<PAGE> 1
As filed with the Securities and Exchange Commission on April 20, 1995
Registration No. 33-___________
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------------
Form S-8
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
--------------------------
HOUSEHOLD INTERNATIONAL, INC.
(Exact name of registrant as specified in its charter)
------------------------------------------------------
Delaware 36-3121988
(State of Incorporation) (I.R.S. Employer Identification No.)
------------------------ ------------------------------------
2700 Sanders Road, Prospect Heights, Illinois 60070
(Address of principal executive offices) (Zip Code)
HOUSEHOLD INTERNATIONAL EMPLOYEE STOCK PURCHASE PLAN
(Full title of the Plan)
----------------------------------------------------
PATRICK D. SCHWARTZ
Associate General Counsel - Corporate Finance
Household International, Inc.
2700 Sanders Road, Prospect Heights, Illinois 60070
(708) 564-6301
(Name, address and telephone number of agent for service)
---------------------------------------------------------
Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this
Registration Statement.
CALCULATION OF REGISTRATION FEE
-------------------------------
<TABLE>
<CAPTION>
Title of Proposed Proposed
Securities Amount Maximum Maximum Amount of
to be to be Offering Price Aggregate Registration
Registered Registered Per Share (1) Offering Price (1) Fee
- ------------- ---------- -------------- -------------- ------------
<S> <C> <C> <C> <C>
Common Stock,
Par Value 2,000,000
$1 per Share Shares Not Applicable $91,250,000 $31,465.75
</TABLE>
(1) The proposed maximum aggregate offering price and the amount of the
registration fee are estimated pursuant to rule 457(h) based upon the
average of the high and low prices ($45.625) reported for the Common
Stock on the New York Stock Exchange Composite Tape on April 18, 1995.
----------------------
This Registration Statement shall hereafter become effective in accordance
with the provision of Section 8(a) of the
Securities Act of 1933<PAGE>
<PAGE> 2
CROSS-REFERENCE SHEET
Item Number and Caption Caption in Prospectus
- ----------------------- ---------------------
1. Plan Information Introduction; Description of
the ESPP; Other Information --
Federal Tax Considerations; --
Compensation Committee; --
Restrictions on Resale by
Certain Officers
2. Registrant Information and Other Information--Available
Employee Plan Annual Information and Incorporation
Information. of Certain Documents by
Reference<PAGE>
<PAGE> 3
PROSPECTUS
HOUSEHOLD INTERNATIONAL
EMPLOYEE STOCK PURCHASE PLAN
2,000,000 Shares
COMMON STOCK
($1.00 Par Value)
This Prospectus contains important information concerning the
Household International Employee Stock Purchase Plan (referred to
in this Prospectus as the "ESPP"). The ESPP is intended to
encourage eligible employees of Household International, Inc.
("Household") and its participating subsidiaries to join in the
ownership of Household through the purchase of its Common Stock.
If after reading this Prospectus you have any questions
concerning the ESPP, please call your local Human Resources
representative or the Home Office Employee Benefits Department.
---------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY
THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE
SECURITIES COMMISSION NOR HAS ANY SUCH COMMISSION PASSED
UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
--------------------------------------
THIS DOCUMENT CONSTITUTES PART OF A PROSPECTUS COVERING
SECURITIES THAT HAVE BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933.
HOUSEHOLD INTERNATIONAL, INC.
2700 Sanders Road
Prospect Heights, IL 60070
(708) 564-5000
The date of this Prospectus is May 1, 1995
<PAGE>
<PAGE> 4
TABLE OF CONTENTS
HOUSEHOLD INTERNATIONAL EMPLOYEE STOCK PURCHASE PLAN
INTRODUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
DESCRIPTION OF THE ESPP . . . . . . . . . . . . . . . . . . . . . . . . . 1
What Is An Offering Period? . . . . . . . . . . . . . . . . . . . . . 1
Who Is Eligible?. . . . . . . . . . . . . . . . . . . . . . . . . . . 2
How Do I Know If I Work For A Participating
Employer?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
How Do I Enroll?. . . . . . . . . . . . . . . . . . . . . . . . . . . 2
What Price Will I Pay?. . . . . . . . . . . . . . . . . . . . . . . . 3
What Does Fair Market Value Mean? . . . . . . . . . . . . . . . . . . 3
What Amount May I Contribute? . . . . . . . . . . . . . . . . . . . . 3
What Does Eligible Compensation Include?. . . . . . . . . . . . . . . 4
Do I Receive Interest On My Account Balance?. . . . . . . . . . . . . 4
Is There A Limit On The Maximum Number Of Shares
I May Purchase In An Offering Period? . . . . . . . . . . . . . . . 4
What Happens If I Hit The Maximum Share Limitation For
The Offering Period? . . . . . . . . . . . . . . . . . . . . . . . . 5
Is There Any Other Limitation On The Number of Shares I
Might Purchase During An Offering Period? . . . . . . . . . . . . . 6
May I Change The Amount Of My Payroll Deduction
During An Offering Period?. . . . . . . . . . . . . . . . . . . . . 6
May I Stop Contributions To The ESPP?. . . . . . . . . . . . . . . . 6
What If My Employment Ends?. . . . . . . . . . . . . . . . . . . . . 6
How Do I Actually Purchase Shares? . . . . . . . . . . . . . . . . . 7
How Will My Common Stock Be Held?. . . . . . . . . . . . . . . . . . 7
Do I Get To Vote My Shares?. . . . . . . . . . . . . . . . . . . . . 7
In Whose Name May Stock Be Held? . . . . . . . . . . . . . . . . . . 7
What Reports Do I Receive? . . . . . . . . . . . . . . . . . . . . . 7
Do I Receive Dividends On My Stock?. . . . . . . . . . . . . . . . . 8
Are There Special Limitations On My Stock Ownership? . . . . . . . . 8
How Do I Sell The Stock?. . . . . . . . . . . . . . . . . . . . . . . 8
How Do I Get Stock Certificates?. . . . . . . . . . . . . . . . . . . 10
Whom Do I Contact About Stock Certificates, Registration
Changes, Or My Quarterly Statements?. . . . . . . . . . . . . . . . 10
Whom Do I Contact To Terminate My Participation Or
Regarding My Payroll Deductions?. . . . . . . . . . . . . . . . . . 10
What Is The Effect Of A Stock Split,
Stock Dividend, Etc?. . . . . . . . . . . . . . . . . . . . . . . . 10
Are My Rights Under The ESPP Transferable?. . . . . . . . . . . . . . 10
Where Do The Purchased Shares Come From?. . . . . . . . . . . . . . . 10
How Are Funds Used By Household?. . . . . . . . . . . . . . . . . . . 11
How May The ESPP Be Changed?. . . . . . . . . . . . . . . . . . . . . 11
Who Pays The Expenses Of The ESPP?. . . . . . . . . . . . . . . . . . 11
Will This Prospectus Be Updated Annually? . . . . . . . . . . . . . . 11
How Can I Get An Additional Copy? . . . . . . . . . . . . . . . . . . 11
<PAGE>
<PAGE> 5
OTHER INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Federal Tax Considerations. . . . . . . . . . . . . . . . . . . . . . 12
Compensation Committee. . . . . . . . . . . . . . . . . . . . . . . . 14
Restrictions On Resale By Certain Officers. . . . . . . . . . . . . . 15
Available Information And
Incorporation Of Certain Documents By Reference . . . . . . . . . . 15
<PAGE>
<PAGE> 6
INTRODUCTION
The Household International Employee Stock Purchase Plan (the
"ESPP") was adopted by the Board of Directors of Household at a
meeting on March 14, 1995, to become effective on July 1, 1995.
The ESPP will be voted upon by the shareholders of Household at a
meeting to be held on May 10, 1995 and will become effective on
July 1, 1995, only if a majority of the shareholders present at the
meeting vote to approve the ESPP. The ESPP gives eligible
employees an opportunity to purchase Household Common Stock at a
discounted price through payroll deductions. This is done through
a series of offerings beginning on July 1 of each year. A maximum
of 2,000,000 shares has been reserved for issuance under the ESPP.
Under the ESPP, through payroll deductions, up to $20,040 or 15% of
participating employee's eligible compensation, whichever is less,
may be used to purchase shares of Household Common Stock. On the
last day of an Offering Period, shares will be purchased for the
account of employees at a 15% discount from the fair market value
of the shares on the first or the last day of the Offering Period,
whichever is lower. Subject to certain restrictions, on the last
day of the Offering Period the Agent will purchase the maximum
number of shares the employee's account balance will allow. The
following material should help you to better understand the ESPP.
The full text of the ESPP will be furnished upon a request made as
described in "Other Information -- Available Information and
Incorporation of Certain Documents by Reference", starting at Page
14. All references in this Prospectus to dollars are to U.S.
dollars.
The ESPP is not subject to the qualification requirement of Section
401 of the Internal Revenue Code of 1986, as amended (the "Code"),
or subject to any provisions of the Employee Retirement Income
Security Act of 1974. For the federal income tax treatment of
shares purchased under the ESPP, see "Other Information -- Federal
Tax Consequences," starting at Page 11.
DESCRIPTION OF THE ESPP
WHAT IS AN OFFERING PERIOD?
An Offering Period is the period during which funds deducted from
your pay are collected in order to purchase Household Common Stock.
Each Offering Period under the ESPP will last approximately 11-1/2
months, with the first Offering Period beginning on July 1, 1995
and ending on June 17, 1996. Subsequent Offering Periods will also
begin on July 1 and end on June 15 of the following year (unless
June 15 is not a business day, in which case an Offering Period
will end on the next business day following June 15).
<PAGE>
<PAGE> 7
The Compensation Committee of the Board of Directors (the
"Committee") has the authority to establish different starting and
ending dates for the Offering Periods, but will only do so prior to
the enrollment period for any Offering Period. During the annual
enrollment period you will be informed of the starting and ending
dates which will apply for the next Offering Period.
WHO IS ELIGIBLE?
With certain exception listed below, if you (i) are an active,
regular employee of Household or any of its participating
subsidiaries (a "Participating Employer") on or before December
31 of the year prior to the start of an Offering Period and
(ii) work at least 20 hours per week for a Participating
Employer for at least five months in a calendar year, you are
eligible to participate in the ESPP.
The Committee may exclude one or more employees from participating
in the ESPP who are "highly compensated" as described in Section
423(b)(4)(D) of the Internal Revenue Code of 1986, as amended. As
of the date of this Prospectus, the Committee has determined that
the Chairman of the Board and the President of Household and each
of the executive officers who report directly to them will not be
eligible to participate in the ESPP.
HOW DO I KNOW IF I WORK FOR A PARTICIPATING EMPLOYER?
If you received this Prospectus, you probably work for a
Participating Employer. The Committee will determine which
Household subsidiaries will be eligible to participate. As of the
date of this Prospectus, all employees of Household and its U.S.
subsidiaries, except for an employee in a collective bargaining
unit or of Color Prelude, Capital Graphics, Inc. or of B & K
Corporation, are eligible to participate in the ESPP.
HOW DO I ENROLL?
If you are eligible, and wish to participate in an Offering Period
of the ESPP, send an enrollment form authorizing payroll deductions
to the Home Office Employee Benefits Department indicating the
total amount to be deducted from your pay during the Offering
Period. This form will be included in the package of enrollment
information distributed each May. Deductions will begin with the
first pay period starting on or after July 1, or such other date as
is stated in the enrollment materials. Deductions will be made in
equal amounts and will continue for the first 24 paychecks during
the Offering Period unless you discontinue participation during
that Offering Period or you become ineligible.
<PAGE>
<PAGE> 8
Note: You must re-enroll for each Offering Period and it is your
responsibility to ensure that the Home Office Employee Benefits
Department is properly carrying out your instructions. You should
examine the Statement of Earnings and Deductions that is issued
with your paycheck, particularly following the start of a new
Offering Period, to verify that your instructions are being
followed. Any differences should be reported promptly to the Home
Office Employee Benefits Department.
WHAT PRICE WILL I PAY?
The price you pay for shares of Common Stock purchased will be the
lesser of 85% of the fair market value of the Common Stock on the
first day of an Offering Period or 85% of the fair market value of
the Common Stock on the last day of an Offering Period.
Here's an example:
First day of the Offering Period - July 1, 1995
Last day of the Offering Period - June 17, 1996
Fair Market Value of Common Stock on July 1, 1995-$40.00
Fair Market Value of Common Stock on June 17, 1996-$45.00
Under this example, on June 17, 1996 (the first business day after
June 15), shares of Common Stock will be purchased for your account
at a price of $34.00 per share, which is 85% of $40.00. You will
then be the owner of Common Stock worth $45.00 per share.
WHAT DOES FAIR MARKET VALUE MEAN?
For purposes of the ESPP, on any day, the fair market value of
Household's Common Stock will be the average of the high and low
prices (computed to four decimal places) for Household Common Stock
as published in the Wall Street Journal Report of the New York
Stock Exchange-Composite Transactions for the ten preceding trading
days. The ten day average is used rather than the price on a
single day so that neither you nor Household will be hurt if there
is an unusual or temporary fluctuation in the stock price.
WHAT AMOUNT MAY I CONTRIBUTE?
You may authorize a payroll deduction for any amount in whole
dollars, subject to a minimum of $600 for an Offering Period (which
is $25 from each of the first 24 paychecks during the Offering
Period) and a maximum of $20,040 for an Offering Period (which is
$835 from the first 24 paychecks during the Offering Period).
However, you may not have more than 15% of your eligible
compensation withheld during any Offering Period.
<PAGE>
<PAGE> 9
WHAT DOES ELIGIBLE COMPENSATION INCLUDE?
Eligible compensation means your annualized base pay as of December
31 of the year prior to an Offering Period, plus, if you received
commissions during the calendar year preceding an Offering Period,
the amount of such commissions. Your base pay is the amount you
earned, prior to reduction for government required withholdings,
such as state and federal taxes and social security, and elective
contributions such as the United Way, TRIP, FSA, dependent child
care and other elective contributions or payments for benefits.
Base pay does not include bonuses, awards, overtime pay, deferred
compensation and expense reimbursements.
DO I RECEIVE INTEREST ON MY ACCOUNT BALANCE?
Yes. Amounts deducted from your pay will be credited to an account
in your name. Amounts in your account will earn interest,
compounded monthly, at the rate set out in your enrollment
materials. Interest earned on your balance will be added to the
balance and the aggregate amount will be used to purchase Common
Stock in your name at the end of the Offering Period.
IS THERE A LIMIT ON THE MAXIMUM NUMBER OF SHARES
I MAY PURCHASE IN AN OFFERING PERIOD?
Yes, but this will only be a factor if the stock price declines
substantially during the Offering Period. The maximum number of
shares you may purchase in an Offering Period is determined by
dividing the total dollar amount you contribute during an Offering
Period by the closing price for the Common Stock on the first day
of the Offering Period and multiplying that number by 1-1/2.
Here's an example:
Offering Period - July 1, 1995 - June 17, 1996
Total Contributions for the Offering Period - $1,200
Closing Price for Common Stock on July 1, 1995 - $40.00
$1,200 / 40 = 30 x 1.5 = 45
(Contributions) (Price) (Shares) (Multiplier) (Shares)
In this example, the maximum number of shares that can be purchased
by the employee on June 17, 1996 is 45.
<PAGE>
<PAGE> 10
WHAT HAPPENS IF I HIT THE MAXIMUM SHARE LIMITATION FOR THE
OFFERING PERIOD?
After the maximum number of shares are purchased for your account,
any cash remaining in your account will be sent to you.
Again, continuing with the example from the last question:
Offering Period - July 1, 1995 - June 17, 1996
Total Contributions for the Offering Period - $1,200
Maximum Number of Shares Purchasable on June 17, 1996 - 45
Fair Market Value of Common Stock on July 1, 1995 - $40/share
Fair Market Value of Common Stock on June 17, 1996 - $30/share
Purchase Price on June 17, 1996 - $25.50 (85% of $30)
Interest on Contributions during the Offering Period - $40
Cash Available for Purchase (Contributions and Interest) -
$1,200 + $40 = $1,240
Without the maximum share limitation, you would calculate your
purchase as follows:
$1,240 / $25.50 = 49
(Cash (Purchase (Shares)
Available) Price)
but, due to the limitation on the maximum number of shares that may
be purchased (under this example: 45) you will get a cash refund,
calculated as follows:
$25.50 x 45 = $1,147.50
(Purchase (Maximum (Cost of
Price) Shares) Maximum)
Shares
$1,240 - $1,147.50 = $92.50
(Cash (Cost of (Cash
Available) Maximum Shares) Refunded)
The result of this Offering Period is that you own 45 shares of
Household Common Stock which are worth approximately $30/share on
the market. You paid $25.50/share and also received a refund check
for $92.50.
Please note -- the $40.00 interest earned during the Offering
Period in this example was used only as an estimate.
<PAGE>
<PAGE> 11
IS THERE ANY OTHER LIMITATION ON THE NUMBER OF SHARES I
MIGHT PURCHASE DURING AN OFFERING PERIOD?
Only if the number of shares to be purchased at the end of an
Offering Period by all employees exceeds the number remaining
available under the ESPP. In that event, the Committee will make
pro rata adjustments to each participant's designation to allocate
the remaining shares among all participants in an equitable manner.
Participants will receive written notice of such adjustments. Any
cash balance remaining after purchase of the shares will be
refunded.
MAY I CHANGE THE AMOUNT OF MY PAYROLL DEDUCTION
DURING AN OFFERING PERIOD?
No. We ask that you consider your needs carefully during the
enrollment period. However, you may elect to terminate
participation during an Offering Period. If you do, you will
receive a check for the full amount of your contributions during
the Offering Period, with interest on such amount, compounded
monthly at a rate established by the Committee prior to the
enrollment period. That rate will be set out in the enrollment
materials.
MAY I STOP CONTRIBUTIONS TO THE ESPP?
You may terminate participation at any time during an Offering
Period by completing the termination form on HouseMail and
transmitting it to the Home Office Employee Benefits Department.
However, if you stop contributions to the ESPP during an Offering
Period, the cash balance in your account will not be used to
purchase stock. The cash balance in your account, including
interest earned on your payroll deductions during the Offering
Period, will be forwarded to you by check as soon as
administratively possible.
If you go on an unpaid leave of absence or become eligible for
long-term disability benefits, your cash account balance will
remain invested in the ESPP (unless you voluntarily terminate
participation in the ESPP) and your contributions, including
interest, will be used to purchase shares at the end of the
Offering Period.
<PAGE>
<PAGE> 12
WHAT IF MY EMPLOYMENT ENDS?
Your participation in the current Offering Period ceases
automatically when your employment ends, including upon your
retirement or death. All amounts you contributed during the
current Offering Period, plus interest, will be paid to you, or in
the event of your death, to your estate.
HOW DO I ACTUALLY PURCHASE SHARES?
You don't have to do a thing. The Committee has appointed Harris
Trust and Savings Bank as its agent (the "Agent") to handle the
record keeping and other routine administrative duties of the ESPP,
subject to the supervision of the Committee. The Agent will ensure
that all payroll deductions are credited to your account under the
ESPP. At the end of the Offering Period, all amounts in your
account, including interest earned during the Offering Period, will
be used by the Agent to purchase Household Common Stock, and the
whole and fractional shares (computed to four decimal places) of
Common Stock purchased will be credited to your account.
HOW WILL MY COMMON STOCK BE HELD?
After shares of Common Stock are purchased in your name, the Agent
will maintain record of your ownership. You may keep your shares
with the Agent as long as you like. Dividends on shares held in
your ESPP stock account will be automatically reinvested by the
Agent in additional shares of Household Common Stock. If you wish
to receive dividends in cash, you must request that a stock
certificate be issued to you.
DO I GET TO VOTE MY SHARES?
Yes. Information concerning any shareholder vote and proxy forms
for voting will be sent to you by the Agent.
IN WHOSE NAME MAY STOCK BE HELD?
Shares purchased for your account will be issued in your name
alone. Following purchase of shares for your account, you may
register ownership in any manner you deem appropriate by sending
required documentation to the Agent.
<PAGE>
<PAGE> 13
WHAT REPORTS DO I RECEIVE?
Each payroll deduction made under the ESPP will appear on your
regular Statement of Earnings, which is issued with your paycheck.
At the end of each calendar quarter you will also receive separate
statements containing details of your ESPP cash and stock account
balances. The cash account statement will be issued by the Agent
and will set out each credit for payroll deductions and interest
earned each month, as well as a total cash account balance. Your
stock account statement will also be issued by the Agent and will
reflect all Common Stock account activity, including price
information for shares purchased and sold and the fair market value
of shares purchased at a discount. It is important that you retain
this statement since it provides information required for income
tax purposes. There will be a charge to provide duplicate
statements.
As an ESPP participant, you will also receive all reports issued to
Household stockholders. This includes Annual and Quarterly Reports
to Stockholders.
DO I RECEIVE DIVIDENDS ON MY STOCK?
Yes. However, while your shares are held by the Agent, all
dividends will be automatically reinvested in additional shares of
Household Common Stock, including fractional shares.
ARE THERE SPECIAL LIMITATIONS ON MY STOCK OWNERSHIP?
Yes. Shares of Common Stock purchased at the end of an Offering
Period (as described above, on or about June 15) may not be sold
until July 1 of the same calendar year. This period will permit
Household and the Agent to perform all administrative tasks
necessary to process the transactions in each participant's account
at the end of the Offering Period. If you wish to have the Agent
sell your shares, you may designate which shares are to be sold and
may do so by completing a sale authorization form obtained on
HouseMail or from the Agent. Unless you make a designation, the
first shares purchased for your account will be the first sold.
Shares may only be sold on days that both the Agent and the New
York Stock Exchange are open for business.
In addition, shares purchased by officers who are subject to
Section 16 of the Securities Exchange Act of 1934 will be subject
to certain resale restrictions. If Section 16 applies to you, you
will be so informed by Household's Office of the Secretary.
<PAGE>
<PAGE> 14
HOW DO I SELL THE STOCK?
On or after July 1 following an Offering Period, you can sell your
Common Stock one of two ways. You may give instructions to the
Agent to sell all or a portion of your shares. A sale request form
may be printed off HouseMail and faxed to the Agent. You may also
request a sale by using the form contained in your quarterly
statement from the Agent. Following receipt of a sale request, the
Agent will sell the shares for you on the open market over a
securities exchange and forward the proceeds of the sale to you by
check after withholding federal, state and local taxes, as required
by applicable laws and regulations. The Agent will also deduct a
brokerage commission from the proceeds of the sale.
You may also sell all or a portion of your shares by requesting
that the Agent forward a stock certificate to you representing the
desired number of shares (whole shares only). You may then sell
such shares through a broker of your choice. If any fractional
shares are held in your account, at your request, the Agent will
sell such fractional shares and forward the proceeds to you.
You may designate which shares are to be sold or issued to you in
stock certificate form by so specifying on a sale request or
certificate issuance form sent to the Agent. If you do not make a
designation as to which specific shares you wish to be sold or
issued to you, the first shares purchased for your account will be
used.
HOW DO I GET STOCK CERTIFICATES?
If you do not want shares held by the Agent or do not wish to have
dividends paid on your shares reinvested in additional shares of
Common Stock, you may obtain stock certificates by completing the
appropriate portion of your quarterly statement and forwarding it
to the Agent. If you request, the Agent will sell fractional
shares held in your account and forward the proceeds to you.
WHOM DO I CONTACT ABOUT STOCK CERTIFICATES, REGISTRATION
CHANGES, OR MY QUARTERLY STATEMENTS?
You may contact the Agent by phoning (800) 926-2335 or by writing
to the Household International Employee Stock Purchase Plan, c/o
Harris Trust and Savings Bank, P. O. Box 755, Chicago, Illinois
60690. You may fax requests to sell shares to the Agent at (312)
461-5543.
<PAGE>
<PAGE> 15
WHOM DO I CONTACT TO TERMINATE MY PARTICIPATION OR
REGARDING MY PAYROLL DEDUCTIONS?
Household's Employee Benefits Department by phoning at (708) 564-
6778, by writing to Employee Benefits at the Home Office or by a
fax sent to (708) 205-7419.
WHAT IS THE EFFECT OF A STOCK SPLIT, STOCK DIVIDEND, ETC.?
In the event of a stock split or a stock dividend, the number of
shares remaining for sale in the ESPP and the number of shares and
the price per share of stock for the current Offering Period will
be adjusted appropriately. In the event of any other change
affecting Household stock, the Committee will make any adjustments
it considers appropriate.
ARE MY RIGHTS UNDER THE ESPP TRANSFERABLE?
You may not transfer your rights under the ESPP, including any cash
or shares in your account, other than by will, or if you should die
without a will, by the laws which then govern the distribution of
your estate. Your rights are exercisable during your lifetime only
by you. However, you may transfer ownership of shares in
accordance with the requirements of the Agent.
WHERE DO THE PURCHASED SHARES COME FROM?
Common Stock will be purchased for your account in open market
transactions over securities exchanges or will be newly issued
shares, or shares held in treasury by Household. The Agent will
acquire shares as directed by Household. If Household directs the
Agent to purchase shares on the open market, Household will
supplement the cash account balance in the amount of the difference
in the market price and the price paid by the participating
employee.
HOW ARE FUNDS USED BY HOUSEHOLD?
All funds received or held by Household under the ESPP may be used
for any corporate purpose.
HOW MAY THE ESPP BE CHANGED?
The Committee may amend the ESPP in any respect at any time.
However, without the approval of Household's shareholders, no
amendment may be made to increase or decrease the number of shares
approved for the ESPP (other than as provided in the preceding
paragraph).
<PAGE>
<PAGE> 16
WHO PAYS THE EXPENSES OF THE ESPP?
All expenses of establishing and administering the ESPP will be
paid by Household without charge to participating employees.
WILL THIS PROSPECTUS BE UPDATED ANNUALLY?
Not unless there is a major change in the ESPP, or changes in the
Internal Revenue Code or Securities and Exchange Commission
regulations which may require that the Prospectus be updated.
HOW CAN I GET AN ADDITIONAL COPY?
This Prospectus, and additional information about the ESPP, the
Committee and the Agent, is available from the Employee Benefits
Department, Household International, Inc., 2700 Sanders Road,
Prospect Heights, IL 60070. Telephone inquiries can be made to
the Employee Benefits Department at (708) 564-6778.
OTHER INFORMATION
FEDERAL TAX CONSIDERATIONS
The ESPP is designed to qualify for special federal tax treatment
under Section 423(b) of the Internal Revenue Code of 1986, as
amended (the "Code"). Currently, under the Code, even though you
will pay less than the market price for shares purchased under the
ESPP, no additional income need be reported until the year in which
you sell or otherwise dispose of the shares, or the year in which
you die if no sale or disposition has occurred before that time.
A "disposition" is a sale, exchange, gift or transfer of legal
title. Even a gift to a family member is a "disposition".
However, if you register ownership in a joint tenancy where you are
one of the owners, this is not a disposition. Also, if you obtain
a stock certificate and deposit shares represented by the
certificate with a custodian for safekeeping, such as a financial
institution, trust company or broker, but you remain the actual
owner, the deposit with the custodian is not a disposition. If you
do transfer shares to a custodian before the end of two years from
the first day of the Offering Period in which you purchased the
shares in the ESPP, you must inform the Agent.
<PAGE>
<PAGE> 17
The current rules for determining the taxable income to be reported
on your U.S. Federal income tax return are summarized below:
1. If you sell or otherwise dispose of shares purchased
through the ESPP within two years of the first day of the
related Offering Period, you are considered to have made a
"disqualifying disposition". If that is the case, you will be
required to include in ordinary income for the year in which you
dispose of the shares, an amount equal to the excess of the fair
market value of the shares on the date they were purchased for
your account in the ESPP over the actual purchase price paid for
the shares from cash in your ESPP account. This amount must be
reported even if you give the shares away as a gift.
2. If you sell or otherwise dispose of shares purchased
through the ESPP more than two years from the first day of the
related Offering Period, you have a "qualifying disposition" and
you will receive favored treatment under the Code. In that
case, you will be required to include in ordinary income for the
year in which you dispose of the shares, an amount equal to the
lesser of:
(a) 15% of the fair market value of the shares on the
first day of the related Offering Period; and
(b) the excess, if any, of the fair market value of the
shares at the time of disposition over the actual
purchase price paid for the shares from cash in
your ESPP account.
3. When you report income under Paragraphs 1 or 2 of the
above rules, the amount reported should be added to the price
paid for the shares. This sum becomes your "adjusted basis" or
your "cost" of the shares for determining the taxable gain or
loss when you sell or dispose of the shares. Therefore, if you
sell the shares for a price exceeding the amount you reported
as ordinary income under Paragraph 1 or 2, plus the actual
purchase price paid from cash in your ESPP account, the excess
is treated as a capital gain. If you sell shares for a price
which is less than your adjusted basis in the shares, the
difference is treated as a capital loss. The length of time you
owned such shares prior to disposing of them will determine
whether your capital gain or loss is long-term or short-term.
Long-term capital gains and losses receive special treatment
under the Internal Revenue Code.
In the event of a disqualifying disposition as described in
Paragraph 1 above, Household is allowed a deduction in its Federal
income tax return in an amount equal to the income required to be
included in the tax return of the employee. In the absence of a
disqualifying disposition, Household is not allowed any deduction.
<PAGE>
<PAGE> 18
Here are examples of the tax consequences of both a qualifying and
disqualifying disposition of a single share of stock:
Offering Period - July 1, 1995 - June 17, 1996
Fair Market Value of Common Stock on July 1, 1995 - $40/share
Fair Market Value of Common Stock on June 17, 1996 - $45/share
Purchase Price on June 17, 1996 - $34/share (85% of $40)
Sale No. 1 - July 15, 1996 at $50 (Disqualifying Disposition)
Sale No. 2 - July 15, 1997 at $50 (Qualifying Disposition)
Sale No. 1 -- (Disqualifying Disposition)
- -----------------------------------------
Because you sell the share before July 1, 1997, you have a
disqualifying disposition. On your 1996 tax return you would
report ordinary income of $11, which is the difference between the
fair market value of the share on the day it was purchased ($45)
and the actual price you paid ($34). You would also report a
capital gain of $5 because your adjusted basis in the share is $45
(the $34 you paid, plus the $11 you reported as ordinary income).
Your capital gain is your sales price, less your adjusted basis
($50 - $45 = $5).
To summarize: $11 ordinary income and $5 capital gain
Sale No. 2 -- (Qualifying Disposition)
- --------------------------------------
Because you sell the share after July 1, 1997, you have a
qualifying disposition. On your 1997 tax return you would report
ordinary income of $6, which is the lesser of: a) 15% of $40, or $6
($40 being the fair market value of the share on the first day of
the Offering Period), and b) the difference between the fair market
value of the share on the date you sold it ($50) and the price you
paid for it ($34), or $16. You would also report a capital gain of
$10, because your adjusted basis in the share is $40 (the $34 you
paid, plus the $6 you reported as ordinary income). Again, your
capital gain is your sales price, less your adjusted basis ($50 -
$40 = $10).
To summarize: $6 ordinary income and $10 capital gain
Please note that these examples ignore the fact that the brokerage
commission and fees you pay to sell your shares will reduce the
proceeds of the disposition of your shares and consequently, your
tax liability.
<PAGE>
<PAGE> 19
Your income tax liability is your responsibility. This description
of U.S. Federal income tax consequences and the examples are
provided merely to help you understand the current regulations.
These rules may change as the Code is amended and as new
regulations are issued by the IRS. Where necessary, you should
seek competent professional advice.
Information about fair market value and the price you paid for
shares will be available on the quarterly statements of account
sent to you by the Agent.
COMPENSATION COMMITTEE
The ESPP is administered by the Compensation Committee of the Board
of Directors. Members of the Committee are chosen by the Board of
Directors annually and may be removed only by the Board. The
Committee is comprised entirely of directors who are not officers
or employees of Household or its subsidiaries. The Committee is
presently comprised of Robert J. Darnall, Mary Johnston Evans,
Cyrus F. Freidheim, Jr., Louis E. Levy, George A. Lorch, S. Jay
Stewart and Raymond C. Tower, Chairman. The Committee's address is
c/o Office of the Secretary, Household International, Inc., 2700
Sanders Road, Prospect Heights, IL 60070. The Committee's phone
number is (708) 564-6989.
The Committee has authority to make rules and regulations for the
administration of the ESPP and its interpretations and decisions
with regard thereto are final and conclusive. The Committee may act
by a majority vote at a meeting or by a document signed by a
majority of the members. Vacancies on the Committee are filled by
the Board of Directors. Future changes in the composition of the
Committee may be found in Household's annual Proxy Statement.
RESTRICTIONS ON RESALE BY CERTAIN OFFICERS
Shares of Common Stock held by persons who are "affiliates" of
Household may be resold by them only in compliance with Rule 144 of
the Securities and Exchange Commission, under another applicable
exemption under the Securities Act of 1933 or through registration
of such sales under an appropriate registration statement filed by
the Company should it choose to do so. Under Rule 405 of the
Securities and Exchange Commission, an "affiliate" would include a
person who directly controls, is controlled by, or is under common
control with Household. All directors and executive officers of
Household may be affiliates under the above definition.
<PAGE>
<PAGE> 20
A purchase of Common Stock under the ESPP would not be considered
a purchase for purposes of Section 16(b) of the Securities Exchange
Act of 1934 and could not be matched with a sale of Common Stock
within any period of less than six months to create liability under
that statute for any officer who is required to report his or her
beneficial ownership to the Securities and Exchange Commission
under Section 16(a) of that Act. The receipt of cash in lieu of a
fractional interest in a share of Common Stock, for example as a
result of a request for a certificate for shares held under the
ESPP, would be considered a sale of that fractional interest for
purposes of Section 16(b) of that Act.
AVAILABLE INFORMATION AND
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
Household is subject to the informational requirements of the
Securities Exchange Act of 1934 and in accordance therewith files
reports and other information with the Securities and Exchange
Commission (the "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 the Commission's Regional Offices,
500 West Madison Street, 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 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.
The following documents filed with the Commission are incorporated
herein by reference:
(a) Household's latest annual report filed pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934
or the latest prospectus filed pursuant to Rule 424(b) under the
Securities Act of 1933, which contains, either directly or by
incorporation by reference, audited financial statements for
Household's latest fiscal year for which such statements have
been filed.
(b) All other reports filed pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934 since the end of
the fiscal year covered by the annual report or the prospectus
incorporated pursuant to (a) above.
<PAGE>
<PAGE> 21
(c) The description of the Common Stock offered herein
which is contained in any registration statements filed under
Section 12 of the Securities Exchange Act of 1934, including any
amendments or reports filed for the purpose of updating such
description.
All documents subsequently filed by Household pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934,
as amended, prior to the filing of a post-effective amendment which
indicates that all securities offered hereby have been sold or
which deregisters all securities remaining unsold, shall be deemed
to be incorporated by reference herein and to be a part hereof from
the date of the filing of such reports and documents.
Household will provide without charge to each person to whom this
Prospectus is delivered, on the written or oral request of such
person, a copy of the ESPP and any or all of the documents
incorporated herein by reference (other than exhibits to such
documents).
Requests should be directed to: Household International, Inc., 2700
Sanders Road, Prospect Heights, IL 60070, Attention: Office of
the Secretary (Telephone: (708) 564-5000).
<PAGE>
<PAGE> 22
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
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
eliminated 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 of 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, bote
of stockholders or otherwise.
The Company's Restated Certificate of Incorporation, a
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<PAGE>
<PAGE> 23
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.
Item 16. Exhibits.
4 Household International Employee Stock Purchase Plan.
5 Opinion of John W. Blenke, Assistant General Counsel and
Secretary of Household International, Inc.
23(a) Consent of John W. Blenke, Assistant General Counsel and
Secretary of Household International, Inc. is contained
in his opinion filed as Exhibit 5 hereto.
23(b) Consent of Arthur Andersen LLP, Certified Public
Accountants
24 Power of Attorney is set forth on pages II-5 through II-7
of this Registration Statement.
Item 17. Undertakings.
A. To Transmit Certain Materials.
Household hereby undertakes to deliver or cause to be
delivered with the Prospectus, to each employee to whom the
Prospectus is sent or given, a copy of Household's latest annual
report to shareholders that is incorporated by reference in the
Prospectus and furnished pursuant to and meeting the requirements
of Rule 14a-3 or rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be
presented by Article 3 of Regulation S-X are not set forth in the
Prospectus, to deliver, or cause to be delivered to each employee
to whom the Prospectus is sent or given, the latest quarterly
report that is specifically incorporated by reference in the
Prospectus to provide such interim financial information.
B. Undertaking to Update Annually.
Household hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of Household's annual report pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934 that is incorporated
by reference in the Registration Statement 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.<PAGE>
<PAGE> 24
C. Continuous Offering.
Household 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; 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 Household'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<PAGE>
<PAGE> 25
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.
D. Indemnification.
Insofar as indemnification for liabilities arising under
the Securities Act of 1933 may be permitted to directors, officers
and controlling persons of Household pursuant to the foregoing
provisions, or otherwise, Household 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
Household of expenses incurred or paid by a director, officer or
controlling person of Household in the successful defense of any
action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the Common Stock being
registered, Household 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.
<PAGE>
<PAGE> 26
SIGNATURES
----------
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has duly caused this Registration Statement
on Form S-8 to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Prospect Heights, and State of Illinois, on
the 19th day of April, 1995.
HOUSEHOLD INTERNATIONAL, INC.
By: /s/ William F. Aldinger
-----------------------
William F. Aldinger
President and Chief
Executive Officer
Each person whose signature appears below constitutes and appoints J.
W. Blenke, P. D. Schwartz, L. S. Mattenson and J. M. Powell and each or
any of them (with full power to act alone), and 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 an 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 on Form S-8 has been signed below by the following
persons in the capacities indicated and on the 19th day of April, 1995.
Signature Title
--------- -----
/s/ William F. Aldinger
- --------------------------- President, Chief Executive Officer
(William F. Aldinger) and Director (as Principal Executive
Officer)
/s/ Donald C. Clark
- --------------------------- Chairman of the Board and Director
(Donald C. Clark)
/s/ Robert J. Darnall
- --------------------------- Director
(Robert J. Darnall)
/s/ Gary G. Dillon
- --------------------------- Director
(Gary G. Dillon)
/s/ John A. Edwardson
- --------------------------- Director
(John A. Edwardson)
/s/ Mary Johnston Evans
- --------------------------- Director
(Mary Johnston Evans)
/s/ Cyrus F. Freidheim, Jr.
- --------------------------- Director
(Cyrus F. Freidheim, Jr.)
/s/ Louis E. Levy
- --------------------------- Director
(Louis E. Levy)<PAGE>
<PAGE> 27
/s/ George A. Lorch
- ---------------------------- Director
(George A. Lorch)
/s/ John D. Nichols
- ---------------------------- Director
(John D. Nichols)
/s/ Gordon P. Osler
- ---------------------------- Director
(Gordon P. Osler)
/s/ James B. Pitblado
- ---------------------------- Director
(James B. Pitblado)
/s/ Arthur E. Rasmussen
- ---------------------------- Director
(Arthur E. Rasmussen)
/s/ S. Jay Stewart
- ---------------------------- Director
(S. Jay Stewart)
/s/ Louis W. Sullivan, M.D.
- ---------------------------- Director
(Louis W. Sullivan, M.D.)
/s/ Raymond C. Tower
- ---------------------------- Director
(Raymond C. Tower)
/s/ David A. Schoenholz
- ---------------------------- Senior Vice President-Chief Financial
(David A. Schoenholz) Officer (as Principal Accounting and
Financial Officer)
A:\WP51\REG
<PAGE> 1 EXHIBIT 4
HOUSEHOLD INTERNATIONAL
EMPLOYEE STOCK PURCHASE PLAN
1. Purpose
-------
The Household International Employee Stock Purchase
Plan (the "Plan") is intended to provide an opportunity to
participate in the ownership of Household International, Inc.
(the "Company") for eligible employees of the Company and such
other companies ("Participating Companies") as the Compensation
Committee of the Board of Directors of the Company (the
"Committee") shall from time to time designate; provided that
each such company shall qualify as a "parent corporation" or
"subsidiary corporation," as defined in Sections 424(e) and (f)
of the Internal Revenue Code of 1986 (the "Code"), on the first
day of the relevant Offering Period. After the initial effective
date of the Plan, an additional company to be included in the
Plan must be designated as a Participating Company by the
Committee prior to December 31 in order for employees of such
company to participate in the next Offering Period. It is
further intended that the Plan shall qualify as an "employee
stock purchase plan" as defined in Section 423 of the Code, but
shall permit offerings that do not qualify under Section 423.
2. Administration
--------------
The Plan shall be administered by the Committee. The
Committee is appointed by the Board. The Committee shall have
full authority to administer the Plan, including authority to
interpret and construe any provision of the Plan and to adopt
such rules and regulations for administering the Plan as it may
deem necessary or desirable. Decisions of the Committee shall be
final and binding on all parties who have an interest in the
Plan. The Committee may authorize the appointment of an agent to
perform record keeping and other administrative duties with
respect to the Plan.
3. Effective Date and Term of Plan
-------------------------------
(a) The Plan shall become effective when adopted by
the Board of Directors (the "Board"), but no Offering Period
shall commence and no options shall be granted under the Plan
until the Plan has been approved by the Company's shareholders.
If shareholder approval is not obtained within twelve (12) months
after the date of the Board's adoption of the Plan, then the Plan
shall terminate.
(b) Unless terminated under Section 3(a) above, the
Plan shall terminate at such time as the Board shall designate,
but in no event shall the Plan continue beyond the date on which
all shares available for issuance under the Plan shall have been
issued.
4. Offering Periods and Applicable Percentage
------------------------------------------
The Plan shall have one or more Offering Periods.
Unless otherwise designated by the Committee, each Offering
Period will begin on July 1 and end on June 15 of the following
year, or the next succeeding business day if June 15 is not a
business day in Chicago, Illinois. However, the Committee may
declare Offering Periods and the first and last day for each
Offering Period as it deems appropriate. Prior to the
commencement of each Offering Period the Committee may designate
percentages which shall not be less than eighty-five percent
(85%) nor more than one hundred percent (100%) which will be used
under Section 7(a) to determine the option price for each
Offering Period. Each Offering Period shall run for a period
specified by the Committee not to exceed two years; provided
however, the Committee may designate the final day of each
Offering Period so as to facilitate administration of the Plan.
No two Offering Periods shall run concurrently.
5. Eligibility and Participation
-----------------------------
Each employee of the Company or any of the
Participating Companies shall be eligible to participate in the
Plan during an Offering Period except (i) employees who were not<PAGE>
<PAGE> 2
employed by the Company or a Participating Company on December 31
of the calendar year prior to the first day of an Offering
Period, (ii) employees who customarily work less than twenty (20)
hours per week, (iii) employees whose customary employment is for
not more than five months in any calendar year, (iv) any one or
more employees excluded in the sole discretion of the Committee
who are highly compensated employees as described in Code
Section 423(b)(4)(D), and (v) at the discretion of the Committee
in the case of an offering that is not intended to qualify under
Section 423 of the Code, any employee not compensated on a
salaried basis. All eligible employees may become participants
with respect to an Offering Period by executing such instruments
as the Committee may specify and delivering them to such persons
and at such time prior to the first day of that Offering Period
as the Committee may specify.
6. Stock
-----
The stock subject to the Plan shall be shares of the
Common Stock of the Company which may be acquired in open market
transactions over securities exchanges or newly issued or
treasury shares. The aggregate amount of stock which may be sold
pursuant to the Plan shall not exceed two million (2,000,000)
shares (subject to adjustment as provided in Section 8).
7. Options
-------
Options shall be evidenced by instruments in such form
as the Committee may from time to time approve, and shall conform
to the following terms and conditions:
(a) Option Price. The option price shall be the lower
of (i) the price determined by multiplying the Opening
Percentage (which shall be eighty-five percent (85%) unless
otherwise determined by the Committee for an Offering
Period) by the fair market value of the Company's Common
Stock on the first day of the Offering Period, and (ii) the
price determined by multiplying the Closing Percentage
(which shall be eighty-five percent (85%) unless otherwise
determined by the Committee for an Offering Period) by the
fair market value of the Company's Common Stock on the last
day of the Offering Period. For the purpose of determining
the option price, the fair market value of the Company's
Common Stock on any day shall be the average of the high and
low prices (computed to four decimal places) as published in
The Wall Street Journal Report of the New York Stock
Exchange-Composite Transactions for the ten preceding
trading days.
(b) Payment. Payment for stock under the Plan shall be
from amounts collected from participants through payroll
deduction, plus any interest credited thereto. However, in
its sole discretion, the Committee may from time to time
designate alternative methods of collecting payment for
stock under the Plan. Under the payroll deduction method of
payment, a participant may participate at a fixed dollar
amount per pay period, such amount not to exceed fifteen
percent (15%) of eligible compensation as of December 31 of
the prior year, or such other lesser amount as may be
specified by the Committee for an Offering Period. For
purposes of this Section 7(b), eligible compensation shall
mean annualized base pay as of December 31, and, if
applicable, commissions earned during the calendar year
preceding an Offering Period, before reduction for elective
contributions under a 401(k) plan, dependent care assistance
program qualified under Section 129 (or a successor
provision) of the Code or cafeteria plan qualified under
Section 125 (or a successor provision) of the Code, but not
including bonuses, awards, overtime pay, deferred
compensation, expense reimbursements including, but not
limited to, car allowances or other contributions to or
benefits under any other employee benefit plan.
(c) Number of Shares. Subject to the limitations in
Section 7(k) herein, on the first day of any Offering
Period, a participant shall be granted an option to purchase
up to a fixed number of shares of Common Stock determined as
of such date by dividing the total amount to be collected<PAGE>
<PAGE> 3
pursuant to Section 7(b) (not including interest to be
collected thereon) by the closing price of the Company's
Common Stock as published in The Wall Street Journal Report
of the New York Stock Exchange Composite-Transactions on the
first day of the Offering Period and multiplying the result
by one and one-half (1-1/2), or such other constant number not
to exceed one and one-half (1-1/2), as may be specified by the
Committee for an Offering Period. If the total number of
shares of Common Stock for which options are to be granted
on any date in accordance with the terms of the Plan exceeds
the number of shares then remaining available under the Plan
(after deduction of all shares for which options have been
exercised or are then outstanding), the Committee shall make
a pro rata allocation of the shares remaining available in
as near as uniform a manner as shall be practicable and as
it shall deem equitable. The Committee shall give written
notice of such allocation to each participant affected
thereby.
(d) Interest. Amounts collected from participants
during an Offering Period may accrue interest, if so
determined by the Committee. The rate of interest, if any,
to be paid upon such collections will be established by the
Committee prior to each Offering Period and will be
compounded monthly in each participant's account.
(e) Termination of Employment. If prior to the end of
an Offering Period, a participant ceases to be employed by
the Company or a Participating Company for any reason,
including death or retirement, the participant's option
shall terminate, and any amounts collected from the
participant, together with any interest thereon, shall be
paid to the participant or the participant's personal
representative. Amounts collected from a participant who
goes on a leave of absence during an Offering Period will be
applied, together with any interest credited thereto, to
purchase stock as described in Section 7(g).
(f) Termination of Option. A participant may, during
an Offering Period, terminate his or her option, by giving
written notice to the Committee, in such manner and at such
time as the Committee may specify, and any amounts collected
from the participant, together with any interest thereon,
shall be paid to the participant and no further amounts will
be collected during the Offering Period.
(g) Exercise. Each option shall be exercised
automatically on the last day of the Offering Period, unless
the option has been previously terminated pursuant to 7(e)
or 7(f). Any balance in the participant's account
(including interest) after purchase of shares under an
option shall be promptly paid to the participant. In the
case of an offering that is not intended to qualify under
Section 423 of the Code, there shall be withheld from the
number of shares issuable to a participant that number of
shares equal in fair market value to the federal and state
income and employment tax withholding obligations with
respect to the participant arising from such
exercise, based on the income and employment tax withholding
rates in effect at the time under federal and applicable
state law.
Upon the purchase of shares underlying an option, the
Company shall cause to be promptly delivered to the
participant a statement reflecting the status of his or her
account and, if requested in writing, the Plan
Administrator, as designated by the Committee, shall issue a
stock certificate for full shares held in the participant's
account and a check for the fair market value of any
fractional shares then held in the participant's account.
However, no stock certificates representing newly acquired
shares will be issued until the date shares are eligible for
sale as described in Section 7(j). The fair market value of
any fractional shares will be the sales price for such
shares on the New York Stock Exchange, which sale will occur
as soon as administratively possible following receipt of a
request for issuance of a stock certificate.
<PAGE>
<PAGE> 4
(h) Assignability. Options under the Plan shall not
be assignable or transferable by the participant, and shall
be exercisable only by the participant.
(i) Rights as Shareholder. A participant shall have
no rights as a shareholder with respect to shares covered by
any option granted under the Plan until the option is
exercised. No adjustments will be made for dividends or
other rights for which the record date is prior to the date
of exercise.
(j) Sale Limitation. Upon exercise of an option,
shares acquired under the Plan may not be sold until July 1
of that year. However, prior to the start of an Offering
Period the Committee may establish an alternative date upon
which shares will first be eligible for sale, provided that
such date will not be more than three weeks following the
date upon which options are exercised under the Plan.
(k) Accrual Limitations. No option shall permit a
participant to purchase stock under all "employee stock
purchase plans" (as defined in Section 423 of the Code) of
the Company or its "subsidiary corporations" (as defined in
Section 425(f) of the Code) which accrues at a rate that
exceeds $25,000 of fair market value of such stock
(determined at the time such option is granted) for each
calendar year in which such option is outstanding at any
time, provided that options which are not part of an
offering intended to qualify as a qualified offering under
Section 423 of the Code shall not be subject to such limit
and shall be disregarded in applying the limit to options
granted under qualified offerings. The Committee shall
specify at the beginning of each Offering Period whether
the offering for such Offering Period is intended to
qualify under Section 423 of the Code.
No option shall be granted to an employee if the
employee would own (within the meaning of Section 424(d) of
the Code), or hold outstanding options to purchase,
immediately after the grant, stock possessing 5 percent (5%)
or more of the total combined voting power or value of all
classes of stock of the Company or any of its subsidiary
corporations.
(l) Payroll Adjustment. In order to comply with the
limitation of Section 423(b)(8) of the Code as described in
Section 7(k) hereof, a participant's contributions to be
allocated under the Plan to the purchase of stock may be
decreased to zero at any time during an Offering Period so
that an employee's aggregate contributions accumulated
during a calendar year do not exceed $20,040. The Committee
may also establish a minimum contribution level for
participants which shall be $600 per Offering Period (unless
otherwise determined by the Committee for an Offering
Period). Income tax and employment tax withholding will be
made as applicable.
(m) Other Provisions. Instruments evidencing options
may contain such other provisions, not inconsistent with the
Plan, as the Committee deems advisable.
8. Capital Adjustments
-------------------
If any change is made in the Common Stock subject to
the Plan, or subject to any option granted under the Plan
(through merger, consolidation, reorganization, recapitalization,
stock dividend, split-up, combination of shares, exchange of
shares, change in corporate structure, or otherwise), appropriate
adjustments shall be made as to the maximum number of shares
subject to the Plan, and the number of shares and price per share
of stock subject to outstanding options.
9. Amendments
----------
The Committee may from time to time alter, amend,
suspend, or discontinue the Plan with respect to any shares at
any time not subject to options; provided, however, that no such
action of the Committee may, without the approval of shareholders<PAGE>
<PAGE> 5
of the Company, (i) increase the number of shares subject to the
Plan (unless necessary to effect the adjustments required under
Section 8), (ii) unless the Committee determines thereafter to
grant only offerings that do not qualify under Section 423 of the
Code, change the class of companies eligible to become
Participating Companies or (iii) make any other change with
respect to which the Committee determines that shareholder
approval is required by applicable law or regulatory standards.
10. No Employment Obligation
------------------------
Nothing contained in the Plan (or in any option granted
pursuant to the Plan) shall confer upon any employee any right to
continue in the employ of the Company or any affiliate or
constitute any contract or agreement of employment or interfere
in any way with the right of the Company or an affiliate to
reduce such employee's compensation from the rate in existence at
the time of the granting of an option or to terminate such
employee's employment at any time, with or without cause, but
nothing contained herein or in any option shall affect any
contractual rights of an employee pursuant to a written
employment agreement.
11. Use of Proceeds
---------------
Cash proceeds received by the Company from the issuance
of shares pursuant to options under the Plan shall be used for
general corporate purposes.
12. Regulatory Approvals
--------------------
The implementation of the Plan, the granting of any
option under the Plan, and the issuance of Common Stock upon the
exercise of any such option shall be subject to the Company's
procurement of all approvals and permits required by regulatory
authorities having jurisdiction over the Plan, the options
granted under it or the Common Stock issued pursuant to it.
13. Governing Law
-------------
To the extent not otherwise governed by federal law,
the Plan and its implementation shall be governed by and
construed in accordance with the laws of the State of Delaware.
A:\WP51\PLAN
<PAGE> 1
EXHIBIT 5
April 19, 1995
Household International, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
RE: Household International Employee Stock Purchase Plan
Registration Statement on Form S-8
- ---------------------------------------------------------
Ladies and Gentlemen:
As Assistant General Counsel and Secretary of Household
International, Inc. (the "Company"), I am generally
familiar with the proceedings in connection with the
Company's Registration Statement on Form S-8 in which
shares of the Company's Common Stock ($1.00 par value per
share) offered pursuant to the Company's Employee Stock
Purchase Plan are being registered under the Securities
Act of 1933, as amended (the "Act"). In accordance with
the foregoing, I have examined such corporate records,
certificates, public documents and other documents, and
have reviewed such questions of law, as considered
necessary or appropriate for the purpose of this opinion.
Upon the basis of such examination, it is my opinion
that:
1. The Company has been duly incorporated and is an
existing corporation in good standing under the laws
of the State of Delaware.
2. The shares of Common Stock have been duly authorized
by the Company, and when (i) the registration
statement on Form S-8 by the Company with respect to
the shares of Common Stock (the "Registration
Statement") shall have been filed with the
Securities and Exchange Commission under the Act and
(ii) shares of the Company's Common Stock are
distributed pursuant to the Plan, such shares will
be validly issued, fully paid and non-assessable.
I hereby consent to the filing of this opinion as an
exhibit to the Registration Statement. In giving said
consent, I do not admit that I am in the category of
persons whose consent is required under Section 7 of the
Act or the rules and regulations of the Securities and
Exchange Commission thereunder.
Very truly yours,
/s/ John W. Blenke
- ------------------
John W. Blenke
A:\WP51\EX5
<PAGE> 1
EXHIBIT 23(b)
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-8 relating to the offering of up to 2,000,000 shares
of Household International, Inc. Common Stock, to be filed
with the Securities and Exchange Commission on or about
April 19, 1995, of our report dated February 3, 1995,
included in Household International's Form 10-K for the
year ended December 31, 1994, and to all references to our
Firm included in this registration statement.
/s/ Arthur Andersen LLP
- -----------------------
Chicago, Illinois,
April 19, 1995
