<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JUNE 6, 1996
REGISTRATION NOS. 333-1025 AND 1025-01
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
AMENDMENT NO. 1
TO
FORM S-3 AND F-3*
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------
HOUSEHOLD INTERNATIONAL, INC.
(EXACT NAME OF REGISTRANT WHO IS THE ISSUER OF THE GUARANTEES AS SPECIFIED IN
ITS CHARTER)
DELAWARE 36-3121988
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
2700 SANDERS ROAD
PROSPECT HEIGHTS, ILLINOIS 60070
847-564-5000
(ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
---------------
HOUSEHOLD FINANCIAL CORPORATION LIMITED
(EXACT NAME OF REGISTRANT WHO IS THE ISSUER OF THE SENIOR NOTES AND WARRANTS
TO PURCHASE SENIOR NOTES AS SPECIFIED IN ITS CHARTER)
ONTARIO, CANADA NOT APPLICABLE
(STATE OR OTHER JURISDICTION OF (I.R.S. EMPLOYER IDENTIFICATION NO.)
INCORPORATION OR ORGANIZATION)
100 SHEPPARD AVENUE EAST
SUITE 1000
NORTH YORK, ONTARIO, CANADA M2N 6N7
416-250-3400
(ADDRESS, INCLUDING POSTAL CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE, OF
REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
---------------
PATRICK D. SCHWARTZ, ASSOCIATE GENERAL COUNSEL--CORPORATE FINANCE AND
ASSISTANT SECRETARY
HOUSEHOLD INTERNATIONAL, INC.
2700 SANDERS ROAD
PROSPECT HEIGHTS, ILLINOIS 60070
847-564-6301
(NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF AGENT FOR SERVICE)
---------------
WITH A COPY TO:
ERNEST MCNEE RICHARD C. HENDERSON
(UNDERWRITERS' BLAKE, CASSELS & DIRECTOR, LAW & COMPLIANCE,
COUNSEL) GRAYDON
SCOTT N. GIERKE SECRETARY AND GENERAL
MCDERMOTT, WILL & BOX 25, COMMERCE COUNSEL
EMERY COURT WEST HOUSEHOLD FINANCIAL
227 WEST MONROE TORONTO, ONTARIO M5L CORPORATION LIMITED
STREET 1A9 100 SHEPPARD AVENUE EAST
CHICAGO, ILLINOIS SUITE 1000
60606 NORTH YORK, ONTARIO, CANADA
M2N 6N7
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]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
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CALCULATION OF REGISTRATION FEE
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<TABLE>
<CAPTION>
PROPOSED MAXIMUM
PROPOSED MAXIMUM AGGREGATE AMOUNT OF
TITLE OF EACH CLASS OF SECURITIES TO AMOUNT TO BE OFFERING PRICE OFFERING REGISTRATION
BE REGISTERED REGISTERED PER UNIT(1) PRICE(1) FEE(2)
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<S> <C> <C> <C> <C>
Senior Notes and Warrants to Purchase
Senior Notes......................... $400,000,000 100% $400,000,000 $137,932
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Guarantees............................ (3) (3) (3) (3)
</TABLE>
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(1) Estimated solely for the purpose of computing the registration fee. Any
offering of Senior Notes 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
Senior Notes or Warrants from the Registrant.
(2) Previously paid.
(3) No separate consideration will be received for the Guarantees, and
accordingly, no additional registration fee required.
THE REGISTRANTS HEREBY AMEND THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANTS
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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*This Registration Statement constitutes a filing on Form F-3 for the Senior
Notes and Warrants to Purchase Senior Notes and on Form S-3 for the
Guarantees.
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<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+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 JUNE 6, 1996
HOUSEHOLD FINANCIAL CORPORATION LIMITED
SENIOR NOTES
AND
WARRANTS TO PURCHASE SENIOR NOTES
HOUSEHOLD INTERNATIONAL, INC.
GUARANTOR
Household Financial Corporation Limited ("Household Canada") from time to
time may offer one or more series of unsecured senior notes ("Debt Securities")
and warrants ("Warrants") to purchase Debt Securities (the Debt Securities and
Warrants being hereinafter collectively called the "Securities") having an
aggregate initial offering price of up to U.S.$400,000,000, or the equivalent
thereof if any of the Securities are denominated in a foreign currency or a
foreign currency unit. All Debt Securities will be unconditionally guaranteed
as to payment of principal, premium, if any, and interest by Household
International, Inc. ("Household International"). The guarantees of the Debt
Securities (the "Guarantees") will constitute unsecured obligations of
Household International and will rank on a parity with other unsecured senior
indebtedness of Household International. The Debt Securities will be offered as
separate series in amounts, at prices and on terms to be determined at the time
of sale and to be set forth in supplements to this Prospectus ("Prospectus
Supplement"). 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. Unless otherwise specified in the
Prospectus Supplement, the Debt Securities will be issued only in denominations
of U.S.$100,000, or the equivalent thereof, or any amount in excess thereof
which is an integral multiple of U.S.$1,000. The specific designation,
aggregate principal amount, the currency or currency unit for which the
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, any redemption terms or other specific terms of the Securities in
respect of which this Prospectus is being delivered will be set forth in the
Prospectus Supplement. With regard to the Warrants, if any, in respect of which
this Prospectus is being delivered, the Prospectus Supplement sets 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.
Household Canada 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 will be set forth in the Prospectus Supplement.
-----------
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.
THESE SECURITIES HAVE NOT BEEN AND WILL NOT BE QUALIFIED FOR SALE UNDER THE
SECURITIES LAWS OF CANADA OR ANY PROVINCE OR TERRITORY THEREOF.
ACCORDINGLY, THESE SECURITIES MAY NOT BE OFFERED OR SOLD IN CANADA OR
ANY PROVINCE OR TERRITORY THEREOF AND THIS DOCUMENT DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY
ANY OF THESE SECURITIES IN CANADA OR ANY PROVINCE OR TERRITORY
THEREOF.
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THE DATE OF THIS PROSPECTUS IS JUNE , 1996.
<PAGE>
AVAILABLE INFORMATION
Household Canada and Household International have filed with the Securities
and Exchange Commission (the "Commission") a combined registration statement
on Form F-3 and Form S-3, respectively, (collectively, the "Registration
Statement," which term encompasses any amendments thereof) under the
Securities Act of 1933, as amended, with respect to the Securities and the
Guarantees offered hereby. As permitted by the rules and regulations of the
Commission, this Prospectus does not contain all of the information set forth
in the Registration Statement and the exhibits and schedules thereto to which
reference is hereby made. Statements or extracts presented in this Prospectus
from financial statements, contracts, agreements or other documents included
as an exhibit to the Registration Statement are not necessarily complete. With
respect to each such financial statement, contract, agreement or other
document filed as an exhibit to the Registration Statement, reference is
hereby made to the exhibit for a more complete description of the matter
involved. All information concerning Household Canada contained herein has
been furnished by Household Canada and all information concerning Household
International has been furnished by Household International.
Household Canada and Household International are subject to the
informational requirements of the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), and in accordance therewith file applicable reports,
proxy statements and other information with 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 at the Commission's Regional Offices at the
Northwestern Atrium Center, 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 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 is not required to send a copy of its
latest Annual Report to Shareholders to holders of the Securities, 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 by Household Canada (File No. 33-
62842) and Household International (File No. 1-8198) with the Commission
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, 1995;
(b) Household International's Quarterly Report on Form 10-Q for the
quarter ended March 31, 1996;
(c) Two Household International Current Reports on Forms 8-K, each dated
January 25, 1996 and a Current Report on Form 8-K, dated June 3, 1996;
(d) Household Canada's Annual Report on Form 40-F for the fiscal year
ended December 31, 1995; and
(e) Household Canada's Quarterly Report filed on Form 6-K for the month
of March 1996.
All documents filed by Household International or Household Canada, as the
case may be, with the Commission pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this
2
<PAGE>
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 (including any Form 6-K
hereafter filed by Household Canada which indicates it is being incorporated
herein by reference). 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: 847-564-5000
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 Household International
initiated a restructuring program that resulted in the disposition of its
merchandising, transportation and manufacturing businesses. This has enabled
Household International to focus its resources in the financial services
industry. Household International's principal executive office is located at
2700 Sanders Road, Prospect Heights, Illinois 60070 (telephone: 847-564-5000).
Through subsidiaries, such as Household Finance Corporation ("HFC"),
Household Bank, f.s.b., Household Bank (Nevada), National Association,
Household Retail Services, Inc., Household Canada, and HFC Bank plc, Household
International 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,
Household International makes credit life, credit accident and health and
household contents insurance available to its customers.
The ongoing commercial finance operations of Household International 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.
HOUSEHOLD FINANCIAL CORPORATION LIMITED
Household Financial Corporation Limited ("Household Canada"), formerly
Household Securities Limited, was incorporated by Letters Patent on September
9, 1947, pursuant to a predecessor to the Business Corporations Act (Ontario).
Household Canada changed its name from Household Securities Limited to
Household Financial Corporation Limited on August 13, 1975 when a Certificate
and Articles of Amendment were issued. Household
- --------
*VISA and MasterCard are registered trademarks of VISA, USA, Inc. and
MasterCard International Incorporated, respectively.
3
<PAGE>
Canada is a wholly-owned subsidiary of Household Global Funding, Inc., which
is a wholly-owned subsidiary of Household International. The registered and
principal office of Household Canada is at 100 Sheppard Avenue East, Suite
1000, North York, Ontario, M2N 6N7 (telephone: 416-250-3400).
Household Canada is a holding company which co-ordinates the activities of,
arranges the funding of, and furnishes administrative services for its
operating subsidiaries. Household Canada and its predecessors have been
involved in the consumer finance business in Canada for over 65 years.
Household Canada offers a diversified range of consumer financial services to
the Canadian public through a network of retail branches. These services
include consumer loans, retail finance, revolving credit and the acceptance of
deposits. They are offered by Household Canada through four principal
operating subsidiaries: Household Finance Corporation of Canada, Household
Realty Corporation Limited, Merchant Retail Services Limited and Household
Trust Company. In 1991, a decision was made by Household Canada to no longer
offer commercial mortgages and a liquidation strategy in respect of the
commercial mortgage lending portfolio was implemented. In 1995, Household
Canada discontinued its conventional first mortgage lending operations and
disposed of the majority of its portfolio.
The enforcement by investors of civil liabilities under the federal
securities laws may be affected adversely by the fact that Household Canada is
incorporated or organized under the laws of Canada, that some or all of its
officers and directors may be residents of Canada and that all or a
substantial portion of the assets of Household Canada and of those persons may
be located outside the United States.
USE OF PROCEEDS
Household Canada will apply the net proceeds from the sale of the Securities
to its general funds to be used for general corporate purposes, including to
fund investments in, or extensions of credit to, its operating subsidiaries;
to reduce other outstanding indebtedness (which may include indebtedness owed
to its affiliates, including Household International); or to fund acquisitions
of other companies or portfolios.
RATIOS OF EARNINGS TO FIXED CHARGES
The ratios of earnings to fixed charges for Household International and
Household Canada for the periods indicated below were as follows:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED MARCH
31, YEAR ENDED DECEMBER 31,
------------- ------------------------
1996 1995 1995 1994 1993 1992 1991
------ ------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Household International and subsidiar-
ies.................................... 1.45 1.37 1.47 1.41 1.38 1.19 1.10
Household Canada and subsidiaries....... 1.00 0.94 1.07 0.86 0.77 0.79 0.83
</TABLE>
For purposes of calculating the ratio, earnings consist of income from
continuing operations to which has been added income taxes and fixed charges.
For Household International, fixed charges consist of interest on all
indebtedness (including capitalized interest) and one-third of rental expense
(approximate portion representing interest). For Household Canada, fixed
charges consist of interest on all indebtedness (excluding capitalized
interest and one-third of rental expense); the respective ratios calculated on
a basis including capitalized interest and one-third of rental expense are
1.00, 0.94, 1.07, 0.86, 0.77, 0.79 and 0.83, respectively.
DESCRIPTION OF DEBT SECURITIES AND GUARANTEES
The following description of the Debt Securities and Guarantees sets forth
certain general terms and provisions of the Debt Securities and Guarantees 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.
4
<PAGE>
GENERAL
The Offered Debt Securities will constitute unsecured senior debt of
Household Canada, will rank on a parity with other unsecured senior debt of
Household Canada and will be unconditionally guaranteed as to payment of
principal, interest and premium, if any, by Household International. The
Offered Debt Securities will be issued under one of two indentures specified
elsewhere herein (the "Indentures"). Copies of the Indentures are filed as
exhibits to the Registration Statement which registers the Securities and the
Guarantees 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. The Debt
Securities of any series may be issued in whole or in part in the form of one
or more global securities that will be deposited with, or on behalf of, a
Depositary. See "Book-Entry System" below.
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 Canada 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; (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 purchase fund provisions, be redeemed by Household Canada, 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 Canada or of the Holder thereof and the
other detailed terms and provisions of such optional redemption; (10) the
securities exchange, if any, on which the Offered Debt Securities will be
listed; and (11) additional provisions, if any, with respect to the Offered
Debt Securities. 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 Canada 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
5
<PAGE>
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.
BOOK-ENTRY SYSTEM
If so indicated in the Prospectus Supplement with respect to any series of
Offered Debt Securities, such Offered Debt Securities will be represented by
one or more global securities (the "Global Security"). The Global Security
will be deposited with, or on behalf of, The Depository Trust Company (the
"Depositary") and registered in the name of a nominee of the Depositary.
Except under circumstances described below, such Offered Debt Securities will
not be issuable in definitive form.
The Depositary has advised Household Canada, Household International and any
underwriters, dealers or agents named in the applicable Prospectus Supplement
as follows: the Depositary is a limited-purpose trust company organized under
the laws of the State of New York, a member of the Federal Reserve System, a
"clearing corporation" within the meaning of the New York Uniform Commercial
Code and a "clearing agency" registered pursuant to the provisions of Section
17A of the Securities Exchange Act of 1934. The Depositary was created to hold
securities of its participants and to facilitate the clearance and settlement
of securities transactions among its participants in such securities through
electronic book-entry changes in accounts of the participants, thereby
eliminating the need for physical movement of securities certificates. The
Depositary's participants include securities brokers and dealers, banks, trust
companies, clearing corporations and certain other organizations, some of
which (and/or their representatives) own the Depositary. Access to the
Depositary's book-entry system is also available to others, such as banks,
brokers, dealers and trust companies, that clear through or maintain a
custodial relationship with a participant, either directly or indirectly.
Upon the issuance of the Global Security, the Depositary will credit on its
book-entry registration and transfer system the accounts of participants with
the respective principal amounts of the Offered Debt Securities represented by
the Global Security. Ownership of beneficial interests in the Global Security
will be limited to persons that have accounts with the Depositary or its
nominee ("participants") or persons that may hold interests through
participants. Ownership of beneficial interests in the Global Security will be
shown on, and the transfer of that ownership will be effected only through,
records maintained by the Depositary or its nominee (with respect to interests
of participants) and on the records of participants (with respect to interests
of persons other than participants). The laws of some states require that
certain purchasers of securities take physical delivery of such securities in
definitive form. Such limits and such laws may impair the ability to transfer
beneficial interests in the Global Security.
So long as the Depositary or its nominee is the registered owner of the
Global Security, the Depositary or such nominee, as the case may be, will be
considered the sole owner or holder of the Offered Debt Securities represented
by the Global Security for all purposes under the Indenture. Except as
provided below, owners of beneficial interests in the Global Security will not
be entitled to have Offered Debt Securities represented by the Global Security
registered in their names, will not receive or be entitled to receive physical
delivery of Offered Debt Securities in definitive form and will not be
considered the owners or holders thereof under the Indenture.
Principal and interest payments on Offered Debt Securities registered in the
name of the Depositary or its nominee will be made to the Depositary or its
nominee, as the case may be, as the registered owner of the Global Security.
None of Household Canada, Household International, the Trustee, any paying
agent or the registrar for the Offered Debt Securities will have any
responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial interests in the Global Security or for
maintaining, supervising or reviewing any records relating to such beneficial
interests.
6
<PAGE>
Household Canada expects that the Depositary for the Offered Debt Securities
or its nominee, upon receipt of any payment of principal or interest, will
credit immediately participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the principal amount
of the Global Security as shown on the records of the Depositary or its
nominee. Household Canada also expects that payments by participants to owners
of beneficial interests in the Global Security held through such participants
will be governed by standing instructions and customary practices, as is now
the case with securities held for the accounts of customers in bearer form or
registered in "street name", and will be the responsibility of such
participants.
If the Depositary is at any time unwilling or unable to continue as
Depositary and a successor Depositary is not appointed by Household Canada
within 90 days, Household Canada will issue Offered Debt Securities in
definitive form in exchange for the entire Global Security. In addition,
Household Canada may at any time and in its sole discretion determine not to
have the Offered Debt Securities represented by the Global Security and, in
such event, will issue Offered Debt Securities in definitive form in exchange
for the entire Global Security. In any such instance, an owner of a beneficial
interest in the Global Security will be entitled to physical delivery in
definitive form of Offered Debt Securities represented by the Global Security
equal in principal amount to such beneficial interest and to have such Offered
Debt Securities registered in its name. Offered Debt Securities so issued in
definitive form will be issued as registered Offered Debt Securities in
denominations of U.S. $100,000 or any amount in excess thereof which is an
integral multiple of U.S.$1,000, unless otherwise specified by Household
Canada.
SAME-DAY SETTLEMENT AND PAYMENT
Settlement for the Offered Debt Securities will be made by the underwriters,
dealers or agents in immediately available funds and all payments of principal
and interest thereon will be made by Household Canada in immediately available
funds.
GUARANTEES
Household International will unconditionally guarantee the due and punctual
payment of the principal of, premium, if any, and interest on the Debt
Securities when and as the same shall become due and payable, whether at
maturity, upon redemption or otherwise. The Guarantees are unsecured
obligations of Household International and will rank equally with all other
unsecured and unsubordinated obligations of Household International. The
Guarantees provide that in the event of a default in payment of principal,
premium, if any, or interest on a Debt Security, the Holder of the Debt
Security may institute legal proceedings directly against Household
International to enforce the Guarantee without first proceeding against
Household Canada. The Indentures provide that Household International may,
without the consent of any Holder, under certain circumstances assume all
rights and obligations of Household Canada under the Indentures with respect
to a series of Debt Securities. Upon such an assumption, Household Canada
shall be released from its liabilities with respect to such series of Debt
Securities. (Section 2.12)
Household International is principally a holding company whose primary
source of funds is dividends from its subsidiaries. Dividend distributions to
Household International from its banking and insurance subsidiaries may be
restricted by federal and state laws and regulations. Dividend distributions
from its foreign subsidiaries, including Household Canada, 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
Household International may itself be a creditor with recognized claims
against the subsidiary. Nevertheless, there are no restrictions that currently
materially limit Household International's ability to make payments to its
creditors at current levels nor are there any restrictions which Household
International reasonably believes are likely to limit materially such payments
in the future.
INDENTURES
Offered Debt Securities and the related Guarantees will be issued under (i)
an Indenture dated as of May 15, 1993, among Household Canada, Household
International and The Bank of New York, as Trustee, or (ii) an
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Indenture dated as of May 15, 1993, among Household Canada, Household
International and LaSalle National Trust, N.A., as Trustee.
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 the respective Trustee or Paying Agent, if any, in either New York, New
York, with respect to the Indenture with The Bank of New York, or in Chicago,
Illinois, with respect to the Indenture with LaSalle National Bank; provided,
however, that payment of interest may be made at the option of Household
Canada by check or draft mailed to the person entitled thereto.
COVENANTS AGAINST CREATION OF PLEDGES OR LIENS
Household International. Household International covenants in the Indentures
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 Guarantees, by supplemental indenture, are
effectively secured by such security interest equally and ratably with all
other indebtedness secured thereby for so long as such other indebtedness
shall be so secured. The term "indebtedness for borrowed money" does not
include any guarantee, cash deposit 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 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 May
15, 1993; 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 rateably securing the Guarantees, 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 used
herein, "Consolidated Net Worth" shall mean the difference between Household
International's consolidated assets and consolidated liabilities as shown on
Household International's most recent audited consolidated financial
statements prepared in accordance with United States generally accepted
accounting principles. In addition, an
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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
with 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 4.04)
Household Canada. Household Canada covenants in the Indentures that, with
the exceptions listed below, it will not create, incur or assume any mortgage,
hypothecation, charge, security interest, lien, encumbrance, pledge or other
security ("security interest") upon the whole or any part of its undertaking
or property, real or personal, present or future, to secure any loan or other
indebtedness, present or future, for any money borrowed and premium and
interest with respect thereto ("Money Borrowed") or to secure any guarantee by
Household Canada of any loan or other indebtedness, present or future, for
Money Borrowed, nor will Household Canada permit any security interest
securing indebtedness of another corporation to extend to any assets of
Household Canada as a result of the amalgamation of Household Canada with, or
the sale of all or substantially all of Household Canada's assets to, such
other corporation or as a result of the purchase by Household Canada from such
other corporation of all or any part of its assets, unless, in either case,
the same security interest shall have been or shall as soon as reasonably
practicable thereafter be created in favor of and be extended equally to and
rateably with the Debt Securities then outstanding.
The foregoing covenant does not apply to (a) Household Canada issuing or
becoming liable on any Purchase Money Obligation (as defined below) or
creating or assuming any Purchase Money Mortgage (as defined below); (b) the
continuation of any security interest existing on the date of the Indentures;
(c) the assumption by Household Canada of any security interest on any
property, real or personal, in existence at the time of acquisition thereof;
(d) the continuation of any Purchase Money Mortgage existing on the date of an
amalgamation of Household Canada with, or the transfer of all or substantially
all of Household Canada's assets to, or the transfer to Household Canada of
all or any part of the other corporation's assets from, another corporation;
(e) any security interest for Money Borrowed of Household Canada, the amount
of which, when aggregated with the amount of all other Money Borrowed of
Household Canada and of its Subsidiaries (as defined below) then outstanding
in respect of which security interest has been given, excluding any security
interest pursuant to the other exceptions referred to herein, would not exceed
10% of Consolidated Shareholders' Equity (as defined below); (f) the giving of
security interest to secure the Senior Notes; or (g) any security interest not
related to the borrowing of money incurred or arising by operation of law in
the ordinary course of business.
As used herein, the following terms have the meanings ascribed to them in
this paragraph: "Consolidated Shareholders' Equity" shall mean at any time the
paid-in capital plus retained earnings, or minus deficit, as the case may be,
plus any other amount which in accordance with generally accepted accounting
principles would be classified as part of the shareholders' equity section of
a consolidated balance sheet of Household Canada and its Subsidiaries, all
determined in accordance with generally accepted accounting principles;
"Purchase Money Mortgage" shall mean any mortgage, charge, security interest,
pledge, lien, encumbrance or other security created, issued or assumed by
Household Canada to secure a Purchase Money Obligation, provided that such
mortgage, hypothecation, charge, security interest, pledge, lien, encumbrance
or other security is limited to the property acquired in connection with the
creation, issue or assumption of such Purchase Money Obligation and is
created, issued or assumed substantially concurrently with the acquisition of
such property except in the case of immoveable property on which fixed
improvements are constructed or installed in which case the same shall be
created or issued within a period of 18 months after the acquisition of such
property, and any extensions or renewals or replacements of any such Purchase
Money Mortgage upon the same property if the principal amount of the
indebtedness secured thereby at the time of such extension, renewal or
replacement is not increased; "Purchase Money Obligation" shall mean any
indebtedness assumed by Household Canada as part of, or issued or incurred to
provide Household Canada with funds to pay, the purchase price of moveable or
immoveable
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property acquired by Household Canada, provided that such indebtedness does
not exceed 100% of the purchase price of such property, and includes any
extension, renewal, replacement or refunding of any such Purchase Money
Obligation to the extent of the principal amount outstanding at the time of
such extension, renewal, replacement or refunding. In the case of immoveable
property so acquired, such terms shall include indebtedness issued or incurred
to provide Household Canada with funds to pay, or to reimburse Household
Canada for, the purchase price of such property and expenditures made for any
fixed improvements constructed or installed thereon within a period of 18
months after the acquisition thereof, provided such indebtedness does not
exceed 100% of the aggregate of such purchase price and of such expenditures;
"Subsidiary" shall mean 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 Household International or by one or more
Subsidiaries thereof, or by Household Canada and one or more Subsidiaries
thereof; and "Voting Stock", as applied to the stock of any corporation, shall
mean 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.
Household Canada has agreed to cause each of its Subsidiaries to abide by
the covenants noted above, subject to the same qualifications, provided that
Household Canada and its Subsidiaries are permitted to give security interests
to each other, to accept deposits and invest monies in investments which under
applicable law are required to be held in trust or otherwise made available
for the persons making such deposits, and to pledge assets to the Government
of Canada with respect to the sale of Canada Savings Bonds or other similar
activities. 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 3.07)
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 Canada
has paid or caused to be paid all other sums payable by it under the
applicable Indenture with respect to such series, then Household Canada will
be deemed to have satisfied and discharged the entire indebtedness represented
by such series of Debt Securities and all the obligations of Household Canada
and 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 to look only to such
trust funds for payment of principal, premium, if any, and interest, if any,
on their Debt Securities (Section 7.03)
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. Any such defeasance may
also give rise to tax consequences under the Income Tax Act (Canada) to
Holders.
THE TRUSTEES
The Bank of New York and affiliates of LaSalle National Trust, N.A. provide
lines of credit to Household International or its subsidiaries in the normal
course of business. The Trustees act as such with respect to currently
outstanding series of debt securities under the respective Indentures and act
or may act as trustees from time to time under other indentures of Household
International or its subsidiaries.
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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 12.02)
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 Household Canada or Household
International and to provide for the assumption of all the obligations of
Household Canada or Household International under 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
to Holders of Debt Securities or add additional Events of Default. (Section
12.01)
SUCCESSOR ENTITY
Household International 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 Household International under the
Indenture terminate. (Sections 11.01 and 11.02)
The Indentures do not contain any covenants specifically designed to protect
Holders of Debt Securities against a reduction in the creditworthiness of
Household International or Household Canada in the event of a highly leveraged
transaction.
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 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 Canada
and Household International are required to file with each Trustee annually an
Officers' Certificate as to the absence of certain defaults under the
Indenture. (Sections 8.01, 3.06 and 4.05)
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 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 8.02)
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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 8.13)
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
9.02)
Holders of Debt Securities may not enforce an Indenture except as provided
therein. (Section 8.07) 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 8.12) 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 9.03(e))
DESCRIPTION OF WARRANTS
Household Canada 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 among Household Canada, 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 will describe the terms of the Offered Warrants,
the Warrant Agreement relating to the Offered Warrants and the Warrant
Certificates representing the Offered Warrants, including the following: (1)
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.
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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 Canada 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.
PLAN OF DISTRIBUTION
Household Canada 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 will
set forth the terms of the offering of the Offered Debt Securities and any
Offered Warrants (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 Canada 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 will describe 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 will be named in the
Prospectus Supplement relating to such offering, and, if an underwriting
syndicate is used, the managing underwriter or underwriters will be 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 Canada or through
agents designated by Household Canada from time to time. Any agent involved in
the offer or sale of the Offered Securities in respect of which this
Prospectus is delivered will be named, and any commissions payable by
Household Canada to such agent will be 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 Canada or Household International to indemnification by Household
Canada and 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 Canada will
authorize underwriters, dealers or other persons acting as Household Canada's
agents to solicit offers by certain institutions to purchase Offered
Securities from Household Canada 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,
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pension funds, investment companies, educational and charitable institutions
and others, but in all cases such institutions must be approved by Household
Canada. 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 Canada 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.
CERTAIN TAX MATTERS
The Prospectus Supplement will describe the material Canadian federal tax
consequences, if any, to an investor who is a citizen or resident of the
United States acquiring Securities, including whether payments of principal,
premium, if any, and interest will be subject to Canadian non-resident
withholding tax.
If interest or principal on the Securities is payable in a currency other
than United States dollars, or if an investor would be required to include
original issue discount in income as a result of holding Securities, the
Prospectus Supplement will contain a discussion of certain United States
Federal income tax consequences of acquiring, holding or disposing of such
Securities.
ERISA MATTERS
The Employee Retirement Income Security Act of 1974, as amended ("ERISA"),
imposes certain restrictions on employee benefit plans ("Plans") that are
subject to ERISA and on persons who are fiduciaries with respect to such
Plans. In accordance with the ERISA's general fiduciary requirements, a
fiduciary with respect to any such Plan who is considering the purchase of
Securities on behalf of such Plan should determine whether such purchase is
permitted under the governing Plan documents and is prudent and appropriate
for the Plan in view of its overall investment policy and the composition and
diversification of its portfolio. Other provisions of ERISA and Section 4975
of the Internal Revenue Code of 1986, as amended (the "Code") prohibit certain
transactions between a Plan and persons who have certain specified
relationships to the Plan ("parties in interest" within the meaning of ERISA
or "disqualified persons" within the meaning of Section 4975 of the Code).
Thus, a Plan fiduciary considering the purchase of Securities should consider
whether such a purchase might constitute or result in a prohibited transaction
under ERISA or Section 4975 of the Code.
Household Canada or Household International may be considered a "party in
interest" or a "disqualified person" with respect to many Plans that are
subject to ERISA. The purchase of Securities by a Plan that is subject to the
fiduciary responsibility provisions of ERISA or the prohibited transaction
provisions of Section 4975 of the Code (including individual retirement
accounts and other plans described in Section 4975(e)(1) of the Code) and with
respect to which Household Canada or Household International is a party in
interest or a disqualified person may constitute or result in a prohibited
transaction under ERISA or Section 4975 of the Code, unless such Securities
are "marketable obligations" (as defined in Section 407(e) of ERISA) or are
acquired pursuant to and in accordance with an applicable exemption, such as
Prohibited Transaction Class Exemption ("PTCE") 84-14 (an exemption for
certain transactions determined by an independent qualified professional asset
manager), PTCE 91-38 (an exemption for certain transactions involving bank
collective investment funds), PTCE 90-1 (an exemption for certain transactions
involving insurance company pooled separate accounts) or PTCE 95-60 (an
exemption for certain transactions involving insurance company general
accounts). ANY PENSION OR OTHER EMPLOYEE BENEFIT PLAN PROPOSING TO ACQUIRE ANY
SECURITIES SHOULD CONSULT WITH ITS COUNSEL.
14
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 16. EXHIBITS.
<TABLE>
<C> <S>
1 Form of Underwriting Agreement.
4(a) Indenture dated as of May 15, 1993, among Household Canada,
Household International and The Bank of New York, as Trustee.
4(b) Indenture dated as of May 15, 1993, among Household Canada,
Household International and LaSalle National Trust, N.A., as
Trustee.
4(c) Forms of Warrant Agreement, including form of Warrant
Certificate.
5(a) Opinion and Consent of Mr. John W. Blenke, Vice President--
Corporate Law and Assistant Secretary of Household
International, Inc.
5(b) Opinion and Consent of Blake, Cassels & Graydon.
12(a)* Statement on the Computation of Ratio of Earnings to Fixed
Charges of Household International.
12(b) Statement on the Computation of Ratio of Earnings to Fixed
Charges for Household Canada.
23(a) Consent of Arthur Andersen LLP, Certified Public Accountants,
for Household International and Household Canada.
23(b) Consent of Mr. John W. Blenke, Vice President--Corporate Law and
Assistant Secretary of Household International, Inc., is
contained in his opinion (Exhibit 5(a)).
23(c) Consent of Blake, Cassels & Graydon is contained in their
opinion (Exhibit 5(b)).
24+ Powers of Attorney.
25(a) Statement of eligibility and qualification of The Bank of New
York.
25(b) Statement of eligibility and qualification of LaSalle National
Trust, N.A.
</TABLE>
- --------
+Previously filed.
*Incorporated by reference from Exhibit 12 to (i) the Annual Report on Form
10-K for the fiscal year ended December 31, 1995 and (ii) the Quarterly
Report on Form 10-Q for the quarter ended March 31, 1996, of Household
International, Inc. (File No 1-8198).
II-1
<PAGE>
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 AMENDMENT NO. 1
TO THE REGISTRATION STATEMENT ON FORM S-3 TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF PROSPECT HEIGHTS, AND
STATE OF ILLINOIS, ON THE 6TH DAY OF JUNE, 1996.
Household International, Inc.
*
By: _________________________________
William F. Aldinger
Chairman and Chief Executive
Officer
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS AMENDMENT
NO. 1 TO THE REGISTRATION STATEMENT ON FORM S-3 HAS BEEN SIGNED BELOW BY THE
FOLLOWING PERSONS IN THE CAPACITIES INDICATED ON THE 6TH DAY OF JUNE, 1996.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
*
- -------------------------------------------
(William F. Aldinger) Chairman, Chief Executive Officer and
Director
*
- -------------------------------------------
(Robert J. Darnall) Director
*
- -------------------------------------------
(Gary G. Dillon) Director
*
- -------------------------------------------
(John A. Edwardson) Director
*
- -------------------------------------------
(Mary Johnston Evans) Director
*
- -------------------------------------------
(Dudley Fishburn, M.P.) Director
*
- -------------------------------------------
(Cyrus F. Freideim, Jr.) Director
*
- -------------------------------------------
(Louis E. Levy) Director
</TABLE>
II-2
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
*
- -------------------------------------------
(George A. Lorch) Director
*
- -------------------------------------------
(John D. Nichols) Director
*
- -------------------------------------------
(James B. Pitblado) Director
*
- -------------------------------------------
(S. Jay Stewart) Director
*
- -------------------------------------------
(Louis W. Sullivan, M.D.) Director
*
- -------------------------------------------
(Raymond C. Tower) Director
*
- -------------------------------------------
(David A. Schoenholz) Executive Vice President-Chief Financial
Officer (as Principal Accounting and
Financial Officer)
</TABLE>
/s/ Patrick D. Schwartz
*By: ___________________________
Patrick D. Schwartz
Attorney-in-Fact
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-3
<PAGE>
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 F-3 AND HAS DULY CAUSED THIS AMENDMENT NO. 1
TO THE REGISTRATION STATEMENT ON FORM F-3 TO BE SIGNED ON ITS BEHALF BY THE
UNDERSIGNED, THEREUNTO DULY AUTHORIZED, IN THE CITY OF PROSPECT HEIGHTS, AND
STATE OF ILLINOIS, ON THE 6TH DAY OF JUNE, 1996.
Household Financial Corporation
Limited
*
By: _________________________________
Craig J. Chapman
Chairman, Chief Executive Officer
and President
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS
REGISTRATION STATEMENT ON FORM F-3 HAS BEEN SIGNED BELOW BY THE FOLLOWING
PERSONS IN THE CAPACITIES INDICATED ON THE 6TH DAY OF JUNE, 1996.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
*
- -------------------------------------------
Craig J. Chapman Chairman of the Board,
Chief Executive Officer,
President and Director
*
- -------------------------------------------
Edgar Ancona Director
*
- -------------------------------------------
Peter A. Love Director
*
- -------------------------------------------
Jean-Claude Marsolais Director
*
- -------------------------------------------
John E. Dill Director
*
- -------------------------------------------
Bonnie Brooks Director
*
- -------------------------------------------
George E. Neal Director
*
- -------------------------------------------
(Richard C. Henderson) Director, Law and Compliance, Secretary,
General Counsel and Director
</TABLE>
II-4
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
*
- -------------------------------------------
(Walter Lubiana) Director, Financial Control and Controller
(Principal Accounting Officer)
*
- -------------------------------------------
(Terry W. Cretney) Treasurer
(Principal Financial Officer)
</TABLE>
/s/ Patrick D. Schwartz
*By: ___________________________
Patrick D. Schwartz
Attorney-in-Fact
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 F-3.
II-5
<PAGE>
EXHIBIT 1
HOUSEHOLD FINANCIAL CORPORATION LIMITED
Debt Securities and Warrants to Purchase Debt Securities
HOUSEHOLD INTERNATIONAL, INC.
Guarantor
Underwriting Agreement
----------------------
[Names of Representative(s)]
[Address]
, 199
Dear Sirs:
From time to time Household Financial Corporation Limited (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
Debt Securities will be unconditionally guaranteed (the "Guarantees") as to the
payment of principal, premium, if any, and interest by Household International,
Inc. (the "Guarantor").
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, the Guarantor and the Underwriters to be bound by all of the
provisions of this Underwriting Agreement.
<PAGE>
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 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 and the Guarantor jointly and severally represent and
warrant to, and agree with, each of the Underwriters that:
(a) A registration statement (Registration No. 333- ) in respect
of the Debt Securities, the Warrants and the Guarantees has been filed with
the
-2-
<PAGE>
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 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
-3-
<PAGE>
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 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 or
Guarantor 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 or the Guarantor by an
Underwriter of
-4-
<PAGE>
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) (i) The financial statements of the Guarantor included or
incorporated by reference in the Registration Statement present fairly the
financial position of the Guarantor and subsidiaries as of the dates
indicated and the 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; and (ii) the financial statements of the Company 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 results of operations and changes in financial position
for the periods specified.
(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 Guarantor (except for changes resulting from the
purchase by the Guarantor 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 Guarantor and its subsidiaries, taken as a
whole, or of the Company, otherwise than as set forth or contemplated in
the Prospectus;
(f) The Guarantor 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 Guarantor
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 Guarantor
and its subsidiaries taken as a whole;
-5-
<PAGE>
(g) There are no legal or governmental proceedings pending, other
than those referred to in the Prospectus, to which the Company or the
Guarantor or any of its other subsidiaries is a party or of which any
property of the Company or the Guarantor or any of its other 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, or the Guarantor and its subsidiaries taken as a
whole, respectively; and, to the best of the Company's and the Guarantor's
respective 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 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 Guarantees of the Debt Securities have been duly authorized by the
necessary corporate action and, upon the execution, authentication,
issuance and delivery of the Debt Securities and payment therefor, the
Guarantees will be valid and binding obligations of the Guarantor; the
Indenture has been duly authorized and, when executed and delivered by the
Company, the Guarantor and the Trustee thereunder, the Indenture will
constitute a valid and legally binding instrument enforceable in accordance
with its 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 Guarantees, 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,
-6-
<PAGE>
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 or any of its subsidiaries of any
court or of any 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, the Warrants and the
Guarantees, 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,
the Warrants and the Guarantees by the Underwriters; and
(j) The issue of the Guarantees and compliance by the Guarantor with
all of the provisions of the Guarantees, the Indenture, 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,
-7-
<PAGE>
charge or encumbrance upon any of the property or assets of the Guarantor
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 Guarantor or any of its subsidiaries is a party or by which the
Guarantor or any of its subsidiaries may be bound or to which any of the
property or assets of the Guarantor 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 Guarantor 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 Guarantor or any of its
subsidiaries or any statute or any order, rule or regulation applicable to
the Guarantor 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 Guarantor 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 of the Guarantees 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, the Warrants and the Guarantees, 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, the Warrants and the Guarantees by the
Underwriters; and
(k) Arthur Andersen LLP, who have certified certain financial
statements included or incorporated by reference 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
-8-
<PAGE>
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 book-
entry form, and in such authorized denominations and registered in the name of
the nominee of The Depository Trust Company, shall be delivered by or on behalf
of the Company through the facilities of The Depository Trust 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 wire transfer of
same-day funds to the Company, all at the place and time and date specified in
such Pricing Agreement or at such other place and time and date as the
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 and the Guarantor hereby agree 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 or the Guarantor 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 receipt of 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
-9-
<PAGE>
and Warrants or the Guarantees 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 their 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,
Warrants and Guarantees for offering and sale under the securities laws of
such jurisdictions within the United States as the Representatives may
request and to comply with such laws so as to permit the continuance of
sales and dealings therein in such jurisdictions for as long as may be
necessary to complete the distribution of such Debt Securities, Warrants
and Guarantees, provided that in connection therewith neither the Company
nor the Guarantor shall 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
-10-
<PAGE>
supplement to the Prospectus which will correct such statement or omission
or effect such compliance;
(d) To make generally available to the Guarantor's 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
Guarantor 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 and Designated Warrants, as
notified to the Company or the Guarantor 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 or the Guarantor (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 and the Guarantor covenant and agree with the several
Underwriters that the Company or the Guarantor will pay or cause to be paid the
following: (i) the fees, disbursements and expenses of the Company's and the
Guarantor's respective counsel and accountants in connection with the
registration of the Debt Securities, the Warrants and the Guarantees 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,
the Warrants and the Guarantees for offering and sale
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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 their
respective 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 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 Guarantor, the validity of the Indenture, the
Designated Debt Securities, the Designated Warrants, the Guarantees, the
Warrant Agreement, the Registration Statement, the
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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 its
jurisdiction of incorporation;
(ii) The Company and its 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;
(iii) To the best of such counsel's knowledge, there are no
legal or governmental proceedings pending, other than those referred
to in the Prospectus or the documents incorporated therein by
reference, 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;
(iv) 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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(v) 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;
(vi) 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;
(vii) 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 (vi) 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;
(viii) 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 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,
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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
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, the
Designated Warrants and the Guarantees, 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, the Designated Warrants
and the Guarantees by the Underwriters;
(ix) 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
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threatened under Section 8(d) or 8(e) of the Act; and
(x) Such counsel has no reason to believe that, with respect to
the Company, either the Registration Statement or any amendment
thereof (including the filing of any annual report on Form 40-F) 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;
(d) Counsel for the Guarantor 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 Guarantor 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 Guarantor are validly
organized and existing corporations under the laws of their respective
jurisdictions of incorporation; and all of the issued shares of
capital stock 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 Guarantor, free and clear of all liens,
encumbrances, equities or claims;
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(iii) The Guarantor 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 Guarantor
and its subsidiaries taken as a whole;
(iv) The Guarantor 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 in
the Prospectus or the documents incorporated therein by reference, to
which the Guarantor or any of its subsidiaries is a party or of which
any property of the Guarantor 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 Guarantor;
(vii) The Indenture has been duly authorized, executed and
delivered by the Guarantor, and constitutes a valid and legally
binding instrument of the Guarantor 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
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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 issuance of the Designated Debt Securities, and the
related Guarantees have been paid;
(viii) The Guarantees with respect to the Designated Debt
Securities have been duly authorized and, when the Designated Debt
Securities to which they relate have been duly authenticated, issued
and delivered against payment of the agreed consideration therefor,
the Guarantees will constitute valid and legally binding obligations
of the Guarantor and, with like exception as noted in subdivision
(vii) above, will be entitled to the benefits provided by the
Indenture; and the Guarantees and the Indenture conform to the
descriptions thereof in the Prospectus as amended or supplemented;
(ix) The issue of the Guarantees and the compliance of the
Guarantor with all of the provisions of the Guarantees, the Indenture
and this 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 Guarantor 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 Guarantor or any of its subsidiaries is a
party or by which the Guarantor or any of its subsidiaries may be
bound or to which any of the property or assets of the Guarantor 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 Guarantor 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
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amended, or the By-Laws of the Guarantor 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 Guarantor 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
Guarantor 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 of the Guarantee 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 Guarantees, 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 Guarantees by the
Underwriters;
(x) 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
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<PAGE>
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;
(xi) 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
(xii) The Registration Statement and the Prospectus as amended
or supplemented and any further amendments and supplements thereto
made by the Company or the Guarantor prior to the Time of Delivery for
the Designated Debt Securities (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 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;
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(e) At the Time of Delivery for the Designated Debt Securities and
the Designated Warrants, the independent accountants of the Company and of
the Guarantor who have certified the financial statements of the Company
and its subsidiaries and of the Guarantor and its subsidiaries,
respectively, included or incorporated by reference in the Registration
Statement shall have furnished to the Representatives a letter or letters,
dated such Time of Delivery, in form and substance satisfactory to the
Representatives, and as to such matters as the Representatives may
reasonably request;
(f)(i) Neither of the Company and its subsidiaries taken as a whole
nor the Guarantor and its subsidiaries taken as a whole shall 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 or management, or the consolidated
financial position, stockholders' equity or results of operations of the
Company and its subsidiaries taken as a whole or of the Guarantor and its
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;
(g) Subsequent to the date of the Pricing Agreement relating to the
Designated Debt Securities and the Designated Warrants no downgrading shall
have occurred in any of the respective ratings accorded the Company's or
the Guarantor'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;
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(h) 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
(i) The Company and the Guarantor 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 and the Guarantor, respectively, satisfactory to
the Representatives as to the accuracy of the representations and
warranties of the Company and the Guarantor 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 and the Designated Warrants), as to the performance by the
Company or the Guarantor, as applicable, 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 and the Guarantor jointly and severally 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
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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 and the Guarantor 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 or the Guarantor 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 and
the Guarantor against any losses, claims, damages or liabilities to which the
Company or the Guarantor 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 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 or the Guarantor by such Underwriter through the Representatives
expressly for use therein; and will reimburse the Company and the Guarantor for
any legal or other expenses reasonably incurred by such entity 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
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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 and the Guarantor 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 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 and the Guarantor 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 and the Guarantor 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)
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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 and the Guarantor
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 Guarantor 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.
(e) The obligations of the Company and the Guarantor under this Section 8
shall be in addition to any liability which the Company and the Guarantor 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 or the Guarantor and to each person, if any, who controls the Company or
the Guarantor within the meaning of the Act.
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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) 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
-26-
<PAGE>
(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, the Guarantor 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 the Guarantor, or any officer or director or controlling person of
the Company or the Guarantor, and shall survive delivery of and payment for the
Designated Debt Securities and the Designated Warrants.
11. If any Pricing Agreement shall be terminated pursuant to Section 9
hereof, neither the Company nor the Guarantor shall 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
-27-
<PAGE>
delivered by or on behalf of the Company as provided herein, the Company or the
Guarantor 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 neither the Company nor the Guarantor
shall then be under any 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 or telecopy 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 or the Guarantor shall be sufficient in
all respects if delivered or sent by registered mail to the address of the
Company or the Guarantor, as the case may be, set forth in the Registration
Statement, in each case: 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 the
Pricing Agreement.
13. This Agreement and each Pricing Agreement shall be binding upon, and
inure solely to the benefit of, the Underwriters, the Company and the Guarantor
and, to the extent provided in Section 8 and Section 10 hereof, the officers and
directors of the Company and the Guarantor and each person who controls the
Company or the Guarantor 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 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.
-28-
<PAGE>
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 FINANCIAL CORPORATION LIMITED
By________________________________
[Title]
HOUSEHOLD INTERNATIONAL, INC.
By:_______________________________
[Title]
Accepted as of the date hereof:
[Name(s) of Representative(s)]
By:_____________________________
[Title]
-29-
<PAGE>
ANNEX I
PRICING AGREEMENT
-----------------
[Names of Representative(s)]
As Representatives of the several
Underwriters named in Schedule I hereto,
[Address]
_______, 19__
Dear Sirs:
Household Financial Corporation Limited (the "Company") proposes,
subject to the terms and conditions stated herein and in the Underwriting
Agreement dated ___________, _____ (the "Underwriting Agreement"), between the
Company and Household International, Inc. (the "Guarantor") 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>
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>
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, the Company and the Guarantor. 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 FINANCIAL CORPORATION LIMITED
By
-----------------------------
[Title]
HOUSEHOLD INTERNATIONAL, INC.
By
-----------------------------
[Title]
-3-
<PAGE>
Accepted as of the date hereof:
[Name(s) of Representative(s)]
By _______________________________
(Title)
_______________________________________
On behalf of each of the Underwriters
-4-
<PAGE>
SCHEDULE I
Principal
Amount of
Designated Number of
Debt Designated
Securities Warrants
to be to be
Underwriter Purchased Purchased
- ----------- ---------- ----------
[Name(s) of Representative(s)]..... $
[Names of other Underwriters]......
---------- ----------
Total.................. $
========== ==========
<PAGE>
SCHEDULE II
Designated Debt Securities
Title of Designated Debt Securities:
[__%] [Floating Rate] [Zero Coupon] Notes due
Aggregate principal amount:
$
Price to Public:
% of the principal amount of the Designated Debt Securities, plus accrued
interest from ___________________ to the Time of Delivery [and accrued
amortization, if any, from __________________ to the Time of Delivery]
Purchase Price by Underwriters:
% of the principal amount of the Designated Debt Securities, plus accrued
interest from ___________________ to the Time of Delivery [and accrued
amortization, if any, from __________________ to the Time of Delivery]
Indenture:
Indenture, dated ___________, 199_, between the Company and
as Trustee
Maturity:
Interest Rate:
[____%] [Zero Coupon]
Interest Payment Dates:
[months and dates]
Redemption Provisions:
[No provisions for redemption]
<PAGE>
[The Designated Debt Securities may be redeemed in whole or in part at
the option of the Company, in the amount of $_________ or an integral multiple
thereof,
[on or after ________, _________ at the following redemption prices
(expressed in percentages of principal amount). If redeemed during the 12-month
period beginning
Year Redemption Price
---- ----------------
And thereafter at 100% of their principal amount, together in each case with
accrued interest to the redemption date.]
[on any interest payment date falling on or after ________, ________, at the
election of the Company, at a redemption price equal to the principal amount
thereof, plus accrued interest to the date of redemption.]
[Other possible redemption provisions, such as mandatory redemption upon
occurrence of certain events or redemption for changes in tax law]
Sinking Fund Provisions:
[No sinking fund provisions]
[The Designated Debt Securities are entitled to the benefit of a
sinking fund to retire $________ principal amount of Designated Debt Securities
on ________ in each of the years _______ through _____ at 100% of their
principal amount plus accrued interest], [together with [cumulative] [non-
cumulative] redemptions at the option of the Company to retire an additional
$________ principal amount of Designated Debt Securities in the years _____
through ______ at 100% of their principal amount plus accrued interest].
Designated Warrants
Warrant Exercise Price:
Principal Amount of Designated Debt Securities Issuable on Exercise of One
Warrant:
-2-
<PAGE>
Date after which Warrants are Exercisable:
Expiration Date:
Detachable Date:
Bearer or Registered
Miscellaneous
Time of Delivery:
Closing Location:
Type of Funds:
[Other Terms]*:
- ------------------
* A description of particular tax, accounting or other unusual features of
the Securities should be set forth, or referenced to an attached and
accompanying description, if necessary to the issuer's understanding of the
transaction contemplated. Such a description might appropriately be in the
form in which such features will be described in the Prospectus Supplement
for the offering.
-3-
<PAGE>
SCHEDULE III
DELAYED DELIVERY CONTRACT
-------------------------
HOUSEHOLD FINANCIAL CORPORATION LIMITED
[Name and address of Representative(s)]
_________, 19__
Attention:
Dear Sirs:
The undersigned hereby agrees to purchase from HOUSEHOLD FINANCIAL
CORPORATION LIMITED (hereinafter called the "Company"), and the Company agrees
to sell to the undersigned, $_______________principal amount of the Company's
[full title of Debt Securities] and ______ [full title of Warrants] (hereinafter
collectively called the "Securities"), offered by the Company's Prospectus dated
______________, as supplemented by a supplement dated __________, ___, receipt
of a copy of which is hereby acknowledged, at a purchase price of ____% of the
principal amount of the Debt Securities, plus accrued interest from the date
from which interest accrues as set forth below, and on the further terms and
conditions set forth in this contract.
The undersigned will purchase the Securities from the Company on
_____________, ____ (the "Delivery Date"), and interest on the Securities so
purchased will accrue from ________________, _____.
Payment for the Securities which the undersigned has agreed to
purchase on the Delivery Date shall be made to the Company or its order by
certified or official bank check in Federal funds at the office of the Company,
100 Sheppard Avenue East, North York, Ontario, Canada M2N6N7, on the Delivery
Date upon delivery to the undersigned of the Securities then to be purchased by
the undersigned in definitive fully registered form and in such denominations
and registered in such names as the undersigned may designate by written or
telegraphic communication addressed to the Company not less than five full
business days prior to the Delivery Date.
The obligation of the undersigned to take delivery of and make payment
for Securities on the Delivery Date shall be
<PAGE>
subject to the conditions that (1) the purchase of Securities to be made by the
undersigned shall not on the Delivery Date be prohibited under the laws of the
jurisdiction to which the undersigned is subject and (2) the Company, on or
before ____________, _____, shall have sold to the several Underwriters,
pursuant to the Underwriting Agreement and Pricing Agreement each dated
_____________, ____, with the Company, an aggregate principal amount of Debt
Securities equal to $_______, and an aggregate number of Warrants equal to
________, minus the aggregate principal amount of Debt Securities and aggregate
number of Warrants covered by this contract and other contracts similar to this
contract. The obligation of the undersigned to take delivery of and make
payment for Securities shall not be affected by the failure of any purchaser to
take delivery of and make payment for Securities pursuant to other contracts
similar to this contract.
Promptly after completion of the sale to the Underwriters the Company
will mail or deliver to the undersigned at its address set forth below notice to
such effect, accompanied by a copy of the Opinion of Counsel for the Company
delivered to the Underwriters in connection therewith.
The undersigned represents and warrants that, as of the date of this
contract, the undersigned is not prohibited from purchasing the Securities
hereby agreed to be purchased by it under the laws of the jurisdiction to which
the undersigned is subject.
This contract will inure to the benefit of and be binding upon the
parties hereto and their respective successors, but will not be assignable by
either party hereto without the written consent of the other.
This contract shall be construed in accordance with and governed by
the laws of the State of Illinois.
It is understood that the acceptance by the Company of any Delayed
Delivery Contract (including this contract) is in the Company's sole discretion
and that, without limiting the foregoing, acceptances of such contracts need not
be on a first-come, first-served basis. If this contract is acceptable to the
Company, it is requested that the Company sign the form of acceptance below and
mail or deliver one of the counterparts hereof to the undersigned at its address
set forth below. This
-2-
<PAGE>
will become a binding contract between the Company and the undersigned when such
counterpart is so mailed or delivered.
Yours very truly,
----------------------------------
By
-------------------------------
(Signature)
----------------------------------
(Name and Title)
----------------------------------
(Address)
Accepted, _____________, ________.
Household Financial Corporation Limited
By
----------------------------------
-3-
<PAGE>
EXHIBIT 4(a)
HOUSEHOLD FINANCIAL CORPORATION LIMITED,
AS ISSUER
AND
HOUSEHOLD INTERNATIONAL, INC.
AS GUARANTOR
AND
THE BANK OF NEW YORK,
AS TRUSTEE.
------------------------
INDENTURE
DATED AS OF MAY 15, 1993
------------------------
PROVIDING FOR ISSUANCE OF UNCONDITIONALLY GUARANTEED SENIOR NOTES IN SERIES
<PAGE>
HOUSEHOLD FINANCIAL CORPORATION LIMITED
HOUSEHOLD INTERNATIONAL, INC.
Indenture dated as of May 15, 1993
------------------------------------
TABLE OF CONTENTS
------------------------------------
<TABLE>
<CAPTION>
PAGE
<S> <C>
PARTIES
RECITALS:
General Form of Face of Note
General Form of Reverse of Note
Form of Trustee's Certificate of Authentication
for Notes
General Form of `Option to Elect Repayment',
if applicable, for Notes
ARTICLE I - DEFINITIONS AND OTHER
PROVISIONS OF GENERAL APPLICATION
SECTION 1.01 Definitions
"Act"............................................................... 10
"Affiliate"; "Control".............................................. 10
"Authorized Newspaper".............................................. 11
"Board of Directors"................................................ 11
"Board Resolution".................................................. 11
"Business Day"...................................................... 11
"Commission or SEC"................................................. 11
"Company"........................................................... 11
"Company Request"; "Company Order".................................. 11
"Corporate Trust Officer"........................................... 11
"Depository"........................................................ 12
"Depository Note"................................................... 12
"Dollar"............................................................ 12
"ECU"............................................................... 12
"European Communities".............................................. 12
"Event of Default".................................................. 12
</TABLE>
i
<PAGE>
<TABLE>
<S> <C> <C>
"Foreign Currency"............................................. 12
"Guarantee".................................................... 12
"Guarantor".................................................... 12
"Holder"....................................................... 12
"Indenture".................................................... 12
"Independent".................................................. 13
"Interest"..................................................... 13
"Interest Payment Date"........................................ 13
"Maturity"..................................................... 13
"Note Register"; "Note Registrar".............................. 13
"Officers' Certificate"........................................ 13
"Opinion of Counsel"........................................... 13
"Original Issue Discount Note"................................. 13
"Outstanding".................................................. 14
"Paying Agent"................................................. 15
"Person"....................................................... 15
"Predecessor Notes"............................................ 15
"Redemption Date".............................................. 15
"Redemption Price"............................................. 15
"Regular Record Date".......................................... 15
"Responsible Officer".......................................... 15
"Senior Notes"................................................. 15
"Special Record Date".......................................... 15
"Stated Maturity".............................................. 15
"Subsidiary"................................................... 16
"Trustee"...................................................... 16
"Trust Indenture Act or TIA"................................... 16
"Voting Stock"................................................. 16
SECTION 1.02 Compliance Certificates and Opinions.................. 16
SECTION 1.03 Form of Documents Delivered to Trustee................ 17
SECTION 1.04 Acts of Holders....................................... 17
SECTION 1.05 Notices, etc., to Trustee and Company................. 19
SECTION 1.06 Notices to Holders, Waiver............................ 19
SECTION 1.07 Conflict with Trust Indenture Act..................... 20
SECTION 1.08 Effect of Headings and Table of Contents.............. 20
SECTION 1.09 Successors and Assigns................................ 20
SECTION 1.10 Separability Clause................................... 20
SECTION 1.11 Benefits of Indenture................................. 20
SECTION 1.12 Governing Law......................................... 20
SECTION 1.13 Payment on Business Day............................... 20
SECTION 1.14 Incorporation by Reference of Trust Indenture Act..... 20
</TABLE>
ii
<PAGE>
ARTICLE II - ISSUE, EXECUTION AND REGISTRATION OF SENIOR NOTES
<TABLE>
<S> <C> <C>
SECTION 2.01 Issuance of Notes in Series......................... 21
SECTION 2.02 Authentication and Delivery of Notes................ 22
SECTION 2.03 Execution of Notes.................................. 23
SECTION 2.04 Temporary Notes..................................... 24
SECTION 2.05 Exchanges and Transfers of Notes.................... 24
SECTION 2.06 Mutilated, Destroyed, Lost or Stolen Notes.......... 25
SECTION 2.07 Payment of Interest; Interest Rights Preserved...... 26
SECTION 2.08 Persons Deemed Owners............................... 27
SECTION 2.09 Cancellation of Notes............................... 28
SECTION 2.10 Appointment of Authenticating Agent................. 28
SECTION 2.11 Securities Issuable in the Form of a Depository Note 29
SECTION 2.12 Benefit of Guarantee................................ 30
SECTION 2.13 CUSIP Numbers....................................... 31
ARTICLE III - COVENANTS OF THE COMPANY
SECTION 3.01 Payment of Principal, Premium and Interest.......... 31
SECTION 3.02 Maintenance of Office or Agency..................... 31
SECTION 3.03 Money for Note Payments to be Held in Trust......... 32
SECTION 3.04 Corporate Existence................................. 33
SECTION 3.05 Maintenance of Accounts............................. 33
SECTION 3.06 Statement as to Compliance.......................... 33
SECTION 3.07 Not Subject Property to Lien Without Securing
Notes Rateably...................................... 34
SECTION 3.08 Notice to Trustee................................... 35
ARTICLE IV - COVENANTS OF THE GUARANTOR
SECTION 4.01 Payment of Taxes and Other Claims................... 36
SECTION 4.02 Corporate Existence................................. 36
SECTION 4.03 Filing of Reports................................... 36
SECTION 4.04 Not Subject Property to Lien Without Securing
Notes Rateable; Waiver of Covenant.................. 37
SECTION 4.05 Statement as to Compliance.......................... 39
ARTICLE V - REPAYMENT AT OPTION OF HOLDERS
SECTION 5.01 Optional Repayment of Notes......................... 39
SECTION 5.02 Repayment Procedure for Notes....................... 39
</TABLE>
iii
<PAGE>
<TABLE>
ARTICLE VI - REDEMPTION OF NOTES; SINKING FUNDS
<S> <C> <C>
SECTION 6.01 Applicability of Redemption Provisions................ 40
SECTION 6.02 Election to Redeem; Notice to Trustee................. 40
SECTION 6.03 Selection by Trustee of Notes to be Redeemed.......... 40
SECTION 6.04 Notice of Redemption.................................. 41
SECTION 6.05 Deposit of Redemption Price........................... 42
SECTION 6.06 Notes Payable on Redemption Date...................... 42
SECTION 6.07 Notes Redeemed in Part................................ 42
SECTION 6.08 Sinking Funds......................................... 42
SECTION 6.09 Satisfaction of Sinking Fund Payments with Notes...... 42
SECTION 6.10 Redemption of Notes for Sinking Fund.................. 43
ARTICLE VII - SATISFACTION AND DISCHARGE
SECTION 7.01 Satisfaction and Discharge of Indenture............... 43
SECTION 7.02 Application Of Trust Money............................ 44
SECTION 7.03 Satisfaction, Discharge, and Defeasance of Notes of
any Series............................................ 45
SECTION 7.04 Reinstatement......................................... 46
ARTICLE VIII - REMEDIES
SECTION 8.01 Events of Default..................................... 46
SECTION 8.02 Acceleration of Maturity; Rescission and Annulment.... 48
SECTION 8.03 Collection of Indebtedness and Suits for
Enforcement by Trustee................................ 49
SECTION 8.04 Trustee May File Proofs of Claim...................... 50
SECTION 8.05 Trustee May Enforce Claims Without Possession of Notes 50
SECTION 8.06 Application of Money Collected........................ 51
SECTION 8.07 Limitation on Suits................................... 51
SECTION 8.08 Unconditional Right of Holders to Receive
Principal, Premium and Interest....................... 52
SECTION 8.09 Restoration of Rights and Remedies.................... 52
SECTION 8.10 Rights and Remedies Cumulative........................ 52
SECTION 8.11 Delay or Omission Not Waiver.......................... 52
SECTION 8.12 Control by Holders.................................... 53
SECTION 8.13 Waiver of Past Defaults............................... 53
SECTION 8.14 Undertaking for Costs................................. 53
SECTION 8.15 Waiver of Stay or Extension Laws...................... 54
</TABLE>
iv
<PAGE>
ARTICLE IX - THE TRUSTEE
<TABLE>
<S> <C> <C>
SECTION 9.01 Certain Duties and Responsibilities................ 54
SECTION 9.02 Notice of Defaults................................. 55
SECTION 9.03 Certain Rights of Trustee.......................... 55
SECTION 9.04 Not Responsible for Recitals or Issuance of Notes.. 56
SECTION 9.05 May Hold Notes..................................... 56
SECTION 9.06 Money Held in Trust................................ 57
SECTION 9.07 Compensation and Reimbursement..................... 57
SECTION 9.08 Corporate Trustee Required; Eligibility;
Disqualification; Conflicting Interests............ 57
SECTION 9.09 Preferential Collection of Claims Against Company.. 58
SECTION 9.10 Resignation and Removal; Appointment of Successor.. 58
SECTION 9.11 Acceptance of Appointment by Successor............. 59
SECTION 9.12 Merger, Conversion, Consolidation or
Succession to Business............................. 60
ARTICLE X - HOLDERS' LIST AND REPORTS BY TRUSTEE AND COMPANY
SECTION 10.01 Company to Furnish Trustee Names and
Addresses of Holders............................... 60
SECTION 10.02 Preservation of Information; Communications to
Holders............................................ 60
SECTION 10.03 Reports by Trustee................................. 60
ARTICLE XI - CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 11.01 Guarantor May Consolidate, etc. only on Certain
Terms.............................................. 61
SECTION 11.02 Company May Consolidate, etc. only on Certain Terms 62
SECTION 11.03 Successor Corporation Substituted.................. 63
ARTICLE XII - SUPPLEMENTAL INDENTURES
SECTION 12.01 Supplemental Indentures Without Consent of Holders. 63
SECTION 12.02 Supplemental Indentures With Consent of Holders.... 64
SECTION 12.03 Execution of Supplemental Indentures............... 65
SECTION 12.04 Effect of Supplemental Indentures.................. 65
SECTION 12.05 Conformity with Trust Indenture Act................ 65
SECTION 12.06 Reference in Notes to Supplemental Indentures...... 66
</TABLE>
v
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THIS INDENTURE, dated as of the 15th day of May 1993, among Household
Financial Corporation Limited, a corporation incorporated under the laws of
Ontario, Canada (herein called the "Company"), having its principal place of
business at 100 Sheppard Avenue East, Suite 1000, North York, Ontario, Canada,
M2N 6N7, Household International, Inc., a corporation duly organized and validly
existing under the laws of the State of Delaware (hereinafter called the
"Guarantor"), having its principal office at 2700 Sanders Road, Prospect
Heights, Illinois 60070, and The Bank of New York, a banking corporation
organized and existing under the laws of the State of New York (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 senior notes 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 senior notes, or
other evidences of indebtedness (hereinafter called "Senior Notes or Notes"),
issuable as in this Indenture provided;
WHEREAS, the Guarantor has duly authorized the execution and delivery of
this Indenture and deems it appropriate from time to time to issue its
guarantees of the Senior Notes on the terms and substantially in the form herein
provided (the "Guarantees"); and
WHEREAS, the general forms of the Senior Notes, the Trustee's certificate
of authentication to be borne by the Senior 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 SENIOR 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 Senior Note is % of its principal amount and
the issue date is , 19 .]
No.
HOUSEHOLD FINANCIAL CORPORATION LIMITED
....% Senior Note
HOUSEHOLD FINANCIAL CORPORATION LIMITED, a corporation incorporated under
the laws of Ontario, Canada (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 Senior Note is to
bear interest prior to Maturity, insert--, and to pay interest thereon at the
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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 Senior 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 Senior 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 Senior
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 Senior 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 Senior Note is not to bear interest prior to Maturity, insert--The
principal of this Senior 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.]
Payment of the principal of (and premium, if any) on this Senior Note and,
unless otherwise paid as hereinafter provided, the interest (if any) thereon
will be made at the office or agency of the Trustee 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 Senior 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 Senior Note shall not be
entitled to any benefit under the Indenture, or be valid or obligatory for any
purpose.
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This Senior Note shall be construed in accordance with and governed by the
laws of the State of Illinois.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its facsimile corporate seal.
Dated: HOUSEHOLD FINANCIAL CORPORATION LIMITED
ATTEST: By ____________________________________
[GENERAL FORM OF REVERSE OF NOTE]
HOUSEHOLD FINANCIAL CORPORATION LIMITED
....% Senior Note
This Senior Note is one of a duly authorized issue of Senior Notes of the
Company (herein called the "Senior Notes"), issuable in series, unlimited in
aggregate principal amount except as may be otherwise provided in respect of the
Senior Notes of a particular series, issued and to be issued under and pursuant
to an Indenture dated as of May 15, 1993 (herein called the "Indenture"), duly
executed and delivered by the Company, Household International, Inc., a Delaware
corporation (the "Guarantor"), and The Bank of New York, as Trustee, and is one
of a series designated as % Senior Notes due (herein called the "
% Senior 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
description of the rights, limitations of rights, obligations, duties and
immunities thereunder of the Trustee, the Company, the Guarantor and the
Holders.
[AT THE COMPANY'S OPTION, ADDITIONAL PROVISIONS APPLICABLE
TO INTEREST RATE MAY BE INSERTED HERE]
[If applicable, insert--The Senior 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,
Redemption Redemption
Year Price Year Price
---- ---------- ---- ---------
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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 installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Senior
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 Senior 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 installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Senior Notes, or one or more
Predecessor Notes, of record at the close of 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 Senior Notes of this series. [Senior Notes of this
series acquired or redeemed by the Company otherwise than through
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[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 Senior Note in part only, a new Senior
Note or Senior 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 Senior Notes of this series will be repayable
on , , at the option of the holders of the Senior 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
Senior 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 Senior 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 Senior
Note with the form entitled 'Option to Elect Repayment' on the reverse of this
Senior 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
Senior Note, the principal amount of this Senior Note, the amount of this Senior
Note to be repaid, a statement that the option to elect repayment is being
exercised thereby and a guarantee that this Senior Note to be repaid with the
form entitled 'Option to Elect Repayment' on the reverse of this Senior 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 Senior Note and form duly completed are received by the
[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 Senior Note for less than the entire principal
amount of this Senior 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
Senior Note of this series for repayment will be determined by the Company,
whose determination will be final and binding.]
[If the Senior Note is not an Original Issue Discount Note,--If any Event
of Default with respect to Senior Notes of this series shall occur and be
continuing, the principal of the Senior Notes of this series may be declared due
and payable in the manner and with the effect provided in the Indenture.]
[If the Senior Note is an Original Issue Discount Note,--If an Event of
Default with respect to Senior Notes of this series shall occur and be
continuing, an amount of principal of the Senior Notes of this series may be
declared due and payable in the manner and with the
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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 Senior Notes of
this series shall terminate.]
The Indenture provides that each Holder of a Senior Note is entitled to the
benefits of a Guarantee by the Guarantor of the timely payment of the principal
of, premium, if any, and interest on the Senior Note. The Guarantee enclosed
herein is an integral part of this Senior Note.
[The Indenture contains provisions for defeasance at any time of the entire
indebtedness of the Company on this Senior Note upon compliance by the Company
with certain conditions set forth therein, which provisions apply to this Senior
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 Guarantor and the rights of the Holders under the Indenture at
any time by the Company, the Guarantor and the Trustee with the consent of the
Holders of at least a majority in aggregate principal amount of the Senior 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 Senior Notes. The Indenture also
contains provisions permitting the Holders of a majority in aggregate principal
amount of the Outstanding Senior Notes of any series to waive on behalf of the
Holders of such series of Senior Notes compliance by the Company or the
Guarantor 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 Senior Note shall be binding upon such Holder and upon all future
Holders of this Senior Note and any Senior 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 Senior Note.
No reference herein to the Indenture and no provision of this Senior Note
or of the Indenture shall alter or impair the obligations of the Company and the
Guarantor, which are absolute and unconditional, to pay the principal of (and
premium, if any) and interest on this Senior 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 Senior Note is registrable on the Note Register, upon
surrender of this Senior Note for registration of transfer at the office or
agency of the Trustee 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
Senior Notes of the same
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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 % Senior Notes are issuable only as registered Senior Notes
without coupons in denominations of [$________]. As provided in the Indenture
and subject to certain limitations therein set forth, Senior Notes are
exchangeable for a like aggregate principal amount of Senior 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 Guarantor, the Trustee and any agent of the Company, the
Guarantor or the Trustee may treat the person in whose name this Senior Note is
registered as the owner hereof for the purpose of receiving payment as herein
provided and for all other purposes whether or not this Senior Note be overdue,
and neither the Company, the Guarantor, the Trustee nor any such agent shall be
affected by notice to the contrary.
All terms used in this Senior Note which are defined in the Indenture have
the meanings assigned to them in the Indenture.
[FORM OF TRUSTEE'S CERTIFICATE OF
AUTHENTICATION FOR SENIOR NOTES]
This is one of the Senior Notes designated herein referred to in the
within-mentioned Indenture.
The Bank of New York,
as Trustee
Dated:_________________________ By_____________________________________
Authorized Signature
[FORM OF GUARANTEE]
GUARANTEE OF HOUSEHOLD INTERNATIONAL, INC.
FOR VALUE RECEIVED, Household International, Inc., a corporation duly
organized and existing under the laws of the State of Delaware (the
"Guarantor"), hereby unconditionally guarantees to the Holder of the Senior Note
upon which this Guarantee is endorsed the due and punctual payment of the
principal of, premium, if any, and interest on said Senior Note, when
<PAGE>
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and as the same shall become due and payable, whether at maturity or otherwise,
according to the terms thereof and of the Indenture referred to therein.
The Guarantor agrees to determine, at least one Business Day prior to the
date upon which a payment of principal of, or premium, if any, or interest on
said Senior Note is due and payable, whether the Company has available the funds
to make such payment as the same shall become due and payable. In case of the
failure of the Company punctually to pay any such principal, premium, if any, or
interest, the Guarantor hereby agrees to cause any such payment to be made
punctually when and as the same shall become due and payable, whether at
maturity or otherwise, and as if such payment were made by the Company.
The Guarantor hereby agrees that its obligations hereunder shall be
unconditional, irrevocable, and absolute, irrespective of the validity,
regularity, or enforceability of said Senior Note or the Indenture, the absence
of any action to enforce the same, any waiver or consent by the Holder of said
Senior Note with respect to any provisions hereof, the recovery of any judgment
against the Company or any action to enforce the same, or any other
circumstances which might otherwise constitute a legal or equitable discharge or
defense of a guarantor. The Guarantor hereby waives diligence, presentment,
notice of non-payment, demand of payment, any right to require a proceeding
first against the Company, filing of claims with a court in the event of merger,
insolvency or bankruptcy of the Company, protest or notice with respect to the
Senior Note upon which this Guarantee is endorsed or indebtedness evidenced
thereby and all notices and demands to the Company or the Guarantor whatsoever
and covenants that this Guarantee will not be discharged except by complete
performance of the obligations contained in said Senior Note and this Guarantee.
In the event of a default in the payment of principal of, premium, if any, or
interest on said Senior Note, the Holder of said Senior Note may institute legal
proceedings directly against the Guarantor to enforce this Guarantee without
first proceeding against the Company.
The Guarantor shall be subrogated to all rights of the Holder of said
Senior Note against the Company in respect of any amounts paid by the Guarantor
pursuant to the provisions of this Guarantee; provided, however, that the
Guarantor shall not, without the consent of the Holders of all of the
Outstanding Senior Notes, be entitled to enforce or to receive any payments
arising out of, or based upon, such right of subrogation until the principal of,
premium, if any, and interest on all Senior Notes shall have been paid in full
or payment thereof shall have been provided for in accordance with the
Indenture.
Notwithstanding anything to the contrary contained herein, if following any
payment of principal, premium, if any, or interest by the Company on said Senior
Note to the Holder of the Senior Note it is determined by a final decision of a
court of competent jurisdiction that such payment shall be avoided by a trustee
in bankruptcy (including any debtor-in-possession) as a preference under 11
U.S.C. Section 547 (or any successor statute) and such payment is paid by such
Holder to such trustee in bankruptcy, then and to the extent of such repayment
the obligations of the Guarantor hereunder shall remain in full force and
effect.
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This Guarantee ranks equally with all other unsecured and unsubordinated
obligations of the Guarantor. This Guarantee will remain in full force and
effect until the principal of, premium, if any, and interest on the Senior Note
have been fully paid. As provided in the Indenture, the Guarantor may under
certain circumstances assume all rights and obligations of the Company under the
Indenture with respect to the Senior Note.
This Guarantee shall not be valid or become obligatory for any purpose with
respect to the Senior Note upon which it is endorsed until the certificate of
authentication on said Senior Note shall have been signed by the Trustee or the
authenticating agent.
This Guarantee shall be governed by the laws of the State of Illinois.
IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly
executed under its corporate seal.
HOUSEHOLD INTERNATIONAL, INC.
By
---------------------------
Attest:
- ------------------------------
[GENERAL FORM OF "OPTION TO ELECT REPAYMENT",
IF APPLICABLE, FOR SENIOR NOTES]
OPTION TO ELECT REPAYMENT
The undersigned hereby requests and irrevocably instructs the Company to
repay the within Senior 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 Senior 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
<PAGE>
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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 and the Guarantor, in accordance with its terms, have been done.
Now, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of Senior 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:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.01. DEFINITIONS. 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, with respect to the Guarantor, in accordance
with United States generally accepted accounting principles, and with
respect to the Company, in accordance with Canadian 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
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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 or
the Guarantor, as the case may be, any duly authorized committee of that board,
or any officer of the Company or the Guarantor duly authorized by the board of
directors of the Company or the Guarantor, as the case may be, or a duly
authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company or the Guarantor, as applicable, to
have been duly adopted by the Board of Directors of the Company or the
Guarantor, as the case may be, 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.
"Corporate Trust Office" means principal office of the Trustee in New York,
New York, at which its corporate trust business shall be administered.
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"Depository" shall mean, with respect to Senior Notes of any series for
which the Company shall determine that such Senior Notes will be issued in the
form of one or more Depository Notes, 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 Senior Notes, a
Senior 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) together with all other Depository Notes of such series, if
any, shall represent, and shall be denominated in an amount equal to the
aggregate principal amount of, all of the Outstanding Senior Notes of such
series.
"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 8.01.
"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.
"Guarantee" means the agreement of the Guarantor, in substantially the form
set forth herein as provided in Section 2.12 hereof, to be endorsed on the
Senior Notes authenticated and delivered hereunder.
"Guarantor" means the party named as such in the first paragraph of this
Indenture until a successor replaces it and thereafter means such successor.
"Holder" means a Person in whose name a Senior Note is registered in the
Note Register.
"Indenture" means this Indenture dated as of May 15, 1993, and, unless the
context otherwise indicates, all indentures supplemental hereto from time to
time in effect.
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"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, the Guarantor or in any other
obligor upon the Senior Notes or in any Affiliate of the Company, the Guarantor
or of such other obligor, and (3) is not connected with the Company, the
Guarantor or such other obligor or any Affiliate of the Company, the Guarantor
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.
"Interest Payment Date" means the Stated Maturity of interest on Senior
Notes of a particular series.
"Maturity" when used with respect to Senior Notes of a particular series
means the date on which the principal or any instalment of principal of such
Senior 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.
"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 or the Guarantor, as the case may be, 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 or the Guarantor.
"Opinion of Counsel" means written opinion of counsel, who may be any one
or more of counsel for the Company or the Guarantor, or other counsel reasonably
satisfactory to the Trustee.
"Original Issue Discount Note" means any Senior 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 8.02.
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"Outstanding" when used with respect to Senior Notes means, as of the date
of determination, all Senior Notes theretofore authenticated and delivered under
this Indenture, except:
(i) Senior Notes theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Senior 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 or the Guarantor, in
trust or set aside and segregated in trust by the Company or the Guarantor
(if the Company or the Guarantor shall act as Paying Agent) for the Holders
of such Senior Notes, provided that, if such Senior 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) Senior Notes which have been paid pursuant to Section 2.06 or in
exchange for or in lieu of which other Senior Notes have been authenticated
and delivered pursuant to this Indenture other than any such Senior Notes
in respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Senior Notes are held by a bona fide purchaser
in whose hands such Senior Notes are valid obligations of the Company; and
(iv) any such Senior Notes which have been defeased pursuant to
Section 7.03.
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Senior Notes have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, or for any other
purpose, (i) Senior Notes owned by the Company, the Guarantor or any other
obligor upon the Senior Notes or any Affiliate of the Company, the Guarantor 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
Senior Notes which the Trustee knows to be so owned shall be so disregarded, and
Senior 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 Senior Notes and that the pledge
is not the Company, the Guarantor or any other obligor upon the Senior Notes or
any Affiliate of the Company, the Guarantor or such other obligor, and (ii) the
principal amount of an Original Issue Discount Note or a Senior 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 8.02 or,
for a Senior Note denominated in a Foreign Currency, as calculated pursuant to
Section 1.04(f).
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"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Senior Notes on behalf of
the Company.
"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 Senior Note means every previous
Senior Note evidencing all or a portion of the same debt as that evidenced by
such particular Senior Note; and, for purposes of this definition, any Senior
Note authenticated and delivered under Section 2.06 in exchange for or in lieu
of a mutilated, destroyed, lost, or stolen Senior Note shall be deemed to
evidence the same debt as the mutilated, destroyed, lost, or stolen Senior Note.
"Redemption Date" when used with respect to any Senior 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 Senior 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 Senior 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 Senior 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.
"Senior Notes" means all debt securities issued under this Indenture,
regardless of series.
"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 Senior Note or any
instalment of principal thereof or any instalment of interest thereon means the
date specified in such Senior Note as the fixed date on which the principal of
such Senior Note or such instalment of principal or interest is due and payable.
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"Subsidiary" 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 Guarantor or by one or more Subsidiaries thereof,
or by the Company and one or more Subsidiaries thereof.
"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 - COMPLIANCE CERTIFICATES AND OPINIONS. Upon any application
or request by the Company or the Guarantor to the Trustee to take any action
under any provision of this Indenture, the Company or the Guarantor, as the case
may be, 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;
(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
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(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has been complied with.
SECTION 1.03. FORM OF DOCUMENTS DELIVERED TO TRUSTEE. 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 or the Guarantor
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 or the
Guarantor, as the case may be, stating that the information with respect to such
factual matters is in the possession of the Company or the Guarantor, as the
case may be, 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. ACTS OF HOLDERS. (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 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 and the Guarantor. 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. 9.01)
conclusive in favor of the Trustee and the Company and the Guarantor, 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
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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 Senior 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 Senior Note shall bind every future Holder
of the same Senior Note and the Holder of every Senior 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 or
the Guarantor in reliance thereon, whether or not notation of such action is
made upon such Senior Note.
(e) In determining whether the Holders of the requisite principal amount of
Outstanding Senior 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 of such Original Issue Discount Note upon a
declaration of acceleration pursuant to Section 8.02 at the time the taking of
such action by the Holders of such requisite principal amount of Outstanding
Senior Notes is evidenced to the Trustee, as provided in Subsection (a) of this
Section.
(f) For the purposes of calculating the principal amount of Senior 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 Senior 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.
(g) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company may,
at its option, by or pursuant to a Board Resolution, fix in advance a record
date for the determination of Holders entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other Act, but the Company
shall have no obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent, waiver or other Act
may be given before or after such record date, but only the Holders of record at
the close of business on such record
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date shall be deemed to be Holders for the purposes of determining whether
Holders of the requisite proportion of Outstanding Senior Notes have authorized
or agreed or consented to such request, demand, authorization, direction,
notice, consent, waiver or other Act, and for that purpose the Outstanding
Senior Notes shall be computed as of such record date; provided that no such
authorization, agreement or consent by the Holders on such record date shall be
deemed effective unless it shall become effective pursuant to the provisions of
this Indenture not later than six months after the record date.
SECTION 1.05. NOTICES, ETC., TO TRUSTEE AND COMPANY. 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 or the Guarantor shall
be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office, or
(2) the Company or the Guarantor 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 or the Guarantor 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 or the Guarantor.
SECTION 1.06. NOTICES TO HOLDERS, WAIVER. 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 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.
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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. CONFLICT WITH TRUST INDENTURE ACT. 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. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article
headings herein and the Table of Contents are for convenience only and shall not
affect the construction hereof.
SECTION 1.09. SUCCESSORS AND ASSIGNS. All covenants and agreements in
this Indenture by the Company shall bind its successors and assigns, whether so
expressed or not.
SECTION 1.10. SEPARABILITY CLAUSE. In case any provision in this
Indenture or in the Senior 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. BENEFITS OF INDENTURE. Nothing in this Indenture or in the
Senior 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.
SECTION 1.12. GOVERNING LAW. This Indenture and each Senior Note issued
hereunder shall be construed in accordance with and governed by the laws of the
State of Illinois.
SECTION 1.13. PAYMENT ON BUSINESS DAY. In any case where any Interest
Payment Date, Redemption Date or Stated Maturity of any Senior 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. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. 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
<PAGE>
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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 Senior 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, the Guarantor or
any other obligor on the Senior 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 SENIOR NOTES
SECTION 2.01. ISSUANCE OF NOTES IN SERIES. At the option of the Company,
the Senior Notes issued hereunder, which are unlimited in aggregate principal
amount except as may be otherwise provided in respect of the Senior Notes of a
particular series, may be issued in one or more series. The Senior 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 or the Guarantor specified herein with respect to Senior 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
Senior Notes of any series may be issued as a Depository Note.
All Senior 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
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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.
At or prior to the issuance of any of the Guarantees, the exact form and
terms of such Guarantees, which shall be in substantially the form set forth
herein, shall be established by or pursuant to a Board Resolution of the
Guarantor and set forth in an Officer's Certificate of the Guarantor.
SECTION 2.02. AUTHENTICATION AND DELIVERY OF NOTES. From time to time the
Company may execute and deliver to the Trustee, with the Guarantees endorsed
thereon, and, except as otherwise provided in this Article II, the Trustee shall
thereupon authenticate and deliver to or upon a Company Order, Senior Notes of
any series duly established pursuant to Section 2.01. In authenticating such
Senior Notes, and accepting the additional responsibilities under this Indenture
in relation to such Securities, the Trustee shall be entitled to receive, and
subject to Section 8.01, shall be fully protected in relying upon:
(a)(i) the Board Resolution of the Company and the Guarantor authorizing
the execution and requesting the authentication and delivery of the Senior Notes
applied for in the principal amount therein specified, designating the series of
such Senior Notes and specifying the officer or officers of the Company to whom
or upon whose order such Senior Notes shall be delivered; and which, as
permitted by Section 2.01, establishes the terms of such series of Senior Notes
and which, if applicable, authorizes the execution of an indenture supplemental
hereto creating such series of Senior Notes or, (ii) if an officer of the
Company and the Guarantor 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 Senior
Notes of such series are to be issued pursuant to a supplemental indenture, a
supplemental indenture duly executed on behalf of the Company and the Guarantor,
in form satisfactory to the Trustee, creating such series of Senior 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 Senior Notes have been established in
conformity with the provisions of this Indenture;
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(ii) all conditions precedent to the authentication and delivery of
such Senior Notes and the Guarantees have been complied with and that such
Senior Notes and Guarantees, when authenticated and delivered by the
Trustee and issued by the Company or endorsed by the Guarantor, as the case
may be, in the manner and subject to any conditions specified in such
Opinion of Counsel, will constitute valid and legally binding obligations
of the Company or the Guarantor, as applicable, 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 Senior Notes or by the Guarantor of the
Guarantees have been complied with; and
(iv) each of the Company and the Guarantor is not in default in any of
its obligations under this Indenture, and the issuance of such Senior Notes
or the Guarantees will not result in any such default.
If all Senior 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 Senior Note of
such series if such documents are delivered at or prior to the authentication
upon original issuance of the first Senior Note of such series to be issued.
The Trustee shall have the right to decline to authenticate and deliver any
Senior Notes under this Section if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken or if the Trustee in good
faith shall determine that such action would expose the Trustee to personal
liability to existing Holders.
SECTION 2.03. EXECUTION OF NOTES. The Senior Notes and the Guarantees
shall be executed on behalf of the Company or the Guarantor, as the case may be,
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 Senior Notes
or the Guarantees may be manual or facsimile.
Senior Notes or Guarantees bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company or the
Guarantor, as the case may be, shall bind the Company or the Guarantor,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Senior Notes or did not
hold such offices at the date of such Senior Notes.
All Senior Notes shall be dated the date of their authentication.
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No Senior Note or Guarantee shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose, unless there appears on
such Senior Note a certificate of authentication substantially in the form
provided for herein executed by manual signature, and such certificate upon any
Senior Note shall be conclusive evidence, and the only evidence, that such
Senior Note has been duly authenticated and delivered hereunder.
SECTION 2.04. TEMPORARY NOTES. Pending the preparation of definitive
Senior Notes of any series, the Company and the Guarantor may execute, and upon
Company Order the Trustee shall authenticate and deliver, or cause to be
delivered, temporary Senior Notes of such series having duly executed Guarantees
endorsed thereon which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any denomination, substantially of the tenor of the
definitive Senior Notes in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Senior Notes and Guarantee, may determine, as evidenced
by their signing of such Senior Notes or Guarantees.
If temporary Senior Notes of any series are issued, the Company will cause
definitive Senior Notes of such series to be prepared without unreasonable
delay. After the preparation of definitive Senior Notes, the temporary Senior
Notes shall be exchangeable for definitive Senior Notes upon surrender of the
temporary Senior Notes at the office or agency of the Company without charge to
the Holder. Upon surrender for cancellation of any one or more temporary Senior
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 Senior Notes of such series, of authorized denominations.
Until so exchanged the temporary Senior Notes shall in all respects be entitled
to the same benefits under this Indenture as the definitive Senior Notes.
SECTION 2.05. EXCHANGES AND TRANSFERS OF NOTES. The Company shall cause
to be kept at the 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 Senior
Notes and for registrations of transfer of Senior Notes. The Trustee is hereby
appointed Note Registrar for the purpose of registering Senior Notes and
registering transfers of Senior Notes as herein provided.
Subject to the provisions of Section 2.11, upon surrender for registration
of transfer of any Senior Note the Paying Agent and the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Senior Notes of the same series
containing identical terms and provisions, including the Guarantees, 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,
Senior Notes may be exchanged for other Senior Notes of the same series
containing identical terms and provisions, of any authorized denominations and
for a like aggregate principal amount, upon
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surrender of the Senior Notes to be exchanged at any such office or agency.
Whenever any Senior Notes are so surrendered for exchange, the Company and the
Guarantors shall execute, and the Trustee shall authenticate and deliver, the
Senior Notes and the Guarantee which the Holder making the exchange is entitled
to receive.
All Senior Notes issued upon any registration of transfer or exchange of
Senior Notes shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, including the
Guarantee, as the Senior Notes surrendered upon such registration of transfer or
exchange.
Every Senior 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 Senior 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 Senior Notes, other
than exchanges pursuant to Section 2.04, Section 6.07 or Section 12.06 not
involving any registration of transfer.
The Company shall not be required (i) to issue, register the transfer of or
exchange any Senior 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
Senior Notes of such series selected for redemption under Section 6.04 and
ending at the close of business on the day of such mailing, or (ii) to register
the transfer of or exchange any Senior Note so selected for redemption in whole
or in part.
SECTION 2.06. MUTILATED, DESTROYED, LOST OR STOLEN NOTES. A mutilated
Senior Note may be surrendered to the Company and thereupon the Company and the
Guarantor shall execute and the Trustee shall authenticate and deliver in
exchange therefor a new Senior Note of the same series, including the Guarantee,
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 Senior Note of any series, and
(ii) such security or indemnity as may be required by them to save
each of them and the Guarantor harmless,
<PAGE>
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then, in the absence of notice to the Company or the Trustee that such Senior
Note has been acquired by a bona fide purchaser, the Company and the Guarantor
shall execute and upon their request the Trustee shall authenticate and deliver,
in lieu of any such destroyed, lost or stolen Senior Note, a new Senior Note of
such series, including the Guarantee, and of like tenor and principal amount,
bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Senior Note has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Senior Note, pay such Senior Note.
Upon the issuance of any new Senior 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 Senior Note issued pursuant to this Section 2.06 in lieu of any
destroyed, lost or stolen Senior Note shall constitute an original additional
contractual obligation of the Company or the Guarantor, as the case may be,
whether or not the destroyed, lost or stolen Senior 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 Senior Notes of the
same series containing identical terms and provisions duly issued hereunder,
including the Guarantees.
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 Senior Notes.
SECTION 2.07. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED. Interest on
any Senior 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
Senior 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 Senior Notes is payable if so stated in the Senior Note. Notwithstanding the
foregoing, however, interest that is payable on Senior 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 Senior Notes are
continuously held by the Company through the relevant Interest Payment Date.
Any interest on any Senior 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 shall be paid by the Company or the Guarantor, at their its
election in each case, as provided in Clause (1) or Clause (2) below:
<PAGE>
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(1) The Company or the Guarantor may elect to make payment of any
Defaulted Interest to the Persons in whose names the Senior 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 or the Guarantor shall notify
the Trustee in writing of the amount of Defaulted Interest proposed to be
paid on each Senior Note and the date of the proposed payment, and at the
same time the Company or the Guarantor 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 or the Guarantor, as the case may
be, of such Special Record Date and, in the name and at the expense of the
Company or the Guarantor, shall cause notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor to be mailed
first class postage 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 or the Guarantor, 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 Senior 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 or the Guarantor 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 or the Guarantor 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 Senior Note
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Senior Note shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Senior Note.
SECTION 2.08. PERSONS DEEMED OWNERS. The Company, the Guarantor, the
Trustee and any agent of the Company, the Guarantor or the Trustee may treat the
Person in whose
<PAGE>
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name any Senior 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 Senior Note and for all other purposes whatsoever,
whether or not such Senior Note be overdue, and neither the Company, the
Guarantor, the Trustee nor any such agent shall be affected by notice to the
contrary.
SECTION 2.09. CANCELLATION OF NOTES. All Senior 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 Senior Notes
shall, if surrendered to any Person other than the Trustee, be delivered to the
Trustee and shall be promptly cancelled by the Trustee through an appropriate
notation on the Note Register and on the face of the Senior Note. The Company or
the Guarantor may at any time deliver to the Trustee for cancellation any Senior
Notes previously authenticated and delivered hereunder which the Company or the
Guarantor may have acquired in any manner whatsoever, and all Senior Notes so
delivered shall be promptly cancelled by the Trustee. No Senior Notes shall be
authenticated in lieu of or in exchange for any Senior Notes cancelled as
provided in this Section 2.09, except as expressly permitted by this Indenture.
The Trustee may, but shall not be required to, destroy any cancelled Senior
Notes and the Trustee shall deliver to the Company and the Guarantor a
certificate of any such destruction.
SECTION 2.10. APPOINTMENT OF AUTHENTICATING AGENT. 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 Senior Notes of
any series in the name and on behalf of the Trustee. 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 the Guarantor 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 or the Guarantor 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, 9.03, 9.04 and 9.05 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.
<PAGE>
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Notwithstanding any other provisions of the Indenture, the Trustee shall
have no obligation to pay the fees or expenses of any authenticating agent.
If an appointment is made pursuant to this Section 2.10 with respect to any
series of Senior Notes, such Senior Notes shall have endorsed thereon, in
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 Senior Notes of the series designated herein referred to
in the within-mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
Dated: By
-------------------------- -----------------------------
Authenticating Agent
By
-----------------------------
Authorized Signature
SECTION 2.11. SECURITIES ISSUABLE IN THE FORM OF DEPOSITORY NOTES. (a) If
the Company shall establish pursuant to Section 2.01 that the Senior Notes of a
particular series are to be issued in the form of one or more Depository Notes,
then the Company and the Guarantor 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, Depository Notes, each including a
Guarantee, which (i) shall represent, and shall be denominated in an aggregate
amount equal to the aggregate principal amount of, all of the Outstanding Senior
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 Senior 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 Notes 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
<PAGE>
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successor Depository for such series selected or approved by the Company or to a
nominee of such successor Depository.
(c) If at any time the Depository for a series of Senior 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
Senior Notes of such series and the Company and the Guarantor will execute, and
the Trustee will authenticate and deliver, Senior 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
Notes of such series then Outstanding in exchange for such Depository Notes. In
addition, the Company may at any time determine that the Senior Notes of any
series shall no longer be represented by a Depository Notes and that the
provisions of this Section 2.11 shall no longer apply to the Senior Notes of
such series. In such event the Company and the Guarantor will execute and the
Trustee, upon receipt of an Officers' Certificate evidencing such determination
by the Company, will authenticate and deliver Senior 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
Notes of such series in exchange for such Depository Notes. Upon the exchange of
the Depository Notes for such Senior Notes in definitive registered form without
coupons, in authorized denominations, the Depository Notes shall be cancelled by
the Trustee. Such Senior Notes in definitive registered form issued in exchange
for the Depository Notes 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.
SECTION 2.12. BENEFIT OF GUARANTEE. (a) Each Holder of a Senior Note
shall have the benefit of the Guarantee in substantially the form set forth
herein. Such Guarantee shall be endorsed on each Senior Note authenticated and
delivered by the Trustee (or the authenticating agent) and such Guarantee shall
constitute an integral part of each such Senior Note. Each such Guarantee shall
be signed on behalf of the Guarantor prior to the authentication of the Senior
Note on which it is endorsed, and the delivery of such Senior Note by the
Trustee (or the authenticating agent), after the authentication thereof, shall
constitute due delivery of such Guarantee on behalf of the Guarantor.
(b) The Guarantor may, without the consent of any Holder of a Senior Note,
assume all of the rights and obligations of the Company hereunder with respect
to a series of Senior Notes and under the Senior Notes of such series if, after
giving effect to such assumption, no Event of Default shall have occurred and be
continuing. Upon such an assumption, the Guarantor shall execute a supplemental
indenture evidencing its assumption of all such rights and obligations of
<PAGE>
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the Company and the Company shall be released from its liabilities hereunder and
under such Senior Note as obligor thereon.
(c) The Guarantor shall assume all of the rights and obligations of the
Company hereunder with respect to a series of Senior Notes and under the Senior
Notes of such series if, upon a default by the Company in the due and punctual
payment of the principal, premium, if any, or interest on such Senior Notes, the
Guarantor is prevented by any court order or judicial proceeding from fulfilling
its obligations with respect to such series of Senior Notes. Such assumption
shall result in the Senior Notes of such series becoming the direct obligations
of the Guarantor and shall be effected without the consent of the Holders of the
Senior Notes of any series. Upon such an assumption, the Guarantor shall execute
a supplemental indenture evidencing its assumption, the Guarantor shall execute
a supplemental indenture evidencing its assumption of all such rights and
obligations of the Company, and the Company shall be released from its
liabilities hereunder and under such Senior Notes as obligor on the Senior Notes
of such series.
SECTION 2.13. CUSIP NUMBERS. The Company in issuing the Senior Notes may
use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall
use "CUSIP" numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Senior Notes or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Senior Notes, and any such
redemption shall not be affected by any defect in or omission of such numbers.
ARTICLE III
COVENANTS OF THE COMPANY
SECTION 3.01. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST. The Company
will duly and punctually pay the principal of (and premium, if any) and interest
on the Senior Notes in accordance with the terms of the Senior Notes and this
Indenture.
SECTION 3.02. MAINTENANCE OF OFFICE OR AGENCY. The Company shall appoint
a Paying Agent which will maintain an office or agency at each place at which
the principal of (and premium, if any) or interest on any of the Senior Notes is
payable, where Senior Notes may be presented or surrendered for payment, where
Senior Notes may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Company in respect of the Senior 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 Paying Agent 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 Corporate Trust Office of the
<PAGE>
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Trustee, and the Company hereby appoints the Trustee its agent to receive all
such presentations, surrenders, notices and demands.
SECTION 3.03. MONEY FOR NOTE PAYMENTS TO BE HELD IN TRUST. If the Company
shall at any time also 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.
The Company shall, on or before each due date of the principal of (and
premium, if any) or interest on, any of the Senior Notes, deposit with its
Paying Agent or Paying Agents, as the case may be, 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 Senior 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;
(2) give the Trustee notice of any default by the Company, the
Guarantor (or any other obligor upon the Senior 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.
<PAGE>
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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 Senior 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 Senior 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. CORPORATE EXISTENCE. Except as herein otherwise expressly
provided, the Company will carry on and conduct and will cause to be carried on
and conducted its business or businesses in a proper and efficient manner and do
or cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence, rights and franchises, provided that the Company
may cease to operate any business, premises, property or operations or dispose
of or allow to lapse any of its rights or franchises if it is advisable and in
the best interests of the Company to do so, but the Company may not cease to
operate or dispose of all or substantially all of its assets except in
accordance with Article XI hereof. The parties hereto acknowledge that the
Company and its Subsidiaries intend to sell, assign, transfer or otherwise
dispose of, from time to time, certain of their finance receivables and related
assets in transactions commonly known as asset securitization transactions and
agree that notwithstanding anything contained in this Indenture or in the Senior
Notes, such transactions shall not constitute an Event of Default or be deemed
to be prevented or restricted by anything contained herein or in the Senior
Notes.
SECTION 3.05. MAINTENANCE OF ACCOUNTS. The Company will keep or cause to
be kept proper books of account, and will, if and whenever required in writing
by the Trustee, file with the Trustee within 15 days copies of annual or
periodic reports and information, documents or other reports which the Company
has furnished to its shareholder or shareholders after the date hereof, but only
to the extent that such annual and periodic reports are filed with the Ontario
Securities Commission and made available to the general public, or are required
to be filed with the SEC pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
SECTION 3.06. STATEMENT AS TO COMPLIANCE. 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
<PAGE>
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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 3.07. NOT SUBJECT PROPERTY TO LIEN WITHOUT SECURING NOTES
RATEABLY; WAIVER OF COVENANT. So long as any of the Senior Notes remain
outstanding, the Company will not create, incur or assume any mortgage,
hypothecation, charge, security interest, lien, encumbrance, pledge or other
security ("Security") upon the whole or any part of its undertaking or property,
real or personal, present or future, to secure any loan or other indebtedness,
present or future, for Money Borrowed or to secure any guarantee by the Company
of any loan or other indebtedness, present or future, for Money Borrowed, nor
will the Company permit any Security securing indebtedness of another
corporation to extend to any assets of the Company as a result of the
amalgamation of the Company with, or the sale of all or substantially all of the
Company's assets to, such other corporation or as a result of the purchase by
the Company from such other corporation of all or any part of its assets,
unless, in either case, the same Security shall have been or shall as soon as
reasonably practicable thereafter be created in favor of and be extended equally
to and rateably with the Senior Notes then outstanding; provided that the
covenants contained in this section 3.07 shall not apply to or operate to
prevent:
(a) the Company issuing or becoming liable on any Purchase Money
Obligation or creating or assuming any Purchase Money Mortgage; or
(b) the continuation of any Security existing on the date of this
Indenture; or
(c) the assumption by the Company of any Security on any property, real or
personal, in existence at the time of acquisition thereof; or
(d) the continuation of any Purchase Money Mortgage existing on the date
of an amalgamation of the Company with, or the transfer of all or
substantially all of the Company's assets to, or the transfer to the
Company of all or any part of the other corporation's assets from,
another corporation; for purposes of this clause (d), the word
"Company" contained in the definition of "Purchase Money Mortgage" and
"Purchase Money Obligation" shall be deemed to mean such other
corporation; or
(e) any Security for Money Borrowed of the Company the amount of which,
when aggregated with the amount of all other Money Borrowed of the
Company and of its Subsidiaries then outstanding in respect of which
Security has been given, excluding any Security pursuant to the other
exceptions referred to herein, would not exceed 10% of Consolidated
Shareholders' Equity; or
(f) the giving of Security to secure the Senior Notes;
<PAGE>
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(g) any Security not related to the borrowing of money incurred or arising
by operation of law in the ordinary course of business;
(h) the Company from accepting deposits and investing such deposits and
other monies of the Company in investments which, under applicable
laws governing the Company, are required to be held in trust for, or
earmarked and set aside in respect of, or otherwise made available
for, the satisfaction of the Company's liabilities to the Persons
making such deposits; or
(i) the Company pledging assets to the government of Canada with respect
to the sale of Canada Savings Bonds or with respect to other similar
activities of the Company carried out in the ordinary course of
business.
The Company may fail or omit in any particular instance to comply with the
covenants set forth in this Section 3.07 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 Senior 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.
For the purposes of this Section 3.07, the indicated capitalized terms
shall have the following meaning:
"Consolidated Shareholders' Equity" means at any time the paid-in capital
plus retained earnings, or minus deficit, as the case may be, plus any other
amount which in accordance with generally accepted accounting principles would
be classified as part of the shareholders' equity section of a consolidated
balance sheet of the Company and its Subsidiaries, all determined in accordance
with generally accepted accounting principles;
"Money Borrowed" means any money borrowed and premium and interest in
respect thereof;
"Purchase Money Mortgage" means any mortgage, hypothecation, charge,
security interest, pledge, lien, encumbrance or other security created, issued
or assumed by the Company to secure a Purchase Money Obligation, provided that
such mortgage, charge, security interest, pledge, lien, encumbrance or other
security is limited to the property acquired in connection with the creation,
issue or assumption of such Purchase Money Obligation and is created, issued or
assumed substantially concurrently with the acquisition of such property except
in the case of immoveable property on which fixed improvements are constructed
or installed in which case the same shall be created or issued within a period
of 18 months after the acquisition of such property, and any extensions or
renewals or replacements of any such Purchase Money Mortgage
<PAGE>
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upon the same property if the principal amount of the indebtedness secured
thereby at the time of such extension, renewal or replacement is not increased;
"Purchase Money Obligation" means any indebtedness assumed by the Company
as part of, or issued or incurred to provide the Company with funds to pay, the
purchase price of moveable or immoveable property acquired by the Company,
provided that such indebtedness does not exceed 100% of the purchase price of
such property, and includes any extension, renewal, replacement or refunding of
any such Purchase Money Obligation to the extent of the principal amount
outstanding at the time of such extension, renewal, replacement or refunding.
In the case of immoveable property so acquired, such terms shall include
indebtedness issued or incurred to provide the Company with funds to pay, or to
reimburse the Company for, the purchase price of such property and expenditures
made for any fixed improvements constructed or installed thereon within a period
of 18 months after the acquisition thereof, provided such indebtedness does not
exceed 100% of the aggregate of such purchase price and of such expenditures.
SECTION 3.08. NOTICE TO TRUSTEE. The Company shall file with the Trustee
written notice of the occurrence of any default or Event of Default within five
Business Days of its becoming aware of any such default or Event of Default.
ARTICLE IV
COVENANTS OF THE GUARANTOR
SECTION 4.01. PAYMENT OF TAXES AND OTHER CLAIMS. The Guarantor 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 Guarantor shall not be
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 4.02. CORPORATE EXISTENCE. Subject to Article XI, the Guarantor
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 Guarantor shall not be required to
preserve or cause to be preserved any right or franchise if the Guarantor shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Guarantor and that the loss thereof is not disadvantageous
in any material respect to the Holders.
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SECTION 4.03. FILING OF REPORTS. The Guarantor 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 Guarantor is required to file with the SEC pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934. The Guarantor also
shall comply with the other provisions of TIA 314(a).
SECTION 4.04. NOT SUBJECT PROPERTY TO LIEN WITHOUT SECURING NOTES
RATEABLY; WAIVER OF COVENANT. (a) The Guarantor 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, cash deposit or
other recourse obligation with or for any Subsidiary or in connection with the
sale, securitization or discount by the Guarantor 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
Guarantor whether such property is owned at the date of this Indenture or
thereafter acquired, without making effective provision whereby the Guarantees
(together with, if the Guarantor shall so determine, any other indebtedness
issued, assumed or guaranteed by the Guarantor and then existing or thereafter
created) shall be secured by such mortgage equally and rateably with (or, at the
option of the Guarantor, 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 Guarantor 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
Guarantor, or (B) to secure any indebtedness issued, assumed or guaranteed
by the Guarantor 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 Guarantor 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;
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(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 Guarantor;
(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 Guarantor;
(4) mortgages to secure indebtedness of the Guarantor to any
Subsidiary or of any Subsidiary to another 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
Guarantor may, without equally and rateably securing the Guarantee, 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 Guarantor existing at such time and secured by mortgages not
so excepted, does not at the time exceed 10% of the Guarantor's Consolidated Net
Worth. "Consolidated Net
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Worth" shall be the difference between the Guarantor's consolidated assets and
consolidated liabilities as shown on the Guarantor's most recent audited
consolidated financial statements prepared in accordance with United States
generally accepted accounting principles.
(c) An arrangement with any Person providing for the leasing by the
Guarantor of any property, which property has been or is to be sold or
transferred by the Guarantor to such Person with the intention that such
property be leased back to the Guarantor, 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
Guarantor.
The Guarantor may fail or omit in any particular instance to comply with
the covenant set forth in this Section 4.04 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 Senior 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.
SECTION 4.05. STATEMENT AS TO COMPLIANCE. The Guarantor 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 Guarantor 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.
ARTICLE V
REPAYMENT AT OPTION OF HOLDERS
SECTION 5.01. OPTIONAL REPAYMENT OF NOTES. If the Board Resolution or
supplemental indenture, as the case may be, with respect to the Senior Notes of
any particular series so provides, such Senior 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 Senior Notes, upon the receipt by the Company of the form entitled
'Option to Elect Repayment' as specified in Section 5.02 or such optional
notification procedure as may be specified in such Senior Notes.
SECTION 5.02. REPAYMENT PROCEDURE FOR NOTES. To be repaid at the option
of the Holder, unless additional or substitute procedures are set forth in the
Senior Notes, Senior Notes must be received, with the form entitled "Option to
Elect Repayment" on the reverse of the
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Notes duly completed, by the Trustee at its designated office (or at such other
place of which the Company shall from time to time notify the Holders of the
Senior Notes) within the periods specified by the terms of the Senior Notes.
Effective exercise of the repayment option by the Holder shall be irrevocable.
Upon such completion and receipt of the applicable form, Senior 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 Senior 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 or Guarantor shall default in the payment of
the repayment price) such Senior Notes shall cease to bear interest.
ARTICLE VI
REDEMPTION OF NOTES; SINKING FUNDS
SECTION 6.01. APPLICABILITY OF REDEMPTION PROVISIONS. Senior 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 VI.
SECTION 6.02. ELECTION TO REDEEM; NOTICE TO TRUSTEE. The election of the
Company to redeem Senior 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 Senior 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
Senior 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 Senior Notes to be redeemed.
SECTION 6.03. SELECTION BY TRUSTEE OF NOTES TO BE REDEEMED. If less than
all the Senior Notes of any series are to be redeemed, and unless otherwise
provided with respect to the Senior Notes of any particular series, the
particular Senior Notes to be redeemed shall be selected by the Trustee from the
Outstanding Senior 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 Senior Notes, provided, however, that except with respect to Senior Notes
being redeemed pursuant to the operation of a sinking fund, no such partial
redemption shall reduce the portion of the principal amount of a Senior Note of
such series not redeemed to less than the minimum denomination for a Senior Note
of that series. The portions of the principal of Senior Notes so selected for
partial redemption shall be equal to the smallest authorized denomination of the
Senior Notes of such series or an integral multiple thereof.
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The Trustee shall promptly notify the Company in writing of the Senior
Notes selected for redemption and, in the case of any Senior 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 Senior Notes shall relate, in the
case of any Senior Note redeemed or to be redeemed only in part, to the portion
of the principal of such Senior Note which has been or is to be redeemed.
SECTION 6.04. NOTICE OF REDEMPTION. Notice of redemption shall be given
not less than 30 nor more than 60 days prior to the Redemption Date, to each
Holder of Senior Notes to be redeemed, at his address appearing in the Note
Register.
All notices of redemption shall state:
(1) the series designation of the Senior Notes to be redeemed,
(2) the Redemption Date,
(3) the Redemption Price,
(4) if less than all Outstanding Senior Notes of such series are to be
redeemed, the identification (and, in the case of partial redemption, the
respective principal amounts) of the Senior Notes of such Holder to be
redeemed,
(5) that on the Redemption Date the Redemption Price will become due
and payable upon each such Senior Note, and that, if applicable, interest
thereon shall cease to accrue from and after said date,
(6) the place where such Senior 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 Senior Notes is
payable,
(7) if Senior Notes are to be redeemed pursuant to any sinking or
purchase fund established for any series of Senior Notes, that the
redemption is being made for the purposes of such sinking or purchase fund,
and
(8) CUSIP number, if any.
Notice of redemption of Senior 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.
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SECTION 6.05. DEPOSIT OF REDEMPTION PRICE. 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 Senior Notes which are to be redeemed on
that date.
SECTION 6.06. NOTES PAYABLE ON REDEMPTION DATE. Notice of redemption
having been given as aforesaid, the Senior 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 Senior Notes shall cease to bear interest.
Upon surrender of such Senior Notes for redemption in accordance with such
notice, such Senior 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 Senior Notes of record on the relevant
Record Dates according to their terms and the provisions of Section 2.07.
If any Senior 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
Senior Note.
SECTION 6.07. NOTES REDEEMED IN PART. Any Senior 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 and the Guarantor shall execute and the Trustee shall authenticate
and deliver to such Holder, without service charge, a new Senior Note or Senior
Notes of the same series, including the Guarantee, 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 Senior Note
so surrendered.
SECTION 6.08. SINKING FUNDS. The provisions of this Article VI shall be
applicable to any sinking fund for the retirement of Senior Notes of any series
except as otherwise specified as contemplated in such Senior Notes.
The minimum amount of any sinking fund payment provided for by the terms of
Senior 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 Senior Notes of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Senior Notes of any
series, the cash amount of any sinking fund payment may be subject to reduction
as provided in Section 6.09. Each sinking fund payment shall be applied to the
redemption of Senior Notes of any series as provided for by the terms of Senior
Notes of such series.
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SECTION 6.09. SATISFACTION OF SINKING FUND PAYMENTS WITH NOTES. The
Company (1) may deliver to the Trustee for cancellation Outstanding Senior Notes
of a series (other than any previously called for redemption) and (2) may apply
as a credit Senior 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 Senior Notes or through the application of permitted optional
sinking fund payments pursuant to the terms of such Senior Notes, in each case
in satisfaction of all or any part of any mandatory sinking fund payment with
respect to the Senior Notes of such series required to be made pursuant to the
terms of such Senior Notes as provided for by the terms of such Senior Notes;
provided that such Senior Notes shall not have been previously so credited. Such
Senior Notes shall be received and credited for such purpose by the Trustee at
the Redemption Price specified in such Senior Notes for redemption through
operation of the mandatory sinking fund and the amount of such mandatory sinking
fund payment shall be reduced accordingly.
SECTION 6.10. REDEMPTION OF NOTES FOR SINKING FUNDS. Not less than 45 days
prior to each sinking fund payment date for Senior 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 Senior 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 Senior Notes of that series pursuant to Section 6.09 and will also
deliver with the said Officers' Certificate to the Trustee any Senior 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 Senior
Notes to be redeemed upon such sinking fund payment in the manner specified in
Section 6.03 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
6.04. The Company or the Guarantor shall deposit the amount of cash, if any,
required for such sinking fund payment with the Trustee in the manner provided
in Section 6.05. Such notice having been duly given, the redemption of such
Senior Notes shall be made upon the terms and in the manner stated in Sections
6.06 and 6.07.
ARTICLE VII
SATISFACTION AND DISCHARGE
SECTION 7.01. SATISFACTION AND DISCHARGE OF INDENTURE. This Indenture
shall cease to be of further effect (except as to any surviving rights of
registration of transfer or exchange of Senior Notes if herein or in any
supplemental indenture expressly provided for), and the Trustee, on demand of
and at the expense of the Company or the Guarantor, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture, when
(1) either
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(A) all Senior Notes theretofore authenticated and delivered (other
than (i) Senior Notes which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 2.06, and (ii) Senior
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 3.02) have
been delivered to the Trustee for cancellation; or
(B) all such Senior 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 of discharging and undertakes an amount sufficient to pay and
discharge the entire indebtedness on such Senior Notes not theretofore
delivered to the Trustee for cancellation, for principal (and premium, if
any) and interest to the date of such deposit (in the case of Senior Notes
which have become due and payable), or to their Stated Maturity or
Redemption Date, as the case may be; and
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company or the Guarantor; 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 9.07, 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 (1) of
this Section, the obligations of the Trustee under Section 7.02 and the last
paragraph of Section 3.02 shall survive.
SECTION 7.02. APPLICATION OF TRUST MONEY. Subject to the provisions of
the last paragraph of Section 3.02, all money deposited with the Trustee
pursuant to Section 7.01 shall be held in trust and applied by it, in accordance
with the provisions of the Senior Notes and this Indenture, to the payment,
either directly or through any Paying Agent (including the Company
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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 7.03. SATISFACTION, DISCHARGE, AND DEFEASANCE OF NOTES OF ANY
SERIES. Unless this Section 7.03 shall be deemed inapplicable to a series of
Senior 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 Senior 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 Senior Notes of such series,
(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 Senior 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 7.03, 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 Senior
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 7.03, 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 Senior Notes of such series; and
(2) the Company has paid or caused to be paid all other sums payable with
respect to the Outstanding Senior 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
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(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 Senior Notes of any such
series have been complied with.
Any deposits with the Trustee referred to in Section 7.03(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 Senior 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 7.03 with
respect to all the Outstanding Senior 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 or the Guarantor, other than the provisions of
Sections 2.06 and 2.07 and other than the right of Holders of Senior Notes of
such series to receive, from the trust fund described in this Section, payment
of the principal of and the interest on such Senior 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
9.07).
SECTION 7.04. REINSTATEMENT. If the Trustee is unable to apply any money
in accordance with Section 7.01 or 7.03 by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's and Guarantor's obligations
under this Indenture and the Senior Notes shall be revived and reinstated as
though no deposit had occurred pursuant to this Article Seven until such time as
the Trustee is permitted to apply all such money in accordance with Section 7.01
or 7.03; provided, however, that if the Company makes any payment of principal
of (and premium, if any) or interest on any Senior Notes following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Senior Notes to receive such payment from the money held
by the Trustee.
ARTICLE VIII
REMEDIES
SECTION 8.01. EVENTS OF DEFAULT. "Event of Default", wherever used herein
with respect to Senior 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
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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
Senior 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 Senior Note of that series at its Maturity; or
(3) default in the deposit under Section 6.10 of any instalment of any
sinking fund or similar payment with respect to Senior Notes of that 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 or the Guarantor in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere in
this Section 8.01 specifically dealt with or which has expressly been
included in the Indenture solely for the benefit of Senior 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 or the Guarantor a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect of
the Company or the Guarantor 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 the Guarantor 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 or the Guarantor 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, in the case of the Company, the Companies Creditors
Arrangement Act (Canada), the Bankruptcy Act (Canada) or the Winding-up Act
(Canada) or any other bankruptcy, insolvency or analogous law, or in the
case of the Guarantor, 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 the
Guarantor 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
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to pay its debts generally as they become due, or the taking of corporate
action by the Company or the Guarantor in furtherance of any such action;
or
(7) default by the Company or the Guarantor 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 Senior Notes,
under an indenture in which the Trustee is acting as the trustee for
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 Senior Notes under clause (4) or
clause (7) is not an Event of Default until the Trustee notifies the Company and
the Guarantor, or the Holders of at least 25% in principal amount of the
outstanding Senior Notes of that series notify the Company, the Guarantor and
the Trustee, of the default and the Company and the Guarantor do 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 8.02. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. 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 Senior Notes
of that series may declare the principal of all the Senior Notes of that series
(or, if the Senior 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
Senior Notes) and all accrued but unpaid interest to be due and payable
immediately, by a notice in writing to the Company and the Guarantor (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 VIII provided, the Holders of a
majority in principal amount of the Senior Notes then Outstanding of that
series, by written notice to the Company, the Guarantor and the Trustee, may
rescind and annul such declaration and its consequences if
(1) the Company or the Guarantor has paid or deposited with the Trustee a
sum sufficient to pay
(A) all overdue installments of interest, if any, on all Senior Notes
of that series,
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(B) the principal of (and premium, if any, on) any Senior 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 Senior Notes of that series,
(C) to the extent that payment of such interest is lawful, interest
upon overdue installments of interest, if any, at the rate or the
respective rates borne by the Senior 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
Senior Notes of that series which have become due solely by such acceleration,
have been cured or waived as provided in Section 8.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 8.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE. The Company and the Guarantor covenant that if
(1) default is made in the payment of any instalment of interest on any
Senior 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 Senior
Notes at the Maturity thereof,
the Company or the Guarantor will, upon demand of the Trustee or the Holders of
not less than 25% in principal amount of such Outstanding Senior Notes, pay to
the Trustee, for the benefit of the Holders of such Senior Notes, the whole
amount then due and payable on such Senior 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 installments of interest, at the rate or respective
rates borne by such Senior 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 reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
If the Company and the Guarantor fail 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 and the Guarantor
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or any other obligor upon the Senior Notes and collect the moneys adjudged or
decreed to be payable in the manner provided by law out of the property of the
Company and the Guarantor or any other obligor upon the Senior 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 8.04. TRUSTEE MAY FILE PROOFS OF CLAIM. In case of the pendency
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Company, the Guarantor or any other obligor upon the Senior Notes or the
property of the Company, the Guarantor or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Senior
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 or the Guarantor 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 Senior
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
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
9.07.
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 8.05. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF NOTES. All
rights of action and claims under this Indenture or the Senior Notes may be
prosecuted and
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enforced by the Trustee without the possession of any of the Senior 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 rateable benefit of the Holders
of the Senior Notes in respect of which such judgment has been recovered.
SECTION 8.06. APPLICATION OF MONEY COLLECTED. Any money collected by the
Trustee pursuant to this Article VIII 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 Senior 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
9.07;
SECOND: To the payment of the amounts then due and unpaid upon the
Senior Notes for principal (and premium, if any) and interest, in respect
of which or for the benefit of which such money has been collected,
rateably, without preference or priority of any kind, according to the
amounts due and payable on such Senior Notes for principal (and premium, if
any) and interest, respectively; and
THIRD: To the payment of the remainder, if any, to the Company, the
Guarantor or any other Person lawfully entitled thereto.
For all purposes of this Section 8.06, the Holders of any Senior Notes
denominated in ECU, or any other composite currency or a Foreign Currency shall
be entitled to receive a rateable portion of the payment determined pursuant to
Section 1.04(f) hereof.
SECTION 8.07. LIMITATIONS ON SUITS. No Holder of any Senior 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 Senior Notes of that
series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Senior 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;
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(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 Senior 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 rateable benefit of all the Holders.
SECTION 8.08. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM
AND INTEREST. Notwithstanding any other provision in this Indenture, the Holder
of any Senior 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 Senior Note on the respective Stated Maturities
expressed in such Senior Note (or, in the case of redemption, on the Redemption
Date) and to institute suit for the enforcement of any such payment, and such
right shall not be impaired without the consent of such Holder.
SECTION 8.09. RESTORATION OF RIGHTS AND REMEDIES. 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 Guarantor, 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 8.10. RIGHTS AND REMEDIES CUMULATIVE. 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 8.11. DELAY OR OMISSION NOT WAIVER. 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 VIII or by law to the Trustee
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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 8.12. CONTROL BY HOLDERS. The Holders of a majority in principal
amount of the Outstanding Senior 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 8.13. WAIVER OF PAST DEFAULTS. The Holders of a majority in
principal amount of the Outstanding Senior Notes of any series affected by an
Event of Default may on behalf of the Holders of such series of Senior 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 Senior Note of such series, or
(2) in respect of a covenant or provision hereof which under Section
12.02 cannot be modified or amended without the consent of the Holder of
each Outstanding Senior 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 8.14. UNDERTAKING OF COSTS. All parties to this Indenture agree,
and each Holder of any Senior 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 8.14 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 Senior 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 Senior Note on or after
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the respective Stated Maturities expressed in such Senior Note for such interest
(or, in the case of redemption, on or after the Redemption Date).
SECTION 8.15. WAIVER OF STAY OR EXTENSION LAWS. Each of the Company and
the Guarantor covenant (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 each of the Company and the Guarantor (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 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 IX
TRUSTEE
SECTION 9.01. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. (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 9.01;
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(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 direction
of the Holders of a majority in principal amount of the Outstanding Senior
Notes determined as provided in Section 1.01 and 1.04 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 9.02. NOTICE OF DEFAULT. 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 Senior 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 8.01(4) no such notice
to Holders shall be given until at least 60 days after the occurrence thereof.
For the purpose of this Section 9.02 the term 'default' means any event which
is, or after notice or lapse of time or both would become, an Event of Default.
SECTION 9.03. CERTAIN RIGHTS OF TRUSTEES. Except as otherwise provided in
Section 9.01:
(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 or the Guarantor 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;
(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
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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 of its selection and the 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 security or indemnity, reasonably satisfactory to the Trustee,
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 or the Guarantor, personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers 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 9.04. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF NOTES. The
recitals contained herein and in the Senior Notes, except the certificate of
authentication, shall be taken as the statements of the Company or the
Guarantor, as the case may be, 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 Senior Notes. The Trustee shall not be
accountable for the use or application by the Company or the Guarantor of Senior
Notes or the proceeds thereof.
SECTION 9.05. MAY HOLD NOTES. The Trustee, any Paying Agent, Note
Registrar or any other agent of the Company or the Guarantor, in its individual
or any other capacity, may become the owner or pledgee of Senior Notes and,
subject to Sections 9.08 and 9.09 may otherwise deal with the Company or the
Guarantor with the same rights it would have if it were not Trustee, Paying
Agent, Note Registrar or such other agent.
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SECTION 9.06. MONEY HELD IN TRUST. 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 and the
Guarantor.
SECTION 9.07. COMPENSATION AND REIMBURSEMENT. The Company and the
Guarantor, jointly and severally agree
(1) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing 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, damage, claims, liability or expense incurred, including taxes (other
than taxes based upon, or measured by, the income of the Trustee) 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 9.07 the Trustee shall have a lien prior to the Senior Notes for
any amount owing to it or to any predecessor Trustee 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 Senior
Notes.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 8.01(5) or Section 8.01(6), the expenses
(including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
SECTION 9.08. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY; DISQUALIFICATION;
CONFLICTING INTERESTS. (a) This Indenture shall always have a Trustee with
respect to the Senior Notes of each series which satisfies the requirements of
TIA 310(a)(1). The Trustee shall always
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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 310(b), including the optional provision
permitted by the second sentence of TIA 310(b)(9); it being understood that for
the purposes of this Indenture, with respect to Senior Notes of any series, the
provisions of TIA 310(b) with respect to conflicting interests relating to
'other securities' shall be interpreted to include Senior Notes of each other
series and with respect to 'other indentures' shall include the provisions of
this Indenture relating to the Senior Notes of such other series.
SECTION 9.09. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. The
Trustee is subject to TIA 311(a), excluding any creditor relationship listed in
TIA 311(b). A Trustee who has resigned or been removed shall be subject to TIA
311(a) to the extent indicated.
SECTION 9.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. (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 9.11.
(b) The Trustee may resign at any time by giving written notice thereof to
the Company and the Guarantor. 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 Senior Notes, delivered to the
Trustee, the Company and the Guarantor.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 9.08(b) after
written request therefor by the Company, the Guarantor or by any Holder who
has been a bona fide Holder for at least six months, or
(2) the Trustee shall cease to be eligible under Section 9.08(a) and
shall fail to resign after written request therefor by the Company or the
Guarantor 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,
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then, in any such case, (i) the Company or the Guarantor, individually and not
jointly by a Board Resolution may remove the Trustee, or (ii) subject to Section
8.14, 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 Senior 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 9.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. Every successor
Trustee appointed hereunder shall execute, acknowledge and deliver to the
Company and the Guarantor and to the retiring Trustee an instrument accepting
such appointment, and thereupon the resignation or removal of the retiring
Trustee shall become effective and 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 and the
Guarantor 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 9.07. Upon request of any such successor
Trustee, the Company and the Guarantor 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 IX.
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SECTION 9.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
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 IX,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Senior 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 Senior Notes so authenticated with the same
effect as if such successor Trustee had itself authenticated such Senior Notes.
ARTICLE X
HOLDER'S LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 10.01. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF HOLDERS.
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 November 1, 1993, 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 10.02. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(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 10.01 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 10.01
upon receipt of a new list so furnished.
(b) Holders of Senior Notes may communicate pursuant to TIA 312(b) with
other Holders with respect to their rights under this Indenture or the Senior
Notes. The Company, the Guarantor the Trustee, the Senior Note Registrar, and
anyone else shall have the protection of TIA 312(c).
SECTION 10.03. REPORTS BY TRUSTEE. (a) The term 'reporting date', as used
in this Section 10.03, 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 313(a). The Trustee shall also comply with TIA
313(b).
<PAGE>
-61-
(b) Reports pursuant to this Section 10.03 shall be transmitted by mail:
(1) to all Holders of Senior Notes, as the names and addresses of such
Holders appear in the Note Register;
(2) to such Holders of Senior 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 to TIA
313(b), to all Holders of Senior Notes whose names and addresses have been
furnished to or received by the Trustee pursuant to Section 10.01.
(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 Senior
Notes are listed, and also with the Commission. The Company will notify the
Trustee when the Senior Notes are listed on any stock exchange.
ARTICLE XI
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 11.01. GUARANTOR MAY CONSOLIDATE, ETC. ONLY ON CERTAIN TERMS. The
Guarantor 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
Guarantor is merged or the Person which acquires by conveyance, transfer,
sale or lease the properties and assets of the Guarantor 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 Senior Notes pursuant to the Guarantee and the
performance of every covenant of this Indenture on the part of the
Guarantor 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 Guarantor 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 11.01 and that all conditions precedent herein provided for
relating to such transaction have been complied with.
<PAGE>
-62-
SECTION 11.02. COMPANY MAY CONSOLIDATE, ETC. ONLY ON CERTAIN TERMS.
Notwithstanding anything contained in this Indenture or in the Senior Notes, a
resolution or order for winding-up the Company or any other proceedings taken
with a view to its reconstruction or its reorganization or its consolidation,
amalgamation or merger with or into another corporation, or any other
transaction or proceedings resulting in the amalgamation of the Company with
another corporation or the transfer, sale or conveyance of all or substantially
all the Company's undertaking or assets to another Person shall not constitute
an Event of Default or be deemed to be prevented or restricted by anything
contained herein or in the Senior Notes, if the Person resulting from such a
reconstruction, reorganization, consolidation, amalgamation or merger or the
Person to whom such undertaking or assets are transferred, sold or conveyed, as
the case may be, (herein referred to as the "Successor") shall, within 120 days
from the passing of the resolution or the date of the order, and at or before
the taking of such other proceedings or the transfer, sale or conveyance of the
undertaking and assets of the Company to the Successor, enter into a covenant
with the Trustee or otherwise become liable in law to pay the principal and
interest and other moneys due or which may become due under this Indenture and
the Senior Notes and to perform and observe all the obligations of the Company
under this Indenture, and shall sign and execute all such deeds and documents as
the Trustee may be advised by counsel are necessary or advisable in the
circumstances.
Provided, however, that the Company shall not engage in any
transaction referred to in the foregoing paragraph unless the Trustee has been
satisfied that the following conditions have been complied with:
(1) the Successor is a corporation incorporated or a partnership formed
under the laws of Canada or of the United States of America or under
any of the respective political subdivisions thereof;
(2) at the time of and immediately after the consummation of the
transaction no condition or event shall exist which constitutes or
which would, after the lapse of time of giving of notice or both,
constitute an Event of Default hereunder;
(3) the Successor is lawfully entitled to acquire and operate the
undertaking and assets; and
(4) in the opinion of counsel to the Trustee, the transaction is upon such
terms as substantially to preserve and not to impair any of the rights
and powers of the Trustee or of the Holders hereunder.
The Trustee may accept and rely on an opinion of counsel that
conditions prescribed in this section 11.02 have been complied with and upon
obtaining such opinion the Trustee shall join in such documents and do such acts
as may be required or thought advisable to consent to or give effect to such
reconstruction, reorganization, consolidation, amalgamation,
<PAGE>
-63-
merger, transfer, sale or conveyance and to release and discharge the Company
from liability under this Indenture and the Senior Notes.
SECTION 11.03. SUCCESSOR CORPORATION SUBSTITUTED. Upon any consolidation
or merger, or any conveyance, transfer, sale or lease of the properties and
assets of the Company or the Guarantor, as the case may be, as, or substantially
as, an entirety in accordance with Sections 11.01 or 11.02, the successor
corporation formed by such consolidation or into which the Company or the
Guarantor 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 or the Guarantor, as the case may be, under this Indenture with
the same effect as if such successor corporation had been named as the Company
or the Guarantor respectively herein, and thereafter, except in the case of a
lease, the predecessor corporation shall be relieved of all obligations and
covenants under this Indenture, the Senior Notes or the Guarantees as
applicable.
ARTICLE XII
SUPPLEMENTAL INDENTURES
SECTION 12.01. SUPPLEMENTAL INDENTURE WITHOUT CONSENT OF HOLDERS. Without
the consent of any Holder, the Company, the Guarantor 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 Senior Notes;
(2) to evidence the succession of another corporation to the Company
or the Guarantor, and the assumption by any such successor of the covenants
of the Company or the Guarantor herein and in the Senior Notes contained;
(3) to add to the covenants of the Company or the Guarantor for the
benefit of the Holders of all or any series of Senior Notes (and if such
covenants are to be for the benefit of less than all series of Senior
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 or the Guarantor;
(4) to mortgage, pledge, convey, assign and transfer to the Trustee
any property or assets as security for the Senior 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 or the
Guarantor and the Trustee, or to correct or amplify the description of
<PAGE>
-64-
any such property or assets at any 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 Senior 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 Senior Notes issued hereunder;
(7) to provide for uncertificated Senior Notes in addition to
certificated Senior 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
Senior 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 Senior 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 9.11; or
(10) to make any change that does not adversely affect the rights of
any Holder of Senior Notes which are Outstanding.
SECTION 12.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS. Subject
to the provisions of Section 8.12 and Section 8.13, with the consent of the
Holders of not less than a majority in principal amount of the Outstanding
Senior 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, the Guarantor 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 Senior 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 Senior Note affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment
of interest on, any Senior Note, or reduce the principal amount thereof or
the interest thereon or any premium payable upon the redemption 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 Senior
<PAGE>
-65-
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
Senior 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 12.02 or Section
8.13, 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 Senior 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 9.11 and
12.01(9).
It shall not be necessary for any Act of Holders under this Section 12.02
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve substance thereof.
SECTION 12.03. EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article XII or the modification thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Section
9.01) 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 or the Guarantor 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.
SECTION 12.04. EFFECT OF SUPPLEMENTAL INDENTURES. Upon the execution of
any supplemental indenture under this Article XII, 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 Senior Notes
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby.
SECTION 12.05. CONFORMITY WITH TRUST INDENTURE ACT. Every supplemental
indenture executed pursuant to this Article XII shall conform to the
requirements of TIA as then in effect.
<PAGE>
-66-
SECTION 12.06. REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES. Senior
Notes authenticated and delivered after the execution of any applicable
supplemental indenture pursuant to this Article XII 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 Senior 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 Senior Notes.
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.
<PAGE>
-67-
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 FINANCIAL CORPORATION LIMITED
By /s/ Thomas M. Kimble
-------------------------------------
President
Attest:
/s/ Patrick D. Schwartz
- ------------------------
Assistant Secretary
(CORPORATE SEAL)
HOUSEHOLD INTERNATIONAL, INC.
BY /s/ Edgar Ancona
-------------------------------------
Vice President
Attest:
/s/ Susan E. Casey
- ------------------------
Assistant Secretary
(CORPORATE SEAL)
THE BANK OF NEW YORK,
AS TRUSTEE
BY /s/ Walter N. Gitlin
-------------------------------------
Vice President
Attest:
/s/ Robert F. McIntyre
- ------------------------
Assistant Vice President
(CORPORATE SEAL)
<PAGE>
EXHIBIT 4(b)
HOUSEHOLD FINANCIAL CORPORATION LIMITED,
AS ISSUER
AND
HOUSEHOLD INTERNATIONAL, INC.
AS GUARANTOR
AND
LASALLE NATIONAL TRUST, N.A.,
AS TRUSTEE.
---------------------------
INDENTURE
DATED AS OF MAY 15, 1993
---------------------------
PROVIDING FOR ISSUANCE OF UNCONDITIONALLY GUARANTEED SENIOR NOTES IN SERIES
<PAGE>
HOUSEHOLD FINANCIAL CORPORATION LIMITED
HOUSEHOLD INTERNATIONAL, INC.
Indenture dated as of May 15, 1993
------------------------------------
TABLE OF CONTENTS
------------------------------------
<TABLE>
<CAPTION>
PAGE
<S> <C>
PARTIES
RECITALS:
General Form of Face of Note
General Form of Reverse of Note
Form of Trustee's Certificate of Authentication
for Notes
General Form of `Option to Elect Repayment',
if applicable, for Notes
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"......................... 11
"Business Day"............................. 11
"Commission or SEC"........................ 11
"Company".................................. 11
"Company Request"; "Company Order"......... 11
"Corporate Trust Officer".................. 12
"Depository"............................... 12
"Depository Note".......................... 12
"Dollar"................................... 12
"ECU"...................................... 12
"European Communities"..................... 12
"Event of Default"......................... 12
</TABLE>
i
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
"Foreign Currency"............................................. 12
"Guarantee".................................................... 12
"Guarantor".................................................... 13
"Holder"....................................................... 13
"Indenture".................................................... 13
"Independent".................................................. 13
"Interest"..................................................... 13
"Interest Payment Date"........................................ 13
"Maturity"..................................................... 13
"Note Register"; "Note Registrar".............................. 13
"Officers' Certificate"........................................ 13
"Opinion of Counsel"........................................... 14
"Original Issue Discount Note"................................. 14
"Outstanding".................................................. 14
"Paying Agent"................................................. 15
"Person"....................................................... 15
"Predecessor Notes"............................................ 15
"Redemption Date".............................................. 15
"Redemption Price"............................................. 15
"Regular Record Date".......................................... 15
"Responsible Officer".......................................... 15
"Senior Notes"................................................. 15
"Special Record Date".......................................... 16
"Stated Maturity".............................................. 16
"Subsidiary"................................................... 16
"Trustee"...................................................... 16
"Trust Indenture Act or TIA"................................... 16
"Voting Stock"................................................. 16
SECTION 1.02 Compliance Certificates and Opinions.................. 16
SECTION 1.03 Form of Documents Delivered to Trustee................ 17
SECTION 1.04 Acts of Holders....................................... 17
SECTION 1.05 Notices, etc., to Trustee and Company................. 19
SECTION 1.06 Notices to Holders, Waiver............................ 19
SECTION 1.07 Conflict with Trust Indenture Act..................... 20
SECTION 1.08 Effect of Headings and Table of Contents.............. 20
SECTION 1.09 Successors and Assigns................................ 20
SECTION 1.10 Separability Clause................................... 20
SECTION 1.11 Benefits of Indenture................................. 20
SECTION 1.12 Governing Law......................................... 20
SECTION 1.13 Payment on Business Day............................... 20
SECTION 1.14 Incorporation by Reference of Trust Indenture Act..... 21
</TABLE>
ii
<PAGE>
<TABLE>
<CAPTION>
ARTICLE II - ISSUE, EXECUTION AND REGISTRATION OF SENIOR NOTES
<S> <C> <C>
SECTION 2.01 Issuance of Notes in Series................................ 21
SECTION 2.02 Authentication and Delivery of Notes....................... 22
SECTION 2.03 Execution of Notes......................................... 23
SECTION 2.04 Temporary Notes............................................ 24
SECTION 2.05 Exchanges and Transfers of Notes........................... 24
SECTION 2.06 Mutilated, Destroyed, Lost or Stolen Notes................. 25
SECTION 2.07 Payment of Interest; Interest Rights Preserved............. 26
SECTION 2.08 Persons Deemed Owners...................................... 28
SECTION 2.09 Cancellation of Notes...................................... 28
SECTION 2.10 Appointment of Authenticating Agent........................ 28
SECTION 2.11 Securities Issuable in the Form of a Depository Note....... 29
SECTION 2.12 Benefit of Guarantee....................................... 30
SECTION 2.13 CUSIP Numbers.............................................. 31
ARTICLE III - COVENANTS OF THE COMPANY
SECTION 3.01 Payment of Principal, Premium and Interest................. 31
SECTION 3.02 Maintenance of Office or Agency............................ 31
SECTION 3.03 Money for Note Payments to be Held in Trust................ 32
SECTION 3.04 Corporate Existence........................................ 33
SECTION 3.05 Maintenance of Accounts.................................... 33
SECTION 3.06 Statement as to Compliance................................. 33
SECTION 3.07 Not Subject Property to Lien
Without Securing Notes Rateably............................ 34
ARTICLE IV - COVENANTS OF THE GUARANTOR
SECTION 4.01 Payment of Taxes and Other Claims.......................... 36
SECTION 4.02 Corporate Existence........................................ 36
SECTION 4.03 Filing of Reports.......................................... 36
SECTION 4.04 Not Subject Property to Lien Without Securing
Notes Rateably; Waiver of Covenant......................... 37
SECTION 4.05 Statement as to Compliance................................. 39
ARTICLE V - REPAYMENT AT OPTION OF HOLDERS
SECTION 5.01 Optional Repayment of Notes................................ 39
SECTION 5.02 Repayment Procedure for Notes.............................. 39
</TABLE>
iii
<PAGE>
<TABLE>
<CAPTION>
ARTICLE VI - REDEMPTION OF NOTES; SINKING FUNDS
<S> <C> <C>
SECTION 6.01 Applicability of Redemption Provisions..................... 40
SECTION 6.02 Election to Redeem; Notice to Trustee...................... 40
SECTION 6.03 Selection by Trustee of Notes to be Redeemed............... 40
SECTION 6.04 Notice of Redemption....................................... 41
SECTION 6.05 Deposit of Redemption Price................................ 41
SECTION 6.06 Notes Payable on Redemption Date........................... 41
SECTION 6.07 Notes Redeemed in Part..................................... 42
SECTION 6.08 Sinking Funds.............................................. 42
SECTION 6.09 Satisfaction of Sinking Fund Payments with Notes........... 42
SECTION 6.10 Redemption of Notes for Sinking Fund....................... 43
ARTICLE VII - SATISFACTION AND DISCHARGE
SECTION 7.01 Satisfaction and Discharge of Indenture.................... 43
SECTION 7.02 Application Of Trust Money................................. 44
SECTION 7.03 Satisfaction, Discharge, and Defeasance
of Notes of any Series..................................... 44
SECTION 7.04 Reinstatement.............................................. 46
ARTICLE VIII - REMEDIES
SECTION 8.01 Events of Default.......................................... 46
SECTION 8.02 Acceleration of Maturity; Rescission and Annulment......... 48
SECTION 8.03 Collection of Indebtedness and Suits for
Enforcement by Trustee..................................... 49
SECTION 8.04 Trustee May File Proofs of Claim........................... 50
SECTION 8.05 Trustee May Enforce Claims Without Possession of Notes..... 50
SECTION 8.06 Application of Money Collected............................. 50
SECTION 8.07 Limitation on Suits........................................ 51
SECTION 8.08 Unconditional Right of Holders to Receive
Principal, Premium and Interest............................ 52
SECTION 8.09 Restoration of Rights and Remedies......................... 52
SECTION 8.10 Rights and Remedies Cumulative............................. 52
SECTION 8.11 Delay or Omission Not Waiver............................... 52
SECTION 8.12 Control by Holders......................................... 52
SECTION 8.13 Waiver of Past Defaults.................................... 53
SECTION 8.14 Undertaking for Costs...................................... 53
SECTION 8.15 Waiver of Stay or Extension Laws........................... 53
</TABLE>
iv
<PAGE>
<TABLE>
<CAPTION>
ARTICLE IX - THE TRUSTEE
<S> <C> <C>
SECTION 9.01 Certain Duties and Responsibilities....................... 54
SECTION 9.02 Notice of Defaults........................................ 55
SECTION 9.03 Certain Rights of Trustee................................. 55
SECTION 9.04 Not Responsible for Recitals or Issuance of Notes......... 56
SECTION 9.05 May Hold Notes............................................ 56
SECTION 9.06 Money Held in Trust....................................... 56
SECTION 9.07 Compensation and Reimbursement............................ 56
SECTION 9.08 Corporate Trustee Required; Eligibility;
Disqualification; Conflicting Interests................... 57
SECTION 9.09 Preferential Collection of Claims Against Company......... 58
SECTION 9.10 Resignation and Removal; Appointment of Successor......... 58
SECTION 9.11 Acceptance of Appointment by Successor.................... 59
SECTION 9.12 Merger, Conversion, Consolidation or
Succession to Business.................................... 59
ARTICLE X - HOLDERS' LIST AND REPORTS BY TRUSTEE AND COMPANY
SECTION 10.01 Company to Furnish Trustee Names and
Addresses of Holders...................................... 60
SECTION 10.02 Preservation of Information; Communications to
Holders................................................... 60
SECTION 10.03 Reports by Trustee........................................ 60
ARTICLE XI - CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 11.01 Guarantor May Consolidate, etc. only on Certain
Terms..................................................... 61
SECTION 11.02 Company May Consolidate, etc. only on Certain Terms....... 61
SECTION 11.03 Successor Corporation Substituted......................... 62
ARTICLE XII - SUPPLEMENTAL INDENTURES
SECTION 12.01 Supplemental Indentures Without Consent of Holders........ 63
SECTION 12.02 Supplemental Indentures With Consent of Holders........... 64
SECTION 12.03 Execution of Supplemental Indentures...................... 65
SECTION 12.04 Effect of Supplemental Indentures......................... 65
SECTION 12.05 Conformity with Trust Indenture Act....................... 65
SECTION 12.06 Reference in Notes to Supplemental Indentures............. 66
</TABLE>
v
<PAGE>
Tie of certain of Trust Indenture Act of 1939, as amended, with
Indenture dated as of May 15, 1993, among Household Financial Corporation
Limited, Household International, Inc. and LaSalle National Trust, N.A., as
Trustee/*/
<TABLE>
<CAPTION>
Section of
Section of Act Indenture
- -------------- ----------
<S> <C>
310 (a)(1)......................... 9.08
(a)(2)......................... 9.08
(a)(3)......................... Not Applicable
(a)(4)......................... Not Applicable
(b)............................ 9.08, 9.10
311 (a)............................ 9.09
(b)............................ 9.09
312 (a)............................ 10.01, 10.02(a)
(b)............................ 10.02(b)
(c)............................ 10.02(b)
313 (a)............................ 10.03(a)
(b)............................ 10.03(a)
(c)............................ 10.03(a),
10.03(b)
(d)............................ 10.03(c)
314 (a)............................ 3.05, 4.03
(b)............................ Not Applicable
(c)(1)......................... 1.02
(c)(2)......................... 1.02
(c)(3)......................... Not Applicable
(d)............................ Not Applicable
(e)............................ 1.02
315 (a)............................ 9.01(a), 9.01(c)
(b)............................ 9.02, 10.03(a)
(c)............................ 9.01(b)
(d)............................ 9.01(c)
(d)(1)......................... 9.01(c)(1)
(d)(2)......................... 9.01(c)(2)
(d)(3)......................... 9.01(c)(3)
(e)............................ 8.14
316 (a)............................ 1.01
(a)(1)(A)...................... 8.02, 8.12
(a)(1)(B)...................... 8.13
</TABLE>
vi
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
(a)(2)........................ Not Applicable
(b)........................... 8.08
317 (a)(1)........................ 8.03
(a)(2)........................ 8.04
(b)........................... 3.03
318 (a)........................... 1.07
</TABLE>
/*/ This tie of provisions does not constitute a part of the Indenture and is
for convenience of reference only.
vii
<PAGE>
THIS INDENTURE, dated as of the 15th day of May 1993, among Household
Financial Corporation Limited, a corporation incorporated under the laws of
Ontario, Canada (herein called the "Company"), having its principal place of
business at 100 Sheppard Avenue East, Suite 1000, North York, Ontario, Canada,
M2N 6N7, Household International, Inc., a corporation duly organized and validly
existing under the laws of the State of Delaware (hereinafter called the
"Guarantor"), having its principal office at 2700 Sanders Road, Prospect
Heights, Illinois 60070, and LaSalle National Trust, N.A., a national banking
association organized and existing under the laws of the United States of
America (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 senior notes 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 senior notes, or other evidences
of indebtedness (hereinafter called "Senior Notes or Notes"), issuable as in
this Indenture provided;
WHEREAS, the Guarantor has duly authorized the execution and delivery of this
Indenture and deems it appropriate from time to time to issue its guarantees of
the Senior Notes on the terms and substantially in the form herein provided (the
"Guarantees"); and
WHEREAS, the general forms of the Senior Notes, the Trustee's certificate of
authentication to be borne by the Senior 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 SENIOR 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 Senior Note is % of its principal amount and
the issue date is , 19 .]
No.
HOUSEHOLD FINANCIAL CORPORATION LIMITED
....% Senior Note
HOUSEHOLD FINANCIAL CORPORATION LIMITED, a corporation incorporated under the
laws of Ontario, Canada (hereinafter called the "Company", which term includes
any successor corporation under the Indenture hereinafter referred to), for
value received, hereby
<PAGE>
-2-
promises to pay to , or registered assigns, the principal sum of
on . [If the Senior Note is to bear interest prior to Maturity,
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
Senior 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 Senior 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 Senior 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 Senior 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 Senior Note is not to bear interest prior to Maturity, insert--The
principal of this Senior 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.]
Payment of the principal of (and premium, if any) on this Senior Note and,
unless otherwise paid as hereinafter provided, the interest (if any) thereon
will be made at the office or agency of the Trustee 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 Senior Note are set forth on
the reverse hereof.
<PAGE>
-3-
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee by manual signature, this Senior Note shall not be
entitled to any benefit under the Indenture, or be valid or obligatory for any
purpose.
This Senior Note shall be construed in accordance with and governed by the
laws of the State of Illinois.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its facsimile corporate seal.
Dated: HOUSEHOLD FINANCIAL CORPORATION LIMITED
ATTEST: By ____________________________________
[GENERAL FORM OF REVERSE OF NOTE]
HOUSEHOLD FINANCIAL CORPORATION LIMITED
....% Senior Note
This Senior Note is one of a duly authorized issue of Senior Notes of the
Company (herein called the "Senior Notes"), issuable in series, unlimited in
aggregate principal amount except as may be otherwise provided in respect of the
Senior Notes of a particular series, issued and to be issued under and pursuant
to an Indenture dated as of May 15, 1993 (herein called the "Indenture"), duly
executed and delivered by the Company, Household International, Inc., a Delaware
corporation (the "Guarantor"), and LaSalle National Trust, N.A., as Trustee, and
is one of a series designated as % Senior Notes due (herein called
the " % Senior 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 description of the rights, limitations of rights, obligations,
duties and immunities thereunder of the Trustee, the Company, the Guarantor and
the Holders.
[AT THE COMPANY'S OPTION, ADDITIONAL PROVISIONS APPLICABLE
TO INTEREST RATE MAY BE INSERTED HERE]
[If applicable, insert--The Senior 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,
<PAGE>
-4-
<TABLE>
<CAPTION>
Redemption Redemption
Year Price Year Price
---- ---------- ---- ----------
<S> <C> <C> <C>
</TABLE>
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 installments whose Stated Maturity is on or
prior to such Redemption Date will be payable to the Holders of such Senior
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 Senior 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 installments whose Stated Maturity is on or prior to such Redemption
Date will be payable to the Holders of such Senior Notes, or one or more
Predecessor Notes, of record at the close of business on the relevant Regular
Record Dates referred to on the face hereof, all as provided in the Indenture].
<PAGE>
-5-
[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 Senior Notes of this series. [Senior 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 Senior Note in part only, a new Senior
Note or Senior 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 Senior Notes of this series will be repayable on
, , at the option of the holders of the Senior 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 Senior 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 Senior 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 Senior Note
with the form entitled 'Option to Elect Repayment' on the reverse of this Senior
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 Senior Note, the
principal amount of this Senior Note, the amount of this Senior Note to be
repaid, a statement that the option to elect repayment is being exercised
thereby and a guarantee that this Senior Note to be repaid with the form
entitled 'Option to Elect Repayment' on the reverse of this Senior 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 Senior Note and form duly completed are received by the
[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 Senior Note for less than the entire principal
amount of this Senior 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
Senior Note of this series for repayment will be determined by the Company,
whose determination will be final and binding.]
[If the Senior Note is not an Original Issue Discount Note,--If any Event of
Default with respect to Senior Notes of this series shall occur and be
continuing, the principal of the Senior Notes of this series may be declared due
and payable in the manner and with the effect provided in the Indenture.]
<PAGE>
-6-
[If the Senior Note is an Original Issue Discount Note,--If an Event of
Default with respect to Senior Notes of this series shall occur and be
continuing, an amount of principal of the Senior 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 Senior Notes of this series shall terminate.]
The Indenture provides that each Holder of a Senior Note is entitled to the
benefits of a Guarantee by the Guarantor of the timely payment of the principal
of, premium, if any, and interest on the Senior Note. The Guarantee enclosed
herein is an integral part of this Senior Note.
[The Indenture contains provisions for defeasance at any time of the entire
indebtedness of the Company on this Senior Note upon compliance by the Company
with certain conditions set forth therein, which provisions apply to this Senior
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 Guarantor and the rights of the Holders under the Indenture at
any time by the Company, the Guarantor and the Trustee with the consent of the
Holders of at least a majority in aggregate principal amount of the Senior 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 Senior Notes. The Indenture also
contains provisions permitting the Holders of a majority in aggregate principal
amount of the Outstanding Senior Notes of any series to waive on behalf of the
Holders of such series of Senior Notes compliance by the Company or the
Guarantor 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 Senior Note shall be binding upon such Holder and upon all future
Holders of this Senior Note and any Senior 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 Senior Note.
No reference herein to the Indenture and no provision of this Senior Note or
of the Indenture shall alter or impair the obligations of the Company and the
Guarantor, which are absolute and unconditional, to pay the principal of (and
premium, if any) and interest on this Senior 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 Senior Note is registrable on the Note Register, upon
surrender of this Senior Note for registration of transfer at the office or
agency of the Trustee in the ,
duly endorsed by, or accompanied by a written instrument of transfer in form
<PAGE>
-7-
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
Senior 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 % Senior Notes are issuable only as registered Senior Notes
without coupons in denominations of [$________]. As provided in the Indenture
and subject to certain limitations therein set forth, Senior Notes are
exchangeable for a like aggregate principal amount of Senior 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 Guarantor, the Trustee and any agent of the Company, the
Guarantor or the Trustee may treat the person in whose name this Senior Note is
registered as the owner hereof for the purpose of receiving payment as herein
provided and for all other purposes whether or not this Senior Note be overdue,
and neither the Company, the Guarantor, the Trustee nor any such agent shall be
affected by notice to the contrary.
All terms used in this Senior Note which are defined in the Indenture have
the meanings assigned to them in the Indenture.
[FORM OF TRUSTEE'S CERTIFICATE OF
AUTHENTICATION FOR SENIOR NOTES]
This is one of the Senior Notes designated herein referred to in the within-
mentioned Indenture.
Dated:___________________________ LaSalle National Trust, N.A.
as Trustee
By_____________________________________
Authorized Signature
[FORM OF GUARANTEE]
GUARANTEE OF HOUSEHOLD INTERNATIONAL, INC.
FOR VALUE RECEIVED, Household International, Inc., a corporation duly
organized and existing under the laws of the State of Delaware (the
"Guarantor"), hereby unconditionally
<PAGE>
-8-
guarantees to the Holder of the Senior Note upon which this Guarantee is
endorsed the due and punctual payment of the principal of, premium, if any, and
interest on said Senior Note, when and as the same shall become due and payable,
whether at maturity or otherwise, according to the terms thereof and of the
Indenture referred to therein.
The Guarantor agrees to determine, at least one Business Day prior to the
date upon which a payment of principal of, or premium, if any, or interest on
said Senior Note is due and payable, whether the Company has available the funds
to make such payment as the same shall become due and payable. In case of the
failure of the Company punctually to pay any such principal, premium, if any, or
interest, the Guarantor hereby agrees to cause any such payment to be made
punctually when and as the same shall become due and payable, whether at
maturity or otherwise, and as if such payment were made by the Company.
The Guarantor hereby agrees that its obligations hereunder shall be
unconditional, irrevocable, and absolute, irrespective of the validity,
regularity, or enforceability of said Senior Note or the Indenture, the absence
of any action to enforce the same, any waiver or consent by the Holder of said
Senior Note with respect to any provisions hereof, the recovery of any judgment
against the Company or any action to enforce the same, or any other
circumstances which might otherwise constitute a legal or equitable discharge or
defense of a guarantor. The Guarantor hereby waives diligence, presentment,
notice of non-payment, demand of payment, any right to require a proceeding
first against the Company, filing of claims with a court in the event of merger,
insolvency or bankruptcy of the Company, protest or notice with respect to the
Senior Note upon which this Guarantee is endorsed or indebtedness evidenced
thereby and all notices and demands to the Company or the Guarantor whatsoever
and covenants that this Guarantee will not be discharged except by complete
performance of the obligations contained in said Senior Note and this Guarantee.
In the event of a default in the payment of principal of, premium, if any, or
interest on said Senior Note, the Holder of said Senior Note may institute legal
proceedings directly against the Guarantor to enforce this Guarantee without
first proceeding against the Company.
The Guarantor shall be subrogated to all rights of the Holder of said Senior
Note against the Company in respect of any amounts paid by the Guarantor
pursuant to the provisions of this Guarantee; provided, however, that the
Guarantor shall not, without the consent of the Holders of all of the
Outstanding Senior Notes, be entitled to enforce or to receive any payments
arising out of, or based upon, such right of subrogation until the principal of,
premium, if any, and interest on all Senior Notes shall have been paid in full
or payment thereof shall have been provided for in accordance with the
Indenture.
Notwithstanding anything to the contrary contained herein, if following any
payment of principal, premium, if any, or interest by the Company on said Senior
Note to the Holder of the Senior Note it is determined by a final decision of a
court of competent jurisdiction that such payment shall be avoided by a trustee
in bankruptcy (including any debtor-in-possession) as a preference under 11
U.S.C. Section 547 (or any successor statute) and such payment is paid by
<PAGE>
-9-
such Holder to such trustee in bankruptcy, then and to the extent of such
repayment the obligations of the Guarantor hereunder shall remain in full force
and effect.
This Guarantee ranks equally with all other unsecured and unsubordinated
obligations of the Guarantor. This Guarantee will remain in full force and
effect until the principal of, premium, if any, and interest on the Senior Note
have been fully paid. As provided in the Indenture, the Guarantor may under
certain circumstances assume all rights and obligations of the Company under the
Indenture with respect to the Senior Note.
This Guarantee shall not be valid or become obligatory for any purpose with
respect to the Senior Note upon which it is endorsed until the certificate of
authentication on said Senior Note shall have been signed by the Trustee or the
authenticating agent.
This Guarantee shall be governed by the laws of the State of Illinois.
IN WITNESS WHEREOF, the Guarantor has caused this Guarantee to be duly
executed under its corporate seal.
HOUSEHOLD INTERNATIONAL, INC.
By__________________________________
Attest:
______________________________
[GENERAL FORM OF "OPTION TO ELECT REPAYMENT",
IF APPLICABLE, FOR SENIOR NOTES]
OPTION TO ELECT REPAYMENT
The undersigned hereby requests and irrevocably instructs the Company to
repay the within Senior 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 Senior Note), at a price equal to the principal
amount thereof, [together with interest to the date of repayment], to the
undersigned at
<PAGE>
-10-
______________________________________________________________________________
______________________________________________________________________________
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 and the Guarantor, in accordance with its terms, have been done.
Now, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of Senior 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:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 1.01. DEFINITIONS. 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, with respect to the Guarantor, in accordance
with United States generally accepted accounting principles, and with
respect to the Company, in accordance with Canadian generally accepted
accounting principles.
<PAGE>
-11-
"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 or
the Guarantor, as the case may be, any duly authorized committee of that board,
or any officer of the Company or the Guarantor duly authorized by the board of
directors of the Company or the Guarantor, as the case may be, or a duly
authorized committee of that board.
"Board Resolution" means a copy of a resolution certified by the Secretary
or an Assistant Secretary of the Company or the Guarantor, as applicable, to
have been duly adopted by the Board of Directors of the Company or the
Guarantor, as the case may be, 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
<PAGE>
-12-
President, and by its Treasurer, an Assistant Treasurer, Controller, an
Assistant Controller, Secretary or an Assistant Secretary, and delivered to the
Trustee.
"Corporate Trust Office" means principal office of the Trustee in Chicago,
Illinois, at which its corporate trust business shall be administered.
"Depository" shall mean, with respect to Senior Notes of any series for
which the Company shall determine that such Senior Notes will be issued in the
form of one or more Depository Notes, 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 Senior Notes, a
Senior 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) together with all other Depository Notes of such series, if
any, shall represent, and shall be denominated in an amount equal to the
aggregate principal amount of, all of the Outstanding Senior Notes of such
series.
"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 8.01.
"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.
"Guarantee" means the agreement of the Guarantor, in substantially the form
set forth herein as provided in Section 2.12 hereof, to be endorsed on the
Senior Notes authenticated and delivered hereunder.
<PAGE>
-13-
"Guarantor" means the party named as such in the first paragraph of this
Indenture until a successor replaces it and thereafter means such successor.
"Holder" means a Person in whose name a Senior Note is registered in the
Note Register.
"Indenture" means this Indenture dated as of May 15, 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, the Guarantor or in any other
obligor upon the Senior Notes or in any Affiliate of the Company, the Guarantor
or of such other obligor, and (3) is not connected with the Company, the
Guarantor or such other obligor or any Affiliate of the Company, the Guarantor
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.
"Interest Payment Date" means the Stated Maturity of interest on Senior
Notes of a particular series.
"Maturity" when used with respect to Senior Notes of a particular series
means the date on which the principal or any instalment of principal of such
Senior 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.
"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 or the Guarantor, as the case may be, 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 or the Guarantor.
<PAGE>
-14-
"Opinion of Counsel" means written opinion of counsel, who may be any one
or more of counsel for the Company or the Guarantor, or other counsel reasonably
satisfactory to the Trustee.
"Original Issue Discount Note" means any Senior 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 8.02.
"Outstanding" when used with respect to Senior Notes means, as of the date
of determination, all Senior Notes theretofore authenticated and delivered under
this Indenture, except:
(i) Senior Notes theretofore cancelled by the Trustee or delivered to
the Trustee for cancellation;
(ii) Senior 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 or the Guarantor, in
trust or set aside and segregated in trust by the Company or the Guarantor
(if the Company or the Guarantor shall act as Paying Agent) for the Holders
of such Senior Notes, provided that, if such Senior 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) Senior Notes which have been paid pursuant to Section 2.06 or in
exchange for or in lieu of which other Senior Notes have been authenticated
and delivered pursuant to this Indenture other than any such Senior Notes
in respect of which there shall have been presented to the Trustee proof
satisfactory to it that such Senior Notes are held by a bona fide purchaser
in whose hands such Senior Notes are valid obligations of the Company; and
(iv) any such Senior Notes which have been defeased pursuant to
Section 7.03.
provided, however, that in determining whether the Holders of the requisite
principal amount of Outstanding Senior Notes have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, or for any other
purpose, (i) Senior Notes owned by the Company, the Guarantor or any other
obligor upon the Senior Notes or any Affiliate of the Company, the Guarantor 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
Senior Notes which the Trustee knows to be so owned shall be so disregarded, and
Senior 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 Senior Notes and that
<PAGE>
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the pledge is not the Company, the Guarantor or any other obligor upon the
Senior Notes or any Affiliate of the Company, the Guarantor or such other
obligor, and (ii) the principal amount of an Original Issue Discount Note or a
Senior 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 8.02 or, for a Senior 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 Senior Notes on behalf of
the Company.
"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 Senior Note means every previous
Senior Note evidencing all or a portion of the same debt as that evidenced by
such particular Senior Note; and, for purposes of this definition, any Senior
Note authenticated and delivered under Section 2.06 in exchange for or in lieu
of a mutilated, destroyed, lost, or stolen Senior Note shall be deemed to
evidence the same debt as the mutilated, destroyed, lost, or stolen Senior Note.
"Redemption Date" when used with respect to any Senior 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 Senior 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 Senior 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 Senior 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.
"Senior Notes" means all debt securities issued under this Indenture,
regardless of series.
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"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 Senior Note or any
instalment of principal thereof or any instalment of interest thereon means the
date specified in such Senior Note as the fixed date on which the principal of
such Senior Note or such instalment of principal or interest is due and payable.
"Subsidiary" 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 Guarantor or by one or more Subsidiaries thereof,
or by the Company and one or more Subsidiaries thereof.
"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 - COMPLIANCE CERTIFICATES AND OPINIONS. Upon any application
or request by the Company or the Guarantor to the Trustee to take any action
under any provision of this Indenture, the Company or the Guarantor, as the case
may be, 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;
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(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. FORM OF DOCUMENTS DELIVERED TO TRUSTEE. 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 or the Guarantor
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 or the
Guarantor, as the case may be, stating that the information with respect to such
factual matters is in the possession of the Company or the Guarantor, as the
case may be, 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. ACTS OF HOLDERS. (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 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 and the Guarantor. 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
<PAGE>
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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. 9.01) conclusive in favor of the Trustee and
the Company and the Guarantor, 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 Senior 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 Senior Note shall bind every future Holder
of the same Senior Note and the Holder of every Senior 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 or
the Guarantor in reliance thereon, whether or not notation of such action is
made upon such Senior Note.
(e) In determining whether the Holders of the requisite principal amount of
Outstanding Senior 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 of such Original Issue Discount Note upon a
declaration of acceleration pursuant to Section 8.02 at the time the taking of
such action by the Holders of such requisite principal amount of Outstanding
Senior Notes is evidenced to the Trustee, as provided in Subsection (a) of this
Section.
(f) For the purposes of calculating the principal amount of Senior 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 Senior 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.
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(g) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company may,
at its option, by or pursuant to a Board Resolution, fix in advance a record
date for the determination of Holders entitled to give such request, demand,
authorization, direction, notice, consent, waiver or other Act, but the Company
shall have no obligation to do so. If such a record date is fixed, such
request, demand, authorization, direction, notice, consent, waiver or other Act
may be given before or after such record date, but only the Holders of record at
the close of business on such record date shall be deemed to be Holders for the
purposes of determining whether Holders of the requisite proportion of
Outstanding Senior Notes have authorized or agreed or consented to such request,
demand, authorization, direction, notice, consent, waiver or other Act, and for
that purpose the Outstanding Senior Notes shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after the
record date.
SECTION 1.05. NOTICES, ETC., TO TRUSTEE AND COMPANY. 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 or the Guarantor shall
be sufficient for every purpose hereunder if made, given, furnished or
filed in writing to or with the Trustee at its Corporate Trust Office, or
(2) the Company or the Guarantor 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 or the Guarantor 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 or the Guarantor.
SECTION 1.06. NOTICES TO HOLDERS, WAIVER. 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 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.
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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. CONFLICT WITH TRUST INDENTURE ACT. 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. EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article
headings herein and the Table of Contents are for convenience only and shall not
affect the construction hereof.
SECTION 1.09. SUCCESSORS AND ASSIGNS. All covenants and agreements in
this Indenture by the Company shall bind its successors and assigns, whether so
expressed or not.
SECTION 1.10. SEPARABILITY CLAUSE. In case any provision in this
Indenture or in the Senior 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. BENEFITS OF INDENTURE. Nothing in this Indenture or in the
Senior 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.
SECTION 1.12. GOVERNING LAW. This Indenture and each Senior Note issued
hereunder shall be construed in accordance with and governed by the laws of the
State of Illinois.
SECTION 1.13. PAYMENT ON BUSINESS DAY. In any case where any Interest
Payment Date, Redemption Date or Stated Maturity of any Senior 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.
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SECTION 1.14. INCORPORATION BY REFERENCE OF TRUST INDENTURE ACT. 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 Senior 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, the Guarantor or
any other obligor on the Senior 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 SENIOR NOTES
SECTION 2.01. ISSUANCE OF NOTES IN SERIES. At the option of the Company,
the Senior Notes issued hereunder, which are unlimited in aggregate principal
amount except as may be otherwise provided in respect of the Senior Notes of a
particular series, may be issued in one or more series. The Senior 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 or the Guarantor specified herein with respect to Senior 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
Senior Notes of any series may be issued as a Depository Note.
<PAGE>
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All Senior 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.
At or prior to the issuance of any of the Guarantees, the exact form and
terms of such Guarantees, which shall be in substantially the form set forth
herein, shall be established by or pursuant to a Board Resolution of the
Guarantor and set forth in an Officer's Certificate of the Guarantor.
SECTION 2.02. AUTHENTICATION AND DELIVERY OF NOTES. From time to time the
Company may execute and deliver to the Trustee, with the Guarantees endorsed
thereon, and, except as otherwise provided in this Article II, the Trustee shall
thereupon authenticate and deliver to or upon a Company Order, Senior Notes of
any series duly established pursuant to Section 2.01. In authenticating such
Senior Notes, and accepting the additional responsibilities under this Indenture
in relation to such Securities, the Trustee shall be entitled to receive, and
subject to Section 8.01, shall be fully protected in relying upon:
(a)(i) the Board Resolution of the Company and the Guarantor authorizing
the execution and requesting the authentication and delivery of the Senior Notes
applied for in the principal amount therein specified, designating the series of
such Senior Notes and specifying the officer or officers of the Company to whom
or upon whose order such Senior Notes shall be delivered; and which, as
permitted by Section 2.01, establishes the terms of such series of Senior Notes
and which, if applicable, authorizes the execution of an indenture supplemental
hereto creating such series of Senior Notes or, (ii) if an officer of the
Company and the Guarantor 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 Senior
Notes of such series are to be issued pursuant to a supplemental indenture, a
supplemental indenture duly executed on behalf of the Company and the Guarantor,
in form satisfactory to the Trustee, creating such series of Senior 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:
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(i) the form and terms of such Senior Notes have been established in
conformity with the provisions of this Indenture;
(ii) all conditions precedent to the authentication and delivery of
such Senior Notes and the Guarantees have been complied with and that such
Senior Notes and Guarantees, when authenticated and delivered by the
Trustee and issued by the Company or endorsed by the Guarantor, as the case
may be, in the manner and subject to any conditions specified in such
Opinion of Counsel, will constitute valid and legally binding obligations
of the Company or the Guarantor, as applicable, 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 Senior Notes or by the Guarantor of the
Guarantees have been complied with; and
(iv) each of the Company and the Guarantor is not in default in any of
its obligations under this Indenture, and the issuance of such Senior Notes
or the Guarantees will not result in any such default.
If all Senior 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 Senior Note of
such series if such documents are delivered at or prior to the authentication
upon original issuance of the first Senior Note of such series to be issued.
The Trustee shall have the right to decline to authenticate and deliver any
Senior Notes under this Section if the Trustee, being advised by counsel,
determines that such action may not lawfully be taken or if the Trustee in good
faith shall determine that such action would expose the Trustee to personal
liability to existing Holders.
SECTION 2.03. EXECUTION OF NOTES. The Senior Notes and the Guarantees
shall be executed on behalf of the Company or the Guarantor, as the case may be,
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 Senior Notes
or the Guarantees may be manual or facsimile.
Senior Notes or Guarantees bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company or the
Guarantor, as the case may be, shall bind the Company or the Guarantor,
notwithstanding that such individuals or any of them have ceased to hold such
offices prior to the authentication and delivery of such Senior Notes or did not
hold such offices at the date of such Senior Notes.
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All Senior Notes shall be dated the date of their authentication.
No Senior Note or Guarantee shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose, unless there appears on
such Senior Note a certificate of authentication substantially in the form
provided for herein executed by manual signature, and such certificate upon any
Senior Note shall be conclusive evidence, and the only evidence, that such
Senior Note has been duly authenticated and delivered hereunder.
SECTION 2.04. TEMPORARY NOTES. Pending the preparation of definitive
Senior Notes of any series, the Company and the Guarantor may execute, and upon
Company Order the Trustee shall authenticate and deliver, or cause to be
delivered, temporary Senior Notes of such series having duly executed Guarantees
endorsed thereon which are printed, lithographed, typewritten, mimeographed or
otherwise produced, in any denomination, substantially of the tenor of the
definitive Senior Notes in lieu of which they are issued and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Senior Notes and Guarantee, may determine, as evidenced
by their signing of such Senior Notes or Guarantees.
If temporary Senior Notes of any series are issued, the Company will cause
definitive Senior Notes of such series to be prepared without unreasonable
delay. After the preparation of definitive Senior Notes, the temporary Senior
Notes shall be exchangeable for definitive Senior Notes upon surrender of the
temporary Senior Notes at the office or agency of the Company without charge to
the Holder. Upon surrender for cancellation of any one or more temporary Senior
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 Senior Notes of such series, of authorized denominations.
Until so exchanged the temporary Senior Notes shall in all respects be entitled
to the same benefits under this Indenture as the definitive Senior Notes.
SECTION 2.05. EXCHANGES AND TRANSFERS OF NOTES. The Company shall cause
to be kept at the 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 Senior
Notes and for registrations of transfer of Senior Notes. The Trustee is hereby
appointed Note Registrar for the purpose of registering Senior Notes and
registering transfers of Senior Notes as herein provided.
Subject to the provisions of Section 2.11, upon surrender for registration
of transfer of any Senior Note the Paying Agent and the Company shall execute,
and the Trustee shall authenticate and deliver, in the name of the designated
transferee or transferees, one or more new Senior Notes of the same series
containing identical terms and provisions, including the Guarantees, of any
authorized denominations and for a like aggregate principal amount.
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Subject to the provisions of Section 2.11, at the option of the Holder,
Senior Notes may be exchanged for other Senior 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 Senior Notes to be
exchanged at any such office or agency. Whenever any Senior Notes are so
surrendered for exchange, the Company and the Guarantors shall execute, and the
Trustee shall authenticate and deliver, the Senior Notes and the Guarantee which
the Holder making the exchange is entitled to receive.
All Senior Notes issued upon any registration of transfer or exchange of
Senior Notes shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, including the
Guarantee, as the Senior Notes surrendered upon such registration of transfer or
exchange.
Every Senior 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 Senior 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 Senior Notes, other
than exchanges pursuant to Section 2.04, Section 6.07 or Section 12.06 not
involving any registration of transfer.
The Company shall not be required (i) to issue, register the transfer of or
exchange any Senior 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
Senior Notes of such series selected for redemption under Section 6.04 and
ending at the close of business on the day of such mailing, or (ii) to register
the transfer of or exchange any Senior Note so selected for redemption in whole
or in part.
SECTION 2.06. MUTILATED, DESTROYED, LOST OR STOLEN NOTES. A mutilated
Senior Note may be surrendered to the Company and thereupon the Company and the
Guarantor shall execute and the Trustee shall authenticate and deliver in
exchange therefor a new Senior Note of the same series, including the Guarantee,
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 Senior Note of any series, and
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(ii) such security or indemnity as may be required by them to save
each of them and the Guarantor harmless,
then, in the absence of notice to the Company or the Trustee that such Senior
Note has been acquired by a bona fide purchaser, the Company and the Guarantor
shall execute and upon their request the Trustee shall authenticate and deliver,
in lieu of any such destroyed, lost or stolen Senior Note, a new Senior Note of
such series, including the Guarantee and of like tenor and principal amount,
bearing a number not contemporaneously outstanding.
In case any such mutilated, destroyed, lost or stolen Senior Note has
become or is about to become due and payable, the Company in its discretion may,
instead of issuing a new Senior Note, pay such Senior Note.
Upon the issuance of any new Senior 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 Senior Note issued pursuant to this Section 2.06 in lieu of any
destroyed, lost or stolen Senior Note shall constitute an original additional
contractual obligation of the Company or the Guarantor, as the case may be,
whether or not the destroyed, lost or stolen Senior 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 Senior Notes of the
same series containing identical terms and provisions duly issued hereunder,
including the Guarantees.
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 Senior Notes.
SECTION 2.07. PAYMENT OF INTEREST; INTEREST RIGHTS PRESERVED. Interest on
any Senior 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
Senior 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 Senior Notes is payable if so stated in the Senior Note. Notwithstanding the
foregoing, however, interest that is payable on Senior 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 Senior Notes are
continuously held by the Company through the relevant Interest Payment Date.
Any interest on any Senior 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
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such Holder; and such Defaulted Interest shall be paid by the Company or the
Guarantor, at their its election in each case, as provided in Clause (1) or
Clause (2) below:
(1) The Company or the Guarantor may elect to make payment of any
Defaulted Interest to the Persons in whose names the Senior 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 or the Guarantor shall notify
the Trustee in writing of the amount of Defaulted Interest proposed to be
paid on each Senior Note and the date of the proposed payment, and at the
same time the Company or the Guarantor 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 or the Guarantor, as the case may
be, of such Special Record Date and, in the name and at the expense of the
Company or the Guarantor, shall cause notice of the proposed payment of
such Defaulted Interest and the Special Record Date therefor to be mailed
first class postage 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 or the Guarantor, 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 Senior 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 or the Guarantor 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 or the Guarantor 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 Senior Note
delivered under this Indenture upon registration of transfer of or in exchange
for or in lieu of any other Senior Note shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Senior Note.
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SECTION 2.08. PERSONS DEEMED OWNERS. The Company, the Guarantor, the
Trustee and any agent of the Company, the Guarantor or the Trustee may treat the
Person in whose name any Senior 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 Senior Note and for all other
purposes whatsoever, whether or not such Senior Note be overdue, and neither the
Company, the Guarantor, the Trustee nor any such agent shall be affected by
notice to the contrary.
SECTION 2.09. CANCELLATION OF NOTES. All Senior 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 Senior Notes
shall, if surrendered to any Person other than the Trustee, be delivered to the
Trustee and shall be promptly cancelled by the Trustee through an appropriate
notation on the Note Register and on the face of the Senior Note. The Company
or the Guarantor may at any time deliver to the Trustee for cancellation any
Senior Notes previously authenticated and delivered hereunder which the Company
or the Guarantor may have acquired in any manner whatsoever, and all Senior
Notes so delivered shall be promptly cancelled by the Trustee. No Senior Notes
shall be authenticated in lieu of or in exchange for any Senior Notes cancelled
as provided in this Section 2.09, except as expressly permitted by this
Indenture. The Trustee may, but shall not be required to, destroy any cancelled
Senior Notes and the Trustee shall deliver to the Company and the Guarantor a
certificate of any such destruction.
SECTION 2.10. APPOINTMENT OF AUTHENTICATING AGENT. 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 Senior Notes of
any series in the name and on behalf of the Trustee. 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 the Guarantor 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 or the Guarantor 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.
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Any such authenticating agent shall have the rights and immunities of the
Trustee set forth in Sections 2.08, 9.03, 9.04 and 9.05 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.
Notwithstanding any other provision of the Indenture, the Trustee shall
have no obligation to pay the fees or expenses of any authenticating agent.
If an appointment is made pursuant to this Section 2.10 with respect to any
series of Senior Notes, such Senior Notes shall have endorsed thereon, in
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 Senior Notes of the series designated herein referred to
in the within-mentioned Indenture.
LASALLE NATIONAL TRUST, N.A.,
as Trustee
Dated:________________________ By_____________________________
Authenticating Agent
By_____________________________
Authorized Signature
SECTION 2.11. SECURITIES ISSUABLE IN THE FORM OF DEPOSITORY NOTES. (a) If
the Company shall establish pursuant to Section 2.01 that the Senior Notes of a
particular series are to be issued in the form of one or more Depository Notes,
then the Company and the Guarantor 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, Depository Notes, each including a
Guarantee, which (i) shall represent, and shall be denominated in an aggregate
amount equal to the aggregate principal amount of, all of the Outstanding Senior
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 Senior 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."
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(b) Notwithstanding any other provision of this Section 2.11 or of Section
2.05, the Depository Notes 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.
(c) If at any time the Depository for a series of Senior 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
Senior Notes of such series and the Company and the Guarantor will execute, and
the Trustee will authenticate and deliver, Senior 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
Notes of such series then Outstanding in exchange for such Depository Notes. In
addition, the Company may at any time determine that the Senior Notes of any
series shall no longer be represented by a Depository Notes and that the
provisions of this Section 2.11 shall no longer apply to the Senior Notes of
such series. In such event the Company and the Guarantor will execute and the
Trustee, upon receipt of an Officers' Certificate evidencing such determination
by the Company, will authenticate and deliver Senior 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
Notes of such series in exchange for such Depository Notes. Upon the exchange of
the Depository Notes for such Senior Notes in definitive registered form without
coupons, in authorized denominations, the Depository Notes shall be cancelled by
the Trustee. Such Senior Notes in definitive registered form issued in exchange
for the Depository Notes 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.
SECTION 2.12. BENEFIT OF GUARANTEE. (a) Each Holder of a Senior Note
shall have the benefit of the Guarantee in substantially the form set forth
herein. Such Guarantee shall be endorsed on each Senior Note authenticated and
delivered by the Trustee (or the authenticating agent) and such Guarantee shall
constitute an integral part of each such Senior Note. Each such Guarantee shall
be signed on behalf of the Guarantor prior to the authentication of the Senior
Note on which it is endorsed, and the delivery of such Senior Note by the
Trustee (or the authenticating agent), after the authentication thereof, shall
constitute due delivery of such Guarantee on behalf of the Guarantor.
(b) The Guarantor may, without the consent of any Holder of a Senior Note,
assume all of the rights and obligations of the Company hereunder with respect
to a series of Senior Notes and under the Senior Notes of such series if, after
giving effect to such assumption, no Event
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of Default shall have occurred and be continuing. Upon such an assumption, the
Guarantor shall execute a supplemental indenture evidencing its assumption of
all such rights and obligations of the Company and the Company shall be released
from its liabilities hereunder and under such Senior Note as obligor thereon.
(c) The Guarantor shall assume all of the rights and obligations of the
Company hereunder with respect to a series of Senior Notes and under the Senior
Notes of such series if, upon a default by the Company in the due and punctual
payment of the principal, premium, if any, or interest on such Senior Notes, the
Guarantor is prevented by any court order or judicial proceeding from fulfilling
its obligations with respect to such series of Senior Notes. Such assumption
shall result in the Senior Notes of such series becoming the direct obligations
of the Guarantor and shall be effected without the consent of the Holders of the
Senior Notes of any series. Upon such an assumption, the Guarantor shall
execute a supplemental indenture evidencing its assumption, the Guarantor shall
execute a supplemental indenture evidencing its assumption of all such rights
and obligations of the Company, and the Company shall be released from its
liabilities hereunder and under such Senior Notes as obligor on the Senior Notes
of such series.
SECTION 2.13. CUSIP NUMBERS. The Company in issuing the Senior Notes may
use "CUSIP" numbers (if then generally in use), and, if so, the Trustee shall
use "CUSIP" numbers in notices of redemption as a convenience to Holders;
provided that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Senior Notes or as
contained in any notice of a redemption and that reliance may be placed only on
the other identification numbers printed on the Senior Notes, and any such
redemption shall not be affected by any defect in or omission of such numbers.
ARTICLE III
COVENANTS OF THE COMPANY
SECTION 3.01. PAYMENT OF PRINCIPAL, PREMIUM AND INTEREST. The Company
will duly and punctually pay the principal of (and premium, if any) and interest
on the Senior Notes in accordance with the terms of the Senior Notes and this
Indenture.
SECTION 3.02. MAINTENANCE OF OFFICE OR AGENCY. The Company shall appoint
a Paying Agent which will maintain an office or agency at each place at which
the principal of (and premium, if any) or interest on any of the Senior Notes is
payable, where Senior Notes may be presented or surrendered for payment, where
Senior Notes may be surrendered for registration of transfer or exchange and
where notices and demands to or upon the Company in respect of the Senior 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 Paying Agent shall fail to maintain any
such office or
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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
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. MONEY FOR NOTE PAYMENTS TO BE HELD IN TRUST. If the Company
shall at any time also 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.
The Company shall, on or before each due date of the principal of (and
premium, if any) or interest on, any of the Senior Notes, deposit with its
Paying Agent or Paying Agents, as the case may be, 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 Senior 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;
(2) give the Trustee notice of any default by the Company, the
Guarantor (or any other obligor upon the Senior 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.
<PAGE>
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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 Senior 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 Senior 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. CORPORATE EXISTENCE. Except as herein otherwise expressly
provided, the Company will carry on and conduct and will cause to be carried on
and conducted its business or businesses in a proper and efficient manner and do
or cause to be done all things necessary to preserve and keep in full force and
effect its corporate existence, rights and franchises, provided that the Company
may cease to operate any business, premises, property or operations or dispose
of or allow to lapse any of its rights or franchises if it is advisable and in
the best interests of the Company to do so, but the Company may not cease to
operate or dispose of all or substantially all of its assets except in
accordance with Article XI hereof. The parties hereto acknowledge that the
Company and its Subsidiaries intend to sell, assign, transfer or otherwise
dispose of, from time to time, certain of their finance receivables and related
assets in transactions commonly known as asset securitization transactions and
agree that notwithstanding anything contained in this Indenture or in the Senior
Notes, such transactions shall not constitute an Event of Default or be deemed
to be prevented or restricted by anything contained herein or in the Senior
Notes.
SECTION 3.05. MAINTENANCE OF ACCOUNTS. The Company will keep or cause to
be kept proper books of account, and will, if and whenever required in writing
by the Trustee, file with the Trustee within 15 days copies of annual or
periodic reports and information, documents or other reports which the Company
has furnished to its shareholder or shareholders after the date hereof, but only
to the extent that such annual and periodic reports are filed with the Ontario
Securities Commission and made available to the general public, or are required
to be filed with the SEC pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934.
SECTION 3.06. STATEMENT AS TO COMPLIANCE. 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
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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 3.07. NOT SUBJECT PROPERTY TO LIEN WITHOUT SECURING NOTES
RATEABLY; WAIVER OF COVENANT. So long as any of the Senior Notes remain
outstanding, the Company will not create, incur or assume any mortgage,
hypothecation, charge, security interest, lien, encumbrance, pledge or other
security ("Security") upon the whole or any part of its undertaking or property,
real or personal, present or future, to secure any loan or other indebtedness,
present or future, for Money Borrowed or to secure any guarantee by the Company
of any loan or other indebtedness, present or future, for Money Borrowed, nor
will the Company permit any Security securing indebtedness of another
corporation to extend to any assets of the Company as a result of the
amalgamation of the Company with, or the sale of all or substantially all of the
Company's assets to, such other corporation or as a result of the purchase by
the Company from such other corporation of all or any part of its assets,
unless, in either case, the same Security shall have been or shall as soon as
reasonably practicable thereafter be created in favor of and be extended equally
to and rateably with the Senior Notes then outstanding; provided that the
covenants contained in this section 3.07 shall not apply to or operate to
prevent:
(a) the Company issuing or becoming liable on any Purchase Money
Obligation or creating or assuming any Purchase Money Mortgage; or
(b) the continuation of any Security existing on the date of this
Indenture; or
(c) the assumption by the Company of any Security on any property, real or
personal, in existence at the time of acquisition thereof; or
(d) the continuation of any Purchase Money Mortgage existing on the date
of an amalgamation of the Company with, or the transfer of all or
substantially all of the Company's assets to, or the transfer to the
Company of all or any part of the other corporation's assets from,
another corporation; for purposes of this clause (d), the word
"Company" contained in the definition of "Purchase Money Mortgage" and
"Purchase Money Obligation" shall be deemed to mean such other
corporation; or
(e) any Security for Money Borrowed of the Company the amount of which,
when aggregated with the amount of all other Money Borrowed of the
Company and of its Subsidiaries then outstanding in respect of which
Security has been given, excluding any Security pursuant to the other
exceptions referred to herein, would not exceed 10% of Consolidated
Shareholders' Equity; or
(f) the giving of Security to secure the Senior Notes;
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(g) any Security not related to the borrowing of money incurred or arising
by operation of law in the ordinary course of business;
(h) the Company from accepting deposits and investing such deposits and
other monies of the Company in investments which, under applicable
laws governing the Company, are required to be held in trust for, or
earmarked and set aside in respect of, or otherwise made available
for, the satisfaction of the Company's liabilities to the Persons
making such deposits; or
(i) the Company pledging assets to the government of Canada with respect
to the sale of Canada Savings Bonds or with respect to other similar
activities of the Company carried out in the ordinary course of
business.
The Company may fail or omit in any particular instance to comply with the
covenants set forth in this Section 3.07 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 Senior 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.
For the purposes of this Section 3.07, the terms shall have the following
meaning:
"Consolidated Shareholders' Equity" means at any time the paid-in capital
plus retained earnings, or minus deficit, as the case may be, plus any other
amount which in accordance with generally accepted accounting principles would
be classified as part of the shareholders' equity section of a consolidated
balance sheet of the Company and its Subsidiaries, all determined in accordance
with generally accepted accounting principles;
"Money Borrowed" means any money borrowed and premium and interest in
respect thereof;
"Purchase Money Mortgage" means any mortgage, hypothecation, charge,
security interest, pledge, lien, encumbrance or other security created, issued
or assumed by the Company to secure a Purchase Money Obligation, provided that
such mortgage, charge, security interest, pledge, lien, encumbrance or other
security is limited to the property acquired in connection with the creation,
issue or assumption of such Purchase Money Obligation and is created, issued or
assumed substantially concurrently with the acquisition of such property except
in the case of immoveable property on which fixed improvements are constructed
or installed in which case the same shall be created or issued within a period
of 18 months after the acquisition of such property, and any extensions or
renewals or replacements of any such Purchase Money Mortgage upon the same
property if the principal amount of the indebtedness secured thereby at the time
of such extension, renewal or replacement is not increased;
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"Purchase Money Obligation" means any indebtedness assumed by the Company
as part of, or issued or incurred to provide the Company with funds to pay, the
purchase price of moveable or immoveable property acquired by the Company,
provided that such indebtedness does not exceed 100% of the purchase price of
such property, and includes any extension, renewal, replacement or refunding of
any such Purchase Money Obligation to the extent of the principal amount
outstanding at the time of such extension, renewal, replacement or refunding.
In the case of immoveable property so acquired, such terms shall include
indebtedness issued or incurred to provide the Company with funds to pay, or to
reimburse the Company for, the purchase price of such property and expenditures
made for any fixed improvements constructed or installed thereon within a period
of 18 months after the acquisition thereof, provided such indebtedness does not
exceed 100% of the aggregate of such purchase price and of such expenditures.
ARTICLE IV
COVENANTS OF THE GUARANTOR
SECTION 4.01. PAYMENT OF TAXES AND OTHER CLAIMS. The Guarantor 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 Guarantor shall not be
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 4.02. CORPORATE EXISTENCE. Subject to Article XI, the Guarantor
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 Guarantor shall not be required to
preserve or cause to be preserved any right or franchise if the Guarantor shall
determine that the preservation thereof is no longer desirable in the conduct of
the business of the Guarantor and that the loss thereof is not disadvantageous
in any material respect to the Holders.
SECTION 4.03. FILING OF REPORTS. The Guarantor 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 Guarantor is required to file with the SEC pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934. The Guarantor also
shall comply with the other provisions of TIA 314(a).
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SECTION 4.04. NOT SUBJECT PROPERTY TO LIEN WITHOUT SECURING NOTES
RATEABLY; WAIVER OF COVENANT. (a) The Guarantor 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, cash deposit or
other recourse obligation with or for any Subsidiary or in connection with the
sale, securitization or discount by the Guarantor 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
Guarantor whether such property is owned at the date of this Indenture or
thereafter acquired, without making effective provision whereby the Guarantees
(together with, if the Guarantor shall so determine, any other indebtedness
issued, assumed or guaranteed by the Guarantor and then existing or thereafter
created) shall be secured by such mortgage equally and rateably with (or, at the
option of the Guarantor, 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 Guarantor 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
Guarantor, or (B) to secure any indebtedness issued, assumed or guaranteed
by the Guarantor 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 Guarantor 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 Guarantor;
(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 Guarantor;
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(4) mortgages to secure indebtedness of the Guarantor to any
Subsidiary or of any Subsidiary to another 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
Guarantor may, without equally and rateably securing the Guarantee, 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 Guarantor existing at such time and secured by mortgages not
so excepted, does not at the time exceed 10% of the Guarantor's Consolidated Net
Worth. "Consolidated Net Worth" shall be the difference between the Guarantor's
consolidated assets and consolidated liabilities as shown on the Guarantor's
most recent audited consolidated financial statements prepared in accordance
with United States generally accepted accounting principles.
(c) An arrangement with any Person providing for the leasing by the
Guarantor of any property, which property has been or is to be sold or
transferred by the Guarantor to such Person with the intention that such
property be leased back to the Guarantor, 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
Guarantor.
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The Guarantor may fail or omit in any particular instance to comply with
the covenant set forth in this Section 4.04 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 Senior 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.
SECTION 4.05. STATEMENT AS TO COMPLIANCE. The Guarantor 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 Guarantor 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.
ARTICLE V
REPAYMENT AT OPTION OF HOLDERS
SECTION 5.01. OPTIONAL REPAYMENT OF NOTES. If the Board Resolution or
supplemental indenture, as the case may be, with respect to the Senior Notes of
any particular series so provides, such Senior 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 Senior Notes, upon the receipt by the Company of the form entitled
'Option to Elect Repayment' as specified in Section 5.02 or such optional
notification procedure as may be specified in such Senior Notes.
SECTION 5.02. REPAYMENT PROCEDURE FOR NOTES. To be repaid at the option
of the Holder, unless additional or substitute procedures are set forth in the
Senior Notes, Senior 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 time notify the Holders of the Senior Notes) within the periods
specified by the terms of the Senior Notes. Effective exercise of the repayment
option by the Holder shall be irrevocable. Upon such completion and receipt of
the applicable form, Senior 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 Senior
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 or Guarantor shall default in the payment of the repayment price) such
Senior Notes shall cease to bear interest.
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ARTICLE VI
REDEMPTION OF NOTES; SINKING FUNDS
SECTION 6.01. APPLICABILITY OF REDEMPTION PROVISIONS. Senior 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 VI.
SECTION 6.02. ELECTION TO REDEEM; NOTICE TO TRUSTEE. The election of the
Company to redeem Senior 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 Senior 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
Senior 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 Senior Notes to be redeemed.
SECTION 6.03. SELECTION BY TRUSTEE OF NOTES TO BE REDEEMED. If less than
all the Senior Notes of any series are to be redeemed, and unless otherwise
provided with respect to the Senior Notes of any particular series, the
particular Senior Notes to be redeemed shall be selected by the Trustee from the
Outstanding Senior 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 Senior Notes, provided, however, that except with respect to Senior Notes
being redeemed pursuant to the operation of a sinking fund, no such partial
redemption shall reduce the portion of the principal amount of a Senior Note of
such series not redeemed to less than the minimum denomination for a Senior Note
of that series. The portions of the principal of Senior Notes so selected for
partial redemption shall be equal to the smallest authorized denomination of the
Senior Notes of such series or an integral multiple thereof.
The Trustee shall promptly notify the Company in writing of the Senior
Notes selected for redemption and, in the case of any Senior 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 Senior Notes shall relate, in the
case of any Senior Note redeemed or to be redeemed only in part, to the portion
of the principal of such Senior Note which has been or is to be redeemed.
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SECTION 6.04. NOTICE OF REDEMPTION. Notice of redemption shall be given
not less than 30 nor more than 60 days prior to the Redemption Date, to each
Holder of Senior Notes to be redeemed, at his address appearing in the Note
Register.
All notices of redemption shall state:
(1) the series designation of the Senior Notes to be redeemed,
(2) the Redemption Date,
(3) the Redemption Price,
(4) if less than all Outstanding Senior Notes of such series are to be
redeemed, the identification (and, in the case of partial redemption, the
respective principal amounts) of the Senior Notes of such Holder to be
redeemed,
(5) that on the Redemption Date the Redemption Price will become due
and payable upon each such Senior Note, and that, if applicable, interest
thereon shall cease to accrue from and after said date,
(6) the place where such Senior 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 Senior Notes is
payable,
(7) if Senior Notes are to be redeemed pursuant to any sinking or
purchase fund established for any series of Senior Notes, that the
redemption is being made for the purposes of such sinking or purchase fund,
and
(8) CUSIP number, if any.
Notice of redemption of Senior 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 6.05. DEPOSIT OF REDEMPTION PRICE. 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 Senior Notes which are to be redeemed on
that date.
SECTION 6.06. NOTES PAYABLE ON REDEMPTION DATE. Notice of redemption
having been given as aforesaid, the Senior 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
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(unless the Company shall default in the payment of the Redemption Price) such
Senior Notes shall cease to bear interest. Upon surrender of such Senior Notes
for redemption in accordance with such notice, such Senior 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
Senior Notes of record on the relevant Record Dates according to their terms and
the provisions of Section 2.07.
If any Senior 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
Senior Note.
SECTION 6.07. NOTES REDEEMED IN PART. Any Senior 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 and the Guarantor shall execute and the Trustee shall authenticate
and deliver to such Holder, without service charge, a new Senior Note or Senior
Notes of the same series, including the Guarantee, 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 Senior Note
so surrendered.
SECTION 6.08. SINKING FUNDS. The provisions of this Article VI shall be
applicable to any sinking fund for the retirement of Senior Notes of any series
except as otherwise specified as contemplated in such Senior Notes.
The minimum amount of any sinking fund payment provided for by the terms of
Senior 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 Senior Notes of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of Senior Notes of any
series, the cash amount of any sinking fund payment may be subject to reduction
as provided in Section 6.09. Each sinking fund payment shall be applied to the
redemption of Senior Notes of any series as provided for by the terms of Senior
Notes of such series.
SECTION 6.09. SATISFACTION OF SINKING FUND PAYMENTS WITH NOTES. The
Company (1) may deliver to the Trustee for cancellation Outstanding Senior Notes
of a series (other than any previously called for redemption) and (2) may apply
as a credit Senior 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 Senior Notes or through the application of permitted optional
sinking fund payments pursuant to the terms of such Senior Notes, in each case
in satisfaction of all or any part of any mandatory sinking fund payment with
respect to the Senior Notes of such series required to be made pursuant to the
terms of such Senior Notes as provided for by the terms of such Senior Notes;
provided that such Senior Notes shall not have been
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previously so credited. Such Senior Notes shall be received and credited for
such purpose by the Trustee at the Redemption Price specified in such Senior
Notes for redemption through operation of the mandatory sinking fund and the
amount of such mandatory sinking fund payment shall be reduced accordingly.
SECTION 6.10. REDEMPTION OF NOTES FOR SINKING FUNDS Not less than 45 days
prior to each sinking fund payment date for Senior 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 Senior 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 Senior Notes of that series pursuant to Section 6.09 and will also
deliver with the said Officers' Certificate to the Trustee any Senior 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 Senior
Notes to be redeemed upon such sinking fund payment in the manner specified in
Section 6.03 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
6.04. The Company or the Guarantor shall deposit the amount of cash, if any,
required for such sinking fund payment with the Trustee in the manner provided
in Section 6.05. Such notice having been duly given, the redemption of such
Senior Notes shall be made upon the terms and in the manner stated in Sections
6.06 and 6.07.
ARTICLE VII
SATISFACTION AND DISCHARGE
SECTION 7.01. SATISFACTION AND DISCHARGE OF INDENTURE. This Indenture
shall cease to be of further effect (except as to any surviving rights of
registration of transfer or exchange of Senior Notes if herein or in any
supplemental indenture expressly provided for), and the Trustee, on demand of
and at the expense of the Company or the Guarantor, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture, when
(1) either
(A) all Senior Notes theretofore authenticated and delivered (other
than (i) Senior Notes which have been destroyed, lost or stolen and which
have been replaced or paid as provided in Section 2.06, and (ii) Senior
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 3.02) have
been delivered to the Trustee for cancellation; or
(B) all such Senior Notes not theretofore delivered to the Trustee for
cancellation
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(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 of discharging and undertakes an amount sufficient to pay and
discharge the entire indebtedness on such Senior Notes not theretofore
delivered to the Trustee for cancellation, for principal (and premium, if
any) and interest to the date of such deposit (in the case of Senior Notes
which have become due and payable), or to their Stated Maturity or
Redemption Date, as the case may be; and
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company or the Guarantor; 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 9.07, 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 (1) of
this Section, the obligations of the Trustee under Section 7.02 and the last
paragraph of Section 3.02 shall survive.
SECTION 7.02. APPLICATION OF TRUST MONEY. Subject to the provisions of
the last paragraph of Section 3.02, all money deposited with the Trustee
pursuant to Section 7.01 shall be held in trust and applied by it, in accordance
with the provisions of the Senior 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 7.03. SATISFACTION, DISCHARGE, AND DEFEASANCE OF NOTES OF ANY
SERIES. Unless this Section 7.03 shall be deemed inapplicable to a series of
Senior 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 Senior Notes of any
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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 Senior Notes of such series,
(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 Senior 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 7.03, 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 Senior
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 7.03, 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 Senior Notes of such series; and
(2) the Company has paid or caused to be paid all other sums payable with
respect to the Outstanding Senior 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
Senior Notes of any such series have been complied with.
Any deposits with the Trustee referred to in Section 7.03(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 Senior Notes
of such series are to be redeemed
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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 7.03 with
respect to all the Outstanding Senior 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 or the Guarantor, other than the provisions of
Sections 2.06 and 2.07 and other than the right of Holders of Senior Notes of
such series to receive, from the trust fund described in this Section, payment
of the principal of and the interest on such Senior 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
9.07).
SECTION 7.04. REINSTATEMENT. If the Trustee is unable to apply any money
in accordance with Section 7.01 or 7.03 by reason of any order or judgment of
any court or governmental authority, enjoining, restraining or otherwise
prohibiting such applications, then the Company's and Guarantor's obligations
under this indenture and the Senior Notes shall be revived and reinstated as
though no deposit had occurred pursuant to this Article Seven until such time as
the Trustee is permitted to apply all such money in accordance with Section 7.01
or 7.03; provided, however, that if the Company makes any payment of principal
of (and premium, if any) or interest on any Senior Notes following the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Senior Notes to receive such payment from the money held
by the Trustee.
ARTICLE VIII
REMEDIES
SECTION 8.01. EVENTS OF DEFAULT. "Event of Default", wherever used herein
with respect to Senior 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
Senior 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 Senior Note of that series at its Maturity; or
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(3) default in the deposit under Section 6.10 of any instalment of any
sinking fund or similar payment with respect to Senior Notes of that 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 or the Guarantor in this Indenture (other than a covenant or
warranty a default in whose performance or whose breach is elsewhere in
this Section 8.01 specifically dealt with or which has expressly been
included in the Indenture solely for the benefit of Senior 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 or the Guarantor a bankrupt or
insolvent, or approving as properly filed a petition seeking
reorganization, arrangement, adjustment or composition of or in respect of
the Company or the Guarantor 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 the Guarantor 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 or the Guarantor 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, in the case of the Company, the Companies Creditors
Arrangement Act (Canada), the Bankruptcy Act (Canada) or the Winding-up Act
(Canada) or any other bankruptcy, insolvency or analogous law, or in the
case of the Guarantor, 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 the
Guarantor 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 or the Guarantor in
furtherance of any such action; or
(7) default by the Company or the Guarantor 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 Senior Notes,
under an indenture in which the Trustee is acting as the trustee for
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
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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 Senior Notes under clause (4) or
clause (7) is not an Event of Default until the Trustee notifies the Company and
the Guarantor, or the Holders of at least 25% in principal amount of the
outstanding Senior Notes of that series notify the Company, the Guarantor and
the Trustee, of the default and the Company and the Guarantor do 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 8.02. ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. 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 Senior Notes
of that series may declare the principal of all the Senior Notes of that series
(or, if the Senior 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
Senior Notes) and all accrued but unpaid interest to be due and payable
immediately, by a notice in writing to the Company and the Guarantor (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 VIII provided, the Holders of a
majority in principal amount of the Senior Notes then Outstanding of that
series, by written notice to the Company, the Guarantor and the Trustee, may
rescind and annul such declaration and its consequences if
(1) the Company or the Guarantor has paid or deposited with the Trustee a
sum sufficient to pay
(A) all overdue installments of interest, if any, on all Senior Notes
of that series,
(B) the principal of (and premium, if any, on) any Senior 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 Senior Notes of that series,
(C) to the extent that payment of such interest is lawful, interest
upon overdue installments of interest, if any, at the rate or the
respective rates borne by the Senior 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;
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and
(2) all Events of Default, other than the non-payment of the principal of
Senior Notes of that series which have become due solely by such acceleration,
have been cured or waived as provided in Section 8.13.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
SECTION 8.03. COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE. The Company and the Guarantor covenant that if
(1) default is made in the payment of any instalment of interest on any
Senior 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 Senior
Notes at the Maturity thereof,
the Company or the Guarantor will, upon demand of the Trustee or the Holders of
not less than 25% in principal amount of such Outstanding Senior Notes, pay to
the Trustee, for the benefit of the Holders of such Senior Notes, the whole
amount then due and payable on such Senior 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 installments of interest, at the rate or respective
rates borne by such Senior 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 reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel.
If the Company and the Guarantor fail 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 and the Guarantor or any other obligor upon
the Senior Notes and collect the moneys adjudged or decreed to be payable in the
manner provided by law out of the property of the Company and the Guarantor or
any other obligor upon the Senior 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.
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SECTION 8.04. TRUSTEE MAY FILE PROOFS OF CLAIM. In case of the pendency
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Company, the Guarantor or any other obligor upon the Senior Notes or the
property of the Company, the Guarantor or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of the Senior
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 or the Guarantor 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 Senior
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
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
9.07.
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 8.05. TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF NOTES. All
rights of action and claims under this Indenture or the Senior Notes may be
prosecuted and enforced by the Trustee without the possession of any of the
Senior 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
rateable benefit of the Holders of the Senior Notes in respect of which such
judgment has been recovered.
SECTION 8.06. APPLICATION OF MONEY COLLECTED. Any money collected by the
Trustee pursuant to this Article VIII 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
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premium, if any) or interest, upon presentation of the Senior 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
9.07;
SECOND: To the payment of the amounts then due and unpaid upon the
Senior Notes for principal (and premium, if any) and interest, in respect
of which or for the benefit of which such money has been collected,
rateably, without preference or priority of any kind, according to the
amounts due and payable on such Senior Notes for principal (and premium, if
any) and interest, respectively; and
THIRD: To the payment of the remainder, if any, to the Company, the
Guarantor or any other Person lawfully entitled thereto.
For all purposes of this Section 8.06, the Holders of any Senior Notes
denominated in ECU, or any other composite currency or a Foreign Currency shall
be entitled to receive a rateable portion of the payment determined pursuant to
Section 1.04(f) hereof.
SECTION 8.07. LIMITATIONS ON SUITS. No Holder of any Senior 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 Senior Notes of that
series;
(2) the Holders of not less than 25% in principal amount of the
Outstanding Senior 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 Senior 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
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over any other Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and rateable benefit of all the
Holders.
SECTION 8.08. UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL, PREMIUM
AND INTEREST. Notwithstanding any other provision in this Indenture, the Holder
of any Senior 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 Senior Note on the respective Stated Maturities
expressed in such Senior Note (or, in the case of redemption, on the Redemption
Date) and to institute suit for the enforcement of any such payment, and such
right shall not be impaired without the consent of such Holder.
SECTION 8.09. RESTORATION OF RIGHTS AND REMEDIES. 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 Guarantor, 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 8.10. RIGHTS AND REMEDIES CUMULATIVE. 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 8.11. DELAY OR OMISSION NOT WAIVER. 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 VIII 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 8.12. CONTROL BY HOLDERS. The Holders of a majority in principal
amount of the Outstanding Senior 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
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(2) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
SECTION 8.13. WAIVER OF PAST DEFAULTS. The Holders of a majority in
principal amount of the Outstanding Senior Notes of any series affected by an
Event of Default may on behalf of the Holders of such series of Senior 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 Senior Note of such series, or
(2) in respect of a covenant or provision hereof which under Section
12.02 cannot be modified or amended without the consent of the Holder of
each Outstanding Senior 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 8.14. UNDERTAKING OF COSTS. All parties to this Indenture agree,
and each Holder of any Senior 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 8.14 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 Senior 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 Senior Note on or after the respective Stated Maturities
expressed in such Senior Note for such interest (or, in the case of redemption,
on or after the Redemption Date).
SECTION 8.15. WAIVER OF STAY OR EXTENSION LAWS. Each of the Company and the
Guarantor covenant (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 each of the Company and the Guarantor (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 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.
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ARTICLE IX
TRUSTEE
SECTION 9.01. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. (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 9.01;
(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 direction
of the Holders of a majority in principal amount of the Outstanding Senior
Notes determined as provided in Section 1.01 and 1.04 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
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(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 9.02. NOTICE OF DEFAULT. 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 Senior 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 8.01(4) no such notice
to Holders shall be given until at least 60 days after the occurrence thereof.
For the purpose of this Section 9.02 the term 'default' means any event which
is, or after notice or lapse of time or both would become, an Event of Default.
SECTION 9.03. CERTAIN RIGHTS OF TRUSTEES. Except as otherwise provided in
Section 9.01:
(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 or the Guarantor 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;
(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 of its selection and the 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 security or indemnity,
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reasonably satisfactory to the Trustee, 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 or the Guarantor, personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers 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 9.04. NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF NOTES. The
recitals contained herein and in the Senior Notes, except the certificate of
authentication, shall be taken as the statements of the Company or the
Guarantor, as the case may be, 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 Senior Notes. The Trustee shall not be
accountable for the use or application by the Company or the Guarantor of Senior
Notes or the proceeds thereof.
SECTION 9.05. MAY HOLD NOTES. The Trustee, any Paying Agent, Note
Registrar or any other agent of the Company or the Guarantor, in its individual
or any other capacity, may become the owner or pledgee of Senior Notes and,
subject to Sections 9.08 and 9.09 may otherwise deal with the Company or the
Guarantor with the same rights it would have if it were not Trustee, Paying
Agent, Note Registrar or such other agent.
SECTION 9.06. MONEY HELD IN TRUST. 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 and the
Guarantor.
SECTION 9.07. COMPENSATION AND REIMBURSEMENT. The Company and the
Guarantor, jointly and severally agree
(1) to pay to the Trustee from time to time such compensation as the
Company and the Trustee shall from time to time agree in writing for all
services rendered by it
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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, damages, claims, liability or expense incurred, including taxes
(other than taxes based upon, or measured by, the income of the Trustee)
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 9.07 the Trustee shall have a lien prior to the Senior Notes for
any amount owing to it or to any predecessor Trustee 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 Senior
Notes.
When the Trustee incurs expenses or renders services in connection with an
Event of Default specified in Section 8.01(5) or Section 8.01(6), the expenses
(including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
The provisions of this Section shall survive the termination of this
Indenture.
SECTION 9.08. CORPORATE TRUSTEE REQUIRED; ELIGIBILITY; DISQUALIFICATION;
CONFLICTING INTERESTS. (a) This Indenture shall always have a Trustee with
respect to the Senior Notes of each series which satisfies the requirements of
TIA 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 310(b), including the optional provision
permitted by the second sentence of TIA 310(b)(9); it being understood that for
the purposes of this Indenture, with respect to Senior Notes of any series, the
provisions of TIA 310(b) with respect to conflicting interests relating to
'other securities' shall be interpreted to include Senior Notes of each other
series and with respect to 'other indentures' shall include the provisions of
this Indenture relating to the Senior Notes of such other series.
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SECTION 9.09. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COMPANY. The
Trustee is subject to TIA 311(a), excluding any creditor relationship listed in
TIA 311(b). A Trustee who has resigned or been removed shall be subject to TIA
311(a) to the extent indicated.
SECTION 9.10. RESIGNATION AND REMOVAL; APPOINTMENT OF SUCCESSOR. (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 9.11.
(b) The Trustee may resign at any time by giving written notice thereof to
the Company and the Guarantor. 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 Senior Notes, delivered to the
Trustee, the Company and the Guarantor.
(d) If at any time:
(1) the Trustee shall fail to comply with Section 9.08(b) after
written request therefor by the Company, the Guarantor or by any Holder who
has been a bona fide Holder for at least six months, or
(2) the Trustee shall cease to be eligible under Section 9.08(a) and
shall fail to resign after written request therefor by the Company or the
Guarantor 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 or the Guarantor, individually and not
jointly by a Board Resolution may remove the Trustee, or (ii) subject to Section
8.14, 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
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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 Senior 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 9.11. ACCEPTANCE OF APPOINTMENT BY SUCCESSOR. Every successor
Trustee appointed hereunder shall execute, acknowledge and deliver to the
Company and the Guarantor and to the retiring Trustee an instrument accepting
such appointment, and thereupon the resignation or removal of the retiring
Trustee shall become effective and 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 and the
Guarantor 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 9.07. Upon request of any such successor
Trustee, the Company and the Guarantor 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 IX.
SECTION 9.12. MERGER, CONVERSION, CONSOLIDATION OR SUCCESSION TO BUSINESS.
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 IX,
without the execution or filing of any paper or any further act on the part of
any of the parties hereto. In case any Senior 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
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may adopt such authentication and deliver the Senior Notes so authenticated with
the same effect as if such successor Trustee had itself authenticated such
Senior Notes.
ARTICLE X
HOLDER'S LISTS AND REPORTS BY TRUSTEE AND COMPANY
SECTION 10.01. COMPANY TO FURNISH TRUSTEE NAMES AND ADDRESSES OF HOLDERS.
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 November 1, 1993, 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 10.02. PRESERVATION OF INFORMATION; COMMUNICATIONS TO HOLDERS.
(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 10.01 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 10.01
upon receipt of a new list so furnished.
(b) Holders of Senior Notes may communicate pursuant to TIA 312(b) with
other Holders with respect to their rights under this Indenture or the Senior
Notes. The Company, the Guarantor the Trustee, the Senior Note Registrar, and
anyone else shall have the protection of TIA 312(c).
SECTION 10.03. REPORTS BY TRUSTEE. (a) The term 'reporting date', as used
in this Section 10.03, 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 313(a). The Trustee shall also comply with TIA
313(b).
(b) Reports pursuant to this Section 10.03 shall be transmitted by mail:
(1) to all Holders of Senior Notes, as the names and addresses of such
Holders appear in the Note Register;
(2) to such Holders of Senior 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 to TIA
313(b), to all Holders of Senior Notes
<PAGE>
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whose names and addresses have been furnished to or received by the Trustee
pursuant to Section 10.01.
(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 Senior
Notes are listed, and also with the Commission. The Company will notify the
Trustee when the Senior Notes are listed on any stock exchange.
ARTICLE XI
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE
SECTION 11.01. GUARANTOR MAY CONSOLIDATE, ETC. ONLY ON CERTAIN TERMS. The
Guarantor 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
Guarantor is merged or the Person which acquires by conveyance, transfer,
sale or lease the properties and assets of the Guarantor 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 Senior Notes pursuant to the Guarantee and the
performance of every covenant of this Indenture on the part of the
Guarantor 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 Guarantor 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 11.01 and that all conditions precedent herein provided for
relating to such transaction have been complied with.
SECTION 11.02. COMPANY MAY CONSOLIDATE, ETC. ONLY ON CERTAIN TERMS.
Notwithstanding anything contained in this Indenture or in the Senior Notes, a
resolution or order for winding-up the Company or any other proceedings taken
with a view to its reconstruction or its reorganization or its consolidation,
amalgamation or merger with or into another corporation, or any other
transaction or proceedings resulting in the amalgamation of the Company with
another corporation or the transfer, sale or conveyance of all or substantially
all the Company's undertaking or assets to another Person shall not constitute
an Event of Default or be deemed to be prevented or restricted by anything
contained herein or in the Senior
<PAGE>
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Notes, if the Person resulting from such a reconstruction, reorganization,
consolidation, amalgamation or merger or the Person to whom such undertaking or
assets are transferred, sold or conveyed, as the case may be, (herein referred
to as the "Successor") shall, within 120 days from the passing of the resolution
or the date of the order, and at or before the taking of such other proceedings
or the transfer, sale or conveyance of the undertaking and assets of the Company
to the Successor, enter into a covenant with the Trustee or otherwise become
liable in law to pay the principal and interest and other moneys due or which
may become due under this Indenture and the Senior Notes and to perform and
observe all the obligations of the Company under this Indenture, and shall sign
and execute all such deeds and documents as the Trustee may be advised by
counsel are necessary or advisable in the circumstances.
Provided, however, that the Company shall not engage in any
transaction referred to in the foregoing paragraph unless the Trustee has been
satisfied that the following conditions have been complied with:
(1) the Successor is a corporation incorporated or a partnership formed
under the laws of Canada or of the United States of America or under
any of the respective political subdivisions thereof;
(2) at the time of and immediately after the consummation of the
transaction no condition or event shall exist which constitutes or
which would, after the lapse of time of giving of notice or both,
constitute an Event of Default hereunder;
(3) the Successor is lawfully entitled to acquire and operate the
undertaking and assets; and
(4) in the opinion of counsel to the Trustee, the transaction is upon such
terms as substantially to preserve and not to impair any of the rights
and powers of the Trustee or of the Holders hereunder.
The Trustee may accept and rely on an opinion of counsel that
conditions prescribed in this section 11.02 have been complied with and upon
obtaining such opinion the Trustee shall join in such documents and do such acts
as may be required or thought advisable to consent to or give effect to such
reconstruction, reorganization, consolidation, amalgamation, merger, transfer,
sale or conveyance and to release and discharge the Company from liability under
this Indenture and the Senior Notes.
SECTION 11.03. SUCCESSOR CORPORATION SUBSTITUTED. Upon any consolidation
or merger, or any conveyance, transfer, sale or lease of the properties and
assets of the Company or the Guarantor, as the case may be, as, or substantially
as, an entirety in accordance with Sections 11.01 or 11.02, the successor
corporation formed by such consolidation or into which the Company or the
Guarantor 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
<PAGE>
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Company or the Guarantor, as the case may be, under this Indenture with the same
effect as if such successor corporation had been named as the Company or the
Guarantor respectively herein, and thereafter, except in the case of a lease,
the predecessor corporation shall be relieved of all obligations and covenants
under this Indenture, the Senior Notes or the Guarantees as applicable.
ARTICLE XII
SUPPLEMENTAL INDENTURES
SECTION 12.01. SUPPLEMENTAL INDENTURE WITHOUT CONSENT OF HOLDERS. Without
the consent of any Holder, the Company, the Guarantor 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 Senior Notes;
(2) to evidence the succession of another corporation to the Company
or the Guarantor, and the assumption by any such successor of the covenants
of the Company or the Guarantor herein and in the Senior Notes contained;
(3) to add to the covenants of the Company or the Guarantor for the
benefit of the Holders of all or any series of Senior Notes (and if such
covenants are to be for the benefit of less than all series of Senior
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 or the Guarantor;
(4) to mortgage, pledge, convey, assign and transfer to the Trustee
any property or assets as security for the Senior 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 or the
Guarantor and the Trustee, or to correct or amplify the description of any
such property or assets at any 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 Senior 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 Senior Notes issued hereunder;
<PAGE>
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(7) to provide for uncertificated Senior Notes in addition to
certificated Senior 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
Senior 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 Senior 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 9.11; or
(10) to make any change that does not adversely affect the rights of
any Holder of Senior Notes which are Outstanding.
SECTION 12.02. SUPPLEMENTAL INDENTURES WITH CONSENT OF HOLDERS. Subject
to the provisions of Section 8.12 and Section 8.13, with the consent of the
Holders of not less than a majority in principal amount of the Outstanding
Senior 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, the Guarantor 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 Senior 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 Senior Note affected thereby,
(1) change the Stated Maturity of the principal of, or any instalment
of interest on, any Senior Note, or reduce the principal amount thereof or
the interest thereon or any premium payable upon the redemption 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 Senior 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
Senior 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
<PAGE>
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(3) modify any of the provisions of this Section 12.02 or Section
8.13, 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 Senior 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 9.11 and
12.01(9).
It shall not be necessary for any Act of Holders under this Section 12.02
to approve the particular form of any proposed supplemental indenture, but it
shall be sufficient if such Act shall approve substance thereof.
SECTION 12.03. EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article XII or the modification thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and (subject to Section
9.01) 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 or the Guarantor 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.
SECTION 12.04. EFFECT OF SUPPLEMENTAL INDENTURES. Upon the execution of
any supplemental indenture under this Article XII, 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 Senior Notes
theretofore or thereafter authenticated and delivered hereunder shall be bound
thereby.
SECTION 12.05. CONFORMITY WITH TRUST INDENTURE ACT. Every supplemental
indenture executed pursuant to this Article XII shall conform to the
requirements of TIA as then in effect.
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SECTION 12.06. REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES. Senior
Notes authenticated and delivered after the execution of any applicable
supplemental indenture pursuant to this Article XII 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 Senior 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 Senior Notes.
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.
<PAGE>
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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 FINANCIAL CORPORATION LIMITED
By /s/ Kenneth Lipschitz
----------------------------------------
Group Vice President, Chief Financial
Officer and Treasurer
Attest:
/s/ Susan Mastandrea
- ----------------------
Assistant Secretary
(CORPORATE SEAL)
HOUSEHOLD INTERNATIONAL, INC.
BY /s/ J. Richard Hull
---------------------------------------
Senior Vice President, Secretary and
General Counsel
Attest:
/s/ John W. Blenke
- ----------------------
Assistant Secretary
(CORPORATE SEAL)
LaSALLE NATIONAL TRUST, N.A.,
AS TRUSTEE
BY /s/ Gail A. Klewin
---------------------------------------
Vice President
Attest:
/s/ Jeffrey L. Kinney
- ----------------------
Assistant Secretary
(CORPORATE SEAL)
<PAGE>
Exhibit 4(c)
HOUSEHOLD FINANCIAL CORPORATION LIMITED
Form of Warrant Agreement
(for warrants sold alone)
THIS WARRANT AGREEMENT dated as of between Household
Financial Corporation Limited, a corporation organized under the laws of Ontario
(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>
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
2
<PAGE>
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.
3
<PAGE>
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
4
<PAGE>
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.
5
<PAGE>
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
6
<PAGE>
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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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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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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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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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 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 Financial Corporation Limited 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 FINANCIAL CORPORATION LIMITED
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 FINANCIAL CORPORATION LIMITED
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 FINANCIAL CORPORATION LIMITED (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>
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 ].
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[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 FINANCIAL CORPORATION LIMITED
By______________________________________
Attest:
________________________
Countersigned:
________________________
As Warrant Agent
By______________________
Authorized Signature
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[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 Financial Corporation Limited 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.
Dated:
________________________
___________________________ Name_________________________________
(Insert Social Security (Please Print)
or Other Identifying Number
of Holder) Address_______________________________
_______________________________
Signature_____________________________
<PAGE>
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.)
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Reverse of Warrant Certificate
*[CERTIFICATE FOR DELIVERY OF BEARER BONDS]
HOUSEHOLD FINANCIAL CORPORATION LIMITED
Warrant Debt Securities
TO: HOUSEHOLD FINANCIAL CORPORATION LIMITED
[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>
[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.
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:
______________________________
<PAGE>
HOUSEHOLD FINANCIAL CORPORATION LIMITED
Form of Warrant Agreement
(for warrants sold attached to debt securities)
THIS WARRANT AGREEMENT dated as of
between Household Financial Corporation Limited an Ontario 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 $
<PAGE>
Warrant Certificates shall be initially issued in units with 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,
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<PAGE>
prior to the Detachable Date, the registered owner of the Offered 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]
- --------------
* 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>
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 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
4
<PAGE>
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
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
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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
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<PAGE>
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>
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
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<PAGE>
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
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<PAGE>
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.
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<PAGE>
(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
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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>
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.
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IN WITNESS WHEREOF, Household Financial Corporation Limited 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 FINANCIAL CORPORATION LIMITED
By
--------------------------------------
Attest:
- --------------------
By
--------------------------------------
as Warrant Agent
Attest:
- --------------------
14
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EXHIBIT A
(FORM OF WARRANT CERTIFICATE)
[Face of Warrant Certificate]
[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]
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 FINANCIAL CORPORATION LIMITED
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 Financial Corporation Limited (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>
, 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.
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<PAGE>
[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>
This Warrant Certificate shall not be valid or obligatory for any
purpose until countersigned by the Warrant Agent.
Dated as of , 19 .
HOUSEHOLD FINANCIAL CORPORATION LIMITED
By
-------------------------------------
Attest:
- ------------------------
Countersigned:
- ------------------------
As Warrant Agent
By
---------------------
Authorized Signature
4
<PAGE>
[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.
Dated:
- ---------------------------
- --------------------------- Name
(Insert Social Security --------------------------------
or Other Identifying Number (Please Print)
of Holder)
Address
-----------------------------
-----------------------------
Signature
---------------------------
<PAGE>
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>
Reverse of Warrant Certificate
*[Certificate for Delivery of Bearer Bonds]
HOUSEHOLD FINANCIAL CORPORATION LIMITED
Warrant Debt Securities
TO: HOUSEHOLD FINANCIAL CORPORATION LIMITED
---------------------------------------
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>
[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.
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:
- ------------------------------
<PAGE>
EXHIBIT 5(a) and
EXHIBIT 23(b)
June 5, 1996
Household International, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
Re: Household International, Inc. Registration Statement on Form S-3 and Form
F-3, for the unconditional guarantees as to repayment of up to $400 million
of Senior Notes and Warrants to Purchase Senior Notes of Household
Financial Corporation Limited
Gentlemen:
As Vice President-Corporate Law and Assistant Secretary of Household
International, Inc., a Delaware corporation ("Household"), I am generally
familiar with the proceedings in connection with Household's Registration
Statement on Form S-3 and Form F-3 in which the unconditional guarantees (the
"Guarantees") of Household for up to $400,000,000 aggregate principal amount of
Senior Notes and Warrants to Purchase Senior Notes of Household Financial
Corporation Limited ("HFCL"), a subsidiary of Household, are being registered.
The Guarantees will be issuable under an Indenture dated as of May 15, 1993,
among Household, HFCL and The Bank of New York, as Trustee (the "Bank of New
York Indenture"), or an Indenture dated as of May 15, 1993, among Household,
HFCL and LaSalle National Bank, as Trustee (the "LaSalle Indenture"). The
foregoing indentures, or forms thereof, have been filed with the Securities and
Exchange Commission (the "Commission") as exhibits to the Registration
Statement.
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 LaSalle Indenture and Bank of New York Indenture have been duly
authorized, executed and delivered by Household, and each constitutes
a valid and legally binding instrument 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 affecting the enforcement of creditors'
rights
<PAGE>
Household International, Inc.
June 5, 1996
Page 2
or by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
3. When the issuance of Senior Notes and Warrants to Purchase Senior
Notes has been duly authorized by the appropriate corporate action of
HFCL, and such Senior Notes and Warrants to Purchase Senior Notes 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 any Prospectus
Supplement relating to such Senior Notes and Warrants to Purchase
Senior Notes, the Guarantees 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 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).
I hereby consent to the use of my name and my opinion in the Prospectus,
Preliminary Prospectus and any Prospectus Supplement filed pursuant to Rule 424
or 430A of Regulation C of the Securities Act of 1933, as amended ("Act"), in
connection with the above referenced Registration Statement filed with the
Commission on February 16, 1996, as amended by Amendment No. 1 thereto filed
with the Commission on or about June 5, 1996, including any references to my
opinions set forth in the documents incorporated by reference therein, and to
the filing of this opinion as an exhibit to said Registration Statement. In
giving such 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 Commission thereunder.
John W. Blenke
<PAGE>
EXHIBIT 5(b) and
EXHIBIT 23(c)
Box 25, Commerce Court West
Toronto, Ontario
Barristers & Solicitors M5L 1A9
Patent & Trade-mark Agents
Deliveries: 28th floor
Telephone: (416) 863-2400
Facsimile: (416) 863-2653
Telex: 06-219687
June 5, 1996
Reference: 999/1401
Household Financial Corporation Limited
100 Sheppard Avenue East
Suite 1000
North York, Ontario
M2N 6N7
Dear Sirs:
RE: HOUSEHOLD FINANCIAL CORPORATION LIMITED
PROPOSED OFFERING OF UP TO $400,000,000 DEBT SECURITIES IN
THE UNITED STATES GUARANTEED BY HOUSEHOLD INTERNATIONAL, INC.
------------------------------------------------------------------
We have acted on behalf of Household Financial Corporation Limited
(the "Corporation") in connection with the proposed offering by the Corporation
in the United States of up to U.S. $400,000,000 of unsecured senior notes
guaranteed by Household International, Inc. (the "Guarantor") and warrants to
purchase such senior notes (together referred to as the "Securities") and will
be issuable pursuant to an indenture dated as of May 15, 1993 among the
Corporation, the Guarantor and The Bank of New York, as trustee (the "Bank of
New York Indenture") or an indenture dated as of May 15, 1993, among the
Corporation, the Guarantor and LaSalle National Trust, N.A., as trustee (the
"LaSalle Indenture"), which are included as Exhibits 4(a) and 4(b),
respectively, to the registration statement on Form S-3 and Form F-3 (the
"Registration Statement") filed with the Securities and Exchange Commission on
February 16, 1996 and amended by amendment No. 1 filed with the Securities and
Exchange Commission on or about June 5, 1996.
We have considered such questions of law, examined such statutes,
regulations, corporate documents, records, certificates, opinions and
instruments and have made such other investigations as we have deemed necessary
or desirable in connection with the opinions hereinafter set forth, including,
but not so as to limit the generality of the foregoing, the following:
(a) all currently effective articles and by-laws of the Corporation;
Toronto . Ottawa . Montreal . Quebec* . Calgary
Vancouver . London, England . *Associated firm: Levery, de Billy
<PAGE>
Page 2
(b) a certificate as to certain factual matters of the Director, Law and
Compliance, Secretary and General Counsel of the Corporation of even
date herewith;
(c) certified copies of the resolutions of the board of directors of the
Corporation respecting, inter alia, (i) approval of the Registration
Statement, (ii) approval of the Bank of New York Indenture and the
LaSalle Indenture; (iii) delegation to either the President or the
Group Vice-President, Chief Financial Officer and Treasurer and in the
event that neither of those officers is available, the Vice-President-
Corporate Finance, of authority to create and issue the Securities
and to execute the Bank of New York Indenture and the LaSalle
Indenture, and
(d) a certificate of status for the Corporation issued by the Ontario
Ministry of Consumer and Commercial Relations dated April 18, 1996.
In our examinations, we have assumed the genuineness of all
signatures, the authenticity of all documents submitted to us as originals and
the conformity to the original of all documents submitted to us as certified,
notarized or conformed or facsimile copies.
We have not made an examination of the laws of any jurisdiction other
than Canada and the Province of Ontario and we do not express or imply any
independent opinion in respect of the laws of any jurisdiction other than Canada
and the Province of Ontario. As the laws of the State of Illinois are stated to
govern the legal aspects of the issuance and enforceability of the terms of the
Securities, Bank of New York Indenture, LaSalle Indenture and Registration
Statement, with respect to the opinions expressed in paragraphs 3 and 4 below,
we have relied exclusively upon the opinion of Mr. John W. Blenke Vice-President
- -Corporate Law and Assistant Secretary of the Guarantor of even date herewith as
to the matters set forth therein. A copy of Mr. Blenke's opinion is being
delivered to you with this opinion.
We express no opinion herein as to the Guarantor and assume, for
purposes hereof, that the Bank of New York Indenture and the LaSalle Indenture
will have each been duly executed and delivered by all parties thereto other
than the Corporation.
Based upon foregoing and subject to the qualifications hereinafter
expressed, we are of the opinion that:
1. The Corporation has been duly amalgamated and is a subsisting
corporation under the laws of the Province of Ontario.
2. The Bank of New York Indenture and the LaSalle Indenture have each
been duly authorized by the Corporation.
<PAGE>
Page 3
3. The Bank of New York Indenture and the LaSalle Indenture each
constitute valid and legally binding instruments of the Corporation
enforceable against the Corporation 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 (regardless of whether such
enforceability is considered in a proceeding in equity or at law).
4. When the issuance of Securities has been duly authorized by the
appropriate corporate action of the Corporation, and such 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 as described in the
Registration Statement, including the prospectus and prospectus
supplement relating to such Securities, such Securities will be
legally and validly issued and will be the legal and binding
obligations of the Corporation enforceable against the Corporation 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 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).
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement. In giving such consent we do not admit that we are in
the category of persons whose consent is required under section 7 of the
Securities Act of 1933, as amended.
Yours very truly,
/s/ BLAKE, CASSELS & GRAYDON
<PAGE>
<TABLE>
<CAPTION>
EXHIBIT 12(b)
HOUSEHOLD FINANCIAL CORPORATION LIMITED
RATIO OF EARNINGS TO FIXED CHARGES
(EXCLUDING CAPITALIZED INTEREST AND ONE-THIRD RENTAL EXPENSE)
Quarter Ended
Years Ended March 31,
--------------------------------------------------- -------------
1995 1994 1993 1992 1991 1996 1995
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Before tax income (loss) 13,406 (26,402) (48,673) (48,679) (46,269) 37 ( 3,634)
Fixed charges interest expense 202,052 192,160 207,073 227,528 267,807 29,659 57,966
Total earnings 215,458 165,758 158,400 178,849 221,538 29,696 54,332
Ratio of earnings to fixed charges 1.07 0.86 0.76 0.79 0.83 1.00 0.94
</TABLE>
<TABLE>
<CAPTION>
RATIO OF EARNINGS TO FIXED CHARGES
(INCLUDING CAPITALIZED INTEREST AND ONE-THIRD RENTAL EXPENSE)
Quarter Ended
Years Ended March 31,
--------------------------------------------------- ------------
1995 1994 1993 1992 1991 1996 1995
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Income (loss) from continuing
operations 7,078 (15,198) (25,276) (26,842) (24,893) ( 68) ( 2,164)
Income tax expense (benefit) 6,328 (11,204) (23,397) (21,837) (21,376) 105 ( 1,470)
Fixed charges:
Interest expense 202,052 192,160 207,073 227,528 267,807 29,659 57,966
Interest portion of rentals 2,670 2,972 3,223 4,632 4,885 599 725
------- ------- ------- ------- ------- ------ -------
Total fixed charges 204,722 195,132 210,296 232,160 272,692 30,258 58,691
------- ------- ------- ------- ------- ------ -------
Total earnings as
defined/1/ 218,128 168,730 161,623 183,481 226,423 30,295 55,057
------- ------- ------- ------- ------- ------ -------
Ratio of earnings to fixed charges 1.07 0.86 0.77 0.79 0.83 1.00 0.94
======= ======= ======= ======= ======= ====== =======
</TABLE>
- ---------------------------
/1/ Earnings consist of income from continuing operations to which has
been added income taxes and fixed charges.
<PAGE>
EXHIBIT 23(a)
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
-----------------------------------------
Household Financial Corporation Limited
Household International, Inc.
As independent public accountants, relating to the offering of up to
$400,000,000 of Household Financial Corporation Limited's senior notes and
warrants to purchase senior notes, and the guarantee thereof by Household
International, Inc., to be filed with the Securities and Exchange Commission on
or about June 5, 1996:
(i) we hereby consent to the incorporation in this registration
statement on Forms S-3 and F-3 of our report dated January 24,
1996, included with Household Financial Corporation Limited's
consolidated financial statements for the year ended December 31,
1995,
(ii) we also consent to the incorporation by reference in this
registration statement on Forms S-3 and F-3 of our report dated
January 24, 1996, included in Household International, Inc.'s
Form 10-K for the year ended December 31, 1995,
and to all references to our Firm included in this registration statement.
ARTHUR ANDERSEN LLP
Chicago, Illinois
June 5, 1996
<PAGE>
EXHIBIT 25(a)
==============================================================================
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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) [_]
---------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
---------------------
HOUSEHOLD INTERNATIONAL, INC.
(Exact name of obligor as specified in its charter)
Delaware 36-3121988
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
2700 Sanders Road
Prospect Heights, Illinois 60070
(Address of principal executive offices) (Zip code)
---------------------
HOUSEHOLD FINANCIAL CORPORATION LIMITED
(Exact name of obligor as specified in its charter)
Ontario, Canada Not Applicable
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
100 Sheppard Avenue East
Suite 1000
North York, Ontario, Canada M2N 6N7
(Address of principal executive offices) (Zip code)
Senior Notes
(Title of the indenture securities)
==============================================================================
<PAGE>
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.
- --------------------------------------------------------------------------------
Name Address
- --------------------------------------------------------------------------------
Superintendent of Banks of the State of 2 Rector Street, New York,
New York N.Y. 10006, and Albany, N.Y.
12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None. (See Note on page 3.)
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE 7a-
29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND RULE 24 OF THE
COMMISSION'S RULES OF PRACTICE.
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1 filed
with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1
filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-
1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
-2-
<PAGE>
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No. 33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
NOTE
Inasmuch as this Form T-1 is filed prior to the ascertainment by the
Trustee of all facts on which to base a responsive answer to Item 2, the answer
to said Item is based on incomplete information.
Item 2 may, however, be considered as correct unless amended by an
amendment to this Form T-1.
-3-
<PAGE>
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 31st day of May, 1996.
THE BANK OF NEW YORK
By: /s/ Vivian Georges
--------------------------------
Name: VIVIAN GEORGES
Title: ASSISTANT VICE PRESIDENT
-4-
<PAGE>
EXHIBIT 7
- ------------------------------------------------------------------------------
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business December 31,
1995, published in accordance with a call made by the Federal Reserve Bank of
this District pursuant to the provisions of the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from depository institutions:
Noninterest-bearing balances and
currency and coin.............................. $ 4,500,312
Interest-bearing balances........................ 643,938
Securities:
Held-to-maturity securities...................... 806,221
Available-for-sale securities.................... 2,036,768
Federal funds sold and securities
purchased under agreements to resell
in domestic offices of the bank:
Federal funds sold............................... 4,166,720
Securities purchased under agreements
to resell........................................ 50,413
Loans and lease financing
receivables:
Loans and leases, net of unearned
income ..............................27,068,535
LESS: Allowance for loan and
lease losses ...........................520,024
LESS: Allocated transfer risk
reserve...................................1,000
Loans and leases, net of unearned
income and allowance, and reserve.............. 26,547,511
Assets held in trading accounts.................... 758,462
Premises and fixed assets (including
capitalized leases).............................. 615,330
Other real estate owned............................ 63,769
Investments in unconsolidated
subsidiaries and associated
companies........................................ 223,174
Customers' liability to this bank on
acceptances outstanding.......................... 900,795
Intangible assets.................................. 212,220
Other assets....................................... 1,186,274
-----------
Total assets....................................... $42,711,907
===========
LIABILITIES
Deposits:
In domestic offices.............................. $21,248,127
Noninterest-bearing ....................9,172,079
Interest-bearing ......................12,076,048
In foreign offices, Edge and
Agreement subsidiaries, and IBFs................. 9,535,088
Noninterest-bearing .......................64,417
Interest-bearing ...................... 9,470,671
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.......................... 2,095,668
Securities sold under agreements
to repurchase.................................. 69,212
Demand notes issued to the U.S.
Treasury......................................... 107,340
Trading liabilities................................ 615,718
Other borrowed money:
With original maturity of one year
or less........................................ 1,638,744
With original maturity of more than
one year....................................... 120,863
Bank's liability on acceptances executed
and outstanding.................................. 909,527
Subordinated notes and debentures.................. 1,047,860
Other liabilities.................................. 1,836,573
-----------
Total liabilities.................................. 39,224,720
-----------
EQUITY CAPITAL
Common stock....................................... 942,284
Surplus............................................ 525,666
Undivided profits and capital
reserves......................................... 1,995,316
Net unrealized holding gains
(losses) on available-for-sale
securities....................................... 29,668
Cumulative foreign currency translation
adjustments...................................... ( 5,747)
-----------
Total equity capital............................... 3,487,187
-----------
Total liabilities and equity capital .............. $42,711,907
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller 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.
Robert E. Keilman
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 is true and
correct.
J. Carter Bacot )
Thomas A. Renyi ) Directors
Alan R. Griffith )
- ------------------------------------------------------------------------------
-5-
<PAGE>
Exhibit 25(b)
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________________
FORM T-1
STATEMENT OF ELIGIBILITY AND QUALIFICATION
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
_________________________
LASALLE NATIONAL TRUST, N.A.
(Exact name of trustee as specified in its charter)
36-3697893
(I.R.S. Employer
Identification No.)
135 South LaSalle Street, Chicago, Illinois 60603
(Address of principal executive offices) (Zip Code)
_________________________
M. ROBERT K. QUINN
Senior Vice President and General Counsel
Telephone: (312) 904-2010
135 South LaSalle Street
Chicago, Illinois 60603
(Name, address and telephone number of agent for service)
--------------------
HOUSEHOLD FINANCIAL CORPORATION LIMITED
(Exact name of obligor as specified in its charter)
Ontario, Canada 36-3121988
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
100 Sheppard Avenue East
Suite 1000
North York, Ontario, Canada M2N 6N7
(Address of Principal Executive Offices) (Zip Code)
________________________
HOUSEHOLD INTERNATIONAL, INC.
(Exact name of Guarantor as specified in its charter)
Delaware 36-3121988
(State or other jurisdiction or (I.R.S. employer
incorporation or organization) Identification no.)
2700 Sanders Road
Prospect Heights, IL 60070
(Address of Principal executive offices) (Zip Code)
Unconditionally Guaranteed Senior Notes
(Title of the indenture securities)
<PAGE>
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.
1. Comptroller of the Currency, Washington D.C.
2. The Board of Governors of the Federal Reserve Systems,
Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Yes.
ITEM 2. AFFILIATIONS WITH OBLIGOR AND UNDERWRITERS.
If the obligor or any underwriter for the obligor is an affiliate of the
trustee, describe each such affiliation.
Not Applicable
ITEM 3. VOTING SECURITIES OF THE TRUSTEE.
Furnish the following information as to each class of voting securities of the
trustee:
Not applicable
ITEM 4. TRUSTEESHIPS UNDER OTHER INDENTURES.
If the trustee is a trustee under another indenture under which any other
securities, or certificates of interest or participation in any other
securities, of the obligor are outstanding, furnish the following information:
(a) Title of the securities outstanding under each other indenture.
$75,000,000 Household Financial Corporation Limited 6% Senior
Notes Due 6/30/98
<PAGE>
(b) A brief statement of the facts relied upon as a basis for the
claim that no conflicting interest within the meaning of Section 310(b)(1) of
the Act arises as a result of the trusteeship under such other indenture,
including a statement as to how the indenture securities will rank as compared
with the securities issued under such other indenture.
We have performed our standard conflict of interest check. We have
found that there are no defaults with the obligor.
The bonds will be equally ranked with the 6% Senior Notes described in
Item 4(a) hereto.
ITEM 5. INTERLOCKING DIRECTORATES AND SIMILAR RELATIONSHIPS WITH THE OBLIGOR
OR UNDERWRITERS.
If the trustee or any of the directors or executive officers of the trustee is a
director, officer, partner, employee, appointee, or representative of the
obligor or of any underwriter for the obligor, identify each such person having
any such connection and state the nature of each such connection.
Not applicable
ITEM 6. VOTING SECURITIES OF THE TRUSTEE OWNED BY THE OBLIGOR OR ITS
OFFICIALS.
Furnish the following information as to the voting securities of the trustee
owned beneficially by the obligor and each director, partner and executive
officer of the obligor.
Not applicable
ITEM 7. VOTING SECURITIES OF THE TRUSTEE OWNED BY UNDERWRITERS OR THEIR
OFFICIALS.
Furnish the following information as to the voting securities of the trustee
owned beneficially by each underwriter for the obligor and each director,
partner, and executive officer of each such underwriter.
Not applicable
ITEM 8. SECURITIES OF THE OBLIGOR OWNED OR HELD BY THE TRUSTEE.
Furnish the following information as to securities of the obligor owned
<PAGE>
beneficially or held as collateral security for obligations in default by the
trustee:
Not applicable
ITEM 9. SECURITIES OF THE UNDERWRITER OWNED OR HELD BY THE TRUSTEE.
If the trustee owns beneficially or holds as collateral security for obligations
in default any securities of an underwriter for the obligor, furnish the
following information as to each class of securities of such underwriter any of
which are so owned or held by the trustee.
Not applicable
ITEM 10. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF VOTING SECURITIES OF CERTAIN
AFFILIATES OR SECURITY HOLDERS OF THE OBLIGOR.
If the trustee owns beneficially or holds as collateral security for obligations
in default voting securities of a person who, to the knowledge of the trustee
(1) owns 10 percent or more of the voting securities of the obligor or (2) is an
affiliate, other than a subsidiary, of the obligor, furnish the following
information as to the voting securities of such person.
Not applicable
ITEM 11. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF ANY SECURITIES OF A PERSON
OWNING 50 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR.
If the trustee owns beneficially or holds as collateral security for obligations
in default any securities of a person who, to the knowledge of the trustee, owns
50 percent or more of the voting securities of the obligor, furnish the
following information as to each class of securities of such person any of which
are so owned or held by the trustee.
Not applicable
ITEM 12. INDEBTEDNESS OF THE OBLIGOR TO THE TRUSTEE.
If the obligor is indebted to the trustee, furnish the following information.
Household International, Inc. And Household Financial Corporation Limited
have letters of credit from ABN AMRO Bank totaling $265,000,000. ABN AMRO Bank
is a related entity to the trustee.
ITEM 13. DEFAULTS BY THE OBLIGOR.
<PAGE>
a) State whether there is or has been a default with respect to the securities
under this indenture. Explain the nature of any such default.
Not applicable
b) If the trustee is a trustee under another indenture under which any other
securities, or certificates of interest or participation in any other
securities, of the obligor are outstanding, or is trustee for more than one
outstanding series of securities under the indenture, state whether there has
been a default under any such indenture or series, identify the indenture or
series affected, and explain the nature of any such default.
Not applicable
ITEM 14. AFFILIATIONS WITH THE UNDERWRITERS.
If any underwriter is an affiliate of the trustee, describe each such
affiliation.
Not applicable
ITEM 15. FOREIGN TRUSTEE.
Identify the order or rule pursuant to which the foreign trustee is authorized
to act as sole trustee under indentures qualified or to be qualified.
Not applicable
ITEM 16. LIST OF EXHIBITS.
List below all exhibits filed as part of this statement of eligibility and
qualification.
1. A copy of the Articles of Association of LaSalle National Trust, N.A. now
in effect.
(Incorporated by reference to Exhibit 1 to form T-1 filed with the
Amendment Number 1 to Registration Statement Number 33-62842).
2. A copy of the certificate of authority to commence business.
(Incorporated by reference to Exhibit 2 to Form T-1 filed with Amendment
Number 1 to Registration Statement Number 33-62842).
<PAGE>
3. A copy of the authorization to exercise corporate trust powers
(Incorporated by reference to Exhibit 1 to Form T-1 filed with the
Amendment to Registration Statement Number 33-62842).
4. A copy of the existing By-Laws of LaSalle National Trust, N.A.
(Incorporated by reference to Exhibit 4 to Form T-1 filed with amendment
Number 1 to Registration Statement Number 33-62842).
5. Not applicable.
6. The consent of the trustee required by Section 321(b) of the Trust
Indenture Act of 1939.
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.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, the trustee,
LaSalle National Trust, N.A., a corporation organized and existing under the
laws of the United States of America, has duly caused this statement of
eligibility and qualification to be signed on its behalf by the undersigned,
thereunto duly authorized, all in the City of Chicago, State of Illinois, on the
4th day of June 1996.
LASALLE NATIONAL TRUST, N.A.
By: /s/ Gregory P. Angelopoulos
---------------------------
Gregory P. Angelopoulos
Assistant Vice President
<PAGE>
EXHIBIT 6
LaSalle National Trust, N.A. hereby consents in accordance with the provisions
of Section 321(b) of the Trust Indenture Act of 1939, that reports of
examinations by Federal, State, Territorial and District authorities may be
furnished by such authorities to the Securities and Exchange Commission upon its
request therefor.
LASALLE NATIONAL TRUST, N.A.
By: /s/ Gregory P. Angelopoulos
---------------------------
Gregory P. Angelopoulos
Assistant Vice President
<PAGE>
EXHIBIT 7
Latest Report of Condition of
Trustee published pursuant to
law or the requirement of its
surviving or examining authority.
<PAGE>
Board of Governors of the Federal Reserve System
OMB Number: 7100-0036
Federal Deposit Insurance Corporation
OMB Number: 3064-0052
Office of the Comptroller of the Currency
OMB Number: 1557-0081
Expires March 31, 1999
FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL
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[LOGO] Please refer to page i, [1]
Table of Contents, for
the required disclosure
of estimated burden.
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CONSOLIDATED REPORTS OF CONDITION AND INCOME FOR A BANK WITH DOMESTIC OFFICES
ONLY AND TOTAL ASSETS OF $100 MILLION OR MORE BUT LESS THAN $300 MILLION--
FFIEC 033
(960331)
REPORT AT THE CLOSE OF BUSINESS MARCH 31, 1996 --------
(RCRI 9999)
This report is required by law: 12 U.S.C. (S)324 (State member banks); 12 U.S.C.
(S)1817 (State nonmember banks); and 12 U.S.C. (S)161 (National banks).
This report form is to be filed by banks with domestic offices only. Banks with
branches and consolidated subsidiaries in U.S. territories and possessions, Edge
or Agreement subsidiaries, foreign branches, consolidated foreign subsidiaries,
or International Banking Facilities must file FFIEC 031.
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NOTE: The Reports of Condition and Income must be signed by an authorized
officer and the Report of Condition must be attested to by not less than two
directors (trustees) for State nonmember banks and three directors for State
member and National banks.
I, JoAnn Sannasardo Lilek, Controller
______________________________________________________________________________
Name and Title of Officer Authorized to Sign Report
of the named bank do hereby declare that these Reports of Condition and Income
(including the supporting schedules) have been prepared in conformance with the
instructions issued by the appropriate Federal regulatory authority and are true
to the best of my knowledge and belief.
/s/ JoAnn Sannasardo Lilek
________________________________________________________________________________
Signature of Officer Authorized to Sign Report
4/25/96
________________________________________________________________________________
Date of Signature
The Reports of Condition and Income are to be prepared in accordance with
Federal regulatory authority instructions. NOTE: These instructions may in some
cases differ from generally accepted accounting principles.
We, the undersigned directors (trustees), attest to the correctness of this
Report of Condition (including the supporting schedules) 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.
/s/ xxxxxxxxxxxxxxxx
________________________________________________________________________________
Director (Trustee)
/s/ xxxxxxxxxxxxxxxx
________________________________________________________________________________
Director (Trustee)
/s/ xxxxxxxxxxxxxxxx
________________________________________________________________________________
Director (Trustee)
________________________________________________________________________________
FOR BANKS SUBMITTING HARD COPY REPORT FORMS:
STATE MEMBER BANKS: Return the original and one copy to the appropriate Federal
Reserve District Bank.
STATE NONMEMBER BANKS: Return the original only in the special return address
envelope provided. If express mail is used in lieu of the special return address
envelope, return the original only to the FDIC, c/o Quality Data Systems, 2127
Espey Court, Suite 204, Crofton, MD 21114.
NATIONAL BANKS: Return the original only in the special return address envelope
provided. If express mail is used in lieu of the special return address
envelope, return the original only to the FDIC, c/o Quality Data Systems, 2127
Espey Court, Suite 204, Crofton, MD 21114.
________________________________________________________________________________
FDIC Certificate Number 3 2 9 6 2
(RCRI 9050)
Banks should affix the address label in this space.
LaSalle National Trust, National Association
________________________________________________________________________________
Legal Title of Bank (TEXT 9010)
135 South LaSalle Street
________________________________________________________________________________
City (TEXT 9130)
Chicago, IL 60603
________________________________________________________________________________
State Abbrev. (TEXT 9200) ZIP Code (TEXT 9220)
Board of Governors of the Federal Reserve System, Federal Deposit Insurance
Corporation, Office of the Comptroller of the Currency.
<PAGE>
LaSalle NationaL Trust N.A. Call Date: 03/31/96 ST-BK: 171715 FFIEC 033
135 South LaSalle Street Page RC- 1
Chicago, IL 60603 Vendor ID: D CERT: 32962 9
Transit Number: 71000505
Consolidated Report of Condition for Insured Commercial and State-Chartered
Savings Banks for March 31, 1996
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>
C200
Dollar Amounts in Thousands
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<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule RC-A): RCON
----
a. Noninterest-bearing balances and currency and coin (1)............... 0081. . 13,411 1.a
b. Interest-bearing balances (2)........................................ 0071. . 0 1.b
2. Securities:
a. Held-to-maturity securities (from ScheduLe RC-B, column A)........... 1754. . 3,798 2.a
b. AvailabLe-for-sale securities (from Schedule RC-B, column D)......... 1773. . 300 2.b
3. Federal funds sold and securities purchased under agreements to resell:
a. Federal funds sold................................................... 0276. . 71,085 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 RCON
----
(from ScheduLe RC-C)......................... 2122. . 0 .......... 4.a
b. LESS: Allowance for loan and lease losses.... 3123. . 0 .......... 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. . 0 4.d
5. Trading assets.......................................................... 3545. . 0 5.
6. Premises and fixed assets (including capitalized leases)................ 2145. . 1,308 6.
7. Other real estate owned (from Schedule RC-M)............................ 2150. . 0 7.
8. Investments in unconsolidated subsidiaries and associated companies
(from Schedule RC-M).................................................... 2130. . 0 8.
9. Customers' liability to this bank on acceptances outstanding............ 2155. . 0 9.
10. Intangible assets (from Schedule RC-M).................................. 2143. . 0 10.
11. Other assets (from Schedule RC-F)....................................... 2160. . 7,964 11.
12. Total assets (sum of items 1 through 11)................................ 2170. . 97,866 12.
</TABLE>
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(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
<PAGE>
LaSalle NationaL Trust N.A. Call Date: 03/31/96 ST-BK: 171715 FFIEC 033
135 South LaSalle Street Page RC- 2
Chicago, IL 60603 Vendor ID: D CERT: 32962 10
Transit Number: 71000505
Schedule RC - Continued
<TABLE>
<CAPTION>
C200
Dollar Amounts in Thousands
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<S> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of RCON
----
columns A and C from Schedule RC-E).................................. 2200. . 0 13.a
RCON
----
(1) Noninterest-bearing (1)......................... 6631. . 0 ........... 13.a.1
(2) Interest-bearing................................ 6636. . 0 ........... 13.a.2
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs..... ...........
(1) Noninterest-bearing........................................... ...........
(2) Interest-bearing.............................................. ...........
14. Federal funds purchased and securities sold under agreements to
repurchase:
a. Federal funds purchased.............................................. 0278. . 0 14.a
b. Securities sold under agreements to repurchase....................... 0279. . 0 14.b
15. a. Demand notes issued to the U.S. Treasury............................. 2840. . 0 15.a
b. Trading liabilities.................................................. 3548. . 0 15.b
16. Other borrowed money:
a. With a remaining maturity of one year or less........................ 2332. . 1,498 16.a
b. With a remaining maturity of more than one year...................... 2333. . 0 16.b
17. Mortgage indebtedness and obligations under capitalized leases.......... 2910. . 0 17.
18. Bank's liability on acceptances executed and outstanding................ 2920. . 0 18.
19. Subordinated notes and debentures....................................... 3200. . 0 19.
20. Other liabilities (from Schedule RC-G).................................. 2930. . 78,528 20.
21. Total liabilities (sum of items 13 through 20).......................... 2948. . 80,026 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. . 5,000 24.
25. Surplus (exclude all surplus related to preferred stock)................ 3839. . 5,000 25.
26. a. Undivided profits and capital reserves............................... 3632. . 7,840 26.a
b. Net unrealized holding gains (losses) on available-for-sale
securities........................................................... 8434. . 0 26.b
27. Cumulative foreign currency translation adjustments..................... ..........
28. Total equity capital (sum of items 23 through 27)....................... 3210. . 17,840 28.
29. Total liabilities limited-life preferred stock, and equity capital
(sum of items 21, 22, and 28)........................................... 3300. . 97,866 29.
</TABLE>
Memorandum
To be reported only with the March Report of Condition.
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 by independent external auditors as of any
date during 1995................................... 6724. . 1 M.1
1 = Independent audit of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm which
submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in
accordance with generally accepted auditing standards by a certified public
accounting firm which submits a report on the consolidated holding company
(but not on the bank separately)
3 = Directors examination of the bank conducted in accordance with generally
accepted auditing standards by a certified public accounting firm (may be
required by state chartering authority)
4 = Directors examination of the bank performed by other external auditors (may
be required by state chartering authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
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(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
