
surrendered for such exchange [or transfer].
SECTION 4.02. Treatment of Holders of Warrant
Certificates. [If Offered Debt Securities with bearer Warrants
which are not immediately detachable -- Subject to Section 4.01,
each] [If Offered Debt Securities with bearer Warrants which are
immediately detachable -- Each] Warrant Certificate shall be
transferable by delivery and shall be deemed negotiable and the
bearer of each Warrant Certificate may be treated by the Company,
the Warrant Agent and all other persons dealing with such bearer
as the absolute owner thereof for any purpose and as the person
entitled to exercise the rights represented by the Warrants
evidenced thereby, any notice to the contrary notwithstanding.]
[If registered Warrants which are not immediately detachable --
7
<PAGE> 28
Every holder of a Warrant Certificate, by accepting the same,
consents and agrees with the Company, the Warrant Agent and with
every subsequent holder of such Warrant Certificate that until
the Warrant Certificate is transferred on the books of the
Warrant Agent [or the register of the Offered Debt Securities
prior to the Detachable Date], the Company and the Warrant Agent
may treat the registered holder as the absolute owner thereof for
any purpose and as the person entitled to exercise the rights
represented by the Warrants evidenced thereby, any notice to the
contrary notwithstanding.]
SECTION 4.03. Cancellation of Warrant Certificates.
Any Warrant Certificate surrendered for exchange [transfer] or
exercise of the Warrants evidenced thereby shall, if surrendered
to the Company, be delivered to the Warrant Agent and all Warrant
Certificates surrendered or so delivered to the Warrant Agent
shall be promptly cancelled by the Warrant Agent and shall not be
reissued and, except as expressly permitted by this Agreement, no
Warrant Certificate shall be issued hereunder in exchange or in
lieu thereof. The Warrant Agent shall deliver to the Company
from time to time or otherwise dispose of cancelled Warrant
Certificates in a manner satisfactory to the Company.
ARTICLE V
Concerning the Warrant Agent
SECTION 5.01. Warrant Agent. The Company hereby
appoints as Warrant Agent of the Company in
respect of the Warrants and the Warrant Certificates, upon the
terms and subject to the conditions herein set forth, and
hereby accepts such appointment. The Warrant Agent
shall have the powers and authority granted to and conferred upon
it in the Warrant Certificates and hereby and such further powers
and authority to act on behalf of the Company as the Company may
hereafter grant to or confer upon it. All of the terms and
provisions with respect to such powers and authority contained in
the Warrant Certificates are subject to and governed by the terms
and provisions hereof.
SECTION 5.02. Conditions of Warrant Agent's
Obligations. The Warrant Agent accepts its obligations herein
set forth upon the terms and conditions hereof, including the
following, to all of which the Company agrees and to all of which
the rights hereunder of the holders from time to time of the
Warrant Certificates shall be subject:
(a) Compensation and Indemnification. The Company
agrees promptly to pay the Warrant Agent the compensation to be
agreed upon with the Company for all services rendered by the
Warrant Agent and to reimburse the Warrant Agent for reasonable
out-of-pocket expenses (including counsel fees) incurred by the
8
<PAGE> 29
Warrant Agent in connection with the services rendered hereunder
by the Warrant Agent. The Company also agrees to indemnify the
Warrant Agent for, and to hold it harmless against, any loss,
liability or expense incurred without negligence or bad faith on
the part of the Warrant Agent, arising out of or in connection
with its acting as Warrant Agent hereunder, as well as the costs
and expenses of defending against any claim of such liability.
(b) Agent for the Company. In acting under this
Warrant Agreement and in connection with the Warrant
Certificates, the Warrant Agent is acting solely as agent of the
Company and does not assume any obligation or relationship of
agency or trust for or with any of the holders of Warrant
Certificates or beneficial owners of Warrants.
(c) Counsel. The Warrant Agent may consult with
counsel satisfactory to it, and the advise of such counsel shall
be full and complete authorization and protection in respect of
any action taken, suffered or omitted by it hereunder in good
faith and in accordance with the advice of such counsel.
(d) Documents. The Warrant Agent shall be protected
and shall incur no liability for or in respect of any action
taken or thing suffered by it in reliance upon any Warrant
Certificate, notice, direction, consent, certificate, affidavit,
statement or other paper or document reasonably believed by it to
be genuine and to have been presented or signed by the proper
parties.
(e) Certain Transactions. The Warrant Agent, and its
officers, directors and employees, may become the owner of, or
acquire any interest in, Warrants, with the same rights that it
or they would have if it were not the Warrant Agent hereunder,
and, to the extent permitted by applicable law, it or they may
engage or be interested in any financial or other transaction
with the Company and may act on, or as depositary, trustee or
agent for, any committee or body of holders of Warrant Debt
Securities or other obligations of the Company as freely as if it
were not the Warrant Agent hereunder. Nothing in this Warrant
Agreement shall be deemed to prevent the Warrant Agent from
acting as Trustee under the Indenture.
(f) No Liability for Interest. The Warrant Agent
shall have no liability for interest on any monies at any time
received by it pursuant to any of the provisions of this
Agreement or of the Warrant Certificates.
(g) No Liability for Invalidity. The Warrant Agent
shall have no liability with respect to any invalidity of this
Agreement or any of the Warrant Certificates.
(h) No Responsibility for Representations. The
Warrant Agent shall not be responsible for any of the recitals or
9
<PAGE> 30
representations herein or in the Warrant Certificates (except as
to the Warrant Agent's countersignature thereon), all of which
are made solely by the Company.
(i) No Implied Obligations. The Warrant Agent shall
be obligated to perform only such duties as are herein and in the
Warrant Certificates specifically set forth and no implied duties
or obligations shall be read into this Agreement or the Warrant
Certificates against the Warrant Agent. The Warrant Agent shall
not be under any obligations to take any action hereunder which
may tend to subject it to any expense or liability, reimbursement
for which within a reasonable time is not, in its reasonable
opinion, assured to it. The Warrant Agent shall not be
accountable or responsible for the use by the Company of any of
the Warrant Certificates authenticated by the Warrant Agent and
delivered by it to the Company pursuant to this Agreement or for
the application by the Company of the proceeds of the Warrant
Certificates. The Warrant Agent shall have no duty or
responsibility in case of any default by the Company in the
performance of its covenants or agreements contained herein or in
the Warrant Certificates or in the case of the receipt of any
written demand from a holder of a Warrant Certificate with
respect to such default, including, without limiting the
generality of the foregoing, any duty or responsibility to
initiate or attempt to initiate any proceedings at law or
otherwise or, except as provided in Section 6.02 hereof, to make
any demand upon the Company.
SECTION 5.03. Resignation and Appointment of
Successor. (a) The Company agrees, for the benefit of the
holders from time to time of the Warrant Certificates, that there
shall at all times be a Warrant Agent hereunder until all the
Warrant Certificates are no longer exercisable.
(b) The Warrant Agent may at any time resign as such
agent by giving written notice to the Company of such intention
on its part, specifying the date on which its desired resignation
shall become effective; provided that such date shall be not less
than three months after the date on which such notice is given
unless the Company otherwise agrees. The Warrant Agent hereunder
may be removed at any time by the filing with it of an instrument
in writing signed by or on behalf of the Company and specifying
such removal and the date when it shall become effective. Such
resignation or removal shall take effect upon the appointment by
the Company, as hereinafter provided, of a successor Warrant
Agent (which shall be a bank or trust company authorized under
the laws of the jurisdiction of its organization to exercise
corporate trust powers) and the acceptance of such appointment by
such successor Warrant Agent. The obligation of the Company
under Section 5.02(a) shall continue to the extent set forth
therein, notwithstanding the resignation or removal of the
Warrant Agent.
10
<PAGE> 31
(c) In case at any time the Warrant Agent shall resign,
or shall be removed, or shall become incapable of acting, or
shall be adjudged a bankrupt or insolvent, or shall file a
petition seeking relief under Title II of the United States Code,
as now constituted or hereafter amended, or under any other
applicable Federal or State bankruptcy law or similar law or make
an assignment for the benefit of its creditors or shall consent
to the appointment of a receiver or custodian of all or any
substantial part of its property, or shall admit in writing its
inability to pay or meet its debts as they mature, or if a
receiver or custodian of it or of all or any substantial part of
its property shall be appointed, or if an order of any court
shall be entered for relief against it under the provisions of
Title II of the United States Code, as now constituted or
hereafter amended, or under any other applicable Federal or State
bankruptcy or similar law, or if any public officer shall have
taken charge or control of the Warrant Agent or of its property
or affairs, for the purpose of rehabilitation, conservation or
liquidation, a successor Warrant Agent, qualified as set forth in
subsection (b) above, shall be appointed by the Company by an
instrument in writing, filed with the successor Warrant Agent.
Upon the appointment of a successor Warrant Agent and acceptance
by the successor Warrant Agent of such appointment, the Warrant
Agent shall cease to be Warrant Agent hereunder.
(d) Any successor Warrant Agent appointed hereunder
shall execute, acknowledge and deliver to its predecessor and to
the Company an instrument accepting such appointment hereunder,
and thereupon such successor Warrant Agent, without any further
act, deed or conveyance, shall become vested with all the
authority, rights, powers, trusts, immunities, duties and
obligations of such predecessor with like effect as if originally
named as Warrant Agent hereunder, and such predecessor, upon
payment of its charges and disbursements then unpaid, shall
thereupon become obligated to transfer, deliver and pay over, and
such successor Warrant Agent shall be entitled to receive, all
monies, securities and other property on deposit with or held by
such predecessor, as Warrant Agent hereunder.
(e) Any corporation into which the Warrant Agent
hereunder may be merged or converted or any corporation with
which the Warrant Agent may be consolidated, or any corporation
to which the Warrant Agent shall sell or otherwise transfer all
or substantially all the assets and business of the Warrant Agent
shall be the successor Warrant Agent under this Agreement without
the execution or filing of any paper or any further act on the
part of any of the parties hereto, provided that it shall be
qualified as set forth above in subsection (b).
11
<PAGE> 32
ARTICLE VI
Miscellaneous
SECTION 6.01 Amendment. This Agreement may be amended
by the parties hereto, without the consent of the holder of any
Warrant Certificate, for the purpose of curing any ambiguity, or
of curing, correcting or supplementing any defective provision
contained herein, or making any other provisions with respect to
matters or questions arising under this Agreement as the Company
and the Warrant Agent may deem necessary or desirable; provided
that such action shall not adversely affect the interests of the
holders of the Warrant Certificates.
SECTION 6.02. Notices and Demands to the Company and
Warrant Agent. If the Warrant Agent shall receive any notice or
demand addressed to the Company by the holder of a Warrant
Certificate pursuant to the provisions of the Warrant
Certificates, the Warrant Agent shall promptly forward such
notice or demand to the Company.
SECTION 6.03. Addresses. Any communications from the
Company to the Warrant Agent with respect to this Agreement shall
be addressed to , Attention:
, and any communications from the Warrant Agent
to the Company with respect to this Agreement shall be addressed
to
, Attention: (or such other
address as shall be specified in writing by the Warrant Agent or
by the Company).
SECTION 6.04. Applicable Law. The validity,
interpretation and performance of this Agreement and each Warrant
Certificate issued hereunder and of the respective terms and
provisions thereof shall be governed by, and construed in
accordance with, the laws of the State of .
SECTION 6.05. Delivery of Prospectus. The Company
will furnish to the Warrant Agent sufficient copies of a
prospectus relating to the Warrant Debt Securities deliverable
upon exercise of Warrants (the "Prospectus"), and the Warrant
Agent agrees that upon the exercise of any Warrant, the Warrant
Agent will deliver to the holder of the Warrant Certificate
evidencing such Warrant, prior to or concurrently with the
delivery of the Warrant Debt Securities issued upon such
exercise, a Prospectus.
SECTION 6.06. Obtaining of Governmental Approvals.
The Company will from time to time take all action which may be
necessary to obtain and keep effective any and all permits,
consents and approvals of governmental agencies and authorities
and securities acts filings under United States Federal and State
laws (including without limitation a registration statement in
respect
12
<PAGE> 33
of the Warrants and Warrant Debt Securities under the
Securities Act of 1933), which may be or become requisite in
connection with the issuance, sale, transfer and delivery of the
Warrant Certificates, the exercise of the Warrants, the issuance,
sale, transfer and delivery of the Warrant Debt Securities issued
upon exercise of the Warrants or upon the expiration of the
period during which the Warrants are exercisable.
SECTION 6.07. Persons Having Rights under Warrant
Agreement. Nothing in this Agreement expressed or implied and
nothing that may be inferred from any of the provisions hereof is
intended, or shall be construed, to confer upon, or give to, any
person or corporation other than the Company, the Warrant Agent
and the holders of the Warrant Certificates any right, remedy or
claim under or by reason of this Agreement or of any covenant,
condition, stipulation, promise or agreement hereof; and all
covenants, conditions, stipulations, promises and agreements in
this Agreement contained shall be for the sole and exclusive
benefit of the Company and the Warrant Agent and their successors
and of the holders of the Warrant Certificates.
SECTION 6.08. Headings. The descriptive headings of
the several Articles and Sections of this Agreement are inserted
for convenience only and shall not control or affect the meaning
or construction of any of the provisions hereof.
SECTION 6.09. Counterparts. This Agreement may be
executed in any number of counterparts, each of which as so
executed shall be deemed to be an original, but such counterparts
shall together constitute but one and the same instrument.
SECTION 6.10. Inspection of Agreement. A copy of this
Agreement shall be available at all reasonable times at the
principal corporate trust office of the Warrant Agent for
inspection by the holder of any Warrant Certificate. The Warrant
Agent may require such holder to submit his Warrant Certificate
for inspection by it.
IN WITNESS WHEREOF, Household International, Inc. has
caused this Agreement to be signed by one of its duly authorized
officers, and its corporate seal to be affixed hereunto, and the
same to be attested by its Secretary or one of its
13
<PAGE> 34
Assistant Secretaries, all as of the day and year first above
written.
HOUSEHOLD INTERNATIONAL, INC.
By________________________________________
Attest:
____________________
By________________________________________
as Warrant Agent
Attest:
_____________________
14
<PAGE> 35
EXHIBIT A
(FORM OF WARRANT CERTIFICATE)
[Face of Warrant Certificate]
<TABLE>
<S> <C>
[Form of Legend if Prior to this
Debt Securities with Warrant Certificate cannot
Warrants which are not be transferred or exchanged
immediately detachable: unless attached to a [Title
of Offered Debt Securities]
</TABLE>
Exercisable Only if Countersigned By the Warrant
Agent as Provided Herein
Warrant Certificates representing
Warrants to purchase
[Title of Warrant Debt Securities]
as described herein.
HOUSEHOLD INTERNATIONAL, INC.
Warrants to Purchase
[Title of Warrant Debt Securities]
Void After 5 P.M. Time on
, 19
[No.] Warrants
This certifies that [the bearer is the] [ or
registered assigns is the registered] owner of the above-
indicated number of Warrants, each Warrant entitling such
[bearer] [owner] to purchase, at any time [after 5 P.M.
time on , 19 and] on or before 5 P.M.
time on , 19 , $ principal amount of [Title
of Warrant Debt Securities] (the "Warrant Debt Securities"), of
Household International, Inc. (the "Company"), issued and to be
issued under the Indenture (as hereinafter defined), on the
following basis:* [on , 19 the exercise price of
each Warrant is $ ; during the period from , 19 ,
through and including
* Complete and modify the following provision as appropriate
to reflect the exact terms of the Offered Warrants and the
Warrant Debt Securities.
<PAGE> 36
, 19 , the exercise price of each
Warrant will be $ plus [accrued amortization of the
original issue discount] [accrued interest] from , 19
; on , 19 the exercise price of each Warrant will be
$ ; during the period from , 19 , through and
including , 19 the exercise price of each
Warrant will be $ plus [accrued amortization of the
original issue discount] [accrued interest] from , 19
; [in each case, the original issue discount will be amortized at
a % annual rate, computed on an annual basis, using a 360-day
year consisting of twelve 30-day months] (the "Warrant Price").
[The original issue discount for each $1,000 principal amount of
Warrant Debt Securities is $ .] The holder may exercise
the Warrants evidenced hereby by providing certain information
set forth on the back hereof and by paying in full in lawful
money of the United States of America, [in cash or by certified
check or official bank check or by bank wire transfer, in each
case,] [by bank wire transfer] in immediately available funds,
the Warrant Price for each Warrant exercised to the Warrant Agent
(as hereinafter defined) and by surrendering this Warrant
Certificate, with the purchase form on the back hereof duly
executed at the corporate trust office of [name of Warrant
Agent], or its successor as warrant agent (the "Warrant Agent"),
[or ] at the address specified on the reverse hereof
and upon compliance with and subject to the conditions set forth
herein and in the Warrant Agreement (as hereinafter defined).
Any whole number of Warrants evidenced by this Warrant
Certificate may be exercised to purchase Warrant Debt Securities
in registered form in denominations of $ and any integral
multiples thereof. Upon any exercise of fewer than all of the
Warrants evidenced by this Warrant Certificate, there shall be
issued to the holder hereof a new Warrant Certificate evidencing
the number of Warrants remaining unexercised.
This Warrant Certificate is issued under and in
accordance with the Warrant Agreement, dated as of ,
19 (the "Warrant Agreement"), between the Company and the
Warrant Agent and is subject to the terms and provisions
contained in the Warrant Agreement, to all of which terms and
provisions the holder of this Warrant Certificate consents by
acceptance hereof. Copies of the Warrant Agreement are on file
at the above-mentioned office of the Warrant Agent [and at
].
The Warrant Debt Securities to be issued and delivered
upon the exercise of the Warrants evidenced by this Warrant
Certificate will be issued under and in accordance with an
Indenture dated as of (the "Indenture"), between the
Company and , a organized and
existing under the laws of ,
as Trustee, ( and any successor to
such Trustee being hereinafter referred to as the "Trustee") and
will be subject to the terms and provisions contained in the
Indenture.
2
<PAGE> 37
[In particular, issuance of unregistered Warrant Debt
Securities upon exercise of Warrants shall be subject to such
arrangements and procedures as shall be provided pursuant to
Section of the Indenture.] Copies of the Indenture and the
form of the Warrant Debt Securities are on file at the corporate
office of the Trustee [and at ].
[If Offered Debt Securities with bearer Warrants which
are not immediately detachable -- Prior to , 19 this
Warrant Certificate may be exchanged or transferred only together
with the [Title of Offered Debt Securities] ("Offered Debt
Securities") to which this Warrant Certificate was initially
attached, and only for the purpose of effecting, or in
conjunction with, an exchange or transfer of such Offered Debt
Security. After such date, this [If Offered Debt Securities with
bearer Warrants which are immediately detachable -- This] Warrant
Certificate, and all rights hereunder, may be transferred by
delivery, and the Company and the Warrant Agent may treat the
bearer hereof as the owner for all purposes.]
[If Offered Debt Securities with registered Warrants
which are not immediately detachable -- Prior to , 19
this Warrant Certificate may be exchanged or transferred only
together with the [Title of Offered Debt Securities] ("Offered
Debt Securities") to which this Warrant Certificate was initially
attached, and only for the purpose of effecting, or in
conjunction with, an exchange or transfer of such Offered Debt
Security. After such date, this [If Offered Debt Securities with
registered Warrants which are immediately detachable -- This]
Warrant Certificate may be transferred when surrendered at the
corporate trust office of the Warrant Agent [or ] by
the registered owner or his assigns, in person or by an attorney
duly authorized in writing, in the manner and subject to the
limitations provided in the Warrant Agreement.]
[If Offered Debt Securities with Warrants which are not
immediately detachable -- Except as provided in the immediately
preceding paragraph, after] [If Offered Debt Securities with
Warrants which are immediately detachable -- After]
countersignature by the Warrant Agent and prior to the expiration
of this Warrant Certificate, this Warrant Certificate may be
exchanged at the corporate trust office of the Warrant Agent for
Warrant Certificates representing the same aggregate number of
Warrants.
This Warrant Certificate shall not entitle the holder
hereof to any of the rights of a holder of the Warrant Debt
Securities, including, without limitation, the right to receive
payments of principal of (premium, if any) or interest, if any,
on the Warrant Debt Securities or to enforce any of the covenants
of the Indenture.
3
<PAGE> 38
This Warrant Certificate shall not be valid or
obligatory for any purpose until countersigned by the Warrant
Agent.
Dated as of , 19 .
HOUSEHOLD INTERNATIONAL, INC.
By______________________________________
Attest:
________________________
Countersigned:
________________________
As Warrant Agent
By______________________
Authorized Signature
4
<PAGE> 39
[Reverse of Warrant Certificate]
(Instructions for Exercise of Warrant)
To exercise the Warrants evidenced hereby, the holder
must pay [in cash or by certified check or official bank check or
by bank wire transfer] [by bank wire transfer] in immediately
available funds the Warrant Price in full for Warrants exercised
to [insert name of Warrant Agent] Corporate Trust Department
[insert address of Warrant Agent], Attn. [or
], which [payment] [wire transfer] must specify the
name of the holder and the number of Warrants exercised by such
holder. In addition, the holder must complete the information
required below and present this Warrant Certificate in person or
by mail (registered mail is recommended) to the Warrant Agent at
the addresses set forth below. This Warrant Certificate,
completed and duly executed, must be received by the Warrant
Agent within five business days of the [payment] [wire transfer].
[Form of Election to Purchase]
(to be executed upon exercise of Warrant)
The undersigned hereby irrevocably elects to exercise
Warrants, evidenced by this Warrant Certificate, to
purchase $ principal amount of the [Title of Debt
Securities] (the "Warrant Debt Securities") of
and represents that he has tendered payment for such
Warrant Debt Securities [in cash or by certified check or
official bank check or by bank wire transfer, in each case,] [by
bank wire transfer] in immediately available funds to the order
of Household International, Inc. c/o [insert name and address of
Warrant Agent] in the amount of $ in accordance with the
terms hereof. The undersigned requests that said principal
amount of Warrant Debt Securities be in [bearer form in the
authorized denominations] [fully registered form in the
authorized denominations, registered in such names and delivered]
all as specified in accordance with the instructions set forth
below.
If the number of Warrants exercised is less than all of
the Warrants evidenced hereby, the undersigned requests that a
new Warrant Certificate representing the remaining Warrants
evidenced hereby be issued and delivered to the undersigned
unless otherwise specified in the instructions below.
<TABLE>
<S> <C>
Dated:
- ------------------------
___________________________ Name_________________________________
(Insert Social Security (Please Print)
or Other Identifying Number
of Holder) Address______________________________
______________________________
Signature____________________________
</TABLE>
<PAGE> 40
The Warrants evidenced hereby may be exercised at the
following addresses:
By hand at ____________________________________________
______________________________________________
______________________________________________
______________________________________________
By mail at ____________________________________________
______________________________________________
______________________________________________
______________________________________________
(Instructions as to form and delivery of Warrant Debt
Securities and, if applicable, Warrant Certificates evidencing
unexercised Warrants.)
2
<PAGE> 41
Reverse of Warrant Certificate
*[Certificate for Delivery of Bearer Bonds]
HOUSEHOLD INTERNATIONAL, INC.
Warrant Debt Securities
TO: HOUSEHOLD INTERNATIONAL, INC.
This certificate is submitted in connection with our
request that you deliver to us $ principal amount of
Warrant Debt Securities in bearer form upon exercise of Warrants.
We hereby certify that either (a) none of such Warrant Debt
Securities will be held by or on behalf of a United States
Person, or (b) if a United States Person will have a beneficial
interest in such Warrant Debt Securities, such person is
described in Section 165 (j)(3)(A), (B) or (C) of the United
States Internal Revenue Code of 1954, as amended, and the
regulations thereunder. As used herein, "United States Person"
means a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in or under the
laws of the United States or any political subdivision thereof or
an estate or trust whose income from sources without the United
States is includible in gross income for United States Federal
income tax purposes regardless of its connection with the conduct
of a trade or business within the United States.
We understand that this certificate is required in
connection with certain tax legislation in the United States. If
administrative or legal proceedings are commenced or threatened
in connection with which this certificate is or would be
relevant, we irrevocably authorize you to produce this
certificate or a copy thereof to any interested party in such
proceedings.
Dated:
_____________________________________
(Please print name)
* Subject to changes in accordance with changes in tax laws
and regulations.
<PAGE> 42
[If registered Warrant]
ASSIGNMENT
(Form of Assignment to be Executed if Holder Desires
to Transfer Warrants Evidenced Hereby)
For Value Received hereby
sells, assigns and transfers unto
Please insert social security
or other identifying number
________________________________
______________________________
(Please print name and address
including zip code)
_________________________________________________________________
the Warrants represented by the within Warrant Certificate and
does hereby irrevocably constitute and appoint
Attorney, to transfer said Warrant Certificate on
the books of the Warrant Agent with full power of substitution in
the premises.
<TABLE>
<S> <C>
Dated:
--------------------------------
Signature
(Signature must conform in all
respects to name of holder as
specified on the face of this
Warrant Certificate and must
bear a signature guarantee by
a bank, trust company or
member broker of the New York
or Midwest Stock Exchange.)
Signature Guaranteed:
</TABLE>
______________________________
<PAGE> 1
Exhibit 4(e)
HOUSEHOLD INTERNATIONAL, INC.
___________________________________________, As Depositary
AND
THE HOLDERS FROM TIME TO TIME OF
THE DEPOSITARY RECEIPTS DESCRIBED HEREIN
Deposit Agreement
<PAGE> 2
TABLE OF CONTENTS
Page
PARTIES ................................................... 1
RECITALS .................................................. 1
ARTICLE I
Definitions
Certificate ............................................... 1
Company ................................................... 1
Deposit Agreement ......................................... 1
Depositary ................................................ 1
Depositary Shares ......................................... 1
Depositary's Agent ........................................ 1
Depositary's Office ....................................... 2
Receipt ................................................... 2
Record Holder ............................................. 2
Registrar ................................................. 2
Stock ..................................................... 2
ARTICLE II
Form of Receipts, Deposit of Stock, Execution and Delivery,
Transfer, Surrender and Redemption of Receipts
SECTION 2.01. Form and Transfer of Receipts .............. 2
SECTION 2.02. Deposit of Stock; Execution and Delivery
of Receipts in Respect Thereof ............. 3
SECTION 2.03. Redemption of Stock ........................ 4
SECTION 2.04. Registration of Transfer of Receipts ....... 6
SECTION 2.05. Split-ups and Combinations of Receipts;
Surrender of Receipts and Withdrawal of
Stock ...................................... 6
SECTION 2.06. Limitations on Execution and Delivery,
Transfer, Surrender and Exchange of
Receipts ................................... 7
SECTION 2.07. Lost Receipts, etc. ....................... 8
SECTION 2.08. Cancellation and Destruction of
Surrendered Receipts ....................... 8
<PAGE> 3
ARTICLE III
Certain Obligations of Holders
of Receipts and the Company
SECTION 3.01. Filing Proofs, Certificates and Other
Information ................................ 8
SECTION 3.02. Payment of Taxes or Other Governmental
Charges .................................... 8
SECTION 3.03 Warranty as to Stock ....................... 9
ARTICLE IV
The Deposited Securities; Notices
SECTION 4.01. Cash Distributions ......................... 9
SECTION 4.02. Distributions Other Than Cash, Rights,
Preferences or Privileges .................. 9
SECTION 4.03. Subscription Rights, Preferences or
Privileges ................................. 10
SECTION 4.04. Notice of Dividends; Fixing of Record
Date for Holders of Receipts ............... 11
SECTION 4.05. Voting Rights .............................. 11
SECTION 4.06. Changes Affecting Deposited Securities and
Reclassifications, Recapitalizations, etc. . 12
SECTION 4.07. Inspection of Reports ...................... 13
SECTION 4.08. Lists of Receipt Holders ................... 13
ARTICLE V
The Depositary, the Depositary's Agents,
the Registrar and the Company
SECTION 5.01. Maintenance of Offices, Agencies and
Transfer Books by the Depositary;
Registrar .................................. 13
<PAGE> 4
SECTION 5.02. Prevention of or Delay in Performance
by the Depositary, the Depositary's
Agents, the Registrar or the Company ....... 14
SECTION 5.03. Obligations of the Depositary, the
Depositary's Agents, the Registrar and
the Company ................................ 15
SECTION 5.04. Resignation and Removal of the Depositary;
Appointment of Successor Depositary ........ 15
SECTION 5.05. Corporate Notices and Reports .............. 16
SECTION 5.06. Indemnification by the Company ............. 17
SECTION 5.07. Charges and Expenses ....................... 17
ARTICLE VI
Amendment and Termination
SECTION 6.01. Amendment .................................. 17
SECTION 6.02. Termination ................................ 18
ARTICLE VII
Miscellaneous
SECTION 7.01. Counterparts ............................... 18
SECTION 7.02. Exclusive Benefit of Parties ............... 18
SECTION 7.03. Invalidity of Provisions ................... 18
SECTION 7.04. Notices .................................... 19
SECTION 7.05. Depositary's Agents ........................ 19
SECTION 7.06. Holders of Receipts Are Parties ............ 19
SECTION 7.07. Governing Law .............................. 20
SECTION 7.08. Inspection of Deposit Agreement ............ 20
SECTION 7.09. Headings ................................... 20
<PAGE> 5
DEPOSIT AGREEMENT dated as of ___________________, 199_
among HOUSEHOLD INTERNATIONAL, INC., a Delaware
corporation, _____________________________, an
_____________ [bank] [corporation], and the holders from
time to time of the Receipts described herein.
WHEREAS it is desired to provide, as hereinafter set forth
in this Deposit Agreement, for the deposit of shares of ______%
Cumulative Preferred Stock, Series ________, without par value,
of Household International, Inc. with the Depositary for the
purposes set forth in this Deposit Agreement and for the issuance
hereunder of Receipts evidencing Depositary Shares in respect of
the Stock so deposited; and
WHEREAS the Receipts are to be substantially in the form of
Exhibit A annexed hereto, with appropriate insertions,
modifications and omissions, as hereinafter provided in this
Deposit Agreement;
NOW, THEREFORE, in consideration of the premises, the
parties hereto agree as follows:
ARTICLE I
Definitions
The following definitions shall for all purposes, unless
otherwise indicated, apply to the respective terms used in this
Deposit Agreement:
"Certificate" shall mean the certificate of designation
filed with the Secretary of State of Delaware establishing the
Stock as a series of preferred stock of the Company.
"Company" shall mean Household International, Inc., a
Delaware corporation, and its successors.
"Deposit Agreement" shall mean this Deposit Agreement, as
amended or supplemented from time to time.
"Depositary" shall mean __________________________, and any
successor as Depositary hereunder.
"Depositary Shares" shall mean Depositary Shares, each
representing ___________ of a share of Stock and evidenced by a
Receipt.
"Depositary's Agent" shall mean an agent appointed by the
Depositary pursuant to Section 7.05.
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"Depositary's Office" shall mean the principal office of the
Depositary in [Chicago, Illinois, or New York, New York], at
which at any particular time its depositary receipt business
shall be administered.
"Receipt" shall mean one of the Depositary Receipts (each
evidencing one Depositary Share) issued hereunder, whether in
definitive or temporary form.
"Record Holder" as applied to a Receipt shall mean the
person in whose name a Receipt is registered on the books of the
Depositary maintained for such purpose.
"Registrar" shall mean any bank or trust company which shall
be appointed to register ownership and transfers of Receipts as
herein provided.
"Stock" shall mean shares of the Company's ______%
Cumulative Preferred Stock, Series ________, without par value.
ARTICLE II
Form of Receipts, Deposit of Stock, Execution and
Delivery, Transfer, Surrender and Redemption of Receipts
SECTION 2.01. Form and Transfer of Receipts. Definitive
Receipts shall be engraved or printed or lithographed on steel-
engraved borders and shall be substantially in the form set forth
in Exhibit A annexed to this Deposit Agreement, with appropriate
insertions, modifications and omissions, as hereinafter provided.
Pending the preparation of definitive Receipts, the Depositary,
upon the written order of the Company or any holder of Stock, as
the case may be, delivered in compliance with Section 2.02, shall
execute and deliver temporary Receipts which are printed, litho-
graphed, typewritten, mimeographed or otherwise substantially of
the tenor of the definitive Receipts in lieu of which they are
issued and with such appropriate insertions, omissions,
substitutions and other variations as the persons executing such
Receipts may determine, as evidenced by their execution of such
Receipts. If temporary Receipts are issued, the Company will
cause definitive Receipts to be prepared without unreasonable
delay. After the preparation of definitive Receipts, the
temporary Receipts shall be exchangeable for definitive Receipts
upon surrender of the temporary Receipts at an office described
in the last paragraph of Section 2.02, without charge to the
holder. Upon surrender for cancellation of any one or more
temporary Receipts, the Depositary shall execute and deliver in
exchange therefor definitive Receipts representing the same
number of Depositary Shares as represented by the surrendered
temporary Receipt or Receipts. Such exchange shall be made at
the Company's expense and without any charge therefor. Until so
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exchanged, the temporary Receipts shall in all respects be
entitled to the same benefits under this Agreement, and with
respect to the Stock, as definitive Receipts.
Receipts shall be executed by the Depositary by the manual
signature of a duly authorized officer of the Depositary;
provided, that such signature may be a facsimile if a Registrar
for the Receipts shall have been appointed and such Receipts are
countersigned by manual signature of a duly authorized officer of
the Registrar. No Receipt shall be entitled to any benefits under
this Deposit Agreement or be valid or obligatory for any purpose
unless it shall have been executed manually by a duly authorized
officer of the Depositary or, if a Registrar for the Receipts
shall have been appointed, by manual or facsimile signature of a
duly authorized officer of the Depositary and countersigned
manually by a duly authorized officer of such Registrar. The
Depositary or the Registrar, as applicable, shall record on its
books each Receipt so signed and delivered as hereinafter
provided.
Receipts shall be in denominations of any number of whole
Depositary Shares up to but not in excess of _____________
Depositary Shares for any particular Receipt.
Receipts may be endorsed with or have incorporated in the
text thereof such legends or recitals or changes not inconsistent
with the provisions of this Deposit Agreement as may be required
by the Company or the Depositary or required to comply with any
applicable law or any regulation thereunder or with the rules and
regulations of any securities exchange upon which the Stock, the
Depositary Shares or the Receipts may be listed or to conform
with any usage with respect thereto, or to indicate any special
limitations or restrictions to which any particular Receipts are
subject.
Title to Depositary Shares evidenced by a Receipt which is
properly endorsed, or accompanied by a properly executed
instrument of transfer, shall be transferable by delivery with
the same effect as in the case of a negotiable instrument;
provided, however, that until transfer of a Receipt shall be
registered on the books of the Depositary as provided in Section
2.04, the Depositary shall, notwithstanding any notice to the
contrary, treat the record holder thereof at such time as the
absolute owner thereof for the purpose of determining the person
entitled to distributions of dividends or other distributions or
to any notice provided for in this Deposit Agreement and for all
other purposes.
SECTION 2.02. Deposit of Stock; Execution and Delivery of
Receipts in Respect Thereof. Subject to the terms and conditions
of this Deposit Agreement, the Company or any holder of Stock may
from time to time deposit shares of the Stock under this Deposit
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Agreement by delivery to the Depositary of a certificate or
certificates for the Stock to be deposited, properly endorsed or
accompanied, if required by the Depositary, by a duly executed
instrument of transfer or endorsement, in form satisfactory to
the Depositary, together with all such certifications as may be
required by the Depositary in accordance with the provisions of
this Deposit Agreement, and together with a written order of the
Company or such holder, as the case may be, directing the
Depositary to execute and deliver to, or upon the written order
of, the person or persons stated in such order a Receipt or
Receipts for the number of Depositary Shares representing such
deposited Stock.
Deposited Stock shall be held by the Depositary at the
Depositary's Office or at such other place or places as the
Depositary shall determine.
Upon receipt by the Depositary of a certificate or
certificates for Stock deposited in accordance with the
provisions of this Section, together with the other documents
required as above specified, and upon proper registration of the
Stock on the books of the Company in the name of the Depositary
or its nominee, the Depositary, subject to the terms and
conditions of this Deposit Agreement, shall execute and deliver,
to or upon the order of the person or persons named in the
written order delivered to the Depositary referred to in the
first paragraph of this Section, a Receipt or Receipts for the
number of Depositary Shares representing the Stock so deposited
and registered in such name or names as may be requested by such
person or persons. The Depositary shall execute and deliver such
Receipt or Receipts at the Depositary's Office or such other
offices, if any, as the Depositary may designate. Delivery at
other offices shall be at the risk and expense of the person
requesting such delivery.
Other than in the case of splits, combinations or other
reclassifications affecting the Stock, or in the case of
dividends or other distributions of stock, if any, there shall be
deposited hereunder not more than ___________ shares of Stock.
SECTION 2.03. Redemption of Stock. Whenever the Company
shall elect to redeem shares of Stock in accordance with the
provisions of the Certificate, it shall (unless otherwise agreed
in writing with the Depositary) give the Depositary not less than
46 nor more than 91 days' notice of the date of such proposed
redemption of Stock and of the number of shares held by the
Depositary to be so redeemed, which notice shall be accompanied
by a certificate from the Company stating that such redemption of
Stock is in accordance with the provisions of the Certificate.
Such notice, if given more than 90 days prior to the redemption
date, shall be in addition to the notice required to be given for
redemption pursuant to the Certificate. On the date of such
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redemption, provided that the Company shall then have paid in
full to the Depositary the redemption price of the Stock to be
redeemed, plus any accrued and unpaid dividends thereon, the
Depositary shall redeem the number of Depositary Shares
representing such Stock. The Depositary shall mail notice of
such redemption and the proposed simultaneous redemption of the
number of Depositary Shares representing the Stock to be
redeemed, first-class postage prepaid, not less than 45 and not
more than 90 days prior to the date fixed for redemption of such
Stock and Depositary Shares (the "Redemption Date") to the record
holders of the Receipts evidencing the Depositary Shares to be so
redeemed, at the addresses of such holders as they appear on the
records of the Depositary; but neither failure to mail any such
notice to one or more such holders nor any defect in any notice
to one or more such holders shall affect the sufficiency of the
proceedings for redemption as to other holders. Each such notice
shall state: (i) the Redemption Date; (ii) the number of
Depositary Shares to be redeemed and, if less than all the
Depositary Shares held by any such holder are to be redeemed, the
number of such Depositary Shares held by such holder to be so
redeemed; (iii) the redemption price; (iv) the place or places
where Receipts evidencing Depositary Shares are to be surrendered
for payment of the redemption price; and (v) that dividends in
respect of the Stock represented by the Depositary Shares to be
redeemed will cease to accumulate on such Redemption Date. In
case less than all the outstanding Depositary Shares are to be
redeemed, the Depositary Shares to be so redeemed shall be
selected by lot or pro rata as may be determined by the
Depositary to be equitable.
Notice having been mailed by the Depositary as aforesaid,
from and after the Redemption Date (unless the Company shall have
failed to redeem the shares of Stock to be redeemed by it as set
forth in the Company's notice provided for in the preceding
paragraph) all dividends in respect of the shares of Stock so
called for redemption shall cease to accumulate, the Depositary
Shares being redeemed from such proceeds shall be deemed no
longer to be outstanding, all rights of the holders of Receipts
evidencing such Depositary Shares (except the right to receive
the redemption price) shall, to the extent of such Depositary
Shares, cease and terminate and, upon surrender in accordance
with such notice of the Receipts evidencing any such Depositary
Shares (properly endorsed or assigned for transfer, if the
Depositary shall so require), such Depositary Shares shall be
redeemed by the Depositary at a redemption price per Depositary
Share equal to one-tenth of the redemption price per share paid
in respect of the shares of Stock plus all money and other
property, if any, represented by such Depositary Shares,
including all amounts paid by the Company in respect of dividends
which on the Redemption Date have accumulated on the shares of
Stock to be so redeemed and have not theretofore been paid.
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If less than all the Depositary Shares evidenced by a
Receipt are called for redemption, the Depositary will deliver to
the holder of such Receipt upon its surrender to the Depositary,
together with the redemption payment, a new Receipt evidencing
the Depositary Shares evidenced by such prior Receipt and not
called for redemption.
SECTION 2.04. Registration of Transfer of Receipts.
Subject to the terms and conditions of this Deposit Agreement,
the Depositary shall register on its books from time to time
transfers of Receipts upon any surrender thereof by the holder in
person or by duly authorized attorney, properly endorsed or
accompanied by a properly executed instrument of transfer.
Thereupon the Depositary shall execute a new Receipt or Receipts
evidencing the same aggregate number of Depositary Shares as
those evidenced by the Receipt or Receipts surrendered and
deliver such new Receipt or Receipts to or upon the order of the
person entitled thereto.
SECTION 2.05. Split-ups and Combinations of Receipts;
Surrender of Receipts and Withdrawal of Stock. Upon surrender of
a Receipt or Receipts at the Depositary's Office or at such other
offices as it may designate for the purpose of effecting a split-
up or combination of such Receipt or Receipts, and subject to the
terms and conditions of this Deposit Agreement, the Depositary
shall execute and deliver a new Receipt or Receipts in the
authorized denomination or denominations requested, evidencing
the aggregate number of Depositary Shares evidenced by the
Receipt or Receipts surrendered.
Any holder of a Receipt or Receipts representing any number
of whole shares of Stock may withdraw the Stock and all money and
other property, if any, represented thereby by surrendering such
Receipt or Receipts, at the Depositary's Office or at such other
offices as the Depositary may designate for such withdrawals.
Thereafter, without unreasonable delay, the Depositary shall
deliver to such holder, or to the person or persons designated by
such holder as hereinafter provided, the number of whole shares
of Stock and all money and other property, if any, represented by
the Receipt or Receipts for such whole shares of Stock so
surrendered for withdrawal, but holders of such whole shares of
Stock will not thereafter be entitled to deposit such Stock
hereunder or to receive Depositary Shares therefor. If a Receipt
delivered by the holder to the Depositary in connection with such
withdrawal shall evidence a number of Depositary Shares in excess
of the number of Depositary Shares representing the number of
whole shares of Stock to be so withdrawn, the Depositary shall at
the same time, in addition to such number of whole shares of
Stock and such money and other property, if any, to be so
withdrawn, deliver to such holder, or (subject to Section 2.03)
upon his order, a new Receipt evidencing such excess number of
Depositary Shares. Delivery of the Stock and money and other
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property being withdrawn may be made by the delivery of such
certificates, documents of title and other instruments as the
Depositary may deem appropriate.
If the Stock and the money and other property being
withdrawn are to be delivered to a person or persons other than
the record holder of the Receipt or Receipts being surrendered
for withdrawal of Stock, such holder shall execute and deliver to
the Depositary a written order so directing the Depositary and
the Depositary may require that the Receipt or Receipts
surrendered by such holder for withdrawal of such shares of Stock
be properly endorsed in blank or accompanied by a properly
executed instrument of transfer.
Delivery of the Stock and the money and other property, if
any, represented by Receipts surrendered for withdrawal shall be
made by the Depositary at the Depositary's Office, except that,
at the request, risk and expense of the holder surrendering such
Receipt or Receipts and for the account of the holder thereof,
such delivery may be made at such other place as may be
designated by such holder.
SECTION 2.06. Limitations on Execution and Delivery,
Transfer, Surrender and Exchange of Receipts. As a condition
precedent to the execution and delivery, registration of
transfer, split-up, combination, surrender or exchange of any
Receipt, the Depositary, any of the Depositary's Agents or the
Company may require payment to it of a sum sufficient for the
payment (or, in the event that the Depositary or the Company
shall have made such payment, the reimbursement to it) of any
charges or expenses payable by the holder of a Receipt pursuant
to Section 5.07, may require the production of evidence
satisfactory to it as to the identity and genuineness of any
signature and may also require compliance with such regulations,
if any, as the Depositary or the Company may establish consistent
with the provisions of this Deposit Agreement.
The deposit of Stock may be refused, the delivery of
Receipts against Stock may be suspended, the registration of
transfer of Receipts may be refused and the registration of
transfer, surrender or exchange of outstanding Receipts may be
suspended (i) during any period when the register of stockholders
of the Company is closed or (ii) if any such action is deemed
necessary or advisable by the Depositary, any of the Depositary's
Agents or the Company at any time or from time to time because of
any requirement of law or of any government or governmental body
or commission or under any provision of this Deposit Agreement.
Without limitation of the foregoing, the Depositary shall not
knowingly accept for deposit under this Deposit Agreement any
shares of Stock which are required to be registered under the
Securities Act of 1933, unless a registration statement under
such Act is in effect as to such shares of Stock.
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SECTION 2.07. Lost Receipts, etc. In case any Receipt
shall be mutilated, destroyed, lost or stolen, the Depositary in
its discretion may execute and deliver a Receipt of like form and
tenor in exchange and substitution for such mutilated Receipt, or
in lieu of and in substitution for such destroyed, lost or stolen
Receipt, upon (i) the filing by the holder thereof with the
Depositary of evidence satisfactory to the Depositary of such
destruction or loss or theft of such Receipt, of the authenticity
thereof and of his or her ownership thereof and (ii) the
furnishing of the Depositary with reasonable indemnification
satisfactory to it.
SECTION 2.08. Cancellation and Destruction of Surrendered
Receipts. All Receipts surrendered to the Depositary or any
Depositary's Agent shall be canceled by the Depositary. Except
as prohibited by applicable law or regulation, the Depositary is
authorized to destroy all Receipts so canceled.
ARTICLE III
Certain Obligations of Holders
of Receipts and the Company
SECTION 3.01. Filing Proofs, Certificates and Other
Information. Any holder of a Receipt may be required from time
to time to file such proof of residence, or other matters or
other information, to execute such certificates and to make such
representations and warranties as the Depositary or the Company
may reasonably deem necessary or proper. The Depositary or the
Company may withhold the delivery, or delay the registration of
transfer, redemption or exchange, of any Receipt or the
withdrawal of the Stock represented by the Depositary Shares
evidenced by any Receipt or the distribution of any dividend or
other distribution or the sale of any rights or of the proceeds
thereof until such proof or other information is filed or such
certificates are executed or such representations and warranties
are made.
SECTION 3.02. Payment of Taxes or Other Governmental
Charges. Holders of Receipts shall be obligated to make payments
to the Depositary of certain charges and expenses, as provided in
Section 5.07. Registration of transfer of any Receipt or any
withdrawal of Stock and all money or other property, if any,
represented by the Depositary Shares evidenced by such Receipt
may be refused until any such payment due is made, and any
dividends, interest payments or other distributions may be
withheld or any part of or all the Stock or other property
represented by the Depositary Shares evidenced by such Receipt
and not theretofore sold may be sold for the account of the
holder thereof (after attempting by reasonable means to notify
such holder prior to such sale), and such dividends, interest
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payments or other distributions or the proceeds of any such sale
may be applied to any payment of such charges or expenses, the
holder of such Receipt remaining liable for any deficiency.
SECTION 3.03. Warranty as to Stock. The Company hereby
represents and warrants that the Stock, when issued, will be
validly issued, fully paid and nonassessable. Such
representation and warranty shall survive the deposit of the
Stock and the issuance of Receipts.
ARTICLE IV
The Deposited Securities; Notices
SECTION 4.01. Cash Distributions. Whenever the Depositary
shall receive any cash dividend or other cash distribution on
Stock, the Depositary shall, subject to Sections 3.01 and 3.02,
distribute to record holders of Receipts pursuant to Section 4.04
such amounts of such dividend or distribution as are, as nearly
as practicable, in proportion to the respective numbers of
Depositary Shares evidenced by the Receipts held by such holders;
provided, however, that in case the Company or the Depositary
shall be required to withhold and does withhold from any cash
dividend or other cash distribution in respect of the Stock an
amount on account of taxes, the amount made available for
distribution or distributed in respect of Depositary Shares shall
be reduced accordingly. The Depositary shall not be required to
attribute to any holder of Depositary Shares a fraction of one
cent, and any amounts held by the Depositary in such event will
be distributed to holders of Receipts in such reasonable manner
as the Company and the Depositary determine.
SECTION 4.02. Distributions Other Than Cash, Rights,
Preferences or Privileges. Whenever the Depositary shall receive
any distribution other than cash, rights, preferences or
privileges upon Stock, the Depositary shall, subject to Sections
3.01 and 3.02, distribute to record holders of Receipts pursuant
to Section 4.04 such amounts of the securities or property
received by it as are, as nearly as practicable, in proportion to
the respective numbers of Depositary Shares evidenced by the
Receipts held by such holders, in any manner that the Depositary
may deem equitable and practicable for accomplishing such
distribution. If in the opinion of the Depositary such
distribution cannot be made proportionately among such record
holders, or if for any other reason (including any requirement
that the Company or the Depositary withhold an amount on account
of taxes) the Depositary deems, after consultation with the
Company, such distribution not to be feasible, the Depositary
may, with the approval of the Company, adopt such method as it
deems equitable and practicable for the purpose of effecting such
distribution, including the sale (at public or private sale) of
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the securities or property thus received, or any part thereof, at
such place or places and upon such terms as it may deem proper.
The net proceeds of any such sale shall, subject to Sections 3.01
and 3.02, be distributed or made available for distribution, as
the case may be, by the Depositary to record holders of Receipts
as provided by Section 4.01 in the case of a distribution
received in cash. The Company shall not make any distribution of
such securities unless the Company shall have provided an opinion
of counsel stating that such securities have been registered
under the Securities Act of 1933 or do not need to be registered.
SECTION 4.03. Subscription Rights, Preferences or
Privileges. If the Company shall at any time offer or cause to
be offered to the persons in whose names Stock is recorded on the
books of the Company any rights, preferences or privileges to
subscribe for or to purchase any securities or any rights,
preferences or privileges of any other nature, such rights,
preferences or privileges shall in each such instance be made
available by the Depositary to the record holders of Receipts in
such manner as the Depositary may determine, either by the issue
to such record holders of warrants representing such rights,
preferences or privileges or by such other method as may be
approved by the Depositary in its discretion with the approval of
the Company; provided, however, that (i) if at the time of issue
or offer of any such rights, preferences or privileges the
Depositary determines that it is not lawful or (after
consultation with the Company) not feasible to make such rights,
preferences or privileges available to holders of Receipts by the
issue of warrants or otherwise, or (ii) if and to the extent so
instructed by holders of Receipts who do not desire to exercise
such rights, preferences or privileges, then the Depositary, in
its discretion (with the approval of the Company, in any case
where the Depositary has determined that it is not feasible to
make such rights, preferences or privileges available), may, if
applicable laws or the terms of such rights, preferences or
privileges permit such transfer, sell such rights, preferences or
privileges at public or private sale, at such place or places and
upon such terms as it may deem proper. The net proceeds of any
such sale shall, subject to Sections 3.01 and 3.02, be
distributed by the Depositary to the record holders of Receipts
entitled thereto as provided by Section 4.01 in the case of a
distribution received in cash. The Company shall not make any
distribution of any such rights, preferences or privileges unless
the Company shall have provided an opinion of counsel stating
that such rights, preferences or privileges have been registered
under the Securities Act of 1933 or do not need to be registered.
If in order for holders of Receipts to be offered or sold
the securities to which any rights, preferences or privileges
relate, registration under the Securities Act of 1933 of the
securities to which such rights, preferences or privileges relate
is required, the Company will promptly file a registration
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statement pursuant to such Act with respect to such rights,
preferences or privileges and securities and use its best efforts
and take all steps available to it to cause such registration
statement to become effective sufficiently in advance of the
expiration of such rights, preferences or privileges to enable
such holders to exercise such rights, preferences or privileges.
In no event shall the Depositary make available to the holders of
Receipts any right, preference or privilege to subscribe for or
to purchase any securities unless and until such a registration
statement shall have become effective, or unless the offering and
sale of such securities to such holders are exempt from
registration under the provisions of such Act.
If any other action under the laws of any jurisdiction or
any governmental or administrative authorization, consent or
permit is required in order for such rights, preferences or
privileges to be made available to holders of Receipts, the
Company will use its best efforts to take such action or obtain
such authorization, consent or permit sufficiently in advance of
the expiration of such rights, preferences or privileges to
enable such holders to exercise such rights, preferences or
privileges.
SECTION 4.04. Notice of Dividends; Fixing of Record Date
for Holders of Receipts. Whenever any cash dividend or other
cash distribution shall become payable or any distribution other
than cash shall be made, or if rights, preferences or privileges
shall at any time be offered, with respect to Stock, or whenever
the Depositary shall receive notice of any meeting at which
holders of Stock are entitled to vote or any meeting of which
holders of Stock are entitled to notice, or whenever the
Depositary and the Company shall decide it is appropriate, the
Depositary shall in each such instance fix a record date (which
shall be the same date as the record date fixed by the Company
with respect to the Stock) for the determination of the holders
of Receipts who shall be entitled to receive such dividend,
distribution, rights, preferences or privileges or the net
proceeds of the sale thereof, or to give instructions for the
exercise of voting rights at any such meeting, or who shall be
entitled to notice of such meeting or for any other appropriate
reason.
SECTION 4.05. Voting Rights. Upon receipt of notice of any
meeting at which the holders of Stock are entitled to vote, the
Depositary shall, as soon as practicable thereafter, mail to the
record holders of Receipts a notice which shall contain (i) such
information as is contained in such notice of meeting and (ii) a
statement that the holders may, subject to any applicable
restrictions, instruct the Depositary as to the exercise of the
voting rights pertaining to the amount of Stock represented by
their respective Depositary Shares (including an express
indication that instructions may be given to the Depositary to
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give a discretionary proxy to a person designated by the Company)
and a brief statement as to the manner in which such instructions
may be given. Upon the written request of the holders of
Receipts on the relevant record date, the Depositary shall
endeavor insofar as practicable to vote or cause to be voted, in
accordance with the instructions set forth in such requests, the
maximum number of whole shares of Stock represented by the
Depositary Shares evidenced by all Receipts as to which any
particular voting instructions are received. The Company hereby
agrees to take all action which may be deemed necessary by the
Depositary in order to enable the Depositary to vote such Stock
or cause such Stock to be voted. In the absence of specific
instructions from the holder of a Receipt, the Depositary will
abstain from voting (but, at its discretion, not from appearing
at any meeting with respect to such Stock unless directed to the
contrary by the holders of all the Receipts) to the extent of the
Stock represented by the Depositary Shares evidenced by such
Receipt.
SECTION 4.06. Changes Affecting Deposited Securities and
Reclassifications, Recapitalizations, etc. Upon any change in
par or stated value, split-up, combination or any other
reclassification of the Stock, or upon any recapitalization,
reorganization, merger, amalgamation or consolidation affecting
the Company or to which it is a party, the Depositary may in its
discretion with the approval of, and shall upon the instructions
of, the Company, and (in either case) in such manner as the
Depositary may deem equitable, (i) make such adjustments as are
certified by the Company in (x) the fraction of an interest
represented by one Depositary Share in one share of Stock and (y)
the ratio of the redemption price per Depositary Share to the
redemption price of a share of Stock, in each case as may be
necessary fully to reflect the effects of such change in par or
stated value, split-up, combination or other reclassification of
Stock, or of such recapitalization, reorganization, merger,
amalgamation or consolidation and (ii) treat any securities which
shall be received by the Depositary in exchange for or upon
conversion of or in respect of the Stock as new deposited
securities under this Deposit Agreement, and Receipts then
outstanding shall thenceforth represent the new deposited
securities so received in exchange for or upon conversion or in
respect of such Stock. In any such case the Depositary may in
its discretion, with the approval of the Company, execute and
deliver additional Receipts, or may call for the surrender of all
outstanding Receipts to be exchanged for new Receipts
specifically describing such new deposited securities. Anything
to the contrary herein notwithstanding, holders of Receipts shall
have the right from and after the effective date of any such
change in par or stated value, split-up, combination or other
reclassification of the Stock or any such recapitalization,
reorganization, merger, amalgamation or consolidation to
surrender such Receipts to the Depositary with instructions to
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convert, exchange or surrender the Stock represented thereby only
into or for, as the case may be, the kind and amount of shares of
stock and other securities and property and cash into which the
Stock represented by such Receipts might have been converted or
for which such Stock might have been exchanged or surrendered
immediately prior to the effective date of such transaction.
SECTION 4.07. Inspection of Reports. The Depositary shall
make available for inspection by holders of Receipts at the
Depositary's Office, and at such other places as it may from time
to time deem advisable, any reports and communications received
from the Company which are received by the Depositary as the
holder of Stock.
SECTION 4.08. Lists of Receipt Holders. Promptly
upon request from time to time by the Company, the Depositary
shall furnish to it a list, as of a recent date, of the names,
addresses and holdings of Depositary Shares of all persons in
whose names Receipts are registered on the books of the
Depositary.
ARTICLE V
The Depositary, the Depositary's Agents,
the Registrar and the Company
SECTION 5.01. Maintenance of Offices, Agencies and Transfer
Books by the Depositary; Registrar. Upon execution of this
Deposit Agreement, the Depositary shall maintain at the
Depositary's Office, or at the Registrar's Office, at which the
Depositary shall have complete access to all books and records
maintained on the Company's behalf, facilities for the execution
and delivery, registration and registration of transfer,
surrender and exchange of Receipts, and at the offices of the
Depositary's Agents, if any, facilities for the delivery,
registration of transfer, surrender and exchange of Receipts, all
in accordance with the provisions of this Deposit Agreement.
The Depositary shall keep books at the Depositary's Office
for the registration and registration of transfer of Receipts,
which books at all reasonable times shall be open for inspection
by the record holders of Receipts; provided, that any such holder
requesting to exercise such right shall certify to the Depositary
that such inspection shall be for a proper purpose reasonably
related to such person's interest as an owner of Depositary
Shares evidenced by the Receipts.
-13-
<PAGE> 18
The Depositary may close such books, at any time or from
time to time, when deemed expedient by it in connection with the
performance of its duties hereunder.
The Depositary may, with the approval of the Company,
appoint a Registrar for registration of the Receipts or the
Depositary Shares evidenced thereby. If the Receipts or the
Depositary Shares evidenced thereby or the Stock represented by
such Depositary Shares shall be listed on the New York Stock
Exchange, the Depositary will appoint a Registrar (acceptable to
the Company) for registration of such Receipts or Depositary
Shares in accordance with any requirements of such Exchange.
Such Registrar (which may be the Depositary if so permitted by
the requirements of such Exchange) may be removed and a
substitute registrar appointed by the Depositary upon the request
or with the approval of the Company. If the Receipts, such
Depositary Shares or such Stock are listed on one or more other
stock exchanges, the Depositary will, at the request of the
Company, arrange such facilities for the delivery, registration,
registration of transfer, surrender and exchange of such
Receipts, such Depositary Shares or such Stock as may be required
by law or applicable stock exchange regulation.
SECTION 5.02. Prevention of or Delay in Performance by the
Depositary, the Depositary's Agents, the Registrar or the
Company. Neither the Depositary nor any Depositary's Agent nor
any Registrar nor the Company shall incur any liability to any
holder of any Receipt if by reason of any provision of any
present or future law, or regulation thereunder, of the United
States of America or of any other governmental authority or, in
the case of the Depositary, the Depositary's Agent or the
Registrar, by reason of any provision, present or future, of the
Company's Certificate of Incorporation (including the
Certificate) or by reason of any act of God or war or other
circumstance beyond the control of the relevant party, the
Depositary, the Depositary's Agent, the Registrar or the Company
shall be prevented or forbidden from, or subjected to any penalty
on account of, doing or performing any act or thing which the
terms of this Deposit Agreement provide shall be done or
performed; nor shall the Depositary, any Depositary's Agent, any
Registrar or the Company incur any liability to any holder of a
Receipt (i) by reason of any nonperformance or delay, caused as
aforesaid, in the performance of any act or thing which the terms
of this Deposit Agreement provide shall or may be done or
performed, or (ii) by reason of any exercise of, or failure to
exercise, any discretion provided for in this Deposit Agreement
except, in case of any such exercise or failure to exercise
discretion not caused as aforesaid, if caused by the negligence
or willful misconduct of the party charged with such exercise or
failure to exercise.
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<PAGE> 19
SECTION 5.03. Obligations of the Depositary, the
Depositary's Agents, the Registrar and the Company. Neither the
Depositary nor any Depositary's Agent nor any Registrar nor the
Company assumes any obligation or shall be subject to any
liability under this Deposit Agreement to holders of Receipts
other than for its negligence or willful misconduct.
Neither the Depositary nor any Depositary's Agent nor any
Registrar nor the Company shall be under any obligation to appear
in, prosecute or defend any action, suit or other proceeding in
respect of the Stock, the Depositary Shares or the Receipts which
in its opinion may involve it in expense or liability unless
indemnity satisfactory to it against all expense and liability be
furnished as often as may be required.
Neither the Depositary nor any Depositary's Agent nor any
Registrar nor the Company shall be liable for any action or any
failure to act by it in reliance upon the written advice of legal
counsel or accountants, or information from any person presenting
Stock for deposit, any holder of a Receipt or any other person
believed by it in good faith to be competent to give such
information. The Depositary, any Depositary's Agent, any
Registrar and the Company may each rely and shall each be
protected in acting upon any written notice, request, direction
or other document believed by it to be genuine and to have been
signed or presented by the proper party or parties.
The Depositary shall not be responsible for any failure to
carry out any instruction to vote any of the shares of Stock or
for the manner or effect of any such vote made, as long as any
such action or non-action is in good faith. The Depositary
undertakes, and any Registrar shall be required to undertake, to
perform such duties and only such duties as are specifically set
forth in this Agreement, and no implied covenants or obligations
shall be read into this Agreement against the Depositary or any
Registrar. The Depositary will indemnify the Company against any
liability which may arise out of acts performed or omitted by the
Depositary or its agents due to its or their negligence or bad
faith. The Depositary, the Depositary's Agents, and any
Registrar may own and deal in any class of securities of the
Company and its affiliates and in Receipts. The Depositary may
also act as transfer agent or registrar of any of the securities
of the Company and its affiliates.
SECTION 5.04. Resignation and Removal of the Depositary;
Appointment of Successor Depositary. The Depositary may at any
time resign as Depositary hereunder by having notice of its
election to do so delivered to the Company, such resignation to
take effect upon the appointment of a successor Depositary and
its acceptance of such appointment as hereinafter provided.
-15-
<PAGE> 20
The Depositary may at any time be removed by the Company by
notice of such removal delivered to the Depositary, such removal
to take effect upon the appointment of a successor Depositary and
its acceptance of such appointment as hereinafter provided.
In case at any time the Depositary acting hereunder shall
resign or be removed, the Company shall, within 60 days after the
delivery of the notice of resignation or removal, as the case may
be, appoint a successor Depositary, which shall be a bank or
trust company having its principal office in the United States of
America and having a combined capital and surplus of at least
$50,000,000. If no successor Depositary shall have been so
appointed and have accepted appointment within 60 days after
delivery of such notice, the resigning or removed Depositary may
petition any court of competent jurisdiction for the appointment
of a successor Depositary. Every successor Depositary shall
execute and deliver to its predecessor and to the Company an
instrument in writing accepting its appointment hereunder, and
thereupon such successor Depositary, without any further act or
deed, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor and for all purposes
shall be the Depositary under this Deposit Agreement, and such
predecessor, upon payment of all sums due it and on the written
request of the Company, shall execute and deliver an instrument
transferring to such successor all rights and powers of such
predecessor hereunder, shall duly assign, transfer and deliver
all right, title and interest in the Stock and any moneys or
property held hereunder to such successor, and shall deliver to
such successor a list of the record holders of all outstanding
Receipts. Any successor Depositary shall promptly mail notice of
its appointment to the record holders of Receipts.
Any corporation into or with which the Depositary may be
merged, consolidated or converted shall be the successor of such
Depositary without the execution or filing of any document or any
further act, and notice thereof shall not be required hereunder.
Such successor Depositary may authenticate the Receipts in the
name of the predecessor Depositary or in the name of the
successor Depositary.
SECTION 5.05. Corporate Notices and Reports. The Company
agrees that it will transmit to the record holders of Receipts,
in each case at the addresses furnished to it pursuant to Section
4.08, all notices and reports (including without limitation
financial statements) required by law, by the rules of any
national securities exchange upon which the Stock, the Depositary
Shares or the Receipts are listed or by the Company's Certificate
of Incorporation (including the Certificate) to be furnished by
the Company to holders of Stock. Such transmission will be at
the Company's expense.
-16-
<PAGE> 21
SECTION 5.06. Indemnification by the Company. The Company
shall indemnify the Depositary, any Depositary's Agent and any
Registrar against, and hold each of them harmless from, any loss,
liability or expense (including the costs and expenses of
defending itself) which may arise out of (a) acts performed or
omitted in connection with this Agreement and the Receipts (i) by
the Depositary, any Registrar or any of their respective agents
(including any Depositary's Agent), except for any liability
arising out of negligence or bad faith on the respective parts of
any such person or persons, or (ii) by the Company or any of its
agents, or (b) the offer, sale or registration of the Receipts,
Depositary Shares or the Stock pursuant to the provisions hereof.
The obligations of the Company set forth in this Section 5.06
shall survive any succession of any Depositary, Registrar or
Depositary's Agent.
SECTION 5.07. Charges and Expenses. The Company shall pay
all transfer and other taxes and governmental charges arising
solely from the existence of the depositary arrangements. The
Company shall pay all charges of the Depositary in connection
with the initial deposit of the Stock and the initial issuance of
the Depositary Shares, redemption of the Stock at the option of
the Company and all withdrawals of shares of the Stock by owners
of Depositary Shares. All other transfer and other taxes and
governmental charges shall be at the expense of holders of
Depositary Shares. If, at the request of a holder of Receipts,
the Depositary incurs charges or expenses for which it is not
otherwise liable hereunder, such holder will be liable for such
charges and expenses. All other charges and expenses of the
Depositary and any Depositary's Agent hereunder and of any
Registrar (including, in each case, fees and expenses of counsel)
incident to the performance of their respective obligations
hereunder will be paid upon consultation and agreement between
the Depositary and the Company as to the
amount and nature of such charges and expenses. The Depositary
shall present its statement for charges and expenses to the
Company once every three months or at such other intervals as the
Company and the Depositary may agree.
ARTICLE VI
Amendment and Termination
SECTION 6.01. Amendment. The form of the Receipts and any
provisions of this Deposit Agreement may at any time and from
time to time be amended by agreement between the Company and the
Depositary in any respect which they may deem necessary or
desirable; provided, however, that no such amendment (other than
any change in the fees of any Depositary or Registrar, which
shall go into effect not sooner than three months after notice
thereof to the holders of the Receipts) which shall materially
-17-
<PAGE> 22
and adversely alter the rights of the holders of Receipts shall
be effective unless such amendment shall have been approved by
the holders of at least a majority of the Depositary Shares then
outstanding. Every holder of an outstanding Receipt at the time
any such amendment becomes effective shall be deemed, by
continuing to hold such Receipt, to consent and agree to such
amendment and to be bound by the Deposit Agreement as amended
thereby.
SECTION 6.02. Termination. This Agreement may be
terminated by the Company or the Depositary only after (i) all
outstanding Depositary Shares shall have been redeemed pursuant
to Section 2.03 or (ii) there shall have been made a final
distribution in respect of the Stock in connection with any
liquidation, dissolution or winding up of the Company and such
distribution shall have been distributed to the holders of
Depositary Shares pursuant to Section 4.01 or 4.02, as
applicable.
Upon the termination of this Deposit Agreement, the Company
shall be discharged from all obligations under this Deposit
Agreement except for its obligations to the Depositary, any
Depositary's Agent and any Registrar under Sections 5.06 and
5.07.
ARTICLE VII
Miscellaneous
SECTION 7.01. Counterparts. This Deposit Agreement may be
executed in any number of counterparts, and by each of the
parties hereto on separate counterparts, each of which
counterparts, when so executed and delivered, shall be deemed an
original, but all such counterparts taken together shall
constitute one and the same instrument.
SECTION 7.02. Exclusive Benefit of Parties. This
Deposit Agreement is for the exclusive benefit of the parties
hereto, and their respective successors hereunder, and shall not
be deemed to give any legal or equitable right, remedy or claim
to any other person whatsoever.
SECTION 7.03. Invalidity of Provisions. In case
any one or more of the provisions contained in this Deposit
Agreement or in the Receipts should be or become invalid, illegal
or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein or
therein shall in no way be affected, prejudiced or disturbed
thereby.
-18-
<PAGE> 23
SECTION 7.04. Notices. Any and all notices to be
given to the Company hereunder or under the Receipts shall be in
writing and shall be deemed to have been duly given if personally
delivered or sent by mail or telegram or telex confirmed by
letter, addressed to the Company at 2700 Sanders Road, Prospect
Heights, Illinois 60090, to the attention of the Secretary, or at
any other address of which the Company shall have notified the
Depositary in writing.
Any and all notices to be given to the Depositary hereunder
or under the Receipts shall be in writing and shall be deemed to
have been duly given if personally delivered or sent by mail or
by telegram or telex confirmed by letter, addressed to the
Depositary at the Depositary's Office, at______________________,
______________, or at any other address of which the Depositary
shall have notified the Company in writing.
Any and all notices to be given to any record holder of a
Receipt hereunder or under the Receipts shall be in writing and
shall be deemed to have been duly given if personally delivered
or sent by mail or by telegram or telex confirmed by letter,
addressed to such record holder at the address of such record
holder as it appears on the books of the Depositary, or if such
holder shall have filed with the Depositary a written request
that notices intended for such holder be mailed to some other
address, at the address designated in such request.
Delivery of a notice sent by mail or by telegram or telex
shall be deemed to be effected at the time when a duly addressed
letter containing the same (or a confirmation thereof in the case
of a telegram or telex message) is deposited, postage prepaid, in
a post office letter box. The Depositary or the Company may,
however, act upon any telegram or telex message received by it
from the other or from any holder of a Receipt, notwithstanding
that such telegram or telex message shall not subsequently be
confirmed by letter or as aforesaid.
SECTION 7.05 Depositary's Agents. The Deopositary may from
time to time appoint, with the prior approvl of the Company
Depoitary's Agents to act in any respect for the Depositary for
the purposes of this Deposit Agreement and may at any time
appoint additional Depositary's Agents and vary or terminate the
appointment of such Depositary's Agents.
The Company has also requested that the Depositary act as
Registrar and Transfer Agent.
SECTION 7.06. Holders of Receipts Are Parties. The holders
of Receipts from time to time shall be parties to this Deposit
Agreement and shall be bound by all of the terms and conditions
hereof and of the Receipts by acceptance of delivery thereof.
-19-
<PAGE> 24
SECTION 7.07. Governing Law. This Deposit Agreement and
the Receipts and all rights hereunder and thereunder and
provisions hereof and thereof shall be governed by, and construed
in accordance with, the laws of the State of Illinois.
SECTION 7.08. Inspection of Deposit Agreement. Copies of
this Deposit Agreement shall be filed with the Depositary and the
Depositary's Agents and shall be open to inspection during
business hours at the Depositary's Office and the respective
offices of the Depositary's Agents, if any, by any holder of a
Receipt.
SECTION 7.09. Headings. The headings of articles and
sections in this Deposit Agreement and in the form of the Receipt
set forth in Exhibit A hereto have been inserted for convenience
only and are not to be regarded as a part of this Deposit
Agreement or the Receipts or to have any bearing upon the meaning
or interpretation of any provision contained herein or in the
Receipts.
IN WITNESS WHEREOF, the Company and the Depositary have duly
executed this Agreement as of the day end year first above set
forth, and all holders of Receipts shall become parties hereto by
and upon acceptance by them of delivery of Receipts issued in
accordance with the terms hereof.
HOUSEHOLD INTERNATIONAL, INC.
By_________________________________
Attested by
Assistant Secretary
[SEAL]
_________________________________,
as Depositary,
By_______________________________
Attested by _________________________________
(Title)
_________________
Title
[SEAL]
-20-
<PAGE> 1
Exhibit 5
January 12, 1995
Household International, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
Re: Household International, Inc. Registration Statement on Form S-3, for
up to $500 million of Debt Securities, Warrants to Purchase Debt
Securities, Preferred Stock, and Depositary Shares and Common Stock
or any combination of the foregoing
Gentlemen:
As Secretary and Assistant General Counsel of Household International, Inc.
("Household"), I am generally familiar with the proceedings in connection
with Household's Registration Statement on Form S-3 (which also constitutes a
Post-Effective Amendment to Household's Registration Statement No. 33-50619) in
which up to $500,000,000 aggregate principal amount of Debt Securities,
Warrants to Purchase Debt Securities, Preferred Stock, Depositary Shares and
Common Stock, or any combination of the foregoing, of Household are being
registered. Debt Securities, which constitute senior unsecured debt of
Household, will be issuable under an Indenture dated as of October 1, 1993,
between Household and The First National Bank of Maryland, as Trustee (the
"First National Indenture"), an Indenture to be dated as of February 1, 1993,
between Household and First Interstate Bank of California, as Trustee (the
"First Interstate Indenture") or an Indenture to be dated as of January 1,
1995, between Household and Harris Trust and Savings Bank, as Trustee (the
"Harris Indenture"). The foregoing indentures, or forms thereof, have been
included as exhibits to the Registration Statement as filed with the Securities
and Exchange Commission (the "Commission"). Warrants to Purchase Debt
Securities, if authorized by Household, will be issuable under a duly executed
Warrant Agreement, the form of which was filed with the Commission as an
exhibit to the Registration Statement.
<PAGE> 2
Household International, Inc.
January 12, 1995
Page 2
Based upon my review of the records and documents of Household, I am of the
opinion that:
1. Household is a corporation duly incorporated and validly
existing under the laws of the State of Delaware.
2. The First National Indenture constitutes, and each of the
First Interstate Indenture, the Harris Indenture and
any Warrant Agreement will, after being duly authorized,
executed and delivered by Household, constitute, a valid and
legally binding instrument of Household enforceable in
accordance with its terms, except as enforcement of the
provisions thereof may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or affecting the
enforcement of creditors' rights or by general principles of
equity (regardless of whether such enforceability is considered
in a proceeding in equity or at law).
3. When (i) the Registration Statement on Form S-3 filed by
Household with respect to the Debt Securities and Warrants to
Purchase Debt Securities shall have become effective under the
Securities Act of 1933, as amended ("Act"), (ii) the issuance
of Debt Securities and Warrants to Purchase Debt Securities
have been duly authorized by the appropriate corporate action,
and (iii) such Debt Securities and/or Warrants to Purchase
Debt Securities have been duly executed, authenticated, issued
and delivered against payment of the agreed consideration
therefor in accordance with the appropriate Indenture or
Warrant Agreement and as described in the Registration
Statement, including the Prospectus and Prospectus Supplement
relating to such Debt Securities and/or Warrants to Purchase
Debt Securities, such Debt Securities and Warrants to Purchase
Debt Securities will be legally and validly issued and will be
the legal and binding obligations of Household enforceable in
accordance with their terms, except as enforcement of the
provisions thereof may be limited by bankruptcy, insolvency,
reorganization or other laws relating to or
<PAGE> 3
Household International, Inc.
January 12, 1995
Page 3
affecting the enforcement of creditors' rights or by general
principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at
law).
4. When (i) the Registration Statement on Form S-3 filed by
Household with respect to the Preferred Stock and the
Depositary Shares shall have become effective under the Act,
(ii) the Deposit Agreement, if required to be entered into by
Household and the Depositary for the Preferred Stock, if
Depositary Shares are to be issued, shall have been duly
authorized, executed and delivered, and (iii) the Preferred
Stock and Depositary Shares, as the case may be, shall have
been validly authorized, executed and delivered
by Household, the Transfer Agent, the Registrar or the
Depositary and full payment therefore received, the Preferred
Stock will be validly issued, fully paid and non-assessable
and the Depositary Shares will be validly issued, outstanding
and entitled to the benefits afforded by the Deposit
Agreement.
5. When (i) the Registration Statement on Form S-3 filed by
Household with respect to the Common Stock shall have
become effective under the Act, and (ii) the Common Stock
shall have been issued, sold and delivered as authorized by
the appropriate corporate action, the Common Stock shall be
validly issued, fully paid and non-assessable, and no personal
liability for the debts of Household will attach to the
holders of the Common Stock under the laws of the State
of Delaware where Household is incorporated and the laws of
the State of Illinois where its principal place of business is
located.
I hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to me under the heading "Legal
Opinions" in any Preliminary Prospectus, Prospectus or Prospectus Supplement
forming a part of the Registration Statement.
<PAGE> 4
Household International, Inc.
January 12, 1995
Page 4
In giving said consent, I do not admit that I am in the category of persons
where consent is required under Section 7 of the Act or the rules and
regulations of the Commission thereunder.
Very truly yours,
/s/ JOHN W. BLENKE
John W. Blenke
JWB:jlm
<PAGE> 1
Exhibit 23 (a)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
HOUSEHOLD INTERNATIONAL, INC.:
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Form S-3, relating to the offering
of up to an aggregate of $500,000,000 of Debt Securities and Warrants to
Purchase Debt Securities, Preferred Stock or Common Stock, or any combination of
the foregoing, to be filed with the Securities and Exchange Commission on or
about January 11, 1995, of our report dated February 1, 1994, included in
Household International, Inc.'s Form 10-K for the year ended December 31, 1993,
and to all references to our Firm included in this registration statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Chicago, Illinois
January 11, 1995.
<PAGE> 1
EXHIBIT 25(a)
Registration No. __________
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
________________
THE FIRST NATIONAL BANK OF MARYLAND
(Exact name of trustee as specified in its charter)
NOT APPLICABLE 52-0312840
(Jurisdiction of incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification No.)
25 SOUTH CHARLES STREET,
BALTIMORE, MARYLAND 21201
(Address of principal executive offices) (Zip code)
________________
JACOB H. SMITH, IV
THE FIRST NATIONAL BANK OF MARYLAND
25 SOUTH CHARLES STREET
BALTIMORE, MARYLAND 21201
410-244-4223
(Name, address and telephone number
of agent for service)
________________
HOUSEHOLD INTERNATIONAL, INC.
(Exact name of obligor as specified in its charter)
DELAWARE 36-3121988
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
2700 SANDERS ROAD
PROSPECT HEIGHTS, ILLINOIS 60070
(Address of principal executive offices) (Zip code)
________________
NOTES IN SERIES
(Title of the indenture securities)
<PAGE> 2
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Comptroller of the Currency, Washington, D.C. 20219.
Federal Reserve Bank of Richmond, Richmond, Virginia 23261.
Federal Deposit Insurance Corporation, Washington, D.C.
20429.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
If the obligor is an affiliate of the trustee, describe each
such affiliation.
None.
(Because responses from the obligor and the underwriters have
not yet been received, Item 2 is at the date hereof based upon
incomplete information but is believed to be correct and may be
considered to be complete unless modified by an amendment to
this Form T-1).
ITEM 16. LIST OF EXHIBITS.
List below all exhibits filed as a part of this statement of
eligibility.
Exhibit
- -------
1 A copy of the articles of association of the trustee as now in
effect is hereby incorporated by reference to Exhibit T1-1 of
Amendment No. 1 to Form T-1 (Exhibit 26 to the Registration
Statement on Form S-2, Registration No. 2-98697).
2 A copy of the certificate of authority of the trustee to commence
business is hereby incorporated by reference to Exhibit T1-2 to
Form T-1 (Exhibit 26 to the Registration Statement on Form S-2,
Registration No. 2-98697).
3 A copy of the authorization of the trustee to exercise corporate
trust powers is hereby incorporated by reference to Exhibit T1-3
of Amendment No. 1 to Form T-1 (Exhibit 26 to the Registration
Statement on Form S-3, Registration No. 33-18373).
4 A copy of the existing by-laws of the trustee is hereby
incorporated by reference to Exhibit T1-4 to Form T-1 (Exhibit 26
to the Registration Statement on Form S-3, Registration
No. 33-36455).
5 Not applicable.
6 The consent of the trustee required by Section 321(b) of the Act.
<PAGE> 3
7 A copy of the latest report of condition of the trustee published
pursuant to law or the requirements of its supervising or
examining authority.
8 Not applicable.
9 Not applicable.
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the
Trustee, The First National Bank of Maryland, a corporation organized and
existing under the laws of the United States of America, has duly caused this
statement of eligibility to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of Baltimore and State of Maryland,
on the 10th day of January, 1995.
THE FIRST NATIONAL BANK OF MARYLAND
By: /s/ Jacob H. Smith, IV
----------------------------
Jacob H. Smith, IV
Assistant Vice President
<PAGE> 5
EXHIBIT 6
CONSENT OF TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust
Indenture Act of 1939, in connection with the issue by Household International,
Inc. of its Notes in Series, we hereby consent that reports of examinations by
Federal, State, Territorial or District Authorities may be furnished by such
authorities to the Securities and Exchange Commission upon request therefor.
THE FIRST NATIONAL BANK OF MARYLAND
By: /s/ Jacob H. Smith, IV
----------------------------
Jacob H. Smith, IV
Assistant Vice President
<PAGE> 6
EXHIBIT 7
REPORT OF CONDITION
CONSOLIDATING DOMESTIC AND FOREIGN SUBSIDIARIES OF
The First National Bank of Maryland of Baltimore,
in the State of Maryland
at the close of business on September 30, 1994 published in response to call
made by Comptroller of the Currency, under Title 12, United States Code,
Section 161, Charter No. 04822, Comptroller of the Currency, Richmond District.
CONSOLIDATED REPORT OF CONDITION
<TABLE>
<CAPTION>
Dollar Amount
in Thousands
-------------
<S> <C>
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin . . . . . . . . . . . . . . . 581,674
Interest-bearing balances . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
Securities:
Held-to-maturity securities . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,083,073
Available-for-sale securities . . . . . . . . . . . . . . . . . . . . . . . . . . 1,020,190
Federal funds sold and securities purchased under agreements to resell
in domestic offices of the bank and of its Edge and Agreement subsidiaries,
and in IBFs:
Federal funds sold . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 253,400
Securities purchased under agreement to resell . . . . . . . . . . . . . . . 9,750
Loans and lease financing receivables:
Loans and leases, net of unearned income . . . . . . . . . . . . . . . . . . . . 4,227,073
LESS: Allowance for loan and lease losses . . . . . . . . . . . . . . . . . . . 115,320
LESS: Allocated transfer risk reserve . . . . . . . . . . . . . . . . . . . . . 3,800
Loans and leases, net of unearned income,
allowance, and reserve . . . . . . . . . . . . . . . . . . . . . . . . . . . 4,107,953
Assets held in trading accounts . . . . . . . . . . . . . . . . . . . . . . . . . . 65,318
Premises and fixed assets (including capitalized leases) . . . . . . . . . . . . . 73,006
Other real estate owned . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11,459
Customers' liability to this bank on acceptances outstanding . . . . . . . . . . . 23,626
Intangible assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9,769
Other assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135,391
----------
TOTAL ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $7,374,641
==========
</TABLE>
<PAGE> 7
LIABILITIES
<TABLE>
<CAPTION>
Dollar Amount
in Thousands
-------------
<S> <C>
Deposits:
In domestic offices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5,320,978
Noninterest-bearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,710,619
Interest-bearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,610,359
In foreign offices, Edge and Agreement subsidiaries, and IBFs . . . . . . . . . . 586,685
Noninterest-bearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 135
Interest-bearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 586,550
Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of its Edge
and Agreement subsidiaries, and in IBFs:
Federal funds purchased . . . . . . . . . . . . . . . . . . . . . . . . . . . 588,614
Securities sold under agreements to repurchase . . . . . . . . . . . . . . . 82,179
Demand notes issued to the U.S. Treasury . . . . . . . . . . . . . . . . . . . . . 6,343
Trading liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17,741
Other borrowed money:
With original maturity of one year or less . . . . . . . . . . . . . . . . . 20,000
With original maturity of more than one year . . . . . . . . . . . . . . . . 109,727
Bank's liability on acceptances executed and outstanding . . . . . . . . . . . . . 23,626
Subordinated notes and debentures . . . . . . . . . . . . . . . . . . . . . . . . . 61,000
Other liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 93,011
----------
TOTAL LIABILITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . $6,909,904
==========
EQUITY CAPITAL
Common Stock . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18,448
Surplus . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 126,299
Undivided profits and capital reserves . . . . . . . . . . . . . . . . . . . . . . 339,299
Net unrealized holding gains (losses) on available-for-sale securities . . . . . . (19,309)
TOTAL EQUITY CAPITAL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 464,737
----------
TOTAL LIABILITIES AND EQUITY CAPITAL . . . . . . . . . . . . . . . . . . . . . . . $7,374,641
==========
</TABLE>
We, the undersigned directors, attest to the correctness of this
Report of Condition and declare that it has been examined by us and to the best
of our knowledge and belief has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
and correct.
Jeremiah E. Casey
Frank P. Bramble
Henry J. Knott, Jr.
I, James A. Smith, Sr. Vice President of the named bank do hereby
declare that this Report of Condition has been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and is true
to the best of my knowledge and belief.
James A. Smith
October 26, 1994
<PAGE> 1
Exhibit 25(b)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM T-1
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE
PURSUANT TO SECTION 305(B)(2) ____________________
FIRST INTERSTATE BANK OF CALIFORNIA
(Exact name of trustee as specified in its charter)
<TABLE>
<S> <C>
California 95-0593085
(Jurisdiction of Incorporation (I.R.S.Employer
or organization Identification No.)
if not a U.S. national bank)
</TABLE>
707 WILSHIRE BOULEVARD, LOS ANGELES, CALIFORNIA 90017
(Address of principal executive offices) (Zip Code)
William Souza, First Interstate Bancorp General Counsel
633 West Fifth Street, Los Angeles, California 90071 (213) 614-3337
(Name address and telephone number of agent for service)
HOUSEHOLD INTERNATIONAL, INC.
(Exact name of obligor as specified in its charter)
<TABLE>
<S> <C>
DELAWARE 36-3121988
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
</TABLE>
2700 SANDERS ROAD, PROSPECT HEIGHTS, ILLINOIS 60070
(Address of principal executive offices) (Zip Code)
$500,000,000 DEBT SECURITIES
(Title of the indenture securities)
<PAGE> 2
FORM T-1
ITEM 1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS
TO THE TRUSTEE:
(A) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING
AUTHORITY TO WHICH IT IS SUBJECT.
STATE BANKING DEPARTMENT
235 Montgomery Street, San Francisco, California 94104
FEDERAL RESERVE BANK OF SAN FRANCISCO
101 Market Street, San Francisco, California 94105
FEDERAL DEPOSIT INSURANCE CORPORATION
Washington, D.C. 20429
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR. IF THE OBLIGOR IS AN AFFILIATE OF
THE TRUSTEE, DESCRIBE EACH SUCH AFFILIATION.
No such affiliation.
ITEM 3 THROUGH ITEM 15. NOT APPLICABLE.
ITEM 16. LIST OF EXHIBITS.
*EXHIBIT 1. A copy of the Restated Articles of Incorporation of the
Trustee as presently in effect (see Exhibit T-1A
Securities and Exchange Commission File 2-91947).
*EXHIBIT 2. A copy of the certificate of the Superintendent of Banks,
State of California, authorizing First Interstate Bank of
California to commence business of banking. (See Exhibit
T-1a(b), Securities and Exchange Commission File No.
2-41187.)
<PAGE> 3
*EXHIBIT 3. A copy of the certificate of the Superintendent of Banks,
State of California, authorizing First Interstate Bank of
California to transact trust banking business. (See
Exhibit T-1A(b), Securities and Exchange Commission File
No. 2-41187.) A copy of the Certificate as to Merger of
First Western Bank and Trust Company, San Francisco,
California, into California Bank, Los Angeles, California
(United California Bank after said Merger), and as to
Purchase by First Western Bank and Trust Company, Los
Angeles, California (New Bank) from said United California
Bank of the Business of Certain Branches of the Former
First Western Bank and Trust Company, San Francisco,
California (See Exhibit T-1A(c), Securities and Exchange
Commission File No. 2-41187.)
EXHIBIT 4. The By-Laws of the Trustee as presently in effect.
*EXHIBIT 6. The consent of the Trustee required by Section 321(b) of
the Trust Indenture Act of 1939. (See Exhibit 6,
Securities and Exchange Commission File No. 2-41187.)
EXHIBIT 7. A copy of the latest report of condition of the Trustee
published pursuant to law or the requirements of its
supervising or examining authority.
*Exhibits thus designated are incorporated herein by reference. These
exhibits were previously filed by the Trustee with the Securities and
Exchange Commission and are incorporated with the same respective
designations in this statement by specific reference thereto.
<PAGE> 4
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the Trustee,
First Interstate Bank of California, a corporation organized and existing under
the laws of California, has duly caused this Statement of Eligibility to be
signed on its behalf by the undersigned, thereunto duly authorized, all in the
City of Los Angeles, State of California, on January 11, 1995.
FIRST INTERSTATE BANK OF CALIFORNIA
By: CARL BOYD
---------------------------------
Carl Boyd
Assistant Vice President
<PAGE> 5
B Y - L A W S
OF
FIRST INTERSTATE BANK OF CALIFORNIA
ARTICLE I
MEETINGS OF SHAREHOLDERS
SECTION 1. SHAREHOLDERS' ANNUAL MEETING: Annual meetings of Shareholders
shall be held at the First Interstate World Center, 633 West Fifth Street, Los
Angeles, California, or at such other California location as the shareholders
or this Board shall direct. Annual meetings shall take place at one-fifteen on
the third Monday in April of each year, if not a legal holiday, and if a legal
holiday, then on the next succeeding day not a legal holiday.
SECTION 2. NOTICE OF SHAREHOLDERS' ANNUAL MEETING: The notice of the annual
meeting of the Shareholders shall be given by the Secretary, or in the event of
his absence, refusal or failure to act, by an Assistant Secretary, or a
Secretary Pro Tem appointed for that purpose by the Chairman of the Board, the
President, or by any Vice President, or by the Executive Committee. Said
notice shall be given in the manner and for the time required by law.
SECTION 3. SPECIAL SHAREHOLDERS' MEETINGS: Special meetings of the
shareholders shall be held at the principal executive office of the Corporation
and may be called by order of the Chairman of the Board, the President, or by
the Board of Directors, or at the request of the holders at the meeting which
represent not less than one-tenth in amount of the shares of the capital stock
of the Corporation issued and outstanding. Notice of special meetings of the
shareholders shall be given by the Secretary, or in the case of his absence,
refusal, or failure to act, by an Assistant Secretary, or Secretary Pro Tem
appointed for that purpose by the Chairman of the Board, the President, or by
any Vice President, or by the Executive Committee; such notice shall be given
by mailing through the United States mails, postage prepaid, a written or
printed notice thereof stating the time, place and general nature of the
business to be transacted at the meeting, addressed to each shareholder of
record entitled to vote at such meeting at the address of such shareholder
appearing on the books of the Corporation, or given by the shareholder to the
Corporation for the purpose of notice, or if no such address appears or is
given, at the place where the principal executive office of the Corporation is
located. Said notice shall be mailed by placing the same in any regular place
of deposit for United States mail not less than ten (10) nor more than sixty
(60) days before the day on which the meeting is to be held.
SECTION 4. ADJOURNMENT OF SHAREHOLDERS' MEETINGS: Any meeting of the
shareholders may be adjourned from time to time by the vote of a majority of
the shares, the holders of which are either present in person or represented
by proxy.
1
<PAGE> 6
ARTICLE II
MEETINGS OF DIRECTORS
SECTION 1. ANNUAL MEETING: The Board of Directors shall meet for the purpose
of organization, the election of officers, and the transaction of other
business, immediately after each annual election of directors on the same day
on which the shareholders' meeting at which they have been elected has been
held. Notice of such meeting need not be given.
SECTION 2. REGULAR MEETINGS OF DIRECTORS: The regular meetings of the Board
shall be held at least once each calendar quarter at such hour and on such day
during such month as shall from time to time be fixed by standing resolution of
the Board, except during the month of April when the annual meeting shall
constitute the regular meeting and shall be held immediately after the annual
election of directors. In the event that the day fixed for a regular meeting
of directors shall fall on a legal holiday, then such regular meeting shall be
held at the same hour upon such day as the Board of Directors may previously
designate by resolution, and if no such day be designated, the said meeting
shall be held on the next succeeding day not a holiday. No notice of regular
meetings of directors is required.
SECTION 3. SPECIAL MEETINGS OF THE DIRECTORS: Special meetings of the Board
may be called by the Chairman of the Board, the President, the Secretary or any
two (2) directors. Notice of special meetings of the Board shall state the
time and place of the meeting but need not state the purpose thereof. Such
notice may be in writing and shall be sufficient if given by United States
mail, telegraph, personal service or by telephone; if by mail then the notice
shall be deposited, postage prepaid, in any regular place of deposit for United
States mail in the City of Los Angeles at least four (4) days before the time
of the meeting, addressed to the director at his last post office address as
known to the officer giving the notice; if by telegraph then the telegram
containing the notice shall be delivered to a telegraph office in the City of
Los Angeles, transmission charges prepaid, at least twenty-four (24) hours
before the time of the meeting, addressed to the director at his last post
office address as known to the officer giving the notice; if by personal
service or by telephonic means at least twenty-four (24) hours before the time
of the meeting. A record of such notice, by whom given and the manner in which
given shall be entered upon the minutes of any special meeting of the Board,
and the said minutes on being read and approved at any subsequent meeting of
the Board shall be presumptive upon the question of service. The attendance of
any director at any meeting of the Board, without protest of lack of notice to
him, either prior to or at the commencement of the meeting shall constitute a
waiver of any such notice. A director may execute a waiver of notice of any
meeting of the Board either before or after such meeting.
2
<PAGE> 7
SECTION 4. PLACE AND TIME OF MEETINGS OF DIRECTORS: Regular meetings of the
Board shall be held without call or notice at such time and place as shall from
time to time be fixed by standing resolution of the Board. Special meetings of
the Board shall be held at the time and place stated in the notice of such
meeting.
SECTION 5. ACTION WITHOUT MEETING: Any action by the Board may be taken
without a meeting if all members of the Board shall individually or
collectively consent in writing to such action. Such written consent or
consents shall be filed with the minutes of the proceedings of the Board.
SECTION 6. TELEPHONIC MEETINGS: A meeting of the Board of Directors or of any
Committee thereof may be held through the use of conference telephone or
similar communications equipment, so long as all members participating in such
meeting can hear one another. Participation in such a meeting shall constitute
presence at such meeting.
ARTICLE III
DIRECTORS
SECTION 1. Wherever in these By-Laws the term "BOARD" is used, the same is
intended to designate the Board of Directors of the Corporation. Subject to
limitations of the Articles of Incorporation, of these By-Laws, of the
California General Corporation Law, and of the California Financial Code as to
action to be authorized or approved by the shareholders, and subject to the
duties of Directors as prescribed by these By-Laws, all corporate powers shall
be exercised by or subject to the direction of, and business and affairs of the
Corporation shall be managed by or under the direction of, the Board. Without
prejudice to such general powers, but subject to the same limitations, it is
hereby expressly declared that the Board shall have the following powers:
a. To control the election, the appointment, the authority,
responsibility and the qualifications of all persons in charge of the
business and the affairs of the Corporation.
b. To cause to be kept a record of all their meetings and proceedings and
of all the meetings of the shareholders, and to cause to be presented
at the annual meeting of the shareholders a statement showing the
assets and liabilities of the Corporation.
c. To require from the officers and from other persons in charge of the
business and affairs of the Corporation respectively, such bond or
security as it may see fit for the faithful performance of their
duties.
d. To appoint such committees and members thereof as it may deem proper
and to define the powers and duties of such
3
<PAGE> 8
committees, and to determine their compensation.
e. Make any distribution to its shareholders at a rate or in a periodic
amount or within a price range as it may deem proper and in a manner
provided by law.
f. To cause to be issued to the shareholders, in proportion to their
several interests, certificates of stock not to exceed in the
aggregate the authorized capital.
g. To fix by general and uniform resolution or resolutions the
compensation of each director for serving as director and to make such
changes therein from time to time as it may deem proper.
SECTION 2. The authorized number of Directors of this Corporation shall not be
less than eight (8) nor more than fifteen (15). The exact number of Directors
shall be fixed, within these limits, by approval of the Board of Directors or
the Shareholders, within the limits and in the manner prescribed by law.
ARTICLE IV
OFFICERS
SECTION 1. NUMBER AND TITLES: The Corporation shall have (a) a Chairman of
the Board, (b) a President, and (c) a Secretary. The Corporation may also have
one or more Vice Chairmen, one or more Executive Vice Presidents, one or more
Senior Vice Presidents, one or more Vice Presidents, one or more Assistant Vice
Presidents, one or more Assistant Cashiers, one or more Assistant Secretaries,
a General Counsel, one or more Assistant General Counsel, one or more Managing
Counsel, one or more Senior Counsel, one or more Counsel, one of more Assistant
Counsel, two or more Trust Officers of whom one or more may be designated
Senior Trust Officer, a General Auditor, one or more Audit Officers, a Chief
Financial Officer, a Comptroller, one or more Financial Analysis Officers, one
or more Accounting Officers, one or more Managers, one or more Assistant
Managers, one or more Operations Officers, one or more Corporate Banking
Officers, one or more Banking Officers, and one or more International Banking
Officers.
There may also be such other officers as may from time to time be designated by
resolution of the Board of Directors.
SECTION 2. APPOINTMENT AND TERM OF OFFICE: The Chairman of the Board, the
President, the Vice Chairmen, the Executive Vice Presidents, the Senior Vice
Presidents, the Secretary, the General Counsel, the Assistant General Counsel,
the Senior Trust Officers, the General Auditor, the Chief Financial Officer and
the Comptroller shall be chosen by the Board at the first meeting after the
election of the Board and shall hold office at the pleasure of
4
<PAGE> 9
the Board. The Board may also appoint such officers from time to time at any
regular or special meeting of the Board. All other officers designated by
resolution of the Board as provided in Section 1, may be appointed by the
Chairman of the Board or the President. All persons authorized to sign on
behalf of the Corporation, other than officers, may be appointed by the
Chairman of the Board, or the President.
SECTION 3. CHAIRMAN OF THE BOARD: The Chairman of the Board shall preside at
all meetings of the shareholders and all meetings of the Board and of the
Executive Committee. He shall be the chief executive officer of the
Corporation with general executive supervision of its business and affairs. He
shall act as Chairman of all committees of which he is a member, except as may
be provided in the resolution or order appointing such committee or committees.
In the absence or disability of the Chairman of the Board, the following
officers in the following order shall act in his stead: the President, an
officer designated by the Chairman of the Board, an officer designated by the
Board of Directors or Executive Committee. In the absence or disability of the
Chairman of the Board, the President, and all officers so designated, if any,
the Board of Directors shall elect a temporary Chairman of the Board to act
during such absence or disability of said officers. The Chairman of the Board
shall at all times have on file with the Secretary his written designation of
the officer from time to time so designated by him to act as the chief
executive officer in his absence or disability and in the absence or disability
of the President.
SECTION 4. PRESIDENT: The President shall have such powers and duties as may
be prescribed by these By-Laws, the Board, the Executive Committee or the
Chairman of the Board. Subject to the authority of the Chairman of the Board,
the President shall have general executive supervision of the business and
affairs of the Corporation and shall be senior in authority to all officers
other than the Chairman of the Board. In the absence or disability of the
Chairman of the Board, the President shall exercise the powers and perform the
duties of the Chairman of the Board.
SECTION 5. VICE CHAIRMEN: The Vice Chairmen shall perform the duties imposed
upon them by the By-Laws, the Board of Directors, the Executive Committee, the
Chairman of the Board or the President.
SECTION 6. EXECUTIVE VICE PRESIDENTS: The Executive Vice Presidents shall
perform the duties imposed upon them by the By-Laws, the Board, the Executive
Committee, the Chairman of the Board or the President.
SECTION 7. SENIOR VICE PRESIDENTS: The Senior Vice Presidents shall perform
the duties imposed upon them by the By-Laws, the
5
<PAGE> 10
Board, the Executive Committee, the Chairman of the Board or the President.
SECTION 8. SECRETARY: The Secretary shall keep full and complete minutes of
each meeting of the Board, of the Executive Committee and of the shareholders
and give notice, as required, of all such meetings. He shall maintain custody
of and keep such other records of the Corporation as are required by the Board
and, generally, perform all duties which pertain to his office and which are
required by the Board.
SECTION 9. GENERAL AUDITOR: The General Auditor shall be responsible to the
Board, through the Audit Committee, for the systems of internal audit and for
testing and evaluating the systems of protective controls. The office of the
General Auditor shall make such examinations and reports as the General Auditor
deems advisable or as may be required by the Audit Committee. The General
Auditor shall have the duty to report to the Chairman of the Board on all
matters concerning which the General Auditor deems advisable or which the
Chairman of the Board may request and shall perform such other duties as the
Chairman of the Board may prescribe. Additionally, the General Auditor shall
have the duty of reporting independently of all officers of the Corporation to
the Audit Committee at least quarterly on all matters concerning which the
General Auditor deems advisable or which the Audit Committee may request.
SECTION 10. CHIEF FINANCIAL OFFICER: The Chief Financial Officer shall keep
and maintain, or cause to be kept and maintained, adequate and correct accounts
of the properties and business transactions of the Corporation, including
accounts of its assets, liabilities, receipts, disbursements, gains, losses,
capital, surplus and shares. He shall be responsible for all the money, funds
and valuables belonging to the Corporation. He shall deposit all money and
other valuables in the name of and to the credit of the Corporation with such
depositories as are authorized by law. He shall render to the Chairman of the
Board, the President and Board, whenever they request it, an account of all of
his transactions as Chief Financial Officer and of the financial condition of
the Corporation, and shall have such other powers and perform such other duties
as are prescribed by the Board, the Executive Committee, the By-Laws, the
Chairman of the Board or the President.
SECTION 11. OTHER OFFICERS: Each other officer shall have such authority and
perform such duties as are prescribed by the By-Laws, the Board, the Executive
Committee, the Chairman of the Board or the President.
6
<PAGE> 11
ARTICLE V
COMMITTEES OF THE BOARD OF DIRECTORS
SECTION 1. EXECUTIVE COMMITTEE: There shall be an Executive Committee
consisting of the Chairman of the Board, the President and at least three
non-officer directors to be appointed for respective terms to be fixed by the
Board. A majority of the members of the Committee shall constitute a quorum
for the transaction of business. The Board may from time to time appoint an
additional director or directors as an alternate member or members of the
Committee to serve only at a meeting if there otherwise may not be a quorum
present at such meeting. The alternate member or members so appointed shall
act in the place and stead of any regular member or members who may be absent
from such meeting. The Executive Committee shall have all of the powers and
authority of the Board in the management of the business and affairs of the
Corporation during the intervals between meetings of the Board, except the
power to declare dividends and to adopt, amend or repeal By-Laws or as
otherwise prohibited by law. The Executive Committee may establish and appoint
such other committees not otherwise provided for by these By-Laws or the Board
of Directors as it may deem advisable and may prescribe the powers and duties
of such committees.
The Chairman of the Board or a member of the Committee designated by the
Chairman of the Board, shall preside over meetings of the Committee. Meetings
of the Committee may be held at the call of the Chairman of the Board or the
President or any two other members of the Committee at the time and place
stated in the notice of such meeting.
The transactions of any meetings of the Executive Committee however called or
noticed or wherever held shall be as valid as though had at a meeting duly held
after the regular call and notice, if a quorum be present and if, either before
or after the meeting each of the members of the Committee not present sign a
written waiver of notice or a consent to the holding of such meeting or an
approval of the minutes thereof. All such waivers, consents or approvals shall
be filed with the records of the Committee or made a part of the minutes of the
meeting.
SECTION 2. OTHER COMMITTEES: The Board of Directors may designate one or more
committees from time to time, each consisting of two or more directors to serve
at the pleasure of the Board. The Board of Directors may designate one or more
directors as alternate members of any committee, who may replace any absent
member at any meeting of the committee. Any such committee, to the extent
provided in the resolution of the Board of Directors shall have all the
authority of the Board, except with respect to:
a. The approval of any action for which shareholder approval is also
required.
7
<PAGE> 12
b. The filling of vacancies on the Board or in any Committee.
c. The fixing of compensation of the directors for serving on the Board
or on any committee.
d. The amendment or repeal of By-Laws or the adoption of new By-Laws.
e. The amendment or repeal of any resolution of the Board which by its
express terms is not so amendable or repealable.
f. A distribution to the shareholders of the corporation as defined in
Section 166 of the California Corporations Code, except at a rate or
in a periodic amount or within a price range determined by the Board.
g. The appointment of other committees of the Board or the members
thereof.
h. The approval of any action for which the entire Board is required.
ARTICLE VI
INDEMNIFICATION OF DIRECTORS, OFFICERS AND EMPLOYEES
(A) INDEMNIFICATION OF DIRECTORS, OFFICERS AND EMPLOYEES. Each person who was
or is a party or is threatened to be made a party or is otherwise involved in
any action, suit or proceeding, whether civil, criminal, administrative or
investigative (hereinafter a "proceeding"), by reason of the fact that he or
she is or was a director, officer or employee of the Corporation, or of any
predecessor corporation, or is or was serving at the request of the Corporation
as a director, officer, employee or other agent of another corporation or of a
partnership, joint venture, trust or other enterprise (including service with
respect to employee benefit plans), whether the basis of such proceeding is
alleged action in an official capacity as a director, officer or employee or in
any other capacity while serving as a director, officer or employee, shall be
indemnified and held harmless by the Corporation to the fullest extent
permissible under California law and the Corporation's Articles of
Incorporation, against all expense, liability and loss (including attorneys'
fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in
settlement) actually and reasonably incurred or suffered by such person in
connection therewith. Such indemnification shall continue as to a person who
has ceased to be a director, officer or employee and shall inure to the benefit
of his or her heirs, executors and administrators. Notwithstanding the
foregoing, the Corporation shall indemnify any such person in connection with a
proceeding (or part thereof) initiated by such person only if such proceeding
(or part thereof) was authorized by the Board of Directors of the
8
<PAGE> 13
Corporation. The right to indemnification conferred in this Article shall
include the right to be paid by the Corporation the expenses incurred in
defending any proceeding in advance of final disposition to the fullest extent
permitted by law; provided, however, that the payment under this Article of
such expenses in advance of the final disposition of a proceeding may be
conditioned upon the delivery to the Corporation of such undertakings by or on
behalf of such director, officer or employee to repay all amounts so advanced
as may be required or permitted by law.
(B) EXCLUSIONS. Notwithstanding the foregoing or any other provisions under
this Article, the Corporation shall not be liable under this Article to
indemnify a director, officer or employee against, or make any advances or
other payments in connection with, any proceeding against a director, officer
or employee based upon, arising out of, resulting from, relating to or in
consequence of (1) transactions or activities in which such person gained or
sought to gain, any improper personal profit or advantage, or (2) the
intentional misconduct of such person which such person knew, or reasonably
should have known, would violate the law or any policy of the Corporation or
(3) the knowing fraud or deliberately dishonest actions of such person.
(C) SUCCESSFUL DEFENSE. To the extent that a director, officer or employee
has been successful on the merits in defense of any proceeding referred to in
paragraph (a) or in defense of any claim, issue or matter therein, such person
shall be indemnified against expenses (including attorneys' fees) actually and
reasonably incurred by him or her in connection therewith.
(D) NON-EXCLUSIVITY OF RIGHTS. The right to indemnification provided by this
Article shall not be exclusive of any other right which any person may have or
hereafter acquire under any statute, by-law, agreement, vote of shareholders or
disinterested directors, or otherwise.
ARTICLE VII
CERTIFICATE OF STOCK
Certificates for shares of the capital stock of the Corporation shall be of
such form as the Board may prescribe and shall be signed by the President or a
Vice President and the Secretary or an Assistant Secretary, or be authenticated
by facsimiles of the signatures of the President and the Secretary, or by a
facsimile of the signature of the President and the written signature of the
Secretary or an Assistant Secretary. Every certificate authenticated by a
facsimile of a signature must be countersigned by a transfer agent or transfer
clerk, and be registered by an incorporated bank or trust company as registrar
of transfers, before issuance.
9
<PAGE> 14
ARTICLE VIII
TRANSFER OF STOCK
SECTION 1. Shares of the capital stock of the Corporation may be transferred
by the holders thereof, or by attorney legally constituted, or by their legal
representatives, by endorsement on the certificates of stock, but no such
transfer shall be valid until the certificate is surrendered and acknowledgment
made on the books of the Corporation.
SECTION 2. No new certificates shall be issued for the surrendered
certificates unless the surrendered certificates have been duly canceled. If a
certificate shall be lost or destroyed, the Board or the Executive Committee
may order a new certificate in lieu thereof issued upon such guaranty or
indemnity of the person claiming the same as the Board or the Executive
Committee may deem proper and satisfactory.
SECTION 3. The Board may fix a time in the future as a record date for the
determination of the shareholders entitled to notice of and to vote at any
meeting of shareholders or entitled to receive any dividend or distribution, or
any allotment of rights, or to exercise rights in respect to any change,
conversion, or exchange of shares. The record date so fixed shall be not more
than sixty (60) nor less than ten (10) days prior to the date of the meeting or
event for the purposes of which it is fixed. When a record date is so fixed,
only shareholders of record on that date are entitled to notice of and to vote
at the meeting or to receive the dividend, distribution, or allotment of
rights, or to exercise the rights, as the case may be, notwithstanding any
transfer of any shares on the books of the Corporation after the record date.
At any meeting of shareholders as to which the Board has not fixed a record
date for the determination of the shareholders entitled to notice of and to
vote at such meeting, only shareholders of record at the close of business on
the business day next preceding the day on which notice is given or, if notice
is waived, at the close of business on the business day next preceding the day
on which the meeting is held shall be entitled to vote thereat.
ARTICLE IX
DEPOSITS
SECTION 1. All deposits made by the shareholders shall be entitled to the same
rights, privileges and benefits as those of other depositors.
ARTICLE X
SEAL
SECTION 1. The seal of the Corporation shall be in such form as the Board may
prescribe. In the execution on behalf of this Corporation of any instrument,
document, writing, notice or paper
10
<PAGE> 15
it shall not be necessary to affix the corporate seal of this Corporation
thereon, and any such instrument, document, writing, notice or paper when
executed without said seal affixed thereon shall be of the same force and
effect and as binding on this Corporation as if said corporate seal had been
affixed thereon in each instance. Said seal, if required, may be affixed,
imprinted or reproduced by facsimile on any instrument or document, including
certificates for shares of the stock of this Corporation.
ARTICLE XI
AMENDMENT TO BY-LAWS
SECTION 1. Subject to the right of shareholders to adopt, amend or repeal
By-Laws, as provided in Section 211 of the Corporations Code of California,
By-Laws may be adopted, amended or repealed by the Board, except that a By-Law
or amendment thereof changing the authorized number of directors may be
adopted, amended or repealed by the Board only pursuant to Section 212 of said
Corporations Code.
I, Carl Boyd, Assistant Vice President of FIRST INTERSTATE BANK OF CALIFORNIA,
a California corporation, hereby certify that the foregoing eleven (11) pages
represent a full, true and correct copy of the Code of By-Laws of First
Interstate Bank of California as amended, and that the same is in full force
and effect as of April 26, 1994.
WITNESS my hand and the seal of said Corporation this 11th day of January,
1995.
/s/ Carl Boyd
-------------------------------
Assistant Vice President
of
FIRST INTERSTATE BANK OF CALIFORNIA
BYLAWS
11
<PAGE> 16
<TABLE>
<S> <C> <C> <C>
First Interstate Bank of California Call Date: 09/30/94 ST-BK: 66-6 FFIEC: 031
1200 W. 7th St. Page RC-1
Los Angeles, CA 90017 Vendor ID: D Cert: 01226
11
Transit Number: 12200021
</TABLE>
Consolidated Report of Condition for Insured Commercial and State-Chartered
Savings Banks for September 30, 1994
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.
Schedule RC - Balance Sheet
<TABLE>
<CAPTION>
C400 <-
Dollar Amounts in Thousands
- ---------------------------------------------------------------------------------------------------------------------------------
Assets
<S> <C> <C> <C>
1. Cash and balances due from depository institutions (from Schedule RC-A): RCFD
----
a. Noninterest-bearing balances and currency and coin1 0081 3,037,154 1.a
b. Interest-bearing balances2 0071 56,035 1.b
2. Securities
a. Held-to-maturity securities (from Schedule RC-B, column A) 1754 6,757,550 2.a
b. Available-for-sale securities (from Schedule RC-B, column D) 1773 39,018 2.b
3. Federal funds sold and securities purchased under agreements to resell in domestic
offices of the bank and of its Edge and Agreement subsidiaries, and in IBF's:
a. Federal funds sold 0276 1,084,250 3.a
b. Securities purchased under agreements to resell 0277 0 3.b
4. Loans and Lease financing receivables:
a. Loans and Leases, net of unearned income RCFD
-----
(from Schedule RC-C) 2122 11,315,612 4.a
b. LESS: Allowance for Loans and Lease losses 3123 322,444 4.b
c. LESS: Allocated transfer risk reserve 3128 0 4.c
d. Loans and Leases, net of unearned income,
allowance, and reserve Item 4.a minus 4.b and 4.c) 2125 10,993,168 4.d
5. Assets held in trading accounts 3545 2,100 5.
6. Premises and fixed assets (including capitalized leases) 2145 361,652 6.
7. Other real estate owned (from Schedule RC-M) 2150 53,247 7.
8. Investments in unconsolidated subsidiaries and associated companies
(from Schedule RC-M) 2130 12,291 8.
9. Customers' liability to this bank on acceptances outstanding 2155 8,894 9.
10. Intangible assets (from Schedule RC-M) 2143 78,167 10.
11. Other assets (from Schedule RC-F) 2160 519,499 11.
12. Total assets (sum of items 1 through 11) 2170 23,003,025 12.
</TABLE>
1 Includes cash items in process of collection and unposted
debits.
2 Includes time certificates of deposit not held in trading
accounts.
<PAGE> 17
<TABLE>
<S> <C> <C> <C>
First Interstate Bank of California Call Date: 09/30/94 ST-BK: 66-6 FFIEC: 031
1200 W. 7th St. Page RC-2
Los Angeles, CA 90017 Vendor ID: D Cert: 01226 12
Transit Number: 12200021
</TABLE>
Schedule RC - Continued
<TABLE>
<CAPTION>
Dollar Amounts in Thousands
- ------------------------------------------------------------------------------------------------------------------------------
LIABILITIES
<S> <C> <C> <C> <C>
13. Deposits:
a. In domestic offices (sum of totals of columns A and C RCON
----
from Schedule RC-E, Part I) 2200 20,580,485 13.a
(1) Noninterest-bearing(1) 6631 9,394,501 13.a.1
(2) Interest-bearing 6636 11,185,984 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and RCFN
----
IBFs (from Schedule RC-E, part II) 2200 91,077 13.b
(1) Noninterest-bearing 6631 0 13.b.1
(2) Interest-bearing 6636 91,077 13.b.2
14. Federal funds purchased and securities sold under agreements
to repurchase in domestic offices of the bank and of its Edge
and Agreement subsidiaries, and in IBFs: RCFD
----
a. Federal funds purchased 0278 84,697 14.a
b. Securities sold under agreements to repurchase 0279 7,260 14.b
15. a. Demand notes issued to the RCON
----
U.S. Treasury 2840 0 15.a
RCFD
----
b. Trading Liabilities 3548 0 15.b
16. Other borrowed money:
a. With original maturity of one year or less 2332 14,879 16.a
b. With original maturity of more than one year 2333 0 16.b
17. Mortgage indebtedness and obligations under capitalized
Leases 2910 90,547 17.
18. Bank's Liability on acceptances executed and outstanding 2920 8,894 18.
19. Subordinated notes and debentures 3200 0 19.
20. Other Liabilities (from Schedule RC-G) 2930 318,746 20.
21. Total Liabilities (sum of items 13 through 20) 2948 21,196,585 21.
22. Limited-Life preferred stock and related surplus 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus 3838 0 23.
24. Common stock 3230 428,182 24.
25. Surplus (excluded all surplus related to preferred stock) 3839 558,948 25.
26. a. Undivided profits and capital reserve 3632 818,599 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities 8434 0 711 26.b
27. Cumulative foreign currency translation adjustments 3284 0 27.
28. Total equity capital (sum of items 23 through 27) 3210 1,806,440 28.
29. Total Liabilities, Limited-Life preferred stock, and equity
capital (sum of items 21, 22, and 28) 3300 23,003,025 29.
</TABLE>
<PAGE> 18
Memorandum
To be reported only with the March Report of Condition.
<TABLE>
<S> <C>
1. Indicate in the box at the right the number of the
statement below that best describes the most
comprehensive level of auditing work performed for the bank RFCD NUMBER
----
by Independent external auditors as of any type during 1993 6724 N/A M.1
1=Independent audit of the bank conducted in accordance 4=Director's examination of the bank performed by other
with generally accepted auditing standards by a certified external auditors (may be required by state chartering
public accounting firm which submits a report on the bank authority)
2=Independent audit of the bank's parent holding company 5=Review of the bank's financial statements by external
conducted in accordance with generally accepted auditing auditors
standards by a certified public accountant firm which
submits a report on the consolidated holding company (but 6=Compilation of the bank's financial statements by
not on the bank separately) external auditors
3=Directors' examination of the bank conducted in accordance 7=Other audit procedures (excluding tax preparation work)
with generally accepted auditing standards by a certified
public accounting firm (may be required by state charter- 8=No External audit work
ing authority)
</TABLE>
_____________
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
<PAGE> 1
Exhibit 25(c)
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM T-1
Statement of Eligibility
Under the Trust Indenture Act of 1939
of a Corporation Designated to Act as
Trustee
Check if an Application to Determine
Eligibility of a Trustee Pursuant to Section
305(b)(2) _______________
HARRIS TRUST AND SAVINGS BANK
(Name of Trustee)
Illinois 36-1194448
(State of Incorporation) (I.R.S. Employer Identification No.)
111 West Monroe Street, Chicago, Illinois 60603
(Address of principal executive offices)
Carolyn C. Potter, Harris Trust and Savings Bank,
111 West Monroe Street, Chicago, Illinois, 60603
312-461-2531
(Name, address and telephone number for agent for service)
HOUSEHOLD INTERNATIONAL, INC.
(Name of obligor)
Delaware 36-3121988
(State of Incorporation) (I.R.S. Employer Identification No.)
2700 Sanders Road
Prospect Heights, IL 60070
(Address of principal executive offices)
Debt Securities
(Title of indenture securities)
<PAGE> 2
1. GENERAL INFORMATION. Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
Commissioner of Banks and Trust Companies, State of Illinois,
Springfield, Illinois; Chicago Clearing House Association, 164
West Jackson Boulevard, Chicago, Illinois; Federal Deposit
Insurance Corporation, Washington, D.C.; The Board of Governors
of the Federal Reserve System, Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Harris Trust and Savings Bank is authorized to exercise
corporate trust powers.
2. AFFILIATIONS WITH OBLIGOR. If the Obligor is an affiliate of the Trustee,
describe each such affiliation.
The Obligor is not an affiliate of the Trustee.
3. thru 15.
NO RESPONSE NECESSARY
16. LIST OF EXHIBITS.
1. A copy of the articles of association of the Trustee is now in effect
which includes the authority of the trustee to commence business and to
exercise corporate trust powers.
A copy of the Certificate of Merger dated April 1, 1972 between Harris
Trust and Savings Bank, HTS Bank and Harris Bankcorp, Inc. which
constitutes the articles of association of the Trustee as now in effect
and includes the authority of the Trustee to commence business and to
exercise corporate trust powers was filed in connection with the
Registration Statement of Louisville Gas and Electric Company, File No.
2-44295, and is incorporated herein by reference.
2. A copy of the existing by-laws of the Trustee.
A copy of the existing by-laws of the Trustee was filed in connection
with the Registration Statement of Hillenbrand Industries, Inc., File
No. 33-44086, and is incorporated herein by reference.
3. The consents of the Trustee required by Section 321(b) of the Act.
(included as Exhibit A on page 2 of this statement)
4. A copy of the latest report of condition of the Trustee published
pursuant to law or the requirements of its supervising or examining
authority.
(included as Exhibit B on page 3 of this statement)
1
<PAGE> 3
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the Trustee,
HARRIS TRUST AND SAVINGS BANK, a corporation organized and existing under the
laws of the State of Illinois, has duly caused this statement of eligibility to
be signed on its behalf by the undersigned, thereunto duly authorized, all in
the City of Chicago, and State of Illinois, on the 6th day of January, 1995.
HARRIS TRUST AND SAVINGS BANK
By: /s/ CAROLYN C. POTTER
-----------------------------
Carolyn C. Potter
Assistant Vice President
EXHIBIT A
The consents of the trustee required by Section 321(b) of the Act.
Harris Trust and Savings Bank, as the Trustee herein named, hereby consents
that reports of examinations of said trustee by Federal and State authorities
may be furnished by such authorities to the Securities and Exchange Commission
upon request therefor.
HARRIS TRUST AND SAVINGS BANK
By: /s/ CAROLYN C. POTTER
----------------------------
Carolyn C. Potter
Assistant Vice President
2
<PAGE> 4
EXHIBIT B
Attached is a true and correct copy of the statement of condition of Harris
Trust and Savings Bank as of September 30, 1994, as published in accordance
with a call made by the State Banking Authority and by the Federal Reserve Bank
of the Seventh Reserve District.
[HARRIS BANK LOGO]
Harris Trust and Savings Bank
111 West Monroe Street
Chicago, Illinois 60603
of Chicago, Illinois, And Foreign and Domestic Subsidiaries, at the close of
business on September 30, 1994, a state banking institution organized and
operating under the banking laws of this State and a member of the Federal
Reserve System. Published in accordance with a call made by the Commissioner of
Banks and Trust Companies of the State of Illinois and by the Federal Reserve
Bank of this District.
Bank's Transit Number 71000288
<TABLE>
<CAPTION>
ASSETS THOUSANDS
OF DOLLARS
<S> <C> <C>
Cash and balances due from depository institutions:
Non-interest bearing balances and currency and coin.................. $926,673
Interest bearing balances............................................ $686,713
Securities:.................................................................
a. Held-to-maturity securities $722,766
b. Available-for-sale securities $1,560,119
Federal funds sold and securities purchased under agreements to resell in
domestic offices of the bank and of its Edge and Agreement
subsidiaries, and in IBF's:
Federal funds sold..................................................... $421,221
Securities purchased under agreements to resell........................ $74,156
Loans and lease financing receivables:
Loans and leases, net of unearned income............................... $6,081,473
LESS: Allowance for loan and lease losses............................. $92,307
----------
Loans and leases, net of unearned income, allowance, and reserve
(item 4.a minus 4.b)................................................... $5,989,166
Assets held in trading accounts.............................................. $355,239
Premises and fixed assets (including capitalized leases)..................... $137,238
Other real estate owned...................................................... $1,831
Investments in unconsolidated subsidiaries and associated companies.......... $566
Customer's liability to this bank on acceptances outstanding................. $71,652
Intangible assets............................................................ $28,142
Other assets................................................................. $546,710
-----------
TOTAL ASSETS $11,473,310
===========
LIABILITIES
Deposits:
In domestic offices.................................................... $4,793,158
Non-interest bearing............................................. $2,586,164
Interest bearing................................................. $2,206,994
In foreign offices, Edge and Agreement subsidiaries, and IBF's......... $2,498,415
Non-interest bearing............................................. $36,675
Interest bearing................................................. $2,461,740
</TABLE>
3
<PAGE> 5
<TABLE>
<S> <C>
Federal funds purchased and securities sold under agreements to repurchase
in domestic offices of the bank and of its Edge and Agreement subsidiaries,
and in IBF's:
Federal funds purchased............................................... $472,955
Securities sold under agreements to repurchase........................ $1,540,788
Trading Liabilities $219,236
Other borrowed money:........................................................
a. With original maturity of one year or less $431,252
b. With original maturity of more than one year $15,163
Bank's liability on acceptances executed and outstanding $71,652
Subordinated notes and debentures............................................ $235,000
Other liabilities............................................................ $421,949
-----------
TOTAL LIABILITIES $10,780,089
===========
EQUITY CAPITAL
Common stock................................................................. $100,000
Surplus...................................................................... $275,000
a. Undivided profits and capital reserves.................................... $321,267
b. Net unrealized holding gains (losses) on available-for-sale securities $3,046
-----------
TOTAL EQUITY CAPITAL $693,221
-----------
$11,473,310
===========
</TABLE>
I, Paul Skubic, Controller of the above-named bank, do hereby declare
that this Report of Condition has been prepared in conformance with the
instructions issued by the Board of Governors of the Federal Reserve System and
is true to the best of my knowledge and belief.
PAUL SKUBIC
10/27/94
We, the undersigned directors, attest to the correctness of this Report
of Condition and declare that it has been examined by us and, to the best of our
knowledge and belief, has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and the
Commissioner of Banks and Trust Companies of the State of Illinois and is true
and correct.
DONALD S. HUNT,
RICHARD E. TERRY,
B. KENNETH WEST,
Directors.
4
