<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON FEBRUARY 16, 1996
REGISTRATION NO. 333-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM S-3 AND F-3*
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
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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)
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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)
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WITH A COPY TO:
SCOTT N. GIERKE ERNEST MCNEE RICHARD C. HENDERSON
MCDERMOTT, WILL & BLAKE, CASSELS & DIRECTOR, LAW & COMPLIANCE,
EMERY GRAYDON SECRETARY AND GENERAL
227 WEST MONROE BOX 25, COMMERCE COUNSEL
STREET COURT WEST HOUSEHOLD FINANCIAL
CHICAGO, ILLINOIS TORONTO, ONTARIO M5L CORPORATION LIMITED
60606 1A9 100 SHEPPARD AVENUE EAST
SUITE 1000
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
TITLE OF EACH CLASS OF SECURITIES TO AMOUNT TO BE OFFERING PRICE OFFERING AMOUNT OF
BE REGISTERED REGISTERED PER UNIT(1) PRICE(1) REGISTRATION FEE
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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............................ (2) (2) (2) (2)
</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) 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 FEBRUARY 16, 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.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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 FEBRUARY , 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, 1994;
(b) Household International's Quarterly Reports on Forms 10-Q for the
quarters ended March 31, 1995, June 30, 1995 and September 30, 1995;
(c) Household International's Current Reports on Forms 8-K dated February
7, August 9, October 1, 1995, and two reports dated January 25, 1996;
(d) Household Canada's Annual Report on Form 40-F for the fiscal year
ended December 31, 1994; and
(e) Household Canada's Quarterly Reports filed on Forms 6-K for the
months of April 1995, August 1995 and September 1995.
2
<PAGE>
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 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. In 1994 Household
International initiated further restructuring in order to focus on its core
finance and banking business in the United States, the United Kingdom and
Canada. Since 1993 Household International has sold its Australia operations,
all retail banking operations outside metropolitan Chicago, its domestic and
Canadian first mortgage portfolios and its individual life and annuity
products. Household International's principal executive office is located at
2700 Sanders Road, Prospect Heights, Illinois 60070 (telephone: 847-564-5000).
The finance and banking business of Household International is the primary
focus of Household International's operations. Through subsidiaries, such as
Household Finance Corporation ("HFC"), Household Bank, f.s.b., Household Bank
(Nevada), National Association, Household Retail Services, Inc., Household Bank
(Illinois), National Association, 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 leveraged leases, privately-placed limited term preferred
stocks and selected commercial financing of equipment or property.
- --------
*VISA and MasterCard are registered trademarks of VISA, USA, Inc. and
MasterCard International Incorporated, respectively.
3
<PAGE>
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 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>
NINE MONTHS
ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
------------- ------------------------
1995 1994 1994 1993 1992 1991 1990
------ ------ ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Household International and subsidiar-
ies.................................... 1.41 1.42 1.41 1.38 1.19 1.10 1.17
Household Canada and subsidiaries....... 0.96 0.85 0.86 0.77 0.79 0.83 1.15
</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 0.96, 0.86,
0.86, 0.77, 0.79, 0.83 and 1.15, respectively.
4
<PAGE>
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.
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
5
<PAGE>
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 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.
6
<PAGE>
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.
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
If so indicated in the Prospectus Supplement with respect to any series of
Offered Debt Securities, settlement for such 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. Secondary trading in long-term notes and
debentures of corporate issuers is generally settled in clearing-house or next-
day funds. In contrast Offered Debt Securities subject to settlement in
immediately available funds will trade in the Depositary's Same-Day Funds
Settlement System until maturity, and secondary market trading activity in the
Offered Debt Securities will therefore be required by the Depositary to settle
in immediately available funds. No assurance can be given as to the effect, if
any, of settlement in immediately available funds on trading activity in the
Offered Debt Securities.
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
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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 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
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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 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
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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 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)
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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.
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)
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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)
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
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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.
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.
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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, 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.
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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
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 80-51 (an exemption for certain transactions involving bank
collective investment funds) or PTCE 90-1 (an exemption for certain
transactions involving insurance company pooled separate accounts). ANY PENSION
OR OTHER EMPLOYEE BENEFIT PLAN PROPOSING TO ACQUIRE ANY SECURITIES SHOULD
CONSULT WITH ITS COUNSEL.
15
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
Estimated Expenses:
<TABLE>
<S> <C>
Printing & Engraving............................................ $ 40,000
Fees of Trustees................................................ 40,000
Accountants' Fees............................................... 40,000
Blue Sky Qualification Fees..................................... 15,000
SEC Filing Fee.................................................. 137,932*
Rating Service Fees............................................. 300,000
Legal Fees...................................................... 20,000
Miscellaneous................................................... 7,068
--------
Total....................................................... $600,000
========
</TABLE>
- --------
* Actual
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The General Corporation Law of Delaware (Section 102) allows a corporation to
eliminate the personal liability of directors of a corporation to the
corporation or to any its stockholders for monetary damage for a breach of
his/her fiduciary duty as a director, except in the case where the director
breached his/her duty of loyalty, failed to act in good faith, engaged in
intentional misconduct or knowingly violated a law, authorized the payment of a
dividend or approved a stock repurchase in violation of Delaware corporate law
or obtained an improper personal benefit. The Restated Certificate of
Incorporation, as amended, of Household International, contains a provision
which eliminates directors' personal liability as set forth above.
The General Corporation Law of Delaware (Section 145) gives Delaware
corporations broad powers to indemnify their present and former directors and
officers and those of affiliated corporations against expenses incurred in the
defense of any lawsuit to which they are made parties by reason of being or
having been such directors or officers, subject to specified conditions and
exclusions; gives a director or officer who successfully defends an action the
right to be so indemnified; and authorizes Household International to buy
directors' and officers' liability insurance. Such indemnification is not
exclusive of any other right to which those indemnified may be entitled under
any bylaw, agreement, vote of stockholders or otherwise.
Household International's Restated Certificate of Incorporation, as amended,
provides for indemnification to the fullest extent as expressly authorized by
Section 145 of the General Corporation Law of Delaware for directors, officers
and employees of Household International and also to persons who are serving at
the request of Household International as directors, officers or employees of
other corporations (including subsidiaries such as Household Financial
Corporation Limited). This right of indemnification is not exclusive of any
other right which any person may acquire under any statute, bylaw, agreement,
contract, vote of stockholders or otherwise.
The Business Corporations Act (Ontario) (the "Act") (Section 136) allows a
corporation to indemnify a present or former director or officer of the
corporation who acts or acted at the corporation's request in such capacity
against all costs, charges and expenses, including an amount paid to settle an
action or satisfy a judgment, reasonably incurred by such director or officer
in respect of any civil, criminal or administrative action or proceeding to
which he or she is made a party by reason of being or having been a director or
officer of such corporation, if (i) such director or officer acted honestly and
in good faith with a view to the best interests of the corporation; and (ii) in
the case of a criminal or administrative action or proceeding that is enforced
by a monetary penalty, provided such director or officer had reasonable grounds
for believing that his or her conduct was lawful. Section 136 of the Act
entitles a director or officer to be indemnified by
II-1
<PAGE>
the corporation in respect of all costs, charges, and expenses reasonably
incurred in the successful defense of such action or proceeding provided he
fulfills the conditions set out in clauses (i) and (ii) above.
Section 7.02 of Household Canada by-laws provides for indemnification of
present or former directors or officers of Household Canada, as permitted under
Section 136 of the Act. Household Canada will also indemnify such person in
such other circumstances as the Act or law permits or so requires.
Household International has purchased liability policies which indemnify its
officers and directors, including those of Household Canada, against loss
arising from claims by reason of their legal liability for acts as officers,
subject to limitations and conditions as set forth in the policies.
Pursuant to agreements which Household International and Household Canada may
enter into with underwriters or agents (the form of which is included as an
exhibit to this Registration Statement), officers and directors of Household
International and Household Canada may be entitled to indemnification by such
underwriters or agents against certain liabilities, including liabilities under
the Securities Act of 1933, as amended, arising from information appearing in
the Registration Statement or any Prospectus or Prospectus Supplement which has
been furnished to Household International and Household Canada by such
underwriters or agents.
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, Assistant General
Counsel and 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, Assistant General Counsel and
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 (included on Pages II-3 and II-5 hereof.)
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>
- --------
+To be filed by amendment.
*Incorporated by reference from Exhibit 12 to (i) the Annual Report on Form 10-
K for the fiscal year ended December 31, 1994 and (ii) the Quarterly Report
on Form 10-Q for the quarter ended September 30, 1995, of Household
International, Inc. (File No 1-8198).
II-2
<PAGE>
ITEM 17. UNDERTAKINGS.
The undersigned Registrants hereby undertake:
(2) To file, during any period in which offers or sales are being made of
the securities registered hereby, a post-effective amendment to this
Registration Statement:
(i) To include any prospectus required by section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in this Registration Statement;
(iii) To include any material information with respect to the plan of
distribution not previously disclosed in this Registration Statement or
any material change to such information in this Registration Statement;
provided, however, that the undertakings set forth in paragraphs (i) and
(ii) above do not apply if the information required to be included in a
post-effective amendment by those paragraphs is contained in periodic
reports filed by the Registrants pursuant to section 13 or section 15(d) of
the Securities Exchange Act of 1934 that are incorporated by reference in
this Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new Registration Statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) That for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report pursuant to
section 13(a) or section 15(d) of the Securities Exchange Act of 1934 that
is incorporated by reference in this Registration Statement shall be deemed
to be a new registration statement relating to the securities offered
herein, and the offering of such securities at that time shall be deemed to
be the initial bona fide offering thereof.
(5) That for purposes of determining any liability under the Securities
Act of 1933, the information omitted from the form of prospectus filed as
part of this Registration Statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act of 1933 shall be deemed
to be part of this Registration Statement as of the time it was declared
effective.
(6) That for purposes of determining any liability under the Securities
Act of 1933, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new Registration Statement relating to
the securities offered therein, and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
The undersigned registrants hereby further undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrants' annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered herein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrants pursuant to the provisions set forth or described
II-3
<PAGE>
in Item 15 of this Registration Statement, or otherwise, the Registrants have
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrants of expenses
incurred or paid by a director, officer or controlling person in the successful
defense of any action, suit or proceeding) is asserted against the Registrants
by such director, officer or controlling person, in connection with the
securities registered hereby, the Registrants will, unless in the opinion of
its counsel the matter has been settled by controlling precedent, submit to a
court of appropriate jurisdiction the question whether such indemnification by
it is against public policy as expressed in the Act and will be governed by the
final adjudication of such issue.
II-4
<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 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
16TH DAY OF FEBRUARY, 1996.
Household International, Inc.
/s/ William F. Aldinger
By: _________________________________
William F. Aldinger
President and Chief Executive
Officer
Each person whose signature appears below constitutes and appoints J. W.
Blenke, L. S. Mattenson and P. D. Schwartz and each or any of them (with full
power to act alone), as his/her true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for him/her in his/her
name, place and stead, in any and all capacities, to sign and file with the
Securities and Exchange Commission, any and all amendments (including post-
effective amendments) to the Registration Statement, granting unto each such
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite and necessary to be done, as fully to all intents
and purposes as he/she might or could do in person, hereby ratifying and
confirming all that such attorney-in-fact and agent or their substitutes may
lawfully do or cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION
STATEMENT ON FORM S-3 HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON THE 16TH DAY OF FEBRUARY, 1996.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ William F. Aldinger
- -------------------------------------------
(William F. Aldinger) President, Chief Executive Officer and
Director
/s/ Donald C. Clark
- -------------------------------------------
(Donald C. Clark) Chairman of the Board and Director
/s/ Robert J. Darnall
- -------------------------------------------
(Robert J. Darnall) Director
/s/ Gary G. Dillon
- -------------------------------------------
(Gary G. Dillon) Director
/s/ John A. Edwardson
- -------------------------------------------
(John A. Edwardson) Director
/s/ Mary Johnston Evans
- -------------------------------------------
(Mary Johnston Evans) Director
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ Dudley Fishburn
- -------------------------------------------
(Dudley Fishburn, M.P.) Director
/s/ Cyrus F. Freideim, Jr.
- -------------------------------------------
(Cyrus F. Freideim, Jr.) Director
/s/ Louis E. Levy
- -------------------------------------------
(Louis E. Levy) Director
/s/ George A. Lorch
- -------------------------------------------
(George A. Lorch) Director
/s/ John D. Nichols
- -------------------------------------------
(John D. Nichols) Director
/s/ James B. Pitblado
- -------------------------------------------
(James B. Pitblado) Director
/s/ S. Jay Stewart
- -------------------------------------------
(S. Jay Stewart) Director
/s/ Louis W. Sullivan, M.D.
- -------------------------------------------
(Louis W. Sullivan, M.D.) Director
/s/ Raymond C. Tower
- -------------------------------------------
(Raymond C. Tower) Director
/s/ David A. Schoenholz
- -------------------------------------------
(David A. Schoenholz) Senior Vice President-Chief Financial
Officer (as Principal Accounting and
Financial Officer)
</TABLE>
The Registrant reasonably believes that the security rating to be assigned to
the Securities registered hereunder will make the Securities "investment grade
securities" pursuant to Transaction Requirement B.2 of Form S-3.
II-6
<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 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
16TH DAY OF FEBRUARY, 1996.
Household Financial Corporation
Limited
/s/ Craig J. Chapman
By: _________________________________
Craig J. Chapman
Chairman, Chief Executive Officer
and President
Each person whose signature appears below constitutes and appoints J. W.
Blenke, L. S. Mattenson and P. D. Schwartz and each or any of them (with full
power to act alone), as his/her true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for him/her in his/her
name, place and stead, in any and all capacities, to sign and file with the
Securities and Exchange Commission, any and all amendments (including post-
effective amendments) to the Registration Statement, granting unto each such
attorney-in-fact and agent full power and authority to do and perform each and
every act and thing requisite and necessary to be done, as fully to all intents
and purposes as he/she might or could do in person, hereby ratifying and
confirming all that such attorney-in-fact and agent or their substitutes may
lawfully do or cause to be done by virtue hereof.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION
STATEMENT ON FORM F-3 HAS BEEN SIGNED BELOW BY THE FOLLOWING PERSONS IN THE
CAPACITIES INDICATED ON THE 16TH DAY OF FEBRUARY, 1996.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ Craig J. Chapman
- -------------------------------------------
Craig J. Chapman Chairman of the Board,
Chief Executive Officer,
President and Director
/s/ Edgar Ancona
- -------------------------------------------
Edgar Ancona Director
/s/ Peter A. Love
- -------------------------------------------
Peter A. Love Director
/s/ Jean-Claude Marsolais
- -------------------------------------------
Jean-Claude Marsolais Director
/s/ John E. Dill
- -------------------------------------------
John E. Dill Director
/s/ Bonnie Brooks
- -------------------------------------------
Bonnie Brooks Director
</TABLE>
II-7
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ George E. Neal
- -------------------------------------------
George E. Neal Director
/s/ Richard C. Henderson
- -------------------------------------------
(Richard C. Henderson) Director, Law and Compliance, Secretary,
General Counsel and Director
/s/ Walter Lubiana
- -------------------------------------------
(Walter Lubiana) Director, Financial Control and Controller
(Principal Accounting Officer)
/s/ Terry W. Cretney
- -------------------------------------------
(Terry W. Cretney) Treasurer
(Principal Financial Officer)
</TABLE>
The Registrant reasonably believes that the security rating to be assigned to
the Securities registered hereunder will make the Securities "investment grade
securities" pursuant to Transaction Requirement B.2 of Form F-3.
II-8
